WORK OF PARLIAMENT.

New Zealand Herald, Volume LXVIII, Issue 20842, 8 April 1931, Page 11

WORK OF PARLIAMENT.

HOUSE RESUMES TO-DAY. SURPRISES IN PROSPECT. DRASTIC ECONOMIES LIKELY. REVISING STATE EXPENDITURE. I i [BY TKLEC.n ATH. —SPECIAL REPORTER. ] WELLINGTON. Tuesday. Considerable surprise is certain to be •caused by the appearance in the House of Representatives of the Prime Minister's second Finance Bill, in which will be embodied the direct proposals of the Economy Committee for tho extensive reorganisation of State departments with a, view to effecting further drastic reductions in expenditure. The measure will probably be introduced as soon as the earthquako legislation lias been passed, and it is understood I its provisions will constitute the most, determined attempt made for many years to cut down the growing expenso of the departments, and to readjust con- ' trol in such a manner as to eliminate wasto wherever possible. Members of Parliament will reassemble to -morrow after the Easter vacation for the second and what will undoubtedly prove the most interesting phase of the emergency session. Measures yet to be introdurd will practically all be highly debatable, and indications are that even the Hawke's Bay Earthquake Bill, which is the first to be considered, will come j-under this category. Hawke's Bay Opposition. ," Information from the earthquake area shows that those who will be brought tinder the provisions of the bill are not fully in accord with all it contains, and it is likely that the proposed insurable property tax will meet with a mixed reception. Certain members of the Reform Party are not satisfied that the tax will he imposed at all equitably. Representations upon various asnects of the bill are being made to the Prime Minister, and the prospects are that it will rojb emerge from the Committee stages without amendments. There are 78 clauses in the bill, so that in any case jts passage will not be a hurried one. Once the Government has. disposed of the earthquake legislation, it will proceed with either the Mortgagors Relief Bill, "which has been already introduced, or the second Finance- Bill. The fact that legislation is necessary to give effect to the recommendations of the Economy Committee shows that its proposals are most fai'-reaching arid that they involve more fundamental readjustments than can be brought about by the exercise of ordinary Ministerial authority. Strenuous Four Months. The Economy Committee has spent a particularly strenuous four months, working night and day. It has probed the operations of every department of State. 3t, has taken voluminous evidence and it lias not hesitated to summon before it Ministers of the Crown, who have been asked to account for various items of expenditure and to show reason why reductions should not be made.

The committee has spared none and itlas already been the cause of numerous economy measures being carried out. The committee has prepared a. list of recommendations covering about 100 typewritten sheets of foolscap. The introduction of legislation to give effect to its major proposals has been made necessary on account of the fact that certain departmental expenditure is governed by legislation.

The purpose of the second Finance Bill Tv-ill be to bring about a drastic curtailment in departmental spending, but in order to regulate this, it is understood it will be necessary to repeal certain Acts, to amend others and to suspend the operations of still more. A Complicated Process.

The whole process will be most complicated and quite apart from the public servants. themselves, the bill will prove of interest to the public generally by virtue of the fart that it will be the most comprehensive attempt for many years to revise the operations of State services. The Prime Minister's economy programme, as previously announced, provided that apart from salaries and wage reductions totalling £1,500,000, a saving of £1,250.000 would be made by reductions in "other expenditure and financial adjustments." To this end, the second Finance Bill will make provision for the elimination or curtailment of some of the services at present supplied by the State either free or below cost. This means that some of the monetary grants at present given 011 work done by departments below cost will be reduced, or perhaps entirely stopped. One of the directions in which the Prime Minister hopes to find further relief for the Consolidate!) Fund _is through the utilisation of reparation moneys received from Germany for debt repayment- purposes. At present, as the reparation moneys are received, they are applied to reducing the war debt, in addition to Hip repayment of the debt, effected under the funded debt agreement. with the British Government and the cumulative repayment of the public debt system. Money for Unemployed Relief. The proposal is that, for a year or two, the reparation moneys shall form part of the financial provision required for these cumulative repayments, instead of being additional to them. There is a growing feeling of uneasiness jmonr- both the business community and the wage-earners at the prospect of increased direct and indirect taxation, ft, is practically certain that the Prime Minister wiljf have to secure more money for unemployment relief in the, near future, and it is significant that ho is at present looking into the operation of a scheme adopted in New South Wales, under which a /wages tax of one shilling in the pound i? levied upon practically every emplovee in the Stale. There is nothing to show that tins prheme appr.-i's In Mr. Forbes, but the fact, remains that the whole plan of un4 i rn]»lo\ niont relief will tn oHnbly fx tended shortly, arid that increased taxa--1 inn will be required to bring that about.