Budge! Debate Concludes

Manawatu Times, Volume 61, Issue 190, 13 August 1936, Page 7

Budge! Debate Concludes

Financing on Country’s Credit

GUARANTEED PRICE DEFENDED BY MINISTER

Per Press Association. WELLINGTON, Last Night. In tihe House to-day tho Financial debate was resumed by Mr. W. J. Broadfoot who, referring to the guaranteed price said a reduction of twopence a pound iu the price of butter iu New Zealand was another sly hit at the producer and taking part of the return to which ho was justly entitled. Ho claimed that the guaranteed price was a hugo factor in the great swing over at election time. The farming community rightly or wrougly assumed that the minimum guaranteed price would be one for a term of years to bring stability to the industry. The House was told that mortgages were to be adjusted, ou the basis of the guaranteed price. Were mortgages to be adjusted every year according to the rise or fall iu tho guaranteed price? The farmers expected that the guaranteed price would bo in the vicinity of Is 3d and lie, thought they wero justly entitled to that figure. He asserted that very little allowance was made for increased costs due to the recent industrial legislation. He said tho Minister of Finance was in no way bashful and if there was anything to crow about he did so vociferously. He said it was desirable for every employer to pay tho highest possible wages, but there was a, limit and that was the amount of profit made by industry. It was inevitable that costs must go up and he said the reduction of twopence per pound for butterfat was an attempt to keep tho cost of living down. Referring to tho basic wage, Mr. Broadfoot said it had the effect of paying a single man and a married man with no children too much and a married man with a large family not enough. He said industry was getting two knockout blows in tho shape of higher wages and shorter hours and taxation which, ho thought was a record in this country and must inevitably hurt industry and create unemployment. The people had every reason to beileve that there would be no increase in taxation as that had been preached all through the country. The unemployment figures had not been reduced, doelared Mr. Broadfoot. In June 1935 the figure was 39,330, while in June this year it was 39,303, a decrease of only 292. These figures did not disclose the true position because the number of men employed on public works, which wero really relief works, was 3711. The Government had failed to grapple with and solve the unemployment problem. Ho was surprised to find thero was an increase of 9000 in tho number of men on sustenance compared with last year. Men not fit for public works could be employed on a number of lighter jobs iu rural areas.

Wlicrc the Money ic Coming From

Mr. J. G. Barclay said he believed tho chief criticism of tho Budget was that it was of an inflationary nature and that (here would be an enormous rise iu the cost of living that would take away any benefits tho increased spending power was going to give. He had not said, and ho did not think other Labour luembers had said, that houses would bo built without borrowing. It was no intended to borrow overseas or to raise a loan in New Zealand, but it was intended to uso the funds iu the State departments. The funds in the savings bank and iu the insurance department would be used for the Government schemes. It would become more and more difficult for the moneylender to secure a high rate of interest than it was under the last Government. The tendency was for money to fall in New Zealand to-day and that was line result of Labour’s policy of using the national credits for public p’-vposes. Ho predicted that if the last Government had been returned to power before now an internal loan would have been raised and if the policy of the present Government was inflationary that of the last Government was deflationary. The Government aimed at a policy of stabilisation. He contended that but for the last Government’s policy the farmers would not have lost the equities in their properties as they had done, but the present Government would restore some of the farmer’s equity though it could not, restore it all. He said the net income to Ihe fa rmer from the factor)- per cow would be about £l2 whereas iu recent years it had been £S or £9.

The average farmer with the guaranteed ’price and with his mortgage readjusted on that basis would have a good living. lie might have to work longer hours but he would have more security. The Labour party did not believo that idleness w-ns preferable to work. They did not stand for anybody getting something for nothing. Working people would be encouraged to save their savings and the Government would look after their savings for them.

How the Guaranteed -Price Was Fixed

Hon. W. Nash, iu reply, said iu fixing the guaranteed price tho Government took the ten-year period because the averages for eight and nine years were lower than the price announced, and the price announced would give more than the average over the last ten years. He claimed that 'the exchange had been taken into account and went on to explain how the price was arrived at. Tho farmer would receive a better price this year than he received last year. Ho had received a large number of letters approving of the price fixed. Tho farmer would get every fraction of a penny realised for his produce. Ho suggested that the fanner should bo asked in three months if he was satisfied with the price he was getting. He could not understand farmers being dissatisfied.

Bilateral Agreement

Dealing with bilateral agreements and Mr. Coates’ question as to whether the Government was threatening the Old Country, Mr. Nash said he was go-

ing to Britain to discuss trade arrangements and ho would say to Britain that New Zealand would take from Britain the things she could not manufacture here in return for the things Britain took from New Zealand. He predicted that when Britain realised the goodwill existing in New Zealand and when they understood What New Zealand wanted, New Zealand would get what she wanted. Mr. Coates had said a bilateral agreement could not be reached, that it could not. be done, but it was done with Canada in the case of pork. Mr. Nash defended the payment of pensions to deserted wives who were in a worse positiou than widows. They could not marry again and had to find for their children. Admittedly there would be difficulties but they would be overcome. 'When soldiers’ pensions were under review the question arose whether the economic pension Hhould be restored to the original level of 30s or whether it should be raised to 25s and the balance given to soldiers’ widows, and the decision was reached to give it to the widows. The soldiers were satisfied. Mr. Hamilton had said that, no mention was made in the Budget jf agriculture, but was the dairy industry not agriculture"

Using Bank'Credits.

Mr. Nasn, continuing, dealt with forms of bank credits, ne said if ihc people s savings, which were put on nxed deposit, oceanic irozeu tueu the use of Dunk credits to develop the country was justifiable, fno use of banK credits was also justified m times oi expanding ec.uomy to extend production. If raw materials and labour were available there was no sense in allowing them to iio idle and credit had tu Do used inside tho expanding economy to convert tnem into goods and services. If the credit of the country could be utilised lor extending production and extending services that would lead to the weil-bemg of the community at large. There was no industry that gave a better return than the building industry and there was no industry in which the Government was determined to put more money than the building industry. The public buildings programme had been starved for many years.

A Generous Interpretation,

Reverting to the guaranteed price, Mr. Nash said the interpretation of the Government's promise was a generous one. The Government was actually paying out £562,000 more than it was endued to. Tho price over ten years actually averaged Ills per owt., yet tlie Government was giving 117 s 3d. Mr. Coates: It should bo. 1225. Mr. Nash said when Mr. Coates was in charge tho farmer received lid plus 25 per cent, or 7 id. Estimates Under Consideration. Tho House resolved itself into a Committee of Supply' to consider the Estimates. Gn the first item in the Estimates Mr. W. J. Poison referred to the guaranteed price, but was called to order by tho chairman, wfio ruled him out of order as there was no vote for the guaranteed price. Government members pointed out that questions of policy could not be discussed.

Mr. W. A. Bodkin argued that questions of policy that did not involve legislation could be discussed. The chairman quoted authorities for his ruling and the point was dropped. Mr. Poison asked what was to be the future work of the Executive Commission of Agriculture for which the House was asked to cote £-5000. Would that Commission handle the Dominion’s produce under the guaranteed price plan? Mr. Nash said tho Executive Commission of Agriculture had nothing to do with the guaranteed price. .Mr. Eorbes asked the Government’s intention regarding the completion of Parliament Buildings. Mr. Broadfoot asked for particulars of the expenses of running the steamer Maui Poniarc and' whether she was showing a profit. Mr. AV. P. Endean urged that greater provision should be made for the defence of New Zealand and also its share in the defence of the Empire. Mr. Savage said the Maui Fomare bad been a payable proposition for some years and it was expected this year a profit of about £6OOO would be made. The Government had made no decision regarding Parliament Buildings, but it believed the time was uot far distant when something would have to be done to provide for the convenience of members and the carrying on of the country’s business. Regarding defence, the Government was in constant touch with the British Government. The matter hud not been lost sight of and aviation, civil and military, would be the subject of investigation in tho near future. “Taking in Each Other’s Washing.”

The Speaker, Hon. W. E. Barnard, said it was commonly thought by the public that the Legislative vote represented the cost of running Parliament and he thought, on this occasion he might point out that that impression was entirely erroneous. The Legislative vote represented much more than the actual cost of conducting Parliament. The Legislative Department was one that was grievously exploited by more than one other Government department. Perhaps the chief exploiter was the Railways Department. There was an item of £29,500 for railway passes and concessions for members and cx-members of the Legislature, families, relations, etc. It was very nearly onethird of the total vote. That amount was not incurred for that purpose or anything like it. Actually if members of Parliament and their wives were charged for the actual travelling they did in the course of a year he would say the amount could be very nearly halved. The entry was to a great extent a book entry, but in any case it was much in excess of the cost of railway travel to members and their wives. Tho Legislative Department was also exploited by the Public Works Department in connection with maintenance or small additions. If tho voto were kept strictly to the running of Parlia-

ment many thousands would be deducted from it. Probably £20,000 to £30,000 would be taken from the vote and attached t.o other departments, it mlgnt bo as well in future if the vote were a truer reflection of the cost of the Legislative Department. Mr. Savage said this was a stupid old method that had been introduced by past (Wernments and it was just another way of living by taking in each other's washing. The Railway Department charged tho Legislative Department for a service it did not give and the Public AVorks Department did likewise, and so the game went on. It looked as if the Department was spending a lot that really was not spent. Some day they would get scuso and they would have a different way of putting things. They would pay for what they got and would get what they paid for. It was, however, an important matter from the members’ point of view. They should not oe enarged for some service they did not enjoy. Members were entitled to be treated just as fairly as other people. British or American Oars.

Hon. A. Hamilton asked what was the Government’s policy regarding the purchase of Government cars. He said he had seen some Government cars that were of American make. Hon. \\ 7 . Nash: Made in Petone.

Air. Hamilton: No. They might be assembled in Petone, but they are still American. He added that British cars could be assembled in New Zealand and Departmental officers should be content to travel in cars made in Britain.

Air. Nash, referring to the purchase of cars, said British manufacturers were very reluctant to come to New Zealand to assemble their cars, and if they would not do so tho Government must give complete preference to those companies that did come here and gave employment to New Zealanders and used New Zealand material as far as possible. British manufacturers were beginning to come to New Zealand to assemble cars and all things being equal preference would be given to British cars. Progress was reported and the House rose at 10.25.