WEAK DEBATE—WEAK REPLY

Evening Post, Volume CX, Issue 35, 9 August 1930, Page 8

WEAK DEBATE—WEAK REPLY

For the most part the Budget Debate was weak and wearying, and the Prime Minister may retort to criticism of his speech-in-reply that it was as good as most of the critics deserved. Perhaps it was; but there were points of first importance raised in the House and outside to which no adequate reply was given. Some were even ignored altogether. To the general criticism that he had been too pessimistic and too cautious in his estimates of revenue, Mr. Forbes gave the only reply it was possible for him to make—that he had acted on expert advice tendered to him. Whether that advice is wholly sound is yet to be seen. It is generally agreed that there will be a fall in revenue, but opinions differ as to the probable 'extent of the fall. In these circumstances a, new Minister of Finance would be risking a deficit if he set his inexpert opinion against that of his expert advisers. Having accepted the advice of the Treasury, Mr. Forbes was quite right to make the facts known. There is nothing to be gained by concealment, and when the position is disclosed with perfect frankness there is a better prospect of applying appropriate remedies in time. This part of Mr. Forbes's defence was sound; but the defence of his economy and taxatibn measures was not equally so. The wide distribution of new burdens is commendable as a general principle, though it entails the bad practice (from the orthodox budgeting viewpoint) of collecting small sums from numerous sources. But this distribution should not resemble a broadcast scattering of liabilities, without thought for where they will fall and the effect of their fall. The effect, especially of the revenue-productive tariff revision, has been insufficiently considered by the Government. Moreover, we cannot admit that there has been equality of distribution. Income (10 per cent, increase and a reduced allowance for buildings) and Customs (a surtax of nine-fortieths of the duty on most items) are both called upon to con tribute more in both rate and total than is land with a 5 per cent, addition and (with farmers owning land exceeding £7500 unimproved value) liability for income tax.

These points the Prime Minister evaded, though they are points of great importance if the tax burden is to be so adjusted that it will not retard the Dominion's recovery. To the criticism of the petrol tax answer was made, but here again the attack on the fundamental weakness of the new levy was ignored. Mr. Forbes sought to justify the tax as a legitimate and necessary transfer of the cost of road finance from the taxpayer to the road-user. We think this ground could be maintained; but only if the new tax were shown to be part of a complete and thoroughly considered user-payment plan. Mr. Forbes has yet to prove that sevenpence a gallon, plus tiretax and licenses, represents fairly the motorist's just contribution to road finance. When he has done this lie must attempt to prove that the road-, user funds are equitably distributed according to the use that is made of

the roads. This he certainly cannot do while the existing allocation of funds is retained. The Prime Minister displayed discretion, if not valour, in making no attempt to meet this point. But the people who are suffering from the injustice of the distribution will be foolish if they allow the matter to rest where Mr. Forbes has conveniently dropped it.