PUBLIC SERVANTS

Nelson Evening Mail, Volume LXIV, 19 February 1931, Page 3

PUBLIC SERVANTS

“CUT” IN SALARIES “AN UNFAIR BURDEN” As briefly reported yesterday, representatives of every section of the Civil Service waited upon the Prime Minister (the Right lion. G. W. Forbes) yesterday in reference to the proposed 10 per cent, “cut” in the salaries of all servants of the State. It was submitted that,, the “cut” would place an unfair and intolerable share of the Dominion s burden on State employees. In bis reply, tho Prime Minister said that he Imd announced bis police and whether it was endorsed or not was a matter for Parliament. Tho deputation was not open to the press, but a copy of the statement made on behalf of the service bv Mr A. Burgess, president of the Public Service Association, was subsequently banded to a representative of the “Post.” There were about thirty members of the deputation. The statement submitted bv Mr Burgess was as follows: —

“This deputation, representing the Public Service Association, the Educational Institute, the Post and Telegraph Employees’ Association, the Railway Officers’ Institute, the Amalgamated Society of Railway Servants, the Railway Engineers, Firemen and Cleaners’ Association, and the Railway Tradesmen’s Association, tenders its thanks for the opportunity offered of placing its views before vou on the question of the proposed reduction of 10 per cent, in the wages and salaries of those employed by the State. “It is recognised by the associations here represented that the unpleasant duty has fallen upon you of balancing the Budget ill a time of depression, and we wish to say that State employees as a body are ready to boar a fair share of the burden, provided it is shouldered by the whole community. “To a previous deputation from the State employees you stated that your Government was working upon the principle of equality of sacrifice for all sections of the community, and this was reffiarmed in your statement given to the press on 14th February

“UNFAIR AND INTOLERABLE” “We wish to respectfully point out that the proposal to reduce State-paid wages and salaries by 10 per cent, is one which puts an unfair and intolerable share of tho burden upon State employees. In support of this carefully weighed assertion we offer tho following reasons: — (3) Tho anticipated deficit for the financial year ending 31st March, 1932, is £4,500,000. The total number of people in receipt of salaries or wages may he estimated at 450,000 (see 1931 Year Book, p. 841). The number of State employees is estimated at 50,000; that is, the State employees are oneninth of the wage earners of the Dominion. But this one-ninth is to be asked to provide one-third of the expected shortage of £4,500,000. as well as meeting their share of the £850,000 proposed to lie raised by taxation direct and indirect. (See published statement.) (2) It is a well-known principle of economics that if equal sums are added in successive increments to a given income the utility of the successive increments gradually decreases; the converse of this is that the loss of equal amounts in successive stages represents gradually increasing sacrifice. This deputation would respectfully urge that the principle of equality of sacrifice demands the exemption of the lower-paid workers from further reduction of their economic standard. We submit that no other course is possible in tho pursuit of equity.

TWO “CUTS” ALREADY (3) The Public Servants’ salaries were reduced by two cuts in 1922 because of a similar national emergency. If those salaries had been “tied” by awards to the cost-of-living figures, the cuts would have been restored in 1923, which you yourself admitted when a former Government was in office. Award wages, interest, rents, and profits were allowed to share in the time of comparative prosperity from then until 1928, but the cut operated unceasingly against Public Servants. We also submit. Sir, that Public Servants incomes for the last nine years have been low in comparison with other incomes. The present proposals would lower by a serious amount that which is already too low. (4) The present proposals are con-

I vary to all tenets of justice and principles of equity, for the principle of equality of sacrifice should carry with, it equality of opportunity to share in better times. But our bitter experience is that the reduced salary is taken as the normal figure when the country returns to prosperity. The result is that all the cumbersome machinery of Parliamentary procedure has to be set in motion when State servants again seek to have their incomes adjusted to the increasing local prices which inevitably follow improving markets for tho exports of the Dominion.

THE COST OF LIVING (5) There can be no certainty that award wages and other wages will ho reduced by 10 per cent. Parliament may give power to the Arbitration Court to review wages, bub presumably will not dictate to the Court the precise amount of the 'reduction. If the Court bases its award on cost-of-living figures it mav barmen that wages will not he reduced; thev might even bo increased. Even if award wages were reduced by 10 per cent., and if all oilier wages and salaries were equally reduced. it is not to be assorted that the cost of living would fall in proportion. If New Zealand were a self-contained and commercially isolated country, such a sensitive response of living costs to wage movements could he expected, but the fact is that our living costs in respect to the food and clothing groups are not governed to any appreciable extent by local wages, but must rise and fall in sympathy with world prices. We _ suggest, Sir, that a rather ingenuous interpretation of the quantity theory of money vitiates the argument that costs V’ould inevitably follow wages on the down grade. In the past the cost of living has actually increased, while Public Servants’ salaries were being reduced.

(6) The Government can have no effective statutory control over the balte of interest (which is governed chiefly by London rates) nor of profits (which arc governed bv competition among the employing classes) and a general reduction of wages may be the only result of the Government’s proposals. (7) One other aspect should not be overlooked; that is that a large number of State servants have entered into financial commitments on the present rate of remuneration. A salary cut would ruin many of them. “In conclusion, Sir. we would urge that serious reconsideration be given, to the proposal for reducing Public Service salaries, partly because of tho nebulous nature of the consequences upon other wages and costs, but chiefly because of the injustice of expecting a small section of the community, which has already had a drastic salary reduction inflicted on it, to carry onethird of the burden of balancing the Budget for the next financial year.” In his reply, the Prime Minister said, ho had announced his policy, and whether it was endorsed or not was a matter for Parliament to decide.