SURRENDER TO REFORM

Evening Post, Volume CXI, Issue 39, 16 February 1931, Page 10

SURRENDER TO REFORM

MR. HOLLAND'S VIEWS

LABOUR WILL RESIST

(By Telegraph—Press Association.) WESTPOBT, 14.th February. "The first thought that will strike the average reader of the Primo Minister's pronouncement will be that the Government's new policy, plus its abandonment of its railway construction schemes, leaves it making an unconditional surrender to Mr. Coatcs and the Reform Party on practically every item except the South Island Main Trunk line " stated Mr. H. E. Holland, Leader of the Labour Party, summing up his opinions on the policy of the Government as set out by the Prime Minister, the Right Hon. G. W. Forbes, on Saturday. "There has never been in the hrsUny of any country such wholesale dishonouring of election pledges, accompanied by au amazing determination to hold on to office in defiance of the electors, whose confidence has been violated," says Mr. Holland. "Mr. Forbes estimates that there will be a fall of about 20 per cent, in our export values this year as against 1930. That is serious enough, but is the position so utterly dismal as the Prime Minister's statement would lead people to believe? Tho 'export values for 1930 wore less than £300,000 below the yearly average of the ten years 1920-29, which period included two abnormal years: 1928, which showed an increase of nearly £8,000,000 over 1927, and 1929, with an increase of more than £7,000,000 over 1927. If the Prime Minister is correct, export values for the present year will amount to round about £40,000,000, or just about double the yearly average of our export values for tho ten years immediately preceding the war. I have faith jn the capacity of this country to make rapid recoveries from any_ period of economic depression, but it is epiite clear to me that the policy which the Government is now putting forward will accentuate our difficulties rather thaiv end or minimise them. METHODS WILL BE REPUDIATED. "No one will quarrel with the Prime Minister over his desire to balance his Budget, but most will repudiate his method of doing it," Mr. Holland continues. "There will be widespread resentment at the determination to place on the shoulders of the Public Servants and other wage-workers the heaviest responsibility in the matter of sacrifices demanded. Even if the position should prove to be as dismal as Mr. Forbes has ■painted it, his method of retrieving the situation would still be the wrong one. A far more equitable method would be a super-tax on all incomes of, say, £.500 and over. But even if wage reductions were admitted, it is au extremely lopsided policy1 that levies a flat rate of 10 per cent, on all incomes irrespective of their dimensions. It means that the man with the small wage or salary pays out of all proportion in comparison with the highlysalaried official. If a raid is to bo made on wages and salaries, why not commence at the top, drastically reducing all higher salaries without exemption whatever. THE RATE OF INTEREST. "The decision to reduce wages," says Mr. Holland, "is definite and emphatic, but the Prime Minister adopts a different tono when he talks about in'lcrest. 'Rates of wages must come down,' Mr. Forbes says, but apologetically he makes what ho terms 'an earnest appeal to banks, mortgagees, stock and station agents, etc., to review each individual mortgage ease.' 'The unfortunate farmers/ he correctly says, 'are not in a position to meet the high rates of interest charged on loans, and they certainly cannot reduce their indebtedness.' It is for the Prime Minister to explain why he is content only to appeal to money-lenders. Why has he not applied the same legislative principle as in the case of Public Servants and wage ■workers? A reduction of two per cent, (or even one per cent.) in the rate of interest would mean an enormously greater measure of relief to bona-fide farmers than any system of wage-re-duction. SMALL RELIEF TO FARMERS. "The latest available, statistics ClfUtl) shows that wngc-s paid in butter factories of Wow Zealand amount to .<■; 945,000, and in meat freezing works

£1,570,000. The. amount of wages paid on farms is not given, but the latest agricultural statistical report (for 1929-30) shows that the number of wage workers on farms is less than 33,000. Many of these are. necessarily not in permanent employment, but if we average wages at tho abnormally high figure of £3 10s a week the total paid out in wages would be only £115,----500. On this high estimate nil that tho 10 per cent, wage-reduction can save is £11,500. On the wages of butter factory and meat and freezing works employees a 10 per cent, reduction will mean a saving of £04,000 and £157,000 respectively, a total (including farm employees) of £202,000. Tho relief such reduction would bring to farmers would be infinitesimal. Jn the case of shearers a sliding scale agreement is in operation and any interference witli that will bo quite as deserving of condemnation as the proposal to dishonour other existing awards and agreements. THE COST OF LIVING. "The main effect of the wage reductions will be to deprive tlic local market to the time of some millions of pounds, destroying tho people's ability to meet periodical and national liabilities, and the farmer will be hit as badly as the wage-worker in consequence. There is also another aspect of this question. Even if the wagereductions were unavoidable the first condition should be an all-round reduction in the cost of rentals, wearing apparel, foodstuffs, etc., but there is no proposal lo legislate in that direction. The Government haltingly assures us that it 'expects' wage reductions will reflect themselves immediately in tho cost of living. "There is no reference to the position of workers in intermittent employment —waterside workers, miners, and others, whose wages are never sufficient to give their families an average standard of living. Their incomes, already wholly inadequate, arc to be still further reduced. Mr. Forbes will have the task of formulating his excuse for reducing tho wages of men with less than £300, while he gives liberal exemption to income tax. payers. However, it is beyond question that there has been no reduction in the cost of living that will justify a 10 per cent, reduction in the wages of workers, and the Government may rest assured that tho Labour Party will oppose to the utmost its attack on the basic wage. No one knows better than the average business man that wage-reductions arc not the way out, and tho working farmer knows it too. Mr. Forbes has now capitulated to ttie Reform. Party, and is proposing to continue tho work begun in 1922 by that party at the dictation of the financial institutions. CONTROL OF THE RAILWAYS. "It is absurd to talk about placing the railways under non-political control, when Parliament must vote money with which to carry on the service. There is a danger that the new arrangement will mean practically handing Ihe railways over to private control, and in that case it will not be in the public interest.

"The Dominion's credit should be mobilised," concluded Mr. Holland." "During the war no difficulty was experienced in organising the credit of the Dominion. Special methods were adopted to compel the people to contribute to the war loans, and an amount of £55,000,000 loan money was raised within the Dominion. There is no reason why similar action should not bo resorted to to-day. The whole of the Dominion's credit should now be mobilisedy to infuse life into industry. This is the time for au extension of national industrial activity rather than a down-grade policy."