Parliament

Hawke's Bay Tribune, Volume XVII, Issue 203, 11 August 1927, Page 6

Parliament

HOUSE OF REPRESENTATIVES BUDGET DEBATE CONTINUES. Wellington, Aug. 10. The debate on the Budget was resumed in the House of Representatives this afternoon by Mr. F. Waite (Clutha) who chided the Labour party with a new found love for soldier settlers, which showed a sudden change of heart. What had been the attitude of the official Labour party when the New Zealand soldiers were hanging on at Chunak Bair. The speaker said the Labour party were like Mahommedans, who turned their faces to Mecca when praying. The Labour party, which used to turn its face to Moscow, now turned it to Geneva. Mr. Waite declared that the difficulties New Zealand was experiencing to-day were common to other countries. No Government could be blamed for the economic factors operating to-day, because these were due to after-war conditions. The acreage ot oats and chaff was steadily diminishing, and the speaker quoted figures to prove what he was saying. Instead of growing oats a man nowadays, said Mr. Waite. looked for a job in a motor garage, or for some other similar position. He remarked that the whole trend of the arbitration legislation reouired to be carefully looked into. The speaker went on to draw attention to the growth of the time payment system m this country, and said its whole trend should be examined when it was applied to such expensive luxuries as gramophones. Regarding Mr Holland’s advocacy of a State bank. Mr. Waite said it had been stated that if the Russian State Bank could have printed bread and butter in the same way as it printed rouble notes there would have been no poverty in Russia. QUESTION OF PENSIONS. Mr. I). J. Sullivan (Avon) advocated the establishment of a State hank and regretted that the State Fire Insurance Department was not now rendering the same service to the people it formerly did, because it had to some extent come under the influence of privately companies. Dealing with pensions, the speaker said that years ago the Minister promised to introduce an invalid pension, but so far nothing had materialised. A readjustment of income tax would enable the Minister to carry out his long delayed promise. Old-age pensions should be increased to 25/- per week and we should have pensions lor the blind and a larger family allowance. Mr. J A. Nash (Palmerston) said (pne disappointing feature of the Budget was the absence of any proposals to reduce taxation. He congratulated the Government on the success of its last loan and thought the Government, should continue to borrow abroad, because the promotion of local loans induced investors to put money into Government securities rather than tending it to the fanners. For that they could scarcely be blamed, and unless the rural credit debentures had a State guar antee he did not believe that the scheme would be a success. He urged greater activity on the nart of the State Advances office. The farmers wanted cheap fertilisers, which were becoming yearly of great necessity. Discussing the administration of the Dairy Control Board. Mr. Nash said it was understood its expenditure exceeded the income derived from the levy made upon factories, in addition to which there was complete failure of the board’s policy and a most disastrous season for farmers. Ho had suggested that tnis hoard should be merged with the Meat Board and the Minister had replied that this was a mattei for the board, but is the Government had two representatives on the hoard it was surely also a matter for the Government. There was no need for two boards.

SINKING FUNDS FOR LOANS. Sir Joseph Ward (Invercargill) said he proposed to criticise the Budget, but did not propose to in any way reflect upon any member of the Government. He then proceeded to detail the steps which he took while Minister of Finance to set up sinking funds for the elimination of public loans, and then declared that by his Budget the present Minister of Finance had swent away the whole effect of these precautions. In doing this it was claimed that we were following the practice now obtaining in Britain. This he challenged, claiming that the Prime Ministers of Australia had recently resolved that every Australian loan must have a sinking fund, while quotation was made from a speech of the Rt. Hon. W. Churchill to show that he was. in his British Budget, making provision for sinking funds, while America also recently insisted upon a sinking fund being attached to the Australian loan raised last year in that country. Everywhere the system of sinking funds was being adopted, and sooner or later our Government would be compelled to go back to that system, He noticed a reference to “readjustment” of income tax. Some readjustment might be necessary, but he warned the Minister against going too far, for there were many big companies and banks in which the larger proportion of the shareholders were “small” people, depending upon the dividend for getting a living. He did not find fault with the Budget, but how could the Minister expect to reduce taxation when large sums had to be found out of consolidated revenue to pay off loans? He did not know who was responsible for altering the system of sinking funds. The Hon. W. Nosworthy: 1 was. Sir Joseph Ward: By the Lord Harry! I thought so. > WAR LOANS. Continuing, Sir Joseph Ward said he did not believe the people of New Zealand would have accepted railway administration by a Commissioner rather than by a Railway Board, but the fact was that they were discuss ing the finances of the country am! there was not a single member of the House who had the least idea of what the railway finance was. Coming to war loans, he said this country had done as other countries had done, raised portion of its money at 4.} per cent, free of income tax. This was the cheapest money ever found for war purposes, and yet the Minister was taking credit for having bought back so much of this cheap money. He criticised the funding of £27,000. 000 to the British Government, which was raised for war purposes. He had made good arrangements with the British Government and he had never been able to find out why those arrangements we'e changed, ‘ Why

did the Budget not tell the House the effect of the increase in motor tax last year? How much did British motor cars benefit by the alteration made? That was what they had a right to know. The Hon. W. Downie Stewart: That information can be given when the tariff comes down.

Continuing, Sir Joseph Ward said they could consider the matter then, but they must take a broad view and endeavour to frame a tariff so as to give every assistance to British industries. He congratulated the Prime Minister upon the work he did at the Imperial Conference where the status of the Dominion was definitely recognised as large and in the succouring of which the Prime Minister took a prominent part. RAILWAY POLICY Sir Joseph Ward criticised 1 the policy of subsidising non-paving railways. If they did this with one department, why not with others? Why should the railways be expeced to earn a high rate of interest? This was the most valuable department in the Dominion for promoting the welfare of the country. Perhaps 50 per cent, of the farmers were barely paying their way. and what could help them better than cheap transport ? The railways should not be expected to earn more than 3) per cent., and any surplus should be given back to the users in the shape of concessions. He did not believe in price-fixing for New Zealand butter. His view was that we should not send our butter -Home to be sold, but they should compel Tooley street buyers to come out here and compete for our produce. not in England, but in New Zealand. They must have it and would compete for it. After advocating the closer settlement of lands as a mean? of promoting production, he said that financially we were £1.500.000 worse off at the end of this year than we were last year, and this deficiency would probably be made up by borrowing or hv the use of Treasury bills, but he did not think we could get on with less money in the aggregate than we had last year

THE HON O. J HAWKEN REPLIES.

The Hon. O. J. Ho wken said Sir Joseph Ward was in error in saving our sinking fund system was different to the Australian. It was copied from the British system and was generally conceded to be superior to the old system. It enabled Us to payoff our debts at any suitable date, and though Sir Joseph Ward complained that sums paid off were too large it was the opinion of the Government that the war debts should be wiped out as soon as possible The question of buying back tax free debentures was a much debated one. If it paid to do it. it was the right thing to do. because as a matter of general policy it was unwise to permit anyone to go tax free who should pay taxes. He defended the absence of the Railway Statement, because it was not humanly possible to produce it in time. Railway sub. sidies were an incentive to the department to make good, and the same system might very well be adopted so far as other departments were concerned. So far as dairy control was concerned, he said the Government was ala-ays of opinion that the board might not be able to make much difference to the nrices of butter and cheese, but he did not believe the results of the board’s attempt to do so had been nearly so disastrous as was "«rprfillv suppp-.. He favoured a dual market for both wool and dairy produce, as it gaye the producers two chances. LAND POLICY. So far as land valuations were concerned Mr Hawken did not think there had been much loss on first mortgages on old settled land. lx>sses had occurred on newer lands, the qualiies of which were not known These had deteriorated because the holders did not always know how to work them The Government was adopting a bold policy in connection with these lands to enable settlers to hold on but he was distinctly of opinion that much of this land should go back into forest. He lefended the public building programme of £BOO,OOO. Some £550.000 of this sum was for schools and school houses, every one of which was wanted. Complaint had been made that soldier settlers had been harshly treated He denied this. The work of the revaluation of (fiese farms was now practically complete, so that writings off had come to an end, and the losses were now ascertained The Government was doing its utmost to put the timber industry on a sound basis, and a full report of what was being done would oe presented to the House when the tariff revision came before the House. It was interesting to note how people werp spending money on luxuries. In many cases motor-cars were luxuries, and the chief cause of the present depression was over importation, for which the Government was not in any way responsible. SELF-RELIANCE NEEDED Mr M J. Savage (Auckland West) complained that in 15 years the public debt had been increased bv £79,251,303 and interest charges by abou £4,000,000 annually, and vet there seemed nothin" to show for it. The Advances to Settlers Department had no money, and the only tangible result was a crop of bankruptcies. of which there were 814 for last rear, in addition to which there were more thousands of unemployed—certainly not very proniising of prosperity. Mr Savage said that il borrowing was to go on. the Advances Department was worthy of consideration, but if ever there was a time when self-reliance was needed that time was now.

Mt H. G. Dickie (Patea) spokji in "tenet-iil approval of the adminiltration and the Budget proposals of .he Government. The adjournment of the debate was moved by Mr W. E. Party /Auckland Central), and the House rose at 11.10 pm till 2.30 p.m to-morrow.