CIVIL SERVANTS' WAGES.

New Zealand Herald, Volume LXIX, Issue 21117, 26 February 1932, Page 10

CIVIL SERVANTS' WAGES.

REDUCTIONS INDICATED.

EXPENDITURE OF THE STATE. FURTHER CUTTING ESSENTIAL. DISMISSALS AS ALTERNATIVE. [EY telegraph.—special reporter.] WELLINGTON. Thursday. 'A plain indication that r, further reduction in civil servants' salaries ir. contemplated was given by the Prime Minister, tho lit. Hon. G. W. Forbes, today, in replying to representations made to him and the Minister of Labour, the Hon. A. Hamilton, to-day by a deputation representing all branches of the service. Tie deputation submitted its recentlypublished statement setting out suggestions whereby the financial situation might bo met without recourso to further salary cuts. Replying, Mr. Forbes said the t;isk of wags reductions was the most unpleasant the Government could face. He found no pleasure in what had been done in that direction during tho past year. He also recognised to tho full tho hardship find distyess that had been caused and the difficult financial position in which many civil servants had been placed. Problem Before Government.

He was not taking any exception whatever to the representations which were lieing made to him, as he realised the organisations represented had a duty to their members. The Government had to consider, however, how it was going to get through the present difficulties without involving further disaster. "I am bound to say that the attitude taken up by civil servants in the past lias not been very helpful," said Mr. Forbes. "'The reductions have been very strongly resisted. Well, there will have to be further reductions in Government expenditure, otherwise we are facing bankruptcy. Ko Government is going to allow a country to become bankrupt or is going to bring further disaster upon civil servants and evei'y section of the community. If we did that, you would bo the first to cone to us in indignation. "The whole position is this. What policy do you stand for—wage reductions or wholesale dismissals? That is the alternative wo have before us. We have to reduce costs and we can only do that either by reducing wages or by reducing staffs. "The public service is not any different from privato firms. Privato firms have had to make dismissals. To-day our public servico is over-staffed and we are placed in the same position as private firms." ,/ Consequences of Inflation. Mr. Forbes said he noticed the organisations proposed inflation, but experience went to show that there had never been inflation without consequent deflation. They were suggesting the issue of Treasury notes in accordance with tho extent of the deficit, but the deficit was not fixed. The amount of the deficit could be a tremendously large sum of money. ; However, the Government was trying to keep the deficit down to the smallest possible amount. "The present rate expenditure lias to be cut down," said Mr. Forbes. "The Government went to the country with defiaitfe proposals for further economy. I told the people that if it was necessary that wage reductions should be made for the sake of the country's stability, they •would be made."

Mr. Forbes said the whole question had been placed before the Economy Commission, which woul 1 report shortly. It had been charged against the Government that was nc.u. possible for the Government to make the necessary economies ill the public service because it had been responsible fo>- building it- up, but an independent tribunal had now been set up to decide whether the public service was greater than the country could afford. That tribunal consisted of outside business The representations of thn various organisations had been placed before the commission and would be considered.

Mr. Forbes said that personally he was very sorry to have been placed in the position in which ho had been placed jis a result of the reductions it had been necessary to make. However, lie was carrying out a task which ho eo'tiidered 1:o be in the best interests of the country. It was not a question of what the Government would like to do, but what the state of the finances allowed them to do.