SERIOUS FAULTS SEEN

Nelson Evening Mail, Volume 76, 6 August 1941, Page 3

SERIOUS FAULTS SEEN

CRITICISM OF BUDGET ALLEGED ECONOMIC INSTABILITY The Budget recently presented to Parliament had the same serious faults as that of the previous year, said Mr jM. C. G. McCaul. in a statement at a meeting of the council of the Wellington Chamber of Commerce last night. The Minister of Finance. Mr Nash, claimed to have maintained economic and financial stability, but the claim was not well founded, Mr McCaul said. "The expenditure on other than war purposes is very much too high and has created a position of economic and financial' instability which is a serious danger to the future welfare of the people.” Mr McCaul continued. "The Minister estimates the total t uxation for the coming year at £63,683,000, of which £20.840.000 will be allotted to winning the war. and £42.837.000. plus a public works loan of £12,950.000, a total of £55.787,000, to a continuation of extravagant expenditure in the vain hope that somehow, some day. sheer waste might create real prosperity. HELD TO BE DANGEROUS “This uneconomic and highly dangerous rate of domestic expenditure is being intensified at a time when we should be husbanding our resources for the war effort. The commercial and investing classes have raised no objection to high taxation for the prosecution of ihe war. What we object to is that our hard earned money is splashed round on State extravagances. “It is sound policy to tax heavily at a time of expanded State expenditure. In war time, taxation should be spread fairly over all classes, and up to the extreme limit that can be exacted without freezing the sources of taxation. In short, the Government should take all it can without killing the goose. “The only way to prevent inflation, and to ensure economic and financial stability during the present time of stress, is for all the people to work longer hours, and harder, and for the Government to tax heavily and wisely. and to be scrupulously careful in ! ihe expenditure of every penny. "In his Budget statement, the Mini ister of Finance says: "Short supply of consumption goods is inevitable while the whole British Common wealth of Nations is making a gigantic war effort involving the loss to industry of millions of men and the call upon industry for enormous quantities of supplies to equip and main tain our armed forces.’ “He omits to add.” said Mr McCaul. “that the New Zealand gigantic war effort on the home front is limited to a 40-hour week, and anything in excess to penal rates of pay.” RIGHT OF CRITICISM j During Mr McCaul’s statement, the I vice-president, Mr A. L. Wall, interposed to say that the speaker was apparently bordering more on the politi- ! cal side than the economic, j Mr McCaul: It has been the custom of the chamber, ever since I can remember, to discuss the Budget. If the time has now come when we are not permitted to discuss it what is the use of our meeting? We are elected here to represent the commercial community and express its opinion. Mr M. M. F. Luckie moved that the meeting pass on to the next business. There was no seconder, j They would all agree, said Mr F. J Wilson, that the main consideration to j day was the Dominion’s war effort and 'its ability to produce a IUO per cent ! effort. Civil expenditure should be rej legated to second place, i Captain S. Holm said the chamber [had the example of the Opposition in 1 Parliament which had refused to de- ! bate the Budget and let it go in order '■ to devote its energies to helping the I wi r effort. ! Mr N. S. Hunt asked the vice-presi-jdent to have it made plain that the statement made by Mr McCaul was iMr McCaul's personal statement. Mr Luckie: And personal opinion. MR Mot All SUPPORTED ! Mr W. H. Hindie said he was disI tressed at the impression that the j chamber was becoming a little afraid to discuss a question of vital importance to the country. It would be a sad day ! when the business people were muzzled on such a question even when a war was being fought, rie supported what iMr McCaul had said, particularly in [reference to the disproportionate expenditure on internal affairs compared ! with the expenditure on the war effort.