MR. NASH WINDS UP DEBATE

Dominion, Volume 31, Issue 270, 11 August 1938, Page 12

MR. NASH WINDS UP DEBATE

Reply To Criticism

“COUNTRY INFINITELY

BETTER OFF”

People’s Higher Incomes

Opposition criticism of the Government’s financial policy was replied to by the Minister of Finance, Hon. W. Nash, in winding up the Financial Debate in the House of Representatives last night. The extra amount anticipated from income tax this year, said the Minister, was due to the fact that it was expected to collect more from a lot of people who bad previously evaded taxation. Another factor in the yield from taxation was the higher incomes earned by the people. The member for Hurunui, lit. lion. G. W. Forbes, bad talked about the Government's disregard for the future of the Dominion, Mr. Nash said. Mr. Forbes had said that people had approached him and expressed their anxiety about the future. No doubt these people were anxious because they had seen prosperity and were afraid it would not continue. Prosperity would inevitably last for another three years after the election, and he hoped for all time. Mr. Forbes appeared more concerned about opinions from London. At times London had said some nasty things about the Government, and no doubt more nasty things would be said between now and the election. The Minister said that Mr. Forbes bad also asked for a straightforward explanation of the reduction in the public debt "What more information can be given?” asked Mr. Nash. I went out of my way to give every figure. There is not a figure associated with the public debt that has not been set out so that every member can understand the position. The Budget shows that sinking funds have been used to pay the debt” Country Better Off.

The Rt. Hon. J. G. Coates (Opposition. Kaipara) : How much better off is the country? ‘‘lnfinitely better off because it has a better Government,” said Mr. Nash. “If I had £5OO in the bank and used £4OO of it to pay off a mortgage my debt would be reduced from £5OO to £lOO. That, is what this Budget does.” The statement had been made by the member for Parnell, Mr. W. P. Endean, that the country was living beyond its resources, said the Minister. That was not correct. Mr. undean had also quoted fnom a confidential circular sent out by one of the largest stock-broking’ firms in Australasia, suggesting there were doubts in the minds of investors as to investments in this country. According to Mr. Endean one of the officers of this company had visited the Dominion and stated that the Government could get all the money it wanted at a higher rate of interest. If the Government were to allow interest rates to slip no doubt it would please the friends of the Opposition. “One month this firm states that the prices of our securities are firming, said Mr. Nash, “and next month, in view of the approach of the election, it sends out: a damning statement about our investments.” Mr. 11. S. S. Kyle (Opposition. Riccarton) : That was after the Prime Minister talked about kicking over the traces. Freezing Industry Costs. Mr. Nash said that Mr. H. G. Dickie (Opposition, Patea) had stated during the debate that costs in the freezing industry had gone up by £750,000, but if that was so it would be necessary for the Government, to investigate the balance-sheets of the freezing companies. Their total net profits in 1935 were £175,329, with au average dividend of 6.8 per cent. The next year the net profits fell to £159,060, although the dividends increased to 7.4 per cent., and last year there were net profits of £197,000 and an average dividend of 7.7 per cent. That showed that the farmers, with the exception of the sheep-farmers whose prices had fallen, were now better off. Reference had been made lo money having been sent: overseas, the Minister said, and he had no doubt that there were people who would send money to Australia if they could get 4} per cent, there ag against 3-J per cent, in New Zealand. Mr. W. J. Broadfoot (Opposition, Waimea) : They can get 4J per cent, here now, can’t they? I believe the Government Life Insurance Department is offering that rate. Mr. Nash: I did not know that was so. Reduced Interest Rales. "The Leader of the Opposition, Hon. A. Hamilton, stated that if the previous Government had remained in power the unemployment tax would have been abolished,” the Minister continued, “but we have spent £5,000.000 collected from that tax, and I would like to know wbat expenditure he would have cut out. He must remember that there are two sides to a Government’s finances.

“Mr. Hamilton ■ also compared our income tax with that in Britain, but with the exception of three lilies they pay more in Britain than we do, and the people are charged for certain services by the local authorities that are covered in this country by the Consolidated Fund. “The Government claims some credit for having reduced interest rates. The interest rates have declined on the average each year since 1935. The Opposition claims credit because they fixed a rate of 4 1-8 per cent, for State Advances loans, but the fact that all rates have come down is largely determined by this Government’s policy. There is now more money out at 4$ and 5 per cent, and less out at (5 per cent, than formerly.” The Hon. Sir Alfred Ransom (Opposition, Pahlatua) : The capitalists are responsible for that. Mr. Nash: Although there are some very good people among the capitalists I never knew one who preferred 4} per cent, to 6 per cent.