THE New Zealand Herald AND DAILY SOUTHERN CROSS FRIDAY, JULY 18, 1930. THE UNEMPLOYMENT BILL.

New Zealand Herald, Volume LXVII, Issue 20619, 18 July 1930, Page 10

THE New Zealand Herald AND DAILY SOUTHERN CROSS FRIDAY, JULY 18, 1930. THE UNEMPLOYMENT BILL.

The Government's bill to deal with unemployment has created more general interest than any other measure to sec the light since it entered office. This is natural. The proposed annual flat rate levy of 30s on all males over 20 years of age ensures that everybody has an interest, direct or vicarious, in the bill. It need not bo assumed that, in its present form, it is certain to reach the Statute Book. That is its least likely fate. The method of financing the unemployment fund will be enough alone, if persisted in, to kill it. That can be decided without stopping to consider whether it deserves to die or not. The inevitable, very plainly expressed objection to any flat-rate levy, which is certain to come from those to whose voices the ears of the two parties in power at present are peculiarly sensitive, will assure the mending or ending of the measure in quick time. Prophecies are dangerous, but that forecast is not nearly so risky as the usual political prophecy. Bombarded with questions when the bill appeared, the Minister of Labour said there would bo no taxation beyond the levy; at least that is the only construction that can be put on his answer. The inference is that everyone liable io register will contribute equally to the insurance fund, regardless of occupation, income or other resources. Nothing could have been better designed to make tho measure unpopular, or to assure for it as it stands such determined and organised opposition that it is not likely to proceed unless drastically altered. That will be its certain fate, although the assurance there is no other taxation beyond the 30s levy is quite wrong. The yield of the levy will represent only half the fund the Unemployment Board will have at its disposal, for it will bear " a subsidy from the Consolidated Lund of 50 per cent, of the expenditure." An estimate based on population gives a return, in round figures, of £675,000 annually from the levy. Assuming this is alt spent—and it is not an unreasonable assumption—the Consolidated Fund must provide another £675,000, all of which will be the product of taxation. The Prime Minister warned the country long ago that a deficit of £3,000,000 was in prospect this year unless drastic measures were taken to reduce expenditure and raise additional revenue. In other words, the prospect, when he spoke, was of a struggle to balance the accounts, with success by no means certain. Now the Government produces a bill which, if passed, promises a new demand, amounting to £675,000 on the resources of the Consolidated Fund. Yet the Minister of Labour says it means no taxation, in fact, "none whatever." What new source of revenue has he in mind? The plain fact is that whatever this measure, if carried, might do for the relief of the unemployed—incidentally those out of work when the scheme began to operate would apparently have to contribute their levy before becoming eligible for assistance —whatever it might do I toward providing employment, it would certainly add in substantial measure to the chief cause of industrial depression and unemployment —excessive taxation. One-half of the money the proposed board would spend would be direct, personal ungraduated taxation. The other half would be taxation that, on present appearances, must be raised by further exploitation of existing resources, which means it would be contributed partly by individuals, directly and indirectly, partly by industry. Having designed a financial sys-j tem which makes possible an an- j nual expenditure of £1,350,000, the framers of this bill follow, in a substantial measure, the recommendations of the Unemployment Com- j nnttee in providing for adminis-1 tration of the fund. There is to be a board with the Minister of Labour as chairman, and two official mem-1 hers whom he nominates, two representatives of employers of labour, j two of labour organisations, and j one to be nominated by the Be-1 turned Soldiers' Association. Since women workers are neither to pay the levy nor to receive any assist- i ance if out of work, naturally no j provision has been made, for: their special representation. Why ; women workers have been left entirely out of account it is difficult to say. The Government will probably have to answer some pointed questions about that if the bill proceeds any distance. The functions of the board, corresponding very closely with the recommendations of the committee, call for little, special comment beyond that passed when its report appeared. The trouble with them is that except for the definite provision for paying sustenance allowances to those en titled to receive them, (he whole scheme is exceedingly vague and nebulous. Take the second of the main functions of the board, "to take such steps as it considers necessary to promote the growth of the primary and secondary industries of New Zealand so that an increasing number of workers will be required"—if a board could do any thing substantial in that direction, there would be no need for any anxiety about unemployment. Its chances of doing anything would be prejudiced at the very outset by the fact that new taxation would inevitably descend ori the primary and ry industries the moment it i,ri t'i openih'.. That is the facl'.r */;}iicli e/iviriH all confudcralion bill. Ta v. for III" relief of it,<u.j •!'/ ir/fnt arid tic liability to Mi' i'-;\ unemployment ;il once appear'!. However, the bill in ils present, form doe; 1 riot iieeni lo have any great, expectation of life, because of the, way in which it, provides for a very direct and what would certainly be a very unpalatable form of personal taxation.