BUDGET DEBATE

Evening Star, Issue 21824, 13 September 1934, Page 2

BUDGET DEBATE

DEFENCE MINISTER JUSTIFIES EXPENDITURE MODERN WAR METHODS NECESSITATE CHANGES EUROPE A SEETHING CAULDRON I'Pes United Press Association.) WELLINGTON, September 12. Urgency was taken for the Financial Debate in the House of Representatives to-day. The Government lias up to the moment been very lenient with members, but the debate lias been showing signs of dragging on for days. It is now hoped to proceed to-morrow to the committee stage of the Custom Acts Amendment Bill and to detailed consideration of the Estimates.

Mr A. S. Richards (Roskill) said it was a false hope that the Budget would bring prosperity back to the country. He considered that taxation should not have been touched, but that the unemployed and pensioners should have been reclassified and their weekly earnings increased, as that would have l increased the consumptive power of the people. The Government claimed to be a farmers’ Government. It was rather surprising, therefore, that from time to time statements were made by Ministers that substantial rises in overseas prices might be expected. He could see no hope of a substantial rise coming. He protested against the change-over from the State Advances Lending Department to a mortgage corporation, as he could not see that any benefit to the country would b© derived. He contended that it was only wealthy persons and businesses that would benefit from the wage tax reduction. Not many people were receiving £2 a week or less. He criticised the expenditure on defence while the Government was not willing to spend a few thousands on old age pensions. The House had no assur‘ance that the defence equipment on which £300,000 was being spent would be up to date when it did arrive. He considered that the money could be better spent elsewhere. The Minister of Defence (Mr Cobbe) resumed Ids speech, which was interrupted by the adjournment last night. Dealing with defence, lie said the guns that were coining to New Zealand had been secured through the War Office. They could rest assured that nothing old would be among them. For the past three years the department had curtailed its expenditure wherever it had been reasonably possible to do so. The change in world conditions'and in modern methods of attack and defence of nations made it necessary that New Zealand should take such steps as the existing conditions rendered necessary for the security of her people, trade, and territory. It should not bo forgotten that the policy of the Empire and the dominions was purely.defensive, and not in any way aggressive; but they could not overlook the fact that New Zealand stood or fell with the Empire. They could not igiioro the fact that Europe was a seething cauldron to-day, mid there should be no conflict in the views as to what was New Zealand’s duty in order to meet any emergency that might arise. The Government was not aggressive,' and it wished to avoid trouble; but when the country was at stake it claimed the right to take steps to protect ourselves, and in taking any steps necessary it believed it had the support of every man and woman in New Zealand. Mr W. E. Barnard (Napier) : You will not have the support of the Labour Party. Mr Cobbe said that New Zealand had something worth defending.. The steps taken were imperative. Every young man of average health and strength should be drilled. It. was difficult to understand the mentality of those who failed to realise the dangers that surrounded a country whose inhabitants were too careless or too effeminate to defend it. The Government believed that it was its duty to strengthen the defences of the dominion, and despite what had been said to the contrary it was going to do its duty. Mr D. G. Sullivan (Avon) said that such a speech as that just delivered by the Minister had the effect of stimulating the war spirit and further the interests of the armament firms. He hoped the question of national superannuation would be taken up by Parliament and by the people, as it had farreaching effects. •. If the people were given the security of such a fund the need for them to save would not exist. The whole economic machine would bo stimulated, and sucli a provision would contribute to the continued maintenance of prosperity more than anything else the House could develop. He believed the Mortgage Corporation would mean the destruction of the State’s groat lending departments. He did not believe the corporation would extend to borrowers the consideration that had been extended by tho various State Advances Departments. It would be run on rigid lines, and the first aim would be to secure the interests of the corporation. He contended that the people were too generous-hearted to want a reduction of twopence in the unemployment tax, and he hoped the Government would not persist in taking it nway. The Minister had admitted that no class in the community was suffering as the unemployed were suffering, and there was an opportunity to give them some increase in their funds, but the Government was making a hopeless endeavour to make itself popular at the expense of half-starved families. Mr W. J. Poison said that the control of banking policy was the basis of sound economic life. Government control was necessary. It was absolutely necessary if the primary producer was to face the difficulties confronting him. Interest rates must be reduced, he suggested, to 3 per cent, on long-term securities. Dealing with the Mortgage Corporation, he could not imagine the State handing its lending departments over to a private corporation. The State would have to stand, behind the Mortgage Corporation until it was on its feet, but unless it was watched carefully the cream of the securities would go elsewhere. Mr P. C. Webb (Buffer) said that the only State institutions that were in a flourishing condition to-day were those which had been bitterly opposed when they were originated by the con-servative-ni(nded people of that day. He instanced the State Advances Department, the Public Trust, the Government Life and the State Fire Insurance Department, and the State Mines Department. Continuing, Mr Webb said that every step taken by the State showed that it could not establish large industries without the support of a big bank. He contended therefore that the State should have had complete control of the Reserve Bank. He stressed the need for planning to get the country out of its difficulties, and said there was no need at the present. He, dealt with events for the poverty which existed in tho

early war yours ami the developments leading up'to Ins, imprisonment for re* fusing to go to the war. He said the New Zealand Government was the only Government in the Empire that had applied conscription to members of Parliament. He had lost his civil rights for ten years. He went out by the front door and returned by the front door, bi\t he had no feelings of animosity towards the Government. I'he Government at that time spoke of finding work and providing for the returned men, but it was regrettable now to think that the Minister of Pensions should live in the past. He would like to see a scheme evolved that would get food into the homes of the people and find work for the boys and girls. He thought that all sides of the House should get together and inspire a message of hope for the people. Surely they could alter the present state of affairs. There was no reason why anybody should be in want in this young country, where there was food in plenty. 'Mr H. M. Campbell (Hawke’s Pay) said the Government had had to do some most unpleasant things—things that in normal times most members would not have cared to stand up to. Those things had saved the country from a huge disaster. He believed that now the country was sailing along smoothly and that the next Budget would show a proper surplus. He would like to have seen a greater reduction in the unemployment tax. He appealed to the Minister of Lands to consider remitting some of the rent that had piled up against the farmers in order to give them some hope. Mr H. Atmore (Nelson) criticised the Government for not giving more consideration to the old-age pensioners. The recent • increase in the price of wool, he said, was due to buying by Japan, which wished to put its army into woollen uniforms. It would he better, he submitted, if the same nation would wear more woollen clothes. The Government seemed to be fighting against the advent of the machine. It was trying to find manual work for hoys and girls leaving school. The Government did not seem‘to realise that it was the consumer who had to be considered in order to improve the condition of the country instead of the producer. Without purchasing power the people could not buy- Mr Atmore added that the only sound basis for trade with any country was goods for goods, and if New Zealand could secure cheap goods from Japan in return for her produce she should take them. Mr E. J. Howard (Christchurch South) said that everything the Coalition Government had done since it took office had been against the workers and in favour of the moneyed class. Mr F. Lye (Waikato) said the imposition of the wage cuts was justified, and as soon as the country’s 1 finances allowed it 5 per cent, of the cut had been restored. • Mr J. Connelly (Mid-Canterbury) said if the Government had waited till adequate provision had been made for the unemployed before the salary restoration had been made it would have been verv unfair. The Civil servants had horde a heaJy burden, and had carried out their duties well. He suggested that stock and station agents should reduce interest rates by at least i per cent. Mr P. Fraser (Wellington Central) said if there had been no Labour Opposition the Government would not have done the things that were included in the Budget. The debate was unfinished when the Telegraph Office closed at 2 a.m. ANOTHER LABOUR CRITIC (Per United Press Association. 1 WELLINGTON, September _l3. Speaking after 2 o’clock, Mr Fraser said the Government was now doing what Labour said could have been done all along, and the country would have been saved much suffering. Ho claimed that the Auditor-General was not “ up the tree ” regarding silver conversion. He reported on the facts revealed during his audit, and was entitled to the fullest respect. Last year over certain happenings resentment was shown, and the Auditor-General was subjected to indignity he should not have been subjected to. Unfortunately there was too much truth in his statements. The fact that this year the conversion of silver showed a loss demanded a reply. New Zealand should have clone as well as South Africa. Mr Coates: We can’t do that. Mr Fraser: Well, the Minister should say why not. Mr Coates: I will give the facts. Mr Fraser said it was a very serious matter to talk slightingly of the Audi-tor-General, although he should not be above criticism. Mr Fraser went on to. criticise the small farms’ scheme. He said ten acres was too small an area. Mr Coates: I believe the ten-acre scheme has proved the best training ground of a lot of men who have gone to bigger areas. Mr Fraser said he was only seeking information on the subject. His quarrel with the wage restoration was twofold. In the first place, it was not big enough; in the second place, it should never have been necessary. He was glad the restoration was mad© retrospective, but would have liked to see the restoration to the higher salaries held over and full restoration made to old age pensions; also restorations made to other pensions. The debate was adjourned on the motion of Mr Coates, and the House rose at 2.30 a.m.