CONTROLLED CURRENCY URGED BY CHAMBER

Manawatu Times, Volume LV, Issue 6836, 18 April 1932, Page 8

CONTROLLED CURRENCY URGED BY CHAMBER

Deputation Waits on Member for District CHECKING DOWNWARD TRICE TENDENCY To place before Mr. J. A. Nash, ALP., the views of the Palmerston North Chamber of Commerco in regard to the relieving of the present situation throughout tho country, members of that body, headed by the president, Mr. M. H. Oram, waited on tho member on Saturday. “It is recognised,” said Mr. Oram, addressing Air. Nash, “ that at the present time the Government is facing problems as difficult as any Government ever faced before, and it is tho duty of every organisation to offer constructive criticism and to do all it possibly can in its power to assist tho Government in the problems that aro facing it. That has been tho policy of the Chamber of Commerce in tho past, and the council hopes will be the policy in the future.”

Some little time ago, Afr. Oram proceeded, the chamber, when considering proposals that had been advanced, had come to the opinion that there should be no further wages cuts until interest charges and rents were reduced. Recently the Public Service Association had waited upon the chamber and placed before it proposals that, in the opinion of officers of the association, wero alternatives to the drastic cuts proposed by the Government. Considering AH Aspects.

“ Whether we aro of the opinion that the cuts as proposed by the Government arc necessary, or whether some modified cut would still bo necessary, or whether a scheme such as this would abolish the necessity for cuts, we nevertheless are of the opinion that the Government, instead of tackling the problem from one side, reducing costs, salaries and wages, which brings in its train further depletion of tho money in circulation, unemployment, and a continuation of the vicious circle of deflation, should also tackle tlic problem from the other standpoint, eitlier through the primary producers by means of a managed exchange, or by the institution of a State Central Bank, suitably controlled and with the necessary rigid safeguards, which would, by means of a properly controlled currency, keep prices at something like a reasonable level. Our fear at the present time is that a continuation of the policy of deflation and the forcing of wages down by cuts will force tho level below what is a reasonable basis.”

Concluding, Air. Oram handed to Mr. Nash a copy of tho following resolution passed by the Chamber:— “That as a means of checking the present downward tendency of prices, and at the same time counteracting the policy of deflation that has been in voguo for tho last few years, the chamber recommends to the consideration of tho Government the advisability of the establishment of a State Central Bank, and tho institution of a controlled currency, with a view to effecting stability in the price level. ' 1 Constructive Criticism Desired.

“I am pleased to meet the Chamber,” said Mr. Nash, in reply, “and to hear your Temarks and also the resolution which it has carried. What is wanted at the present time, I think everyone will agree, is . constructive criticism. If tho Government can get constructive criticism, I want to assure you, knowing the position as I do from tho Prime Alinister and other Alinisters, they are only too glad to receive it. .Tho present is an extraordinary time and a time, in my opinion, when consideration should be given to the views of everybody. I am satisfied that there is no one who realises the sufferings and hardships of many of our people more than the Prime Alinister himself.

* “I tad no hesitation in voting for tlie unemployment tax because I believe that every man who is in a job has to do something for liis fellow men. This will realise a very largo sum, but those who have given thought to the position to-day and what it is likely to be in the next few months will realise that the shilling in the pound may meet the position or may not. In common with nearly every other member of tho llouso I have had petitions sent to me for presentation to Parliament, signed by business men and others, praying that no further reductions shall be mado in salaries and wages. .Whether the petitions are going to have any great effect, it is difficult at the moment to say.

“In reading statements made here at the Chamber of Commerce that there had been no reduction in interest or rents, I want to assure you that there havo been considerable reductions made in rents by people privately. The Act provides that there shall bo reductions in interest and rents as from April 1, and a cut in that direction is to be made of 20 per cent.” Dealing with statements ho had made in the House on the question, Mr. Nash 6aid ho believed the time was not far distant when they would have to attend to the whole of their financo within New Zealand. He had said the National Expenditure Adjustment Bill was one of tho most disagreeable which had como before tho House while he had been there. No matter what was the Government in power, it would have to bear tho brunt of the position. Ho ex-

pocted the number of unemployed to roach 70,000 before the winter was over. It had been stated in the House by the member for Hutt that they wero passing through a long dark tunnel with a gleam of light at the end. He did not believe anything of the kind. “I feel that tho depression will be with U 3 for some time to come,” stated Air. Nash, “and I am horrified to think that there might bo coming down for another year even two similar Bills, but without the same provisions as that just passed.” He added that with the wages tax civil servants would be suffering a reduction within 12 months equivalent to 25 per cent, of their salaries. Alany privato employers had not followed the lead of the Government when the last cut was introduced. Why should civil servants be singled out? Alternative Wages Tax.

Continuing, Air. Nash said ho had advanced the suggestion that a wago tax of 2h per cent, might be imposed by the Government instead of a 10 per cent, cut. It -would produce just as much. He had supported tho Bill because it contained essential provisions, but he had reserved tho right to act as he considered fit on the question of salary cuts. “I understand that the Government is giving every consideration to the exchange proposal,” he added, “but whether anything can be done or not is difficult to say.”

Mr. N. H. Mackie asked Mr. Nash whether his proposal was likely to commend itself to members generally. It seemed to him that tho Government would have to act quickly, and Mr. Nash’s suggestion provided alleviation for the Government and tho civil service.

“It is awkward to answer,” replied Mr. Nash. “I brought this proposal very forcibly under the notice of the Government and have put it before the Prime Minister and tho whole of the Coalition party. It is gaining ground and to-day I find I have a lot of support for it. Where it will end I don’t know, but we have a caucus next Tuesday morning.” Mr. Oram thanked Mr. Nash for meeting the Chamber of Commerce and said that that body was always prepared to assist where it could.