FINANCE BILL

Dominion, Volume 17, Issue 288, 22 August 1923, Page 8

FINANCE BILL

INTRODUCED YESTERDAY SUMMARY OF PROVISIONS The Finance Bill, 1923, was introduced into the House «-f Representatives yesterday morning. Besides special loan and other provisions, referred to elsewhere in this issue, a summary of the general clauses of tho Bill is as follows: — Cost of administration of Scenery Preservation Act to bo paid out of ordinary revenue. Wailu Borough Council to be paid loertain moneys deducted from gold duty. . Gifts made for purposes of charitable trust not to be included in final balance of estate of donor, notwithstanding that he may die within three yearn of date of gift. Special provisions is to payment of subsidies in cases where two or more counties have been united. This is the outcome of the Government's recent decision on the amalgamation proposals of Weber and Akitio Councils. To enable smaller counties, poor in revenue, to unite with larger counties, that were more prosperous, it was decided to amend the law. to provide that the subsidy payable should be equal to the aggregate subsidies of the united counties. Previously, the 1W on the question provided that only the subsidy to which one county was entitled, viz., £2500 per annum, was payable. Increase of travelling allowance of High Commissioner from £1 10s. per day to £2 (£2 10s. outside the United Kingdom). Alaori Land Board’s administrative expenses may be charged on its funds. Authority of Alinister to fix charges in respect of goods handled by him but not carried on railway. This applies to sorting of goods in sheds. Provision for Alinister investing railways superannuation moneys payable to Public Trustee. South Island members <f Parliament to obtain tickets for twelve passages annually between Wellington and Lyttelton, Picton and Nelson. Protection of superannuation rights of Commissioner or Assistant-Commis-sioner of Public Service. Extension of right of election to .aontribtue to Superannuation Fund, as if Public Expenditure Adjustment (Retrenchment) Act had not reduced their salaries or wages.

Protection of superannuation rights of contributors to Teachers’ Superannuation Fund, who become students at Training College. Special provisions as to service of R. H. AV. Richardson, formerly employee of Westport Harbour Board, for superannuation putposes. • Alileage fees may be paid to bailiff, where not payable by means cf stamps. Authorising Auckland Savings Bank to contribtue £lO,OOO to Auckland University College. Alasterton borough may create special rating area for loan to extinguish antecedent liability of i 14,819 4s.' 2d. Authorising Board of Governors of Wellington College to refund to their members amount of certain surcharge in connection with the school magazine, “The Wellingtonian.” Local authority may amend any resolution regarding superannuation, but so as not to reduce benefits of contributors or retired servants,. Fixing limits of borrowing for overdraft of local authorities. Protection of tenants in cases where landlord has agreed to reduction of rent, but without sufficient legal formalities. Second Reading Debate,

Tho Prime Minister, in moving the second reading of the Finance Bill last night, said there was no line of policy or continuity about it; it was really a sort of washing-up financial Bill. The Leader of tho Opposition (Mr. T. M. Wilford) said that his first comment was that it was a Washing-Up Bill in the guise of a Finance Bill. It was quite wrong to place clauses in it that could have taken their place in the Washing-Up Bill. The National Debt ran into £219,000,000, and the further increase contemplated, in view of the fact that there were oyer £26,000,000,0f unauthorised authorities, was unwarranted. If to this were added the £8,600,000 authorised by the Bill, they had an enormous total. A Gloomy Picture. Homo and Australian writers predicted a fall in the price of everything, and we were told that wo had a rival in the Argentine, where £400,060,000 of British capital was invested, largely in the interests of Britishers. Europe was disorganised, British manufacturers discouraged, and we had a big rival in butter coming gradually back in Russia, which would be eventually flooded by American capital. All these things would be taken into consideration by those who were concerned with ths investment of large sums of capital. Secondary industries in the Dominion were not being exploited as they should be. The financiers of Great Britain would no doubt welcome the .Primo Minister’s visit, and l.e hoped that if a loan were made it would be circulated in this country, .'io was firmly of tlie opinion that the three and a half millions of unexpected advances, together with the proposals in the Bill, would not meet the needs of the country, and that to do so the formation of agricultural banks would be found necessary. He criticised the method of tackling swamp drainage. Tire tax would not meet the demands fcr read maintenance; a huge sum of money could be secured by a general tax cn drivers of motor-vehicles, whether for business or pleasure. The capital sunk in motor-cars in the Dominion was some £16,000,000, which, compared with the railways, showed a great unexploited field of taxation. Clearer details of tiie sum of £4,000,000 proposed to be expended on public works should bo given. Mr. Wilford tcok exception to the clause empowering the. fixing of sorting charges and the words “to be deemed to Lave always included’’ as going behind the decision of +hc Privy Council. The Hon. A. T, Ngnta (Eastern Maori) agreed that some of the clauses, such as that of the Auckland City Council’s expenditure on a municipal l>nv>dhook, should have been put in the “Wasliing-un” Bill. ■ All moneys accruing from the sale of native lands should be placed to tho credit of the Native Lands Settlement Account. He would like to see a statement of that account going back over some years. Dealing with the Maori Land Board’s funds, he deprecated calling upon the fund for all purposes, whereas there, were funds that should not be touched bv the Treasury. Taking tho past year there was an excess of £5OOO in expenditure over receipts, and in time the credit balances of the boards vtuld disannear, when other native funds would have to bo drawn upon. The late Sir William TTerries had held that all incursions on the funds or interest of the Maori land boards should be made good. There wa s always the danger that "in times of slump the Gov. ernmont could pass validating legislation enabling it to lay hands upon the propertv of Maori beneficiaries. Mr. W. D. Lysnar (Gisborne) characterised the Leader of the Opposition’s warning regarding Russia a s unjustified. Even in the days of its prime, working nt low wages, Russia had not proved the dangerous competitor he suggested. He supported the request of the member for Eastern Maori in regard to Maori land board funds. Another Sombre Prophet. Mr. 7. A. Hanan Hnvercargill) said

the Bill was a hotch-potch, such as might be expected in panic times. The Government asked for a blank cheque for public works. A schedule should accompany the Bill giving the details of expenditure. It was time for the country to emerge from tho easy going methods of wartime. There wa a no real parliamentary control of the public expenditure. Before the war the man who talked of borrowing £6,000,000 a year was regarded as insane. To-day, with war burdens on our shoulders, we should be very careful in increasing our interest bill. The ® letting lose of the money for public ’ works and other purposes would induce a spurious boom, and land prices would f rise, while professional and business 1 men would take advantage of the public spirit of extravagance to so adjust i their charges, that the reduced taxa--1 tion would prove of little avail. Both Government and people should adopt a ’ policy of self-reliance. Stability in trade would not bo reached until the rest of the world was more settled. Our ‘ sound financial position should be f guarded rather than traded upon. J “Lamentations of Jeremiah." ; “The lamentations of the, prophet i Jeremiah,” commented the Hon. W. . Nosworthy (Alinister of Agriculture) , on tho last speaker. “Was there any ; country in the world where the people I were more contented, where there was > less unemployment, than in New Zea- > land to-day? No doubt there were ■ things that had to bo straightened up in the Bill, but when the last speaker ' wont on to criticise the expenditure i did he expect to carry out all the electric power schemes in tho Dominion? • He knew quite well that the party he ' was connected with mapped out the I policy of going on with all these things. The Leader of the Opposition, ’ when criticising the expenditure, made no reference to meeting the morator--1 ium, but said that agricultural banks 1 would meet the situation, He knew 1 that agricultural banks would take a long time to set up. Either we were ■ not borrowing enough money or his ’ ideas were wrong. How were the works of the country to bo carried out, such ’ as the Alangahao scheme and others? 1 “We have put its policy before the House in this Bill,” continued the Alinister, “and the purposes of expen- ’ diture are set out quite clearly. Let us remember that the war is over and that we have passed through a stage of history since 1914, and must adjust ourselves to changed conditions and make the best of things. The money expended on the drainage of tho Rangitaiki and Hauraki swamps has added £3,000,000 to their vhlue. If the speakers do not want hydroelectric schemes and public works,” concluded the Alinister, “let them get up and oppose them in the House, but do not let them temporise with the electors of the country by playing at one thing and doing another.” Air. W A. Veitch (Wanganui) attacker! the finance of the Bill, and stated that the 12| millions that would come to New Zealand if the proposals in the Bill were carried out would adversely affect the exchange problem. It seemed to be the policy of the Government to fill the needs of the Advances Department by money at a high rate of interest. Interest rates would certainly drop all over the world in the * next few years. The principle adopted by the Government would involve an inflation of currency. Taxing the Rich the Remedy. Air. H. E. Holland (Buller) regretted that the main feature of the Bill was borrowing, despite a £10,000,000 annual interest bill. By more borrowing we would get heavily in debt and plight have to face the mortgagee coming in. If pensions were to be increased—as they must —it could be done by increasing taxation. We could not have public works and increased pensions, all the things that were asked for, without money, and to borrow was the wrong principle. It was a bad thing in the history of a country when the principle of finding all public works money by borrowing was adopted. Prime Minister Replies. The Prime Alinister, replying to the criticisms of the Bill, said that the outstanding feature of the debate had been one of depression, as though the Dominion were just emerging from a very serious position indeed. The Leader of the Opposition could not be called an optimist. He did not believe in the 1 principle applied to unauthorised expenditure, and had this been an ordinary session he had intended to have put an end to it by bringing down all the borrowing proposals in one Bill’, and have the authorities cancelled by legislation. Mr. Wilford: How many of the items are dtids? Air. Alassey: Half of them are duds. What I have suggested to do has been in my mind for a long time past. Referring to the accusations that there was insufficient information regarding the items of expenditure in the Bill, the Government could not expand Is. without the approval of the House, and during the discussion of the Public Works Estimates members

would have the opportunity of agreeing or otherwise, with every item in the Bill. Air. Wilford: That will not show this £4,000,000. Air. Alassey: You cannot go as far as that in this Bill As a matter of fact, I do not expect to borrow that for a year. One never knows, but I do not expect to borrow that until next April or May. The Wanganui clause in the Bill was the result of a conference in AVellington between those interested,in the traffic and representatives of the Railways Department. As

to the tiro tax asked for by Mr. Wilford, it was, _as nearly as possible, £125,000. which would be verv useful. “1 cannot find anyone in difficulties over the moratorium.” said Mr. Massey. “There are no difficulties on the part of the people who have borrowed from the Government in any of the Departments I have made inquiries in. Certainly not in the Advances Department, nor in the Public. Trust. I am told that, with the exception of the man with two or three mortgages, there is no trouble. There is no doubt that money has become more plentiful, and will be slightly cheaper.” A Warning to Producers. “I do not think wo shall have a serious rival in Russia for a very long term of years, but I do look at the Argentine very seriously as a competitor. I am surprised at the quantity they are turning out, though their quality cannot compar? with ours. But there have been indications in the quality of our product that it is not guite so good as it used to be, and if wo are going to keep up tho demand for our products then wo must be very particular about their quality I do not suggest an army of inspectors : tho good, sense of "tho people should be sufficient.” Mr. Massey vindicated the position of the railways and of the Advances Department. It was necessary to remember that the large annual interest bills were a legacy from the past, but the policy of investing only in works that constituted securities would safeguard tho country. The sum of £59,000,000 was interest earning, there was £68,119,000 invested in the railways, £29,725,000 in Crown Lands, £38,000.000 in State forests and tho total assets were not including £18,100,000 invested in the encouragement of industries. So long as tho money was invested in reproductive works the finance was sound ]

The Bill was reported without amendment, read a third time, and passed. 'The House, at 1.40 a.tn., adjourned until 2.30 p.m. to-day.