PARLIAMENT IN SESSION

Dominion, Volume 25, Issue 169, 13 April 1932, Page 10

PARLIAMENT IN SESSION

Economic Readjustment of Dominion NATIONAL EXPENDITURE MEASURE DEBATED Mr. Forbes’s Alternative to National Bankruptcy (From Our Parliamentary Representative.) A week of intensive debating was opened tn the House ot Representatives yesterday afternoon when the I rime Minister moved the second reading of the National Expenditure Adjustment Bill to the accompaniment of a running fire of comment from the Labour benches/Mr. Forbes himself admits that the sweeping natui-e of the Government proposals for reductions of interest rates and rents as well as pensions and Public Service, wages, have probably never before been equalled in the political history of New Zealand, and the reception accorded the Bill from all sides of the House fully confirmed the prediction made by Mr. Forbes when Cabinet was sitting during the Easter recess that the announcement of the Government’s plan of financial and economic reconstruction would create a stir when it became known. , Legal members are agreed that the law draughtsman has never been called upon to frame a measure of such complexity, or one, that deals so drastically with questions involving such widespread effects; However, as the Prime Minister pointed out In his speech, the force of circumstances and the seriousness of the times have left the Government no other option but to adopt a policy which It considered would result in the restoration of financial stability throughout the country. He made it quite ernar that there was no other way out, and that if the House did not endorse the proposals'placed before-it, the country would be faced with 7 ruptcy, and the State with the problem of being unable to meet Public Service wage and salary payments. That sacrifices would be required was not denied by the Prime Minister, but he added a note of optimisin when he expressed the hope that if the. country showed a determination to pull through, equilibrium might be reached at the end of the Governinent’s three-year plan, wjien it would be possible to repeal the legislation it was now proposed to put through. . The Leader of the Opposition, Mr. H. E. Holland, voiced the Labour Barty’s uncompromising hostility to the Bill, the necessity for which he declared did not . exist, and he was supported by several other Labour speakers during the day. In answer to Labour critics, Government speakers, and notably the Minister of Lands and the Minister of Agriculture, pointed to the huge loss in the national income and they emphasised that the country’s first task at the, moment was to devise a means of living within its resources. ' It is likely that the Prime Minister will let the second reading debate run on for another day. or two, after which he will force the pace in order to get the House intJ Committee, at which stage the most heated . part of the Bill’s passage is certain to occur. The debate will be continued this afternoon. ..

NO WORK, NO PAY

Mr. Forbes Emphatic DOLE POLICY BANNED Provision for Needs The Government still has no intention of giving sustenance to the unemployed unless work is performed, according to a statement made by the Prime Minister, Rt. Hon. G. W Forbes, in reply to a question in the House yesterday by. Mr. W. J. Jordan (Lab., Manukau). ( Mr. Jordan 'asked whether, in view or the serious . position developing in the Dominion as the result of unemployment, the Prime Minister would give an assurance that a properly-organised system of giving sustenance would be established. “The Government and the Unemployment Board, with the co-operation of local organisations, are continuing to provide to -the fullest extent of their resources, unemployment relief in return for work performed,” the Prime Minister said. “If the honourable member in his question . infers that payment should be made in , cash or kind without requiring work, the answer is that the Government does not intend to adopt such a policy.” Mr. P. Fraser (Lab.. Wellington Central) : Why the clause in the Bill then? “An amending Unemployment Bill, as ' members arp aware, is now before Parliament,” the Prime Minister added, "and this makes increased provision for' finance • and organisation. I am confident that we shall be able to make reasonable provision for the needs of our people.” Mr. Fraser: The hospital boards are to • be done away with. You do not know what you are talking about. Mr. Speaker: Order I Order 1 • . - - - 1 . /‘NOMINAL . CUTS” Mr, Macmillan’s Hopes READJUSTMENT POLICY The suggestion that the National Expenditure Adjustment Bill might be amended next session if it were found to contain anomalies was made .by the Minister of Agriculture, Hon. C.E. Macmillan, in speaking in the second reading debate yesterday. ' He said the Government hoped the wage cuts would only be nominal once the full policy of readjustment were in operation. The Minister complained that the Labour Leader had given a one-sided prediction of how the country’s finance would be affected after the passage of ■ the Bill. It was like an accountant of a company making up a balancesheet from one side of the ledger only. . He said it was only fair that the Government should be judged upon its whole policy and not merely portion of it. If ' the Government allowed things to slide the unemployed would be allowed to starve. , Mr. W. Parry (Lab., Auckland Central): They are, starving, now. The Minister added that as Parliament would be meeting shortly after the passage of this Bill any anomalies could then be rectified. Mr. H. G. R. Mason (Lab., Auck'ami Stlburbs) : Does that mean you will improve it as it goes through the House? Mr. Parry: He will do ns he is told. Mr. Macmillan said ho was speaking nf the Bill when it became an Act. The Government welcomed helpful suggestions. The chief objection to the measure appeared to.be that it was too Socialistic. Mr. Macmillan added. The Leader of the Opposition had suggested it would be, impossible in future for a person *who was not possessed of independent means to stand for Parliament in a country constituency. He. as a country member, knew the difficulties to be faced, hut he shid it was the Government’s duty to listen to any representation on • the subject and adjust the position by arranging the salaries according to the size of the electorate WOMEN TEACHERS Wage-Cuts Opposed Objection to the economy proposal that the salary basis for women teachers in primary schools should be reduced to a basis equivalent to four-fifths of the salary basis for male teachers.in similar grades, was made in a petition presented to the House yesterday by Mr. I*. Fraser (Lab., Wellington Central), on behalf of 1037 women teachers. Tlifl grounds for objection were stated ns follows:—(1) The proposal involved a change of policy which would become established and which years of future prosperity would not alter; (2) the proposal would operate unfairly on women teachers generally and particularly upon senior women teachers, many of whom • received small commencing salaries of £81) a year or less after completion of training, and who toward the end of their careers would suffer a total reduction in salary of approximately 40 per cent.; (3) the proposal would unfairly grade young men teachers of 10 to 12 years’ experience with women teachers of 25 years’ service and upward. The petition was rend to the House and referred direct to the Government.

MEMBERS’ SALARIES

Opposition Leader’s Complaint EMPIRE COMPARISONS Figures were quoted by the Leader of the Opposition, Mr. H. E. Holland, in the House of Representatives yesterday to show that the. present salary of £405 of members of the New Zealand Parliament was among the lowest in the Empire. He said it was becoming increasingly difficult for members to make both ends meet on account of the heavy cost of representing country constituencies, and he declared that if a policy of cutting salaries were continued it would soon only be possible for men with private means to enter Parliament, Dealing with clause six of the National Expenditure Adjustment Bill, which reduced the salaries of Ministers of the Crown and members of Parliament, Mr. Holland said the operation of the clause would make it impossible for anyone who was not wealthy to represent a large country constituency. The man wlfo looked after a large constituency had more than a full week’s work every week, and it would be a bad thing to bring into operation anything that would make it impossible for anyone other than a man with private means to be a member of Parliament. He was not going out. of his way to fight a reduction of members’ salaries, but his objection to this being done was in, line with his opposition to wage-cut-ting on principle. Instead of making i provision for salary reductions, the Government should set about re-grading electorates. The following amounts were paid elsewhere :—Federal Parliament of Australia, £lOOO, less 10 per cent.; New South Wales,) £744; Victoria, £469; Queensland, £500; South Australia, which had only about half the population of New Zealand, £380; Tasmania, £450; Canada, £BOO, plus travelling allowances; South Africa, £4oo'; Irish Free State, £360, plus travelling allowances; Newfoundland,, which was only a glorified county council in point of size, £2OO a session. “It is quite logical, if the Government is going to drag everyone down, that members of Parliament should be dragged down with the rest.” said Mr. Holland, “but it is illogical to drag anyone down

PUBLIC SERVANTS Reduction in Wages OPERATES FROM APRIL 1 “Has a 10 per cent, reduction already be'---’ made in the salaries and wages of t’ - » Public Service for time worked since the beginning of the present month?” Mr. W. Nash (Lab., Hutt) asked the Prime Minister, Rt. Hon. G. W. Forbes, in the House of Representatives yesterday afternoon. , Mr. Forbes said that when the National Expenditure Adjustment Bill went through the reductions provided for in that measure would operate from April 1, and adjustments would be made accordingly. Mr. Nash: But deductions have been made already. 1 Mr. Forbes said his information was that adjustments would be made in the latter _ half of the month. An indication that members have knowledge in their possession that the Government is anticipating the passing of the Bill, was given in notice of a question which Mr. C. H. Chapman (Lab.. Wellington North) intends to ask the Prime Minister. In this Mr. Chapman asks whether the Prime Minister is aware that salaries in the Government Printing Office have already been reduced in anticipation of the passing of the Bill.

SINGLE MEN’S CAMPS Unemployed at Aka Aka - A request for an immediate inquiry into the food supplies and accommodation at the camp for unemployed single men at Aka, Waiuku, near Auckland, was ma..e to the Minister in Charge of Unemployment, Rt. Hon. J. G. Coates, in a question he was asked by Mr. W. Nash (Lab., Hutt), in the House of Representatives yesterday afternoon. Some time ago a number of single men from the ranks of the Wellington unemployed were drafted to the camp. "One of the workers living nt the camp,” said ,-Mr. Nash, “states that the rations consist of bread and treacle, with meat at times which cannot be enten. that lun.ih consists of three slices of bread and jam or cheese, and that the young men engaged had to make their own beds out of sacks supplied by the farmers.” Mr. Colites said a complaint bad reached him a week or so ago, and he had given instructions for inquiries to be made. The head of the department had visited the camp. That official had reported that the men were well fed, and this information was confirmed from other sources. It was reported to him that there seemed to be little cause for complaint, and that the men were receiving better treatment than could be offered to single men in the cities. Mr. Nash: Why did one of the men write home to his mother and tell her they were given bread and treacle? A Member: We all get that sort of complaint. Mr. Coates said that of course all nt the camp were not satisfied, but generally speaking the men considered that conditions were satisfactory.

NEW COSTS LEVEL

Dealing With the Crisis NEED FOR SACRIFICES Prime Minister’s Speech COUNTRY’S ALTERNATIVE Two alternatives, either the acceptance of the Government’s proposals to reduce costs, or national bankruptcy, were placed before the House of Representatives by 'the Prime Minister, Rt. Hon. G. VV. Forbes, yesterday afternoon, in moving tlie second reading of the National Expenditure Adjustment Bill, whoso object is to reduce interest rates, rents and Public Service wages. - “The very fact that we are introducing a Bill that takes such wide powers and that is so drastic, shows that the crisis in the affairs of this country is very serious,” Mr. Forbes said. “On no other grounds could a Government bring in a measure of this sort if it were not firmly.convinced that the position of the country were such that the remedies which had to.be applied were such that required every section of the country to make sacrifices.” There might lie* some who would fail to see any good in the Bill, and who would not take the broad national outlook, but the Government was fully convinced that it could take no other course. First and foremost the Government aimed at a reduction of fixed charges. This was very necessary in view of _the drop in the national revenue from £150,000,000 to £90,000,000. Charges which were at a higher level during times of prosperity had to be brought down to enable the country to live within its reduced income. If charges remained higher than income, the result would be stagnation of industry and increased unemployment. The welfare of the people was the first consideration and it was believed that the action being adopted would be in the best interests of the country as a whole. Reduction of Spending. Every intelligent man would agree that once .expenditure rose to a level above that of revenue, it reduction of spending would have to be brought about at once. There was no other way out for the prudent or the honourable man, and the same'applied to the State. It had been said that salary reductions had been made in the past and that there had not been a corresponding reduction in fixed charges, but this could no longer be charged against the Government,' which was extending the sacrifices to every section. “I think the position ot the Government is dear,” Mr. Forbes added. “We went to the country with a request that we should be given a free hand to put necessary measures into operation, and we believe this measure will be for the financial stability of the country.” Opposed to the policy of the Government was that of the Labour Party, which said there was no need for cutting down. (Labour Hear, hears.) The Labour Party bad declared all along that it would build up salaries and that it would not have to cut down expenditure, but in spite of the far from rosy picture presented to the electors by the Government, its policy of facing obvious facts with prudence was endorsed. The balancing of the Budget and the maintenance of financial stability was the allimportant question and it was the one consideration that prompted the Government to adopt the course it was taking. It believed that the present Bill was absolutely necessary, and the demands for sacrifice .made in it were the absolute minimum that the Government could ask. If expenditure were maintained on the present level, it was anticipated that the present financial year would end with a deficit of £8,300,000. Economies and the raising of additional taxation would result in £6,300,000 being contributed toward the bridging of ■ the gap. but even so there would be a deficit of £2,000,000 on present calculations. Such a state .of affairs had never before occurred in the history of the Dominion. A Government had never yet had to admit that even after the making of all possible economies and the imposition of as much taxation as the people could reasonably bear, there would be a deficit at the close of the year. These facts spoke for themselves, and the Government would be wanting in its dutv if it did not do something to bring about an all-round adjustment. 1

Purchasing Power Level. Discussing the proposed salary and wage cuts, Mr. Forbes said that a reduction of 10 per cent, had been made last year, but since then there had been a fall in the cost of living by 11 points, so that not one single man who suffered the wage reductions of last year was in a worse position than he was at the time the cut was made. (Loud Labour dissent and cries of “Question 1”) Mr. Forbes said there had been much talk of the last bringing about starvation conditions throughout the Public Service, but it was possible to buv more goods to-day with the same amount of money'than it was in 1929, so that assertions concerning undue hardship had been proved incorrect. During these remarks Mr. Forbes was subjected to a running fire of comment from the Opposition benches, and at timek his words were drowned in uproar, questions being flung at him across the floor, and members persisting in repeating assertions several times. Finally. Mr. Speaker was forced to intervene. He said he might be pardoned for saying there may be a certain amount of feeling over tbe Bill, but he was forced to ask members to refrain from interjecting except in a reasonable manner. If all members interjected as persistently as some, who would remain unnamed, the House would be a Bedlam. Continuing, the Prime Minister said that in 1914 the total State expenditure w'as £11,825,000, but to-day the wages bill of the State was £11,315,000 annually out of a total expenditure of £26.000.000. In the interval prices realised by the staple industries had declined to below the pre-war level, hut costs had not come down in proportion. “If we continue at that rate the end will not be far off,” he added. "We will be faced with national bankruptcy.” Public Service Interests. The members of the Public Service were just as interqsted in the stability ot the country as the farmers' or anyone else. He was sure that they would realise that what the Government was doing could not be avoided in the circumstances, and that if’no other course were adopted the time would come very soon when it would be impossible to pay State salaries at all. “The Government is determined while in office to maintain the solvency of the country and its reputation,” Mr. Forbes added. It was frequently asserted that wage reductions reduced the purchasing power of the people, and led to further depression, and this was apparently the contention of the many petitions against wage-cutting that were being presented to Parliament at the present time. He did not mind what the petitioners said, for they were entitled to their views, but they were not charged with the responsibility of running the country. This very point was dealt with by the Economic Committee, which had pointed out (liar while this argument might have some force for a period, it would not be true in the long run. Turning to the proposed pension reductions. Mr. Forbes said that a pension today was far more valuable than it was in 1929 when prices were high and the country was flourishing. 'A reduction of roughly 10 per cent, in pensions was proposed by the Government, but. actually, the cut would not be equal to that amount in value, for the purchasing power of pensioners had been increased.

The total pensions bill to-day was over £3,000,000, and it could not be justified. Excluding soldiers’ pensions, the total had increased by over £2,000,000 since 1914, and the country could not afford to carry this burden in the presenj; circumstances. Weekly Tenancies Affected. Discussing the reduction of fixed charges including interest and rent, the Prime Minister said that the Government might be blamed if it were not demanding evenhanded justice, but every form of investment was to be affected by the Bill. The reduction of 20 per cent, in rents would affect all tenancies, including those on a weekly basis, and after the passing of the measure all those ou a weekly rental basis would be entitled to a reduction. Mr. W. J. Jordan (Lab., Manukau): Is that true? Mr. Forbes: That is right. This Bill applies to all weekly tenancies. He said that everyone would be entitled to a reduction provided it did not mean that the return from the rent was less than 7 per cent, of the capital value of the property. Mr. P. Fraser (Lab., Wellington Central) : Is the right honourable gentleman not aware that the position is covered under the Rent Restriction Bill? Mr. Forbes said there was a difference in that the Government valuation was taken under the Rent Restriction Bill. Under the present measure the valuation would be agreed upon by the tenant and landlord, and if they failed to agree it would be fixed by an order of the court. Dealiug with the proposed reduction of members’ salaries, the Prime Minister said he recognised that a further cut would place many members in difficulties, jis he knew there were expenses to be met in connection with the representation of large electorates. Mr. Semple (Lab., Wellington East) : You are making this a rich man’s Parliament. Mr. Forbes said everyone would agree that wlien the Government ■ set out to reduce expenses it could not leave anyone out, and that members would not be justified in asking to be exempted. Only Possible Move. Summing up his opinion of the legislation, the Prime Minister said he did not say the Bill went the whole distance, but he believed it was a step in the right direction. By the means proposed tjiey would reduce fixed charges and enable industry to operate again without having such a heavy load to carry. Charges possible before the slump could not be borne to-day. Mr. A. M. Samuel (Govt.. Thames), nsked if there would bo any move to get insurance companies 1 to reduce their premiums. The Prime Minister said he thought reductions might be made as, where interest cutting had been carried into effect,' the insurance companies would be given a certain amount of relief. Mr. Samuel: It is a most important fixed charge. Mr. Forbes: It is not a matter included in this Bill. Mr. J. McCombs (Lab., Lyttelton) : Is there no provision for a reduction in Ministers’ travelling allowanc.es? The Prime Minister said a reduction had been made last year. There were many things not in the Bill, although he thought it covered -a fairly wide range. “From the objections and protests coming in the Bill seems to have covered everything,” he added. "But taking it as a whole the Bill seems to have been received in the right spirit by the country. The' plan is for three years, and by that time we should be back to normal, when we should be able to discard all this legislation.”

HOSTILITY TO BILL Labour Party’s Attitude ATTACK ON POLICY Reductions Opposed The Labour Party’s attitude toward some of the major proposals in the National Expenditure Adjustment Bill was defined by the Leader of the Opposition, Mr. H. E. Holland, in the House of Representatives yesterday afternoon. In referring to the proposal to reduce the salaries of members of Parliament, Mr. Holland said it would become impossible for anyone but a wealthy man to represent the large country constituencies. He contended that in opposing the Bill the Labour Party was rendering to New Zealand a greater service than that ever rendered by any Opposition in New Zealand. Mr. Holland repeated his previous statement that the Bill was the most dangerous and reactionary measure ever placed before tbe New Zealand Parliament. The Prime Minister, he said, had told the House that the electors had given the Government a free hand, but he had forgotten to say that a free hand was given : on the strength of definite promises. It would be safe to say that 50 per cent, of the electors were very sorry for what they had done. “It seemed to me that the Prime Minister commenced his speech with what amounted to a deliberate attempt to antagonise the Opposition,” said Mr. Holland. The Prime Minister flung out the suggestion that opposition to the Government was not a straighforward or honourable policy. A straightforward and honourable policy was one in which pledges made to the electors were kept. He wondered if it were possible to get an understanding from the Government that the whole question would b 6 put to the test, and that i't would go to the country on the policy it had now given the House. Supposing it was not prepared to do that, would the Government put its policy to the test of a series of public meetings? Continuing, Mr. Holland remarked that the Prime Minister had referred to the economists. What economists had he meant? Was the Prime Minister referring to Professor Copland? Mr. Forbes: Yes; and there were others, too. The Prime Minister, Mr. Holland said, was prepared to take the advice of some of the minor economists of New Zealand. The economists were prepared to come along with proposals to cut down everyone’s wages but their own. Mr. Polson : That is not fair. Mr. Holland declared that in addition to their ordinary salaries the economists were drawing journalistic fees and invading the field of the legitimate journalist. They were also collecting examination fees. It was a fair thing to ask them where they stood when they wanted to cut other people’s salaries. Surely the Prime Minister was not going to say that the viewpoint of the minor, economists in New Zealand was the viewpoint of economists throughout the world. Some of the world’s greatest economists were against the opinion put forward by the Prime Minister. These men included Professor' Irving Fisher, Reginald McKenna. .1. A. Hobson. .1. M. Keynes, Professor Soddy, Josiah Stamp, ami Professor Gustav Cassel. The Prime Minister, however, said that these men were all wrong, and that Professor Copland and Professor Tocker, “the whitehaired b/y of Conservatism,” were right. The Prime Minister set himself up against Reginald McKenna, and said that in order to get back to prosperity they had to drag down conditions. Purclrtsing Power Issue. Mr. Forbes: Reginald McKenna never said we should spend more than we receive. . Mr. Holland: The Prime Minister sets to work to diminish purchasing power. Mr. Forbes: I said we must pay our way. The Minister ot Lands, Hon. E. A. Ransom: What is purchasing power? Mr. Holland: The power to purchase the necessaries of life. The Government's programme, he added, was a policy of despair, making for destitution, and not rehabilitation. Before confidence could be restored, purchasing power would have to be restored. The cost of living had not fallen commensurate withthe reductions made in salaries and wages last year, and he predicted that the same would apply when the present Bill had gtxie through. The most scientific way of meeting a difficult financial situation like the present was by means of a steeply-graded taxation that would enable them to get somewhere hear to

equality of sacrifice. ’There was no such equality in the Bill before the House. 'The cutting-down method was wholly unnecessary, but if they were going to cut down there should be no exemptions at all. The Governor-General’s allowances should not be included in the exemptions. That was a position that had to be faced, and the Labour Party had the courage to say so The proper way was to start nt the top and grade downwards, stopping before the bottom was reached. j j Mr. Holland described the graduated scale of salary reductions as “wholly farcical.” It was not what was taken from the taxpayer that mattered, it was what he was left with. The lower-paid employees were to receive a 5 per cent, reduction in wages. Added to that was the 5 per cent, tax on wages for unemployment purposes, and together with last year’s reduction of 10 per cent in wages there was a total reduction of 20 per cent. The cost of living had not fallen -0 per cent, all round since 1931. Pensions Reductions. Reductions in pensions were condemned by Mr. Holland. The position of the old-a'-'e pensioner was going to be made much more difficult. Even a worse attack was that on the widow’s pension, and when the provision in the Bill became operative there would be suffering and hardship in families where the widow was the head of the family. Probably the worst of all was the attack on tbe miner’s pension. Family allowances were going to be cut down, and as a result quite a number of families in New Zealand would be deprived of tbe allowances. • Referring to the clause dealing with interest and rent reduction, Mr. Holland said he could not see that there would be any material change. To some extent the provisions in the clause were already law He had his doubt about the effectiveness of the clause, and the Prime Minister should not object to the clause being amended to operate as he said it would. In conclusion, Mr. Holland said he dreaded the creation of the insurrectionary atmosphere that was being created by the Government’s policy, both legislative and administrative. . Mr. Polson: By the Opposition. Mr. Holland said that what was happening at Dunedin was a faint rumbling of what was likely to happen throughout the Dominion. ’The Government came forward with a Bill and said it would accept amendments, but every one that was moved and every constructive suggestion put forward was rejected. The Government was more unpopular to-day than it was a year ago. “In opposing this Bill.” said Mr. Holland, “the Opposition is rendering to New Zealand the greatest service ever rendered by any Opposition in this country.” FALL IN REVENUE Crown Land Tenants REMISSIONS OF RENT '“The Bill has been drafted in an endeavour to bring costs of production more into line with the market value of tbe products of the primary producer,” said the Minister of Lands, Hon. E. A. Ransom, when speaking during the second reading debate on the National Expenditure Adjustment Bill in the House of Representatives last evening. When they took into consideration that 94 per cent, of the country’s exports were primary it was apparent that the primary producers should receive first consideration in any measures brought before the House. The national income had fallen by £40,000,000 since 1929, and of that amount £28,000,000 had fallen ,on the export producer. The net income of many farmers was nil, while the operations of numbers of others showed a debit. This was reflected in business and enterprise, and the general effect was disastrous. The object of the Bill was an equalisation of sacrifice until world prices revived. The Bill would tiring about a restoration of confidence, and that in itself would release capital for investment. The rent and interest reductions would be a great help to primary producers and wage earners. It would be of little use for the mortgagee to realise on his security, and’until stability was reached no sales were likely to take place.

Help for Tenants. Many mortgages were meeting the position generously and had made even greater reductions than 20 per cent. The Bill applied to Crown tenants, and at the present time the Lands Department was making every endeavour to help its tenants. The Government realised that it was wiser to keep tenants on their holdings, and only last week he had approved of remissions of interest and rent amounting to £56.000. It would be some encouragement to the people who had been granted those remissions to carry on. Reference was made by Mr. Ransom to the statement of the Leader of the Opposition that the Bill was a reactionary and dangerous measure. Mr. Holland, he said, hud not put forward any argument in support of his statement. He would like to know to whom was it dangerous. It Avas true that the Bill meant personal sacrifices to some, but in the ultimate issue it would safeguard the whole of the people. The Bill might lie rectaionary if it meant retracing some of the unwise steps taken in the past. The country was suffering from the effects of excessive expenditure, both public and private, and if .they could not undo what had been done, they could at least refrain from repeating some of the mistakes of the past. The Leader of the '• Opposition had stated that his party stood for reconstruction and rehabilitation, but his speech was sadly lacking in any constructive thought or suggestion for satisfactory rehabilitation. Probably never in the history of this country had Parliament faced a more difficult situation, and almost every clause in the Bill opened up wide and deep issues. What a glorious opportunity was offered in the measure for the Opposition to render counsel and' help, not in the interests of the Government. but in the interests of the country. Mr. Holland had declared his party would fight the Bill nt every stage, but the present was a time for Parliament to forget politics and think of country. Low Prices for Wool. The economists had pointed out that the national income had fallen from £150,000,(100 in 1928-29 to £110.000,000 nt the present time, notwithstanding the favourable exchange rate of 10 per cent. That was a loss to the country of £40.000.000. Could a high wage standard be maintained in face of such facts? asked Mr. Ransom. Wool that sold for 1/3 in 1929 had sold at the Wellington sale the previous day for 3d. to sd. a pound, and lie understood that a penny a pound for wool meant £1.000.000 to the country. The grazier to-day. and for the past two years, suffered up to a 70 per cent, cut in his income. Referring to Mr. Holland’s advocacy of a steeply graduated income tax, Mr. Ransom saiil (hut if that course were adopted it might defeat the object it had in view. The Minister of Public Works had already pointed out that if the wages tax alone were charged to the income taxpayer then the rate would reach 13/4 in the £l. Throughout the present and previous debates the Labour Party had advocated special help for the secondary industries. He quite agreed that more should be done for the secondary industries, and he hoped the Government would soon be able to look' into the position. At the same time, however, it had occurred to him that if the steeply graded income tax advocated by the Labour Party were imposed every secondary industry of any magnitude would bo crushed out of existence. In conclusion. Mr. Ransom said ho thought it a wise provision to carry over a deficit till better times. Only when the private budgets were balanced would it be possible to balance the national Budget.