Evening Post SATURDAY, SEPTEMBER 24, 1938. TAXES THAT COME BACK

Evening Post, Volume CXXVI, Issue 74, 24 September 1938, Page 8

Evening Post SATURDAY, SEPTEMBER 24, 1938. TAXES THAT COME BACK

The houses that Jack did not build should have a powerful influence, moral and material, on the course of the present General Election. What every house-hunter knows may not be general knowledge to, the whole of the electorate, but Mr. Hamilton drove home the point last evening with a few figures: The Socialist Government promised houses at £600 when the actual cost has been up to £1200. The Socialists promised rents for workers of 12s 6d to 16s 6d a week. The rents are from £1 to £1 17s a week. The Socialists promised completed buildings in the Budget of two years ago totalling 5000. Mr. Savage gave the actual figure as 1000 when speaking in August of this year. . It~was to produce this result that the Government clashed with ~the private enterprise of small builders. The fight led by Mr. Hamilton of private enterprise against Socialism is therefore one that comes home to the small employer and to every person who values a dwelling—whether rented or owned, but more particularly an owned dwelling- Here the Nationalists and Labour take absolutely opposite sides —Labour for State house-building and rented houses, the Nationalists for home ownership and for full opportunities for private enterprise. Which of these opposites does the elector prefer? Mr. Hamilton also stated that the Nationalists would raise the Labour embargo on a landlord's right to regain his property. We will restore to owners the right of access to their own properties, at the same time providing adequate safeguards for tenants. The only result of Labour's suspension of free-trade in houses, and Labour's under-supply of new homes at more than the promised rent, has been to increase the home shortage, and to put a premium on devious ways of getting tenants out. Mr. Hamilton refers to Mr. Nash's flight from insulation, evidenced by his rejection of the dairy farmer's twopence increase. Mr. Nash's flight from insulation must not be confused with the retreat from Moscow. It is admitted that Mr. Nash, Minister of Finance, has not defined insulation, but his Parliamentary Undersecretary has said something about insulation in his private literary capacity. He mentions insulation more than once in his chapter on "Guaranteed Prices" (in "Socialism in New Zealand") and states that it will save New Zealand from "disastrous deflation." Also: To members of the Party the success of the guaranteed price is independent of a London price. New Zealand can only import from Britain and pay in Britain whatever the goods fetch in Britain, whether there is or is not an internal guaranteed price. But insulation against world prices enables New Zealand to enjoy a high standard of existence and at the same time acts as a spur and not as a brake to production. In fixing a butter price short of the 2d increase recommended unanimously by the Advisory Committee, the Minister of Finance does not measure up to the vital first sentence quoted above. There is a gap between the practice of the Minister of Finance and the principle laid down by the Parliamentary Secretary to the Minister of Finance —laid down individually, it is true, but with the utmost publicity and the most clear logic. Is it possible that Mr. Nash does not regard insulation as shockproof? Can there be two Socialist orthodoxies at the Ministry of Finance? A fraction of a penny can mean seven figures in money —and a still greater magnitude in terms of principle. Mr. Hamilton comments: The fact that, for this year, the Minister of Finance refuses to grant the price recommended by his own Committee proves that the Minister is not prepared to stand up to his "muchvaunted insulation theory, but instead he relates the guaranteed price to the market price and cuts the Committee's price down by £1,289,000 less than the price, recommended by his Committee. Why did the Committee recommend a rise of 2d in the price? It was for the purpose of compensating the dairy farmer for the extra costs placed on the industry. Weeks ago Mr. Mulholland pointed out that the Minister of Finance (Mr. Nash) was wobbling between the price unrelated to London (Mr. Lee's price) and the price dependent on London. Mr. Nash seems to have finally come back to the latter, for what else can the departure from the Committee's recommendation mean? Mr. Lee says that the guaranteed price as he prescribes it "acts as a spur and not as a brake to production." The farmers say that Mr. Nash's price acts as a brake, and can cite in their favour the independent, expert, and unaccepted price adopted by the Committee, also the figures given by Mr. Hamilton of actual reduced production. If the Committee is right, Mr. Nash's increased price represents less than added costs. It also reflects lack of faith in insulation. And the holding of two opposite views by the two Ministers at the Ministry of Finance is a significant fact, even if the lesser Minister speaks with one voice at the Ministry and with another voice in the world of books. Insulation—even with the suggested ruthlessness towards imports—cannot work, and Mr. Hamilton sounds the right note when he urges the electors to finish with such experiments, and to get back to private enterprise in exporting, importing, and home-building. What is good in

the dairy produce marketing system the farmers can carry out themselves. The State's job is a minimum of regulating and financial helping: The increase of over ten millions in taxation revenue in two years, by a Government that promised to not increase taxation, would be stunning if it were not overshadowed by the pi-ospective Social Security taxation burden which the Government evaded in its election year Budget by postponing operation of Social Security till April of next year. The Labour Government continued its policy of broken promises concerning taxation right till the close of the session. Mr. Nash, says Mr. Hamilton, administered a shock when he decided to tax children, women, pensioners, domestics, relief workers, etc., and make everyone pay a poll tax to register whether they earned or not, Maori and pakeha. Then came the thunderbolt, the amendment by Mr. Nash, after the Bill had been introduced, taxing companies—another load on *the backs of the already overtaxed trading concerns. That is just the same as saying that it was a further tax on the people, an indirect one. You'pay in the cost of living where the cost can be handed on; and, where it can't, you are merely crippling further the firms and enterprises, large v and small, which provide you, your family, and your friends with work. ... I do not believe that people are so unobservant that they will forget i these things, nor that Mr. Nash, after a speech (during the second reading) in which he said that no extra taxation would be necessary, immediately brought in major" amendments to tax companies and so provide another huge bulk of money for the Social Security scheme. Even with the additional taxation on companies—'"taxation which must come out of commodity prices"— vast further sums will be required from the Consolidated Fund, "which is another name for your pocket." Mr. Hamilton's speech will be memorable if only for this illuminating definition of the Consolidated Fund. After all, the main question is "who pays?" The Opposition leader's answer to a questioning public is to hold up a lookingglass. '