CABINET’S WORK

Hawke's Bay Tribune, Volume XXII, Issue 89, 30 March 1932, Page 8

CABINET’S WORK

BALANCING THE BUDGET PREPARING LEGISLATION. STRENUOUS WEEK AHEAD. (By Telegraph—Special to “Tribune.”) Wellington, March 29. Refreshed by tlie snort Easter vacation, the members of the Ministry will reassemble to-morrow morning for a week of intensive deliberation in framing a programme of legislation for the remainder of the emergency session. With the exception of the Unemployment Bill, nothing is ready for the consideration of Parliament, but by the time the House of Representatives meets on Tuesday next the Government should have decided how far it will go in adopting the recommendations of the Economy Commission, and how long it will take to enact its policy.

So far the progress of Parliament has been sluggish, but decidedly eventful. It is expected the results will be more fruitful in the weeks to conic. Actually the volume of legislation yet to be introduced is not large, for it is anticipated that a comprehensive Financo Bill will include many provisions relating to economies and other adjustments. Much time will be occupied by Cabinet this week in considering the reports of the Economists’ Committee and the Commission. Their proposals will form the keynote of the Government’s policy in the immediate future, and while attention will be devoted more particularly, for the moment at least, to direct savings that can be effected in annual expenditure, those sections of the reports dealing with the financial policy in general will not be overlooked. SAVINGS ON EXCEPTIONAL SCALE It is the Economy Commission's opinion that the State can make direct savings totalling about £3,000,000 during the next financial year by means of rigid economies and a wholesale cancellation of grants and contributions toward the cost of social services. That this could be done is admitted by the Government, but there is a body of opinion in the Ministry that it would not be altogether wise to bring about such a stringent paring entirely in the manner suggested. While the principles expressed in many sections of the Commission’s report are agreed upon, it is not agreed that the methods proposed for giving effect to some of the recommendations should be adopted. For this reason it is believed that the Government will not see its way clear to give full effect to the Commission’s recommendations.

It is recognised that the state of the national finances calls for savings on ar exceptional scale and there is no doubt that everything possible will be done to relieve the Consolidated Fund of the heavy burden it is now carrying. It is certain that Cabinet will not allow sentiment to sway it in any way and that its attack upon expenditure will not be made any lighter because economies deemed essential might prove unpalatable to many.

FRAMING OF LEGISLATION. It is significant that the Minister of Finance stated in the supplementary Budget last October that it might be necessary to prune expenditure on social services, and the full effect of this reduction in spending promises to be made apparent before the end of the session. The first of the specific proposals relating to economies arising out of the Commission’s recommendations have been drawn up for presentation to Cabinet to-morrow and an immediate start will be made on the framing of suitable legislation. It was not generally anticipated that the Government would deal with the question of taxation in general this session, but it is now expected that this will be necessary and that a review of income tax will be made. This latter, it is stated, will necessarily follow if there is a general adjustment of interest and other charges. Exactly what are the Government’s intentions in this respect is not as yet known by Cabinet itself, but it is felt at present that it will not be possible to leave taxation questions out of consideration in laying the foundation for next year’s Budget.