HIGHWAY FINANCE.

New Zealand Herald, Volume LXVII, Issue 20646, 19 August 1930, Page 13

HIGHWAY FINANCE.

PROPOSED ALTERATIONS. " BREAKING OF AGREEMENT." CRITICISM BY MR. COATES. [TIY TELEGRAPH.—SPECIAL REt'OUVKR. ] WELLINGTON, Monday. " In my judgment this matter is of sufficient importance to reijniro the confirmation of tlic electors," declared the Leader of the Opposition, the Rt. Hon. J. G. Coates, in protesting strongly in the Financo Bill debate in the House of Representatives to-day against the proposal of tho Government to relieve tho Consolidated Fund of tho payment of £200,000 as subsidies for local bodies. The whole of the Government's proposals for tho alteration of highway finance constituted the breaking of an honourable agreement. " Tho bill imposes taxation indiscriminately," said Mr. Coates in an opening criticism. " None of tiio Ministers has shown any reasonable grounds on which to effect economies. Tho proposals in this bill are not tho proposals of tho Ministry. In my judgment they aro tho production of the Treasury. " I understand that when tho United Party accepted office that was to be tho end of bureaucracy, but I believe this is tho clearest-cut case of bureaucracy wo have ever known. I am not saying that without reason, for certain of tho proposals in this bill wcro placed before ino when I was Primo Minister and they then received tho answer from mo that they should receive from the House today." Previous Government's Promise. Mr. Coates said some of the proposals in the bill amounted to readjustments, but others were nothing but a desecration of an honourable arrangement mado by a previous Government, and any Government must be very careful before it mado such a repudiation. The Prime Minister had said in tho Customs Bill debate that tho Government would stand by honourable agreements. Mr. A. M. Samuel (Reform —Thames) : Hear, bear. Debts of honour. Mr. Coates said some very representative citizens had every reason to complain if thi:> bill werfc passed and honourable agreements were upset. Tho Minister of Lands, tho Hon. E. A. Ransom: Are all amendments of Acts repudiations ? Mr. Coates: Of course Parliament can do what it likes, but beforo it repeals such an arrangement, Parliament should have all the facts before it. Mr. D. G. Sullivan (Labour —Avon): Can you give us the facts. Mr. Coates: Yes, I will do so a little later. Tho Government has the initiative in this matter and the responsibility lies with the Government. This bill spreads a net to catch everyone. Tho Government has failed to economise and that has led it, into this increased taxation. It will prove irritating in every case and disastrous to some institutions. Revenue for the Cities. Strong criticism was levelled by Mr. Coates at the Government's proposal (o give the cities and larger towns only 5£ per cent, oi the net revenue from the petrol duty. Surely, he said, the cities were entitled to at least 8 per cent., which was the present arrangement in connection with the fourpenny duty. Picturning to the subject later in his speech, Mr. Centos said lie wondered whether Mr. Forbes knew how the arrangement with respect to the expenditure on highways was arrived at. Two confer, ences of local bodies and motorists had been held in Wellington and from the last of the conferences the Highways Act had emerged. The Government agreed to contribute £35,000 to the Highways Fund, and handed over 6000 miles of road to the Highways Board. The expenditure on the maintenance of the same roads had cost the Consolidated Fund at least £50,000 in past years. It was felt the Government was doing good business if it could relievo the Consolidated Fund of that expenditure on the terms arranged. Then a sum of £200,000 was to be made a free grant from the Public Works Fund, which had been called on in past years to the extent of about £300,000. The Government proposed to destroy those arrangements entirely. Payments Still To Be Made. Tho Prime Minister: No. 'lhe payments will still be made. Mr. Coates: It is very hard to keep ono's temper with 'he lion, gentleman when he makes a statement like that. The Prime Minister: The general taxpayer paid it before and the special taxpayer will pay it now. That is all. Continuing, Mr. Coates said the Government proposed to charge interest on £1,226,0(30, being transfers from the Public Works Fund to the Main Highways Fund. In effect, the Government, by that method, was taking £61,000 from the tax-, payers' pockets in one transaction alone. Mr. W. J. Poison (Independent—Stratford) : And that £61.000 will increase each year. Mr. Coates: Of course x it will. Mr. Coates said the. Government's proposal not to pay the sum of £200,000 from the Consolidated Fund could only be termed a "steal." The amount was intended as subsidies to local bodies on rates and the legislation had been in force for over 40 years. Legislation of 40 Years. Mr. Coates deemed the matter one of sufficient importance to require the con- y firmalion of the electors. Jt was not ono to be dealt with according to circumstances. A party of 26 members, with the support of the Labour Party, was going to undo and reverse legislation which had been on tho Statute Book for 40 years. Tt was unthinkable that the Government should ever reach as far as that. The Government said the amount would still be paid, but the Government was "diddling" the ratepayers out. of the money. The general taxpayer would not pay as in the past. In fact, the farmers with motor-cars would be in the position of subsidising their own rates. As for the proposal to give only 5} per rent, to the cities and larger towns, neither Mr. Forbes nor Mr. Ransom had worked out that scheme. It was a departmental "rig out." It was calculated that per cent, over the whole petrol taxation would give the cities the same as 8 per rent, of the fourpenny fax. Mr. Forbes: A little more. Mr. Coates: How much? The lion, gentleman cannot justify it. Mr. Forbes: Nothing will be taken from the cities. THE KAIPARA SEAT. COUNTRY PARTY CANDIDATE. MR. W. GROUNDS MENTIONED. [MY TELEGRAPH. —PRESS ASSOCIATION.] DAItGAVILLE, Mouday. It is staled on good authority that Mr. William Grounds, ex-chairman of Ibe Dairy Control Board, will contest the Kaipara scat at tho next general election, in tho Country Party's interests.