THE RELIEF SUBSIDY

Evening Post, Volume CVIII, Issue 10, 11 July 1929, Page 14

THE RELIEF SUBSIDY

GOVERNMENT ASSISTANCE

DEPUTATION OF MAYORS

A request for £ for £ Government subsidy on, unemployment relief expenditure by the four principal local authorities of the Dominion, instead of merely on the cost of labour as at present, was submitted to the Prime Minister this morning by a deputation, consisting of the Mayors of Auckland, Wellington, and Dunedin, and the Deputy Mayor of Christchureh. Alternative suggestions for State aid were also suggested. The Prime Minister repudiated the obligation on the Government to provide for the relief of unemployment, but promised that Cabinet would give consideration to the representations. He referred to the need for Parliament to consider a national scheme for meeting the problem. In introducing the deputation, Mr. D. G. Sullivan, M.P., who also represented the Mayor of Christchurch, referred to the Government's offer of £25,000 to each of the four cities, to be spent on unemployed labour only, and pointed out that in order to qualify for the subsidy under the conditions imposed it was necessary for the cities to find approximately twice the amount of the subsidy. That placed a burden on the city councils, which pressed on them very heavily, for it was difficult to find suitable work to put in hand under these conditions, owing to the cost of materials. Ho pointed out that there was a growing indisposition on the part of ratepayers to increase financial liabilities. The deputation asked the Government to ease the position, so that the city councils could put works in hand without so large a qualification a3 to the amount they must provide to be able to receive the Government subsidy. AN INSURANCE SCHEME. The Mayor of Wellington (Mr. G. A. Troup) quoted the amounts provided by Wellington city for unemployment relief in the last three years, and the amounts received in Government subsidy in each ease. He pointed out that the subsidy usually amounted to only about one-third of the total cost of the work. Last year, for instance, a subsidy of £19,500 was received on a total expenditure of £54,900. This year the expenditure would be considerably heavier. v The council's commitments by loan expenditure would be no less than £89,000, on which it expected to receive £45,000 subsidy, on the most favourable basis; that was to say that on a total of £134,000 the Government would contribute £45,000. Under the very best conditions the must they could expect by subsidy was a third of the total cost. So far as possible the relief works in Wellington were works on which labour represented practically the whole cost. Mr. Troup referred to'an unemployment insurance scheme which had been drawn up by the cities, and which he said would at least make some provision to meet unemployment as it arose in future. They thought the Government might well take up the scheme proposed, which provided for Id in the £ to be paid on wages received, Id in the £ from employers, ia in the £ from the municipalities and local bodies throughout the Dominion, and Id in the £ by tho Government. The Government contribution might be reduced to U in the £, and still there would bo.ample provision to meet requirements. That would ian O <mnnl ft tOta!, froin the Government of £100,000. Alternatively they suggested: (1) That tho Government should subsidise- the local body relief works £ tor t over the total cost; and (2) that allowing the present subsidy to stand' the Government should give the option' instead of carrying out the work by day labour, to do them by contract. Mr Troup suggested that tlfe contributions non-exS. 1^" ?*«***<V™* ™s

Tho Mayor of Auckland (Mr G Baildon) said the trouble iv Auckland was very similar to that of Wellington By using unemployed unskilled labour it was estimated the works put in hand cost at least 25 per centf more than if the work were done ordinarily Several works could bo put in hand in" Auckland if a moro liberal "subsidy were available from tho Government. 1: they could get £ for £ subsidy ho thought ,1. would be moro .satisfactory At present, they could not find work to .instify the council spending £2 to the il subsidy. The Mayor of Dunedin (Air. B S black) said ho did not want it thought they wore looking a gift horse in tho mouth. It was difficult, to find work to comply W ith the conditions on whichd the subsidy was offered. He commend-] ed the insurance scheme as a means of I providing against slack seasons. BEYOND AVAILABLE MEANS. Keplyiug to the deputation, the Prime Minister (the Right Hon. Sir Joseph Ward) said the. representations would

not only receive his earnest consideration, but also that of his colleagues, as an increase was suggested in the amount to be provided by the Government. He found it his duty to point out one particular aspect of the question that struck him. The Government could not keep money supplies going for unemployment relief at the rate at which requests were being received at present. They had not the maximum amount of money available this year to enable them to spend £50,000 more in subsidies. It was beyond the ordinary means of the country to provide for large sums of extra expenditure. He pointed out that while the cities had difficulties in regard to unemployment relief, so had he as Prime Minister—and very material ones. If the unemployment the cities were dealing with was the only unemployment in the country, the position would be a comparatively easy one to meet, but the Government was aiso providing for thousands of others, independently of the city corporation relief works.

There was another aspect of the matter, said Sir Joseph. It was right enough for the deputation to represent that the Government subsidy amounted to only a third of the total expenditure. The country was not obliged to provide anything by way of subsidy on local relief works. The subsidy given ay the Government was merely to help unemployment. It had taken on its shoulders relief to the cities that it was not obliged to give. Mr Sullivan: "Is not unemployment a national obligation?V t "It, is, *endin S that way," said Sir Joseph "but it is not a national obligation." The Government, he said had not undertaken to make provision a" oTrVe Mr. Troup: "Is it not more an obligation on the Government than on the municipalities?"

The Prime Minister pointed out that the municipalities had undertaken certain works within their boundaries. TvnlhZ ti agencies of the labour trouble they would have to provide t T^T m am?, Unt of obligation. Mr. Sulhvan: "It is assumed that these works would be proceeded with, anyhow, but that is not the position." iJ£M S- GP Sai- d the Gov ernment was undertaking assistance solely for the F£P2?° t of tyk* to help In alleviating the trouble. ;

Mi. Baildon: "We would not have done one-tenth of the work we have done m Auckland if it had not been for the Government subsidies." The noint was whether the Government was^arh?™ ♦ '?, gOUIS.on with tho contributions to the municipalities, and whether the money should not be devoted to railway. and road relief works. There was f r6:\- eal t0 be sa;d about that. The ritL thlnS was tt?.* married men in the cities wanted to live near their work A point was reached when the national purse was not big enough to meet the added requirements the Government was Mked-lor. They could not ignore th* fact that the Treasury had only a limited amount of money.

THE CONTRACT SYSTEM. Mr. Troup: "The reason why we put forward the contract system was that it cZ^Uon:" 016386 th 6 G °—t's

. Sir Joseph: «'I am not prepared t give an offhand answer in regard to the contract "system, but we will consider it." Ha said he thought the time was coming when the Government would have to consider making permanent provision for unemployment They were getting into a position when a bioscheme was required to deal with the problem on national lines. He would go mto that aspect again, for obviously the Government could not look on with complacency at tho disturbing conditions arising throughout the country throuch unemployment. "The Government is doing the best it can,'.' said the Prime Minister, "and wo find members of Parliament crying out for no further expenditure on railways. They make me wonder whether I am alive or not, because if we cut out railway works wo would have still more unemployment " Iho Government was laying down a railway policy that was a well-defined one. They were not spending money on any short-distance railways, and had no intention of doing so. But it was committed to a certain number of longdistance railways, and he believed that was the best policy for the country. NATIONAL SCHEME NECESSAEY

In conclusion, he said he would carefully consider their representations. The position could not end where it was. He did not want them to think ho was sending them away feeling he had given them all they had asked for. Parliament would have to be consulted and a national scheme- formulated for meeting unemployment. It seemed that the responsibility for finding work for everybody who was out of work was centring on the Government, and that had never occurred before. It raised a tremendous issue, and would require to be carefully considered by Parliament.