MR. COATES REPLIES

Greymouth Evening Star, 14 September 1934, Page 7

MR. COATES REPLIES

BUDGET POLICY DEFENDED YEAR’S POSSIBLE SURPLUS [PEB PRESS ASSOCIATION.] WELLINGTON, September 13. The Finance Bill debate concluded in the House this afternoon when Mr Coatesi replied to the speeches made in the past fortnight. Mr Coates said it looked as if the downhill rush that set in three or four years ago, had been arrested. He thought the country could heave a sigh of relief. The Government had received messages from all parts of New Zealand expressing appreciation of the work of the Government, and congratulating it on the better outlook as indicated by the Budget. The Government had reached a stage where it. could make economic adjustment, and it. had felt that in the first place it should recognise the part played by the public services. The Government decided to increase by five per cent, all salaries in the Public Service. Had only the lower salaries been increased, it would have produced anomalies that would have taken years to overcome.

Regarding the statements that there should be a general increase outside the Service, Mi- Coates said that such a declaration would have been definitely unfair. Private employers had not called on their employees to anything like the same extent. so far as wages were concerned. Regarding a. statement by Mr Ransom that he hoped the year would end with a surplus of a. million, Mr creates said much hard work had been put into the preparation of the estimates in order to get the figures as correct as possible. It might well be that the £BOOO surplus would be exceeded, but it would require the strictest economy, if they were to finish the year with a surplus of £SOOO. It was true windfalls came from time to time. One had occurred since the Budget was made up. Coming to pensions, Mr Coates said that while he and other members of the Cabinet would have liked to give old age pensioners a restoration from April 1, he was unable at the moment to say he could do that. Referring to the unemployment tax, he said that the tax bore more heavily on the community than any other tax. It had been stated that in making a reduction of twopence, the unemployed would suffer, but that was not so. The Board made provision for a peak of 75,000, but actually it was less than 60,000. The Budget proposed an increase of a. million for public works above last year. The Government was also considering a housing scheme. He thought the reduction of twopence could be .justified.

Referring to the Mortgage Corporation, he said it would have the effect of loosening money from the banks. Regarding statements that the Mortgage Corporation might add to the national debt, he would ask whether the State guarantee behind the Public Trust, State Fire Insurance, and Government Life Insurance added to the national debt. The gold export duty brought in £117.000, but no one could say that with the present prices of gold, the tax was not justified. The raising of the exchange rate had added about thirteen per cent to the overseas debt charges, about a million sterling. Even if that were taken from the Budget, he could not -see where Mr Stewart would get his substantial surplus from.

Dealing with Mr McKeen’s statement that in the space of six years, the national debt had grown by thirty-three million sterling, Mr Coates said that in 1929-30 the public debt was 267 million. In 1932-33, it was 282 million. That had been increased by £1,277,000 in 1933-34, his year of office, and that was in part hue to loan conversion operation. Apart from that, the increase in the long term debt last financial year was £786,000. To get his thirty-three millions, Mr McKeen had apparently used the temporary amount issued under exchange indemnity arrangements. That was now entirely wipeu out, the floating debt at present being about 21 million. Dealing with the conversion of silver and the comments by the AuditorGeneral, Mr Coates quoted from the correspondence and cables that had passed between the British Government and the Imperial Mint and New Zealand Government. He said every care was taken in the negotiations that took place. The House resolved itself into Committee of Supply. Progress was reported and leave given to sit again.

CUSTOMS RESOLUTIONS. The House proceeded to discuss further amendments to the Customs resolutions, Mr Coates explaining it was proposed to fix the rate of duty on foreign radio sets not mounted in cabinets at 35 per cent, and mounted 45 per cent. He explained that under the previous resolution it would not be possible for the New Zealand manufacture of sets, which now assumed big proportions, to carry on efficiently. It was also proposed to exempt from duty, the United Kingdom chinaware of the following classes, breakfast, dinner and tea sets and cups, saucers, and plates, dishes and similar articles for table use.

Mr Coates continued that it was necessary the list of goods which would be admitted as unassembled or completely knocked-down motor vehicles, should be published for general information. It was considered in the initial stages that it would not be advisable as a condition of admission of goods at the lower rate to insist upon the maximum amount of assembly work that could possibly be performed here. It. was therefore necessary that authority Should be conferred on the Minister to determine from time to time the goods . which may be entered as unassembled or completely knocked down motor vehicles.

A number of other machinery amendments were made, and the resolutions were agreed to. The committe stage of the Customs Bill was commenced, in the evening. The wheat flour duties played a. large part in the discussion, Southern members supporting the' sliding scale, while Northern members urged its abolition, contending there was too

great a margin between the price the grower received and the price the consumer paid for bread. Mr Polson and Mr Healy urged the abolition of duty on British steel pipes. Mr Webb regretted a duty was not placed on crude oil, oil burning machinery and imported coal. Mr Hargest said a large number of foreign motor cars were entering New Zealand. He thought something should be done to assist British car manufacturers. i The short title -was passed and pro- , gress was reported.