REPLY TO CRITICS

New Zealand Herald, Volume LXXII, Issue 22225, 27 September 1935, Page 13

REPLY TO CRITICS

GOVERNMENT ACTIONS

REVIEW BY MR. FORBES

STABILITY ACHIEVED THE RETURN OF PROSPERITY [BY TELEGRAPH— SPECIAL REPORTER] WELLINGTON, Thursday Hie actions the Government had taken to cope with the difficulties of the depression years were reviewed in the House of Representatives to-night bv the Prime Minister, Mr. Forbes. Speaking in the financial debate Mr. Forbes replied to many points of Labour criticism and said the best testimonial to the Government's policy lay in the fact that the country was in a sound position to take advantage of returning prosperity. " The fact that there are definite signs of improvement should be hailed with satisfaction by every member of the House," Mr. Forbes said. " But that is not the case with our friends on the Opposition benches. The more cheerful the Budget is the gloomier they become. Recently they have been talking about the depression. They have never talked about it before, never admitted that outside events could influence us. All they have done is to say that everything has been brought about by the maladministration of the Government." Ji'all in National Income During the depression, Mr. Forbes continued, the fall in the national income had been very serious. It had fallen from £150,000,000 in 1928-29 to £'98.000,000 in 1931-32. Such a reduction naturally caused confusion in every section of the community. In the same period export values declined from £56,000.000 to £34,000,000 and yet the Opposition said that exports did not affect the country at aiL " When anyone makes a statement like that he must have his tongue in his check," the Prime Minister said. Members of the Labour Party attempt to prove that we can consume all we produce. Have they ever thought what that means? We have the highest consumption of butter per head of population in the world and yet we consume only 20 per cent of our production.' Then there is all the lamb, mutton and other products. If we set to work to eat this prodigious mountain of stuff anyone with a good remedy for indigestion would mako a fortune."

An Encouraging Outlcok Export values during recent years were quoted by Mr. Forbes as follows: 1928, £54,000.000; 1929, £56,000,000; 1930, £48,000,000; 1931, £39.000,000; 1932, £33,000,000; 1933, £37,000,000; 193-1, £46,000,000; 1935, £44,000,000. With good wool prices this season the outlook for the current year would be highly favourable and in this respect it had to be remembefed that no money went into circulation more rapidly than that received by the farmer in return for his produce. The ■ Government had been charged with breaking contracts and taking other drastic remedies, continued Mr. Forbes, but it was interesting to note how other countries had fared during the years of economic stress. Between 1929 and 1932, the national incomes had fallen in Great Britain by 15 per cent, in Canada by 46 per cent, in Australia by 23 per cent, in South Africa by 21 per cent, in New Zealand by 35 per cent, in the United States by 54 per cent, in Denmark by 14 per cent. Opinion in England

It was easy for anyone with a 15 per cent drop in income to criticise someone who had suffered a decline of 35 per cent, but in England recently he had been told by people whose opinion counted that what the Government had been compelled to do in New Zealand was sound and wise. No one could say the Government had gone to excess in interest reductions.

He himself had often been charged with saying that a reduction in salaries and wages would cure unemployment and restore prosperity. He had never said that. What he had said was that a reduction in wages would enable employers to keep a greater number of men in employment.

"Every country had to face the position and cut down expenditure," said Mr. Forbes. "That method is laughed to scorn by the Labour members. They apparently have some secret formula by which they are able to pay out any amount irrespective of what is received. When information is sought about this formula we are told it is not right to ask for details." Labour's Vague Promises

After defending the Government's action in advancing the rate of exchange by 15 per cent to £125, Mr. Forbes said the currency depreciation was very little when compared with what had been done in many other countries.

"As a result ot the measure of prudence adopted wo are able to show a sound Budget," added Mr. Forbes. "Stability has been achieved in our finances and consequently this country's reputation has been greatly enhanced. The record of the Government in regard to prudent finance is equal to that of any Government that has occupied the Treasury benches. When one places the 12 points of the Labour Party's platform alongside the solid achievement recorded in the Budget I don't think anyone is likely to be carried away by the vague and cloudy promise? of Labour."