"GRANDIOSE PLAN"

Evening Post, Volume CXXVI, Issue 60, 8 September 1938, Page 10

"GRANDIOSE PLAN"

BUSINESS MEN NERVOUS

Speaking on behalf of the members of the Chamber of Commerce, Mr. M. G. C. McCaul, immediate past-president of the Associated Chambers of Commerce, said he would say that they were extremely nervous as to the result of the additional impost of Is in the £ on company profits. "It appears clear to me," he continued,'"that the present Government's financial record has proved its incapacity to govern. | Ideals are of paramount importance in every phase of life, and in particular they are essential in the character of! Cabinet Ministers; but those who aspire to govern must take care to use their ideals to aid them to see clearly what is for the ultimate benefit of the people and not as an opiate to deaden their perception and lull them into a false feeling of security when pursuing a policy that can lead only to disaster. "Unfortunately, gentlemen, this is a prime fault in the present Administration. As blind leaders of the blind they point the way to less work and more comfort, to less endeavour and more pleasure, and all the time they rush nearer and nearer to financial chaos. (Hear, hear.) "All business men believe in insur-' ance against old age and invalidity, and the business community would be glad to co-operate with the Govern? ment in the hammering out of a scheme that would be sound financially and equitable in operation. The present social security proposals of the GovernmenTcomply with neither of these requirements. The present Administration does not appear to realise that the social security benefits cannot come out of thin air. If they are to materialise they must come out of the earnings of the people, and the earnings of the people of this country depend mainly upon .the capacity of the people of Great Britain to purchase our produce. TOP-HEAVY FINANCIAL STRUCTURE. "Our taxation this year, apart from unemployment tax and social insurance taxation, will amount to over £35,000,000. It is a staggering burden that can be borne for only a short period and while prices of our primary products remain high. When values fall the Government's top-heavy financial structure will collapse and the grandiose social security plans will vanish into thin air along with a great deal more, bringing with it a trail of want and misery. "At the present large companies are paying taxation amounting to 10s in the £of profits earned. This penal taxation has caused a steady flow of money away from New Zealand for investment elsewhere. The proposal of the Government to add a further tax of Is in the £ on company profits will hasten the flight of capital from New Zealand to the permanent injury of our primary and secondary industries, and as a result cause widespread unemployment. ' Very few people realise how infinitesimal the profit of a large company is when compared with its turnover in goods and services. "The industrial life of this country is financed largely by overseas capital. The retention of this capital in New Zealand is vital to our existence as a happy and prosperous people, but it is inconceivable that overseas investors will continue to employ their money in the financing of New Zealand industries if the Government takes away in taxation more than half of the profits earned. "Governments, gentlemen, are apt to forget that the much-maligned capitalist is a voluntary worker, and the high

standard of living which we enjoy in this country is due largely to the efforts he made and to the risks he took in time past." (Applause.)