FIXED CHARGES

Evening Star, Issue 21090, 30 April 1932, Page 13

FIXED CHARGES

£5,000,G00 REDUCTION BY ADJUSTMENT BILL LIVING COSTS FALL MORE THAN BALANCES PENSIONS GUT [From Our Parliamentary Reporter.] WELLINGTON, April 29. Tho figure of £5,000,000 was given by the Hon. A. Hamilton in the House to-day as the amount of the estimated annual reduction in fixed charges in New Zealand which would be brought about by the passage of the National Expenditure Adjustment Bill. The Minister stated that according to tho official calculations interest and mortgage rates would bo reduced by £1,945,000, which was a fairly substantial decrease. The estimated reduction under the proposals relative to rentals of dwelling houses and business premises was £2,130,000.

Mr Holland; Does that include weekly tenancies ?

The Minister: That is tho effect that the Bill will have on rents in New Zealand.

Continuing, the Minister said the reduction in Government and local body interest was estimated to be £740,000, and the reduction in other items, such as preference shares, was £185,000, “ These figures,” he added, “ show an .annual reduction in fixed charges under tho Bill of approximately £5,000,000. That is a fairly substantial contribution to the reduction of rents and other rigid charges in the dominion.” Mr Richards; That is all right on paper. The Minister: I am of opinion that it will be absolutely effective. Mr Barry: Does it include ‘call’ money?

The Minister said the Bill was absolutely necessary to bring about an adjustment of values in New Zealand. Dealing with tho cost of living, the Minister stated that the latest available statistics showed that there had been a substanial drop in the last two years, and pensioners, in spite of tho cut, would still have the same purchasing power as previously. Labour Voices: Nonsense. The Minister: There is no nonsense about it. The cost of living to-day, compared with two years ago, maintains the purchasing power of pensioners on the same level in spite of the cut.

The Minister gave figures showing the percentage decrease in various groups for February and March last, as compared with the corresponding months of 1930. He said groceries were down by 9.5 per cent., dairy produce by 22.5 per cent., and meat by 26 per cent., making a decrease in the three food groups of 20.1 per cent. Mr Holland: In what part of New Zealand ?

The Minister: “These figures cover the whole of the dominion.” Ho said rent was down 10.9 per cent., and he was of opinion that it would drop a further 10 per cent, as a result of the passage of the Bill. The fuel and light group was one of the worst, the reduction being only 1.6 per cent., but clothing, drapery, and footwear showed a drop of 12.8 per cent. Miscellaneous items were down by .4 per cent. When all the groups were taken together the fall was represented at 12.6 per cent., which was much greater than the old age pension cut. Mr Langstone: That does not represent the total living costs of people. The Minister: It is not necessary for a man to buy the dearest items. I am sure the wage earner can make a bigger reduction in living costs than 12.6 per cent. Mr Jordan: By buying shoddy goods. The Minister: It is not necessary to buy shoddy at all. Referring to the disparity between export prices and farm costs, the Minister said it was-necessary to bring about an adjustment of values in New Zealand. Compared with 1914, farm expenditure had risen by 49 per cent., while export prices were 20.8 per cent, below the 1914 level. Nominal wages were 47.1 per r ■•'t. above the 1914 standard, and retail prices 38.2 per cent, above. There was a serious disparity in present-day prices, from which tho whole world was suffering, and it was up to Parliament to see that the burden was spread as equitably as possible over all sections of the community.