WAR FINANCE

Dominion, Volume 11, Issue 57, 30 November 1917, Page 6

WAR FINANCE

GOVERNMENT'S RESPONSIBILITY

SIR JOSEPH WARD REPLIES

TO CRITICS

COUNTRY STRONG FINANCIALLY

Tho Minister of Finance (Sir Joseph Ward) said yesterday that he /nad soon tho criticisms levelled against him at a function recently held at Masterton, and while ho had no special desire to onter into any controversy upon the questions raised, he would bo very glad to give his views upon tho principal matters to which reference had been made.

"Ono of the most extraordinary and regrettable things to me at tho presonfc .juncturo," said the Minister, -'is to observe on the part of some people, from whom by their exporienco and knowledge ono would expect something different, a want of recognition of the extraordinarily, difficult situation that lias been brought about from wai causes, and has been accentuated b) the long duration of the war. The war lias made some things impossible of accomplishment at this juncturo bj those with responsibility upon theii shoulders. And notwithstanding that, there are people without that responsibility who are urging these things with indifference to results, and in some cases with tho grossest unfairness.-

"I have not the slightest objection t<j criticism of my actions, but I ck not like to see that criticism baaed upon misleading statements that hav6 no foundation in fact. Apparently because I said during my recent visit to tho south that, as I iisid previously stated in the House of Representatives, the finances of the country were in i. strong and sound position, the membei for Wairarapa considers that justification for indulging in statements which, in their application to mo, art not true. I have not at any time sneered and jeered about a 'slide' or the cost of living, or any other question which has arisen in the House; nor have I stated at any time that there would be a 'slide.' That is also contrary to fact. What I did point out was that the responsibilities the country was undertakng, and to its credit undertaking cheerfully, were enormous; that tho amount of taxation that had to he provided to meet the situation was very heavy, and that with a revenue in war time up to nearly £18,000,000 per annum, largely from taxation, there was room for a great 'slide,' in the revenue to take place, and that no one could safely judge what the financial position of the country woulo. be in six months' time. I said there was bound to be heavy -shrinkage oi revenuo in the railways and the Customs, and that even that would noi be accurately estimated, because of the great uncertainty as to what quantity of shipping wou'd be available, and consequently what amount of imports would come in by those ships. That unquestionably was the position, ana is so now, as every sane man in this country is bound to recognise.

"Let me here shortly state what has had to ho provided for by the Minister of Finance in connection with war expenditure from October 1 to November 28, that is, practically a perioa of eight weeks. The k totiu sum is £5,523,870. In addition -to this, it must be remembered that it is lmposnible to know at present whnt further liabilities have accrued abroad in connection with this titanic stiruEjgle in which New Zealand is takim; its part wth the other portions of the British Empire. Within the last fortnight 1 have had to provide a sum of £600,000 for a special and urgent purpose foi which no provision was made by Parliament, because such a. requirement could not be foreseen by anyone.

"The extra amount provided foi pensions 'and allowances under the Wai Pensions Act tin's last session, aiu. the increased scale of separation ana children's allowances, which are to take effect from January 1 next, may In judged from the following:— Pensions. £ Up to March 31, 1918, the estimated amount required to be found for pensions under the law prior to last sessions was • 439,60(> By the .Ant passed last session this amount is increased to 436,7 iK- the. followinc; ve.ir, name-; Iv, to March,' 1919. under ' the law prior to last session, the amount required to he found during the year would have been 832.20(, £ At the increased rate under the Act of last session the amount required to March 31, 1919, is estimated to be 1,104,070 The estimated annual liability at October 1, 1917, under' the existing law is 456,000 At October 1, 1918, nnder existing law prior to last session 840,000 Under the Act of 1917 1,116,000 Allowances. £ For wives, children, guardians of motherless childrnn, widowed mothers, etc., the amount required for the year beginning October 1, 1917, would have been 555.264 For the same period wider the increased rates beginning January 1, 1918 1,157,211 Increase 598,947 The annual liability at September 30. 1018,' under the rates prior to last session t would have been ' 940.760 And at the rates proposed by the Government from January 1, 1918 2,016,945

"Tlio foregoing figurps ; speak for themselves. amVafc least show that the Government made a sincere and groat ofFort to provide for increased pensions and increased allowances to our soldiers and their dependants. Yet the statement is made by the member for Wnirnrnpn. that 'a. paltry_ £50,000 extra n year- would have po,i(l interest on all the Second Division ns'kfd for. Jyut the Minister of Kinane.e had made up his mind that the Second Division men were not going to get. what they allied.' That is a statement speciously intended to convey the impression that it was only a matter of my making up my mind to prevent this being done. That also is contrary to fact. Every memiier of the Government, without exception, was strongly in favotir of doing everything in his power to make the fullest provision possible for the soldiers and their dependants, and after having increased the amount to the utmost extent to which at that juwturc it was considered safo to go. the whole Government, and not the Minister .of Finance alone, as the member, for Wairarapa vculd disingenuously suggest, were unanimous, with tho knowlcdgo in their possession, that "hby could not at present I go further.

"And now thi> member for "Wairarapa says £50,000 e:itra would havp paid interest on what. ;'Mip Second Division was asking for. That would mean, of course, the adding of 'another million sterling of borrowed money for this purpose. Well, let us look at this from tlm practical standpoint:—

"(1) The totrr.l amount of money raised for war loans to date is £<16,255,<100

"(2) When we have, exhausted tho total of the authority amnterl last session we shall have borrowed £56,171,900.

"(3) Tlio total amount of interest and sinking fund when wo have borrowed the full amount of war loans which have been authorised will amount to approximately £3,000,000 per annum.

"This is, of course, in addition to and quite apart from the annual interest and sinking fund payable upon tho country's ordinary loans. These figures should at least certainly cause overyoue, including the members of tho Second Division—the great majority of whom hopo to livo and to make their living in this country after the war is over —to hositdto about adding any further millions to tho amount, at any rato until the country knows how it stands in, as I said, six months' time.

"During last session I pointed out to the House repeatedly that if tho war runs into another year beyond 1918, tho people in this country, who will do, I know, all that ie required of them to help to prcservo the British Empire, will have- a further enormously increased responsibility s for war expenditure. In the circumstances, I think the Government should, in the financial undertakings that they already have and which may be greatly increased, receive the sympathetic consideration of the people. I am, of course, quito awaro of tho fact that there arc people who do not realise—or if they do, don't admit it—that the taxation already provided, which is largely responsible for that strong financial position which existed at tho time the matters that are tho subject of criticism were raised in the House, is placing a very heavy burden upon those who are called ■upon to bear it. There are people in the country called upon to pay 13s. 6d. in the pound, and in somo cases more, and no outsider can be expected to appreciate tho difficulties that many people, who aro cheerfully responding to the taxation, are experiencing in meeting mado upon them to enable ftTe country to carry out its war obligations. "I feel that it is due to those who take an intelligent and, not unnaturally at present, an anxious interest in the welfare of the Dominion, that I should make this statement. lam quito indifferent to any personal abuse that may be indulged in against me. I am fully seized with the fact that the duties attaching to my position and the duties of all Ministers of tho Ciown during this war period are ones of great responsibility. Necessarily this responsibility is not dissociated from many anxieties at this juncture, as may be judged from the statement I have given above of the money required to be provided within eight weeks, which will indicate to anyone who is not attempting to gain porsonal kuuos by indulging in vicious and unfair attack's in the imperative need fbr caution.

""'am quite confident, and I repeat, that the country is strong financially. It is .absolutely essential that ij; should be so, and nothing has occurred since the meeting of Parliament to warrant .anyone stating that members were 'tricked, fcoled, and humbugged' durfng last session. There was nothing of the kind oven attempted by any meniuer of the Government. All but seven members of Parliament voted with the Government upon the question that formed tho subject of the attack mai?e upon me by the niemher for Wairarapa. lam satisfied that there was not one among tho number who voted with tho Government that was nol its anxious to' do'lflTl in his power to ilefp members of tho Second Division as the member for Wairarapa declares lie was."