LEGISLATIVE ACTIONS.

Manawatu Standard, Volume LVII, Issue 306, 25 November 1937, Page 13

LEGISLATIVE ACTIONS.

OPPOSITION CRITICISM. DAIRY MARKETING SCHEME. Per Press Association. WELLINGTON, Nov. 24. In tlie House of Representatives today urgency was accorded the passing of the Einance Bill. Speaking in the second reading debate, Mr S. G. Holland compared tlie Government’s pre-election statements with its actual legislative actions. He gave instances of hardship imposed under the graduated land tax and asserted that tlie Government’s guaranteed price proposal was the greatest political confidence trick which had ever been played upon the country. The Government, he said, liad never had the slightest intention of putting into effect the promises with which it had wooed the electors.

Dealing with the purchase of Picot Brothers, Mr Holland said the Minister had side-stepped giving information about the transaction. When the Government wished to enter the internal marketing business it knew it could control Picot Brothers., so why was there any necessity to throw away good public money in purchasing the business Why, he asked, had goodwill been paid for the business P They liad yet to get a reasonable explanation of the reason for the purchase. If it meant the first step by the Government in entering private business the public had a right to know. Why did not the Minister come out in the open and tell them what the reason for tlie purchase was? It might almost appear that there was something to hide.

Mr W. M. C. Denham likened the Opposition’s policy of protecting profits in business to that of'the usurers whom Christ had evicted from the temple with a whip. The supply and issue ,of money should he the prerogative of the State. It should be a national service to meet a national need. The financial arrangements this year would assure another year of prosperity in 1938.

Mr W. A. Bodkin held that no case could he made out for the Minister’s having the right to veto the findings of the Hardship Committee ' under the graduated land tax provisions.

THE WAIHI CASE. - Referring to the clauses in the Bill dealing with the Waihi and Martha Goldmining Companies, Mr Bodkin said lie had no sympathy with the Waihi Company, and he wished to congratulate the Minister on his action so far as it was concerned. The Minister was quite correct in his action in making provision that similar erosion should not occur in the future. It was futile for the Waihi Company to say it had acted within the law. There had been a definite weakness in the law and it was only right it should be rectified. He believed the Minister liad acted immediately the matter had been brought beneath his notice. However, lie would issue an appeal for those shareholders who had bought their shares in all good faith after the tax evasion had taken place. It would he unfair to place an imposition on these people, and the Minister would find it difficult_ to justify the retrospective legislation which would cause suffering to innocent persons. He thought the Minister should take statutory authority to protect such people. Mr Bodkin thought the Government could afford to be generous in the taxation of racing clubs of the _ Dominion, and any relief he could give racing clubs was likely to l>e returned fourfold. INDUSTRIAL INSURANCE.

Dr. D. G. McMillan said they were looking forward to the time when the people who spent money on industrial insurance in this country would get a fair deal. There was no question that the relatively well-to-do person who invested money in life insurance was getting a good return for his money, hut the poorest members of the community who were inveigled into putting their money into sickness and industrial insurance received a very poor deal. In 1935 the amounts paid out on account of death or policies maturing totalled £300,000 and the expenses of the companies amounted to £307,000. The claims met totalled 7120, and no fewer than 37,844 policies lapsed and the premiums paid on them were retained by the companies. The administration expenses accounted for 31 per cent., but he was sure when the Government established its insurance scheme it would budget for administration and management expenses of 4 or 5 per cent. Mr K. J. Holyoake asked if the Government’s promises concerning guarananteed nrices had been kept; they had not. Primary products had been taken over compuisorilv from farmers at fixed prices. The nrimary producers should have been left to control their own goods from the farm to the consumer and they were well able to do it. He contended that the price fixed for butterfat was a /‘political” price because the responsibilitv for it was taken by the Government rather than the committees which advised the Government upon it. MINISTER IN REPLY.

The Minister of Finance (Hon. W. Nash), in reply, said the Opposition had contended that the dairy farmers’ money was used for the purchase of Picot Brothers. There was no shadow of justification for such a statement. In answer to an Opposition question, he said there would definitely be a deficit in the Dairy Industry Account. He proceeded to compare the payouts of the Australian dairy companies with those of New Zealand, stating that the Dominion farmer got a better price than the Australian. Referring to the hardship clause, the Minister said it had been asked if the Government would make permanent provision for, such a clause, but it was intended to amend the land and income tax law some time before the season finished in such a manner as it was hoped would obviate_ the necessity for a hardship clause in future. Speaking of the Opposition’s criticism of the provision to refer the de-

cisions of the Hardship Commission to the Minister, Air Nash said the principle in the Bill was exactly the same as that in legislation by past Governments for the writing off of rents by Crown tenants and also that under the Discharged Soldiers’ Settlement Act. The Opposition had merely fastened oh that aspect of the case in order to mislead the public. He thought the Government had the right to say what portion of its revenue should be given away to anyone. THE CHEESE ACCOUNT. The next point referred to was that of daily-prices, the Minister stating he had been considerably surprised at Air Hamilton’s reference to the surplus in the cheese account of £258,000. The Leader of the Opposition had failed to deduct the sales costs from this amount ,and when these were deducted the total of £12,047 was arrived _ at. There had been a lot of opposition to the making of the proposed legislation in reference to the Waihi Company retrospective, said Air Nash, who outlined the history of the company, stating that it had paid in dividends since its inception a total of. £6,263.801. The Minister stated that he had been astounded at the defence of the company put up by the Opposition on the previous night and he was proceeding to deal with the operations which had led up to the necessity for the present legislation when the bell rang, indicating that his time was nearly up. EXTENSION REFUSED.

At this juncture an incident occurred which arose out of the action of Air D. AlcD on gall in objecting to time extensions being granted to Rt. Hon. G. W. Forbes and Rt. Hon. J. G. Coates on the previous evening. Air Forbes rose to move an extension of time for Mr Nash, but when the motion was put by the Speaker it was objected to by Air W. J. Poison and lost. Air Nash: It seems as if the honourable member does not want the story to be told to the House. The Alinister of Education (Hon. P. Fraser): It was done in a very rotten way.

Air Poison rose to a point of order, saying lie had heard the Minister of Education refer to his action as “the very rotten way” in which he had done it. The Speaker ruled that the remark must be withdrawn.

Air Fraser, in doing so, replaced the word “rotten” with the word “unfair.”

Air Poison : Is that Parliamentary ?

The Speaker: Yes. Air Nash continued his speech and pointed out that the return showing the Government’s transactions concerning the purchase of Picot Bros, had been tabled in the House two months ago and a copy had been supplied to all members. Air Holland: But it docs not show the price for the goodwill. Air Nash: Oh, no, you can’t get out of it that way. The return has been there for two months.

Mr Nash was proceeding to deal with the decision of the late Sir Fna.iicis Bell regarding retrospective legislation when Mr W. J. Broadfoot remarked that the Minister was securing a pretty good extension of time. He was called to order by the Speaker, who said that' it was Mr Broadfoot’s duty to point out to the Speaker if he had noticed that an extension of time was being inadvertently given. He advised the Minister that his time limit had expired. The BilT passed the second reading without a division a.nd entered. the Committee stages, Hon. A. Hamilton stating that ho was sorry about the difficulty that had arisen. Perhaps, he added, the matter had got a little out of hand.

Mr Nash: I quite understand. It is a personal matter. Mr Hamilton: Oh, no, I don’t think that it was a personal matter. It arose from the incidents last night. Mr Fraser pointed out that the member who was responsible for the refusal to grant the extensions of time the previous evening was out of the House at the time. He added that Mr Hamilton could not take the responsibility for what had occurred. The Chairman of Committees (Mr E. J Howard): Order. This is not in the Bill. The House passed on to the consideration of the Bill, the committee discussion being interrupted by the adjournment at 5.30. THE LEGAL ASPECT.

Mr Coates asked any lawyer in the House to justify the retrospective taxation provision in the Bill or the naming of any particular company or person in-a Bill of such nature, no matter what they might think personally of the action of any company in evading taxation. Mr J. A. Lee: What about McArthur? .

Mr Coates: That is a remark which deserves the severest censure. The actions of the McArthur companies could in no way be compared with those of the Waihi Company. Mr Nash explained how the Waihi Company had distributed its profits overseas, where they could not be taxed unless the present legislation were passed. In May, 1935, when the Waihi Company was not actually carrying out goldmining operations in the country, .a dividend of £91,866 was distributed. While the payment was being made the Commissioner of Taxes had advised the company that, in view of the standing of the company, no advance assessment of taxation need be made in connection with the dividend, but when a later assessment was made the Commissioner had been informed that the company bad crone into liquidation. The Martha Goldmining Company (Waihi), Ltd., was practically a continuation of the Waihi Company, .and nractica.ilv the same persons were, shareholders. No one would deny that the payment of taxation was due.

PRECEDENT CLAIMED. With respect to the retrospective legislation the Minister quoted cases where it had been used in cases of gift and stamp duties when persons or

companies were evading taxation which should be paid. The Government was entitled to take measures to secure it. There had never been a clause . more justified than was the present | one. Because the company was not i carrying out goldmining operations when the dividend was paid it bad evaded taxation. Mr S. G. Smith said the Minister I had not given the full details of the purchase of Picot B'Pos. in the return tabled in the House. He asked the Minister was it not a fact that the valuation of the business was fixed by a Government official who .tyad not a single bit of experience, and was it riot also a fact that the firm had not asked -for goodwill but were told to put in for it? He asserted that the failure to give full particulars concerning the purchase of Picot Bros, was causing suspicion throughout the country. Mr W. A. Bodkin said that in the caso of the Martha Company 198 people had bought shares after the dividend referred to by Mr Nash had been paid. These people were entitled to protection which would not be given, by the present legislation. At 9 p.m. the Prime Minister moved the closure on the short title. This was forced to ia division by the Opposition and was carried by 48 votes to 17, the short title being passed. Mr Hamilton asked the Minister it he did not think it advisable to bring the State Advances Corporation account hack into the puhiic accounts. The corporation handled £00.000,000 and had a staff of possibly 1000, hut the House did not have'an opportunity of discussing the Estimates. Mr Nash said that if it were going to be advantageous he saw no reason why tho voting on the Estimates : should not come before the House, but there were reasons for keeinng me corporation accounts separate. Four more clauses were passed witri--1 out discussion and the House adjourn- : ed at 9.30 for supper. ■When the House resumed, the chanman of the Native Affairs Comrnit- • tee (Mr J. O’Brien) reported that the committee recommended that tne Petroleum Bill be allowed to proceed 1 unamended. This was agreed to ™ the Bill was referred to the Goldfields and Mines Committee. Two new clauses amending the finance Bill were introduced by Gov-ernor-General’s Message. . . Mr Nash, explaining the provisions of the clauses, said one stipulated that returned soldiers who were holders or decorations would not have payments which were made under the award ot ! those decorations included in thenincome when the latter was computed > for the purposes of sustenance or veterans’ allowance. Mr Coates: Hoes that include the V.C. and D.C.M.? Mr Nash: Yes. all decorations ot that class. Some 6d per day. EVICTION OE TENANTS. The second amendment, said Mr Nash, prevented the tenant of a dwelling house being evicted from that dwelling unless some alternative accommodation was available. In the event of a house being sold the purchaser could not get possession of the house unless the tenant had alternative accommodation. . There was, however, provision for referring tho case to a Magistrate where hardship was inflicted on the purchaser through not being able to secure possession of the dwelling in that case the Magistrate would be required to adjudicate on whether the greatest hardship was being imposed on the purchaser or the tenant. The whole idea of the clause was to prevent tenants being turned out of their houses wlien they had nowhere else to go. AMENDMENT RULED OUT.

Urgency was again granted Air H. Al. Rusliworth, wiio moved an amendment to Clause 11 to the effect that the six millions to he borrowed for public works should he borrowed only from the Reserve Bank. The Chairman of Committees (Air Howard) ruled the amendment out of order because it must necessarily involve an appropriation. On tlie motion of Air Bodkin this ruling was referred to the Speaker. Air Barnard ruled that the clause involved an appropriation and supported the Chairman of Committee’s ruling. Clauses 11 to 20 were passed without* discussion, the last-mentioned clause, dealing >vith the appointment of the committee to consider hardship under tlio graduated land tax, being considered at midnight. Air Hamilton moved an amendment to clause 20, deleting the necessity for the committee set up to consider hardship to refer their findings to the Minister, and also to widen the definition of serious hardship. Air Hamilton’s amendment was lost by 47 votes to 16. Tlie closure was applied to clauses 20 and 21. Clause 36 was being discussed at 2 a.m when the House was left sitting.