SOCIAL SECURITY BILL

Manawatu Standard, Volume LVIII, Issue 228, 25 August 1938, Page 13

SOCIAL SECURITY BILL

BILL UNDER FIRE. HEAVY TAX LEVY. OPPOSITION VIEWS. Per Press Association. WELLINGTON, Aug. 24. The debate on the second reading of the Social Security Bill was continued in the House of Representatives today. Mr S. G. Smith expressed the opinion that the Bill would only make wealthy people poor and the poor poorer. He drew attention to the charges on workers receiving £5 a week and contended that the additional taxation levied for the purposes of the Bill would create circumstances where a man would have to cancel his lodge membership which he had held for perhaps many years. The passing of the Old Age Pension Act towards the end of last century, lie said, had been a monument to Richard John

Seddon. Under the present measure the monument would go. The Seddon flag was coming down and the red flag was going up in its place. Mr Smith urged the Government to pass the provisions in the Bill dealing with increased pensions, but to leave over the remainder of the measure for further consideration. MAORI SATISFACTION.

Mr E. T. Tirakatene said that he, with thousands of others, wished to congratulate the Minister and Government on the Bill. He stressed the fact that under the provisions of the Bill there was no difference in treatment between the Maori and pakeha. It appeared that a number of Opposition speakers were of the opinion that the Bill would not be appreciated by a large number of people, but he did not agree with this contention, and he was of the opinion that the measure gave old people superannuation by right rather than having them depending on charity. FINANCIAL ASPECT. Mr J. A. Roy said the scheme.

would only give a partial medical service to all the community, whereas a full service should be given to those not able to afford it. Stressing the need for examining the financial aspect of the social security scheme, Mr Roy said the'seheme would mean another shilling in the pound in indirect taxation, and with sixpence in the pound for national superannuation the cost of the scheme, instead of being a shilling in the pound, as announced, would be 2s 6d in the pound wage tax. The Government had put up a record in taxing people aged 16, who had no vote. He also predicted that the scheme would mean an increase in hospital rating, as there would be a greater demand for hospital accommodatoin. „ , , Mr Roy claimed that if the scheme were adopted Friendly Societies would go out of existence. He further claimed that country doctors would be sacrificed to the scheme, as the doctors would concentrate on cities. MINISTER’S DEFENCE.

The Minister of Lands (Hon. F. Langstone) said that every clas of the community would receive some benefit under the social security scheme. The attitude of the Opposition was one of undiluted meanness of mind towards those less fortunate members of the community. The National Party throughout New Zealand was saying all sorts of silly, stupid statements with regard to the measure. The speaker quoted Mr Justin Power as saying that the scheme would be a further encouragement to the thriftless Mr Langstone added that this was “bunkum.” He quoted various criticisms of the Government’s scheme and said the people in New Zealand had been waiting for years to provide themselves against old age. Friendly Societies had tried hard, but had failed. Under the last Government the people could not keep up their contributions to the societies. They had wanted some little income coming into the homes. Income must be evenly spread among the community and it was the duty.of the Government to organise and arrange for a more equal distribution. The Opposition did not want any scheme. It was only sham pretence, as they were hostile to the scheme, and were talking with their tongues in their check when the Opposition said they were in favour of part of the scheme. Mr Langstone said he did not think there was a member of a Friendly Society on the basic wage who was not going to receive some benefit from the scheme, and this meant an increase in wages. .Seventy per cent, of those under the 'railway superannuation scheme were drawing less than £4 a week, and they and their families ■would get cash and medical benefits. Forty-three per cent, who were drawing less than £3 a week would get £1 or more to make their income up tp £4.

Mr Langstone went on to quote the benefits under other superannuation and insurance schemes and stated that 51 per cent, of males in the Public Service superannuation schemes got less than £4 a week, and that applied to most schemes operating throughout New Zealand. ROAD TO SOCIALISATION?

Mr W. P. Endean contended that the Labour Government had done nothing to improve the economic conditions of the people of "the Dominion. The people of the Old Country had given us £13,000,000 more for our produce since the gloomy days of the depression, and that was responsible for our present prosperity. He urged the people to weigh up the conditions at present existing more with their minds than with their hearts, and disregard all side issues which were obscuring the financial position of the country. The Minister of Finance had

FINANCIAL ASPECTS EXAMINED SECOND READING DEBATE Tlie House of Representatives, yesterday, resumed the second reading debate on the Social Security Bill, eight speeches being delivered. Hon. F. Langstone (Minister of Lands) participated in the debate, declaring that the duty of the Government was to organise the national income to ensure a more even distribution of it. Ht. Hon. G. W. Forbes examined the financial aspect of the measure and contended that its provisions would so strain the Dominion’s economy as to cause finances to crumble and to jeopardise the pension system. Mr S. G. Smith made an appeal to the Government to hold over controversial aspects of the Bill for further consideration by the next Parliament. He suggested that if this course were adopted it might be possible to devise some scheme that would have the backing of the Friendly Societies and the medical profession.

told them that the Bill would take the country far along the road. What road would that be, asked Mr Endean. Was it the road to Socialism, he asked. Where was all the money coming from to pay for the Government’s proposals? The Prime Minister’s statement to the effect that capitalism would not be allowed to stand in the r way of putting the Government’s proI posals into operation really meant 1 that Mr L. Lefeaux, Governor of the Reserve Bank, and people like him, would get their running shoes. J Mr Endean asked if it was not cor- . rect that the Bill was an effort to socialise the medical profession. He complained of the proposals to tax J people under the age of 20 in the i’ill, and also of the powers conferred on ’ the Minister of Finance hv Order-in--1 Council. The latter .practically gave ’ the Minister the' powers of a dictator. j .. COLLECTIVE ACTION. Mr W. M. C. Denham said the Bill was dealing with'our social disabilities by means of collective action, and he held that it would provide against unemployment. He contended that our present medical service was not a satisfactory one. Many people who suffered illness could not afford medical attention and consequently had to go without, while worry over the expense of illness often retarded a patient’s recovery. The Bill, he said, would not interfere with a medical man’s professional status or tend to limit his skill or activities, and he proceeded to enumerate the classes of people who would benefit under the medical section of the scheme. Mr Denham continued to refer to the compulsory national superannuation and health scheme brought down by a previous Government some years ago. This pretended to be universal, but began by exempting the unemployed. In effect'it offered no security to those who needed it, and by a process of elimination exempted everyone from the provisions of the scheme until it had become valueless and useless.

CAPACITY TO PAY. Rt. Hon. G. W. Forbes said that while they had heard a great dea about the benefits which the Bill wouli confer, they also h.ad to look at tb cost of the proposals, and it was tb duty of every public man to do so am estimate the capacity of the country t pay for it. It must be remembered, b said, that the measure would not be fo one year only. The Government wa attempting to put the scheme perman cntly on the Statute Book, and In would draw attention to the progres sive increase in the cost in the coursi of years. Mr Eorl>cs drew attention to tin Government’s expenditure in other di rections "and said that what lie fearei was that the enormous expenditur< under tlie Bill might jeopardise tin whole of our pension system. He woulc like to see the Government deal witl the scheme so that it would, give rea national security, but he did not thin! a scheme based" on such enormous ex penditure when world prices were beginning to fall would give national security. He did not doubt the sincerity of tlie Government, but he thought ii had thrown all discretion to the windf as far as expenditure was concerned It might claim the sympathy anc friendship for the workers, but it was a poor sort of friendship that failed tc base its finances on a sound footing. REPLY TO CRITICISM. Dr D. G. McMillan contended that a full medical service was not available on account of expense to hundreds, perhaps thousands, of people in the Dominion every day in .the year. Under the medical scheme the cost fell heaviest upon those people who could afford to pay for it, said Dr McMillan, because they had to pay in full, but under a group insurance scheme these people were able to enjoy the benefits, as did all other sections of the community. It was something like a man, said Dr McMillan, who possessed enough money to rebuild a house which had been burnt down refusing to insure it for that reason.

Dr McMillan, dealing with the Opposition’s criticism of the medical provisions of the Bill, said members on the opposite side of the House had contended that curative medicines should not be provided, but that preventive medicines should be concentrated upon. That was the outlook of 50 years ago, and lie proceeded to compare the amounts which had been spent on medical research by past Governments with that expended on that objective by the Labour Administration. Dr McMillan also stressed the opposition which Mr Lloyd George had met from the medical profession on the introduction of his health scheme in Britain. Medical men had conscientiously opposed the scheme at its inception because they had been doubtful of its effects on the health of the people, but after they had seen the benefits of the scheme they had just as conscientiously supported it. Dr. McMillan denied that the scheme aimed at the regimentation of the medical profession, and he also stated that contentions that the scheme would interfere with the personal relationship between doctors and patients were contrary to fact. He did not think that the Bill would spell ruin for the private hospital because no one who to-day entered a private hospital would enter a public hospital under the Government’s scheme, because under that scheme they would get £2 2s towards the cost of treatment in private hospitals. 'Mr It. A. Wright said it was the duty of members to show any weaknesses which they believed existed in a Bill of the magnitude of the present measure. The Minister of Finance had based the finances for the Government’s scheme iipon the supposition that the Dominion would progress in the next 20 or 30 years as it had done in the past, but this supposition was erroneous and was built on opti- 1

mism. It should be built on facts, and unless it was there was trouble in store for everyone. x The debate was interrupted by the adjournment at 10.30. DAIRY FARMING. COSTS IN SOUTHLAND. PRICE INCREASE SOUGHT. When the House met to-day a report was received from the Agricultural and Pastoral Committee on the petition of 2565 Southland farmers praying for an increase in the -prices fixed' for dairy produce. Tlie committee reported that, as the subject matter of this petition was being dealt with by another committee elsewhere at which the petitioners’ representations were being considered they had no recommendation to make. The chairman of the committee (Mr W. J. Lyon) moved that the report be laid on the table. Commenting on the report, Mr J. Hargest said he recognised that the petition was an old one, having been presented last October, and that since its introduction a tribunal had been set up to fix the price for the current season. The farmers of Southland had, with some secretaries and chairmen of dairy companies, compiled a valuable report. They were of the) opinion that the guaranteed price which had been fixed last season was insufficient and did not give a reasonable return to Southland farmers, who had to provide . winter feed for their stock. The conditions in Southland greatly differed from those in tlie north, and the farmers were the victims of circumstances ' over which they had no control K'and tliev were not "receiving an adequate return for their labour and capital. ; Those farmers wore gradually being 1 forced out of dairy production. Farmel’s who had kept their books in a ' competent manner found that it need- : ed over 19d per pound for butterfat for dairying to pay. Those who had goue into the question had not proceeded in a haphazard manner and 1 the report produced was not based on exaggeration. Mr Morgan Williams stated that he had been a member of the committee which had considered the petition and the evidence presented by the petitioners tended to show that Southland was much better suited to mixed farming and the production of butter than it was to cheese. Mr J. G. Barclay remarked that he did not agree • with the member for Awarua when he asserted that farmers were being driven out of dairying because the guaranteed price was too low. If the price of land were going uo in Southland and cows were'selling for practically the same price as previously it did not seem that the guaranteed price had had such a disastrous effect as had been indicated. Mr H. G. Dickie contended that the discussion had proved the futility of the Minister trying to fix one price for the whple of the Dominion from the North Cape to the Bluff. One price might be quite suitable as far as Taranaki was concerned, but it .might lie too low for the Southland dairy farmer. , ~ Mr S. G. Smith urged that the Minister of Finance should give special consideration to the Southland farmers wheiq the guaranteed price was being fixed. , Hon. W. ,Nash: I will read- the whole of the. evidence. Rt. Hon. G. Forbes said some people held the belief that the price of producing butterfat was the same right throughout the Dominion, ancl he instanced cases in certain parts of

Canterbury where, he said, the average production costs were higher than > anywhere else in New Zealand. Dairy--1 ing in these areas was a very disap--1 pointing game, he said. 3 The House agreed to the commit--3 tee’s recommendation and that its re- ’ port be laid on the table ■ JOTTINGS FROM SPEECHES. j ■ ‘-MUST "BE PRESSURE.” . “In the past, pensions schemes have been inaugurated and widened in , scope, but they have always been based j on the capacity of the country to pay [ for them,” said Rt. Hon. G. W. . Forbes during the debate on the So- . cial Security Bill in the House of lle- | presentatives last night. “That prin- ( ciple has been observed all through, l but I believe that in this case the hands of the Ministers have,been forc- • ed. I cannot believe that anyone who • has had charge of tlie finances of this • country could deliberately load the • country with such a burden of qost. J There must be some pressure from be- ; hind.” \ INDEPENDENT’S DISAGREEMENT. “If the Finance Minister’s argument is sound then he will have no difficulty in financing the scheme, but this is just where I am disposed to disagree with him. I cannot see New Zealand making the same progress in the next 30 years as it has made in the last,” said Mr It. A. Wright (Independent). THROWING DOWN GAUNTLET. The conviction that the Minister of iEnauce (Hon. W. Nash) was fantastically idealistic inasmuch as lie had chosen to ignore expert advice and to disregard the capacity of the country to pay for its venture into Socialism, was expressed by Mr W. P. Endean. “Are we throwing down the gauntlet to the capitalist world?” asked Mr Endean. “Are we telling Mr Lefeaux and the directors of the Reserve Bank that they will get their shoes ?

Government members laugh. iius is not a laughing matter. We are dealing with a serious problem involving the life or death of New Zealand’s economic security.” > WORK TO PAY TAXES. “It is a reasonable assumption that when this Bill becomes law the ordinary wage-earner will have to work for six weeks every year to pay taxes,”' said Mr J. A. Rdy. The Government had certainly created records in the amount it extracted from the people in taxation. “NO ARGUMENT.” “The whole thing resolves itself down to the question whether we can produce sufficient food, shelter and clothing to keep the old and sick people in modest comfort,” said Dr. D. G. McMillan. “There can be no argument about our ability to do that,” ho added. ' MINISTER’S SATISFACTION. “The Social Security Bill will probably put an end to industrial insurance, and that will be a very good thing,” said the Minister of Lands (Hon. F. Langstone). “Not one good word,” said the Minister, “can be said for this particular class of insurance.” The people of New Zealand, said Mr Langstone, had endeavoured to guard themselves against poverty in their old age, but they had failed lamentably because of financial slumps artificially created and unnecessarily forced upon the country.

HUMAN CAPITAL. A defence of the Social Security Bill ■as a measure designed to protect human capital was put forward by Mr W. M. C. Denham. “Human capital is the largest capital which we have invested,” said Mr Denham. “Its value depends largely on health. The object of this Bill is to provide collective effort for safeguarding that human capital by giving security against sickness and old age. ’ HOUSING FINANCE. Mr A. C. A. Sexton gave notice to ask the Minister of Finance whether the money for the Housing Department now being borrowed from the Reserve Bank was obtained by means of the creation of credit,-as in the case of the Dairy Industry Account, or whether it was obtained by the Reserve Bank by borrowing, and if so from whom had it beep borrowed. ARBITRATION AMENDMENT. The Arbitration Amendment Bill, providing for a simplification of the

procedure under which litigation can be arbitrators for settlement, made its reappearance in the House of Representatives yesterday when it was reported back from the Statutes Revision Committee. The committee’s report was presented by Mr F. W. Schramm, who said the recommendation was that the Bill should be allowed to proceed with one minor amendment dealing with the procedure to be followed in determining costs.