The Guardian (And Evening Star, with which is incorporated the West Coast Times.) FRIDAY, AUGUST 26, 1938. MORE ENLIGHTENMENT

Hokitika Guardian, 26 August 1938, Page 4

The Guardian (And Evening Star, with which is incorporated the West Coast Times.) FRIDAY, AUGUST 26, 1938. MORE ENLIGHTENMENT

The discussion on the social security proposals taking place in Parliament and the press, is affording much in? formation from many angles. There is agreement in praising the movement as one worthy the country, but grave doubts continue to be expressed in respect to the ability to finance the entire scheme with any degree of certainty. The speeches of the Minister of Finance who sponsored the bill, and the Prime Minister who spoke in general reply to\ criticism from tne Opposition, gave but restricted information on the method in which money was to be provided in so great a sum to ensure the smooth running of all that was proposed. Mr Nash seemed content to provide for the first year only, and was prepared to meet the second and subsequent years as they came along. But the first year is much the lightest, and as the years pass, the cost of the scheme mounts with more and more people coming into tiie benefits. The Finance Minister considered extra taxation would not be considered necessary at the outset, but his details of. anticipated costs were not set out too clearly to follow. Mr Savage was more frank about finding money, stating it must come from taxation, and if need bo money would require creating. The Government with the Reserve Bank behind it, has large powers and a ready opportunity;to create funds by borrowing from the jjank, and issuing pfiper in due course, This might easily grow into undue inflation as time grips on, and it is apparent is a dangerous practice to venture on. Monetary control, appears to be more i-s-

sential now than ever. Bank returns disclose the decline in reserve funds. Prices for commodities are far from stable, and markets fluctuate. The internal expenditure here is very substantial, and will require to' be maintained to ensure a volume of employment, now that the industrial avepues are not expanding. This general condition of affairs suggests caution, and every care in fresh departures of new expenditure. The outlook is such that the cost of social security adding shortly to the obligations of the country, will call for a clearer view than now presents itself of the Dominion to meet the heavy burden with a reasonable' chance of putting it through without incommoding the general administration and the .life of the people. It is known of course, that the Labour Government cherishes the hope of bringing the security to pass, but unless there is behind it the means to back the proposals adequately, the ultimate disappointment to no felt, will be greater, and destroy tne value of the good intentions. It seems manifest from a study of the costs, that the full scheme is beyond the resources of the people as a whole, and that itfi revision for a more gradual introduction of the whole proposals would be wise indeed. While every credit is due to the Government lor its intentions and desire to accomplish so great a feat, it will,be more creditable to see that there is a sure financial;foundation for whatever section of the bill may now be passed.