COMPULSORY SAVINGS

New Zealand Herald, Volume LXXVII, Issue 23619, 1 April 1940, Page 13

COMPULSORY SAVINGS

KEYNES PLAN ATTACKED TRUSTING THE PEOPLE [from OUR OWN CORRESPOXnKNT] LONDON, March 12 An attack on the plan for compulsory savings, advanced by Mr. J. M. Keynes, has been made by Sir Robert Kinderslev, president of the National Savings Committee. -Maintaining the advantages of voluntary savings over compulsion, he said there was one big difference between- Mr. Keynes and the savings movement —"We trust the people, and he does not." Sir Robert expressed the belief that when unemployment showed it was well on the way to elimination, and when the difficult question of the means test as applied to unemployment assistance was settled between Labour and the Government, they would get more by voluntary effort, stimulated by truthful but vigorous propaganda, than by compulsory methods. There was something equally important, perhaps much more important, than money, he said —the spirit of the people. This voluntary effort was going to bo a dominating factor in tho spirit of the peoplo throughout tho war. "Trust the peoplo and they will givo the country what the country needs," he added. "But try to impose upon the j people something in the nature of 1 compulsory savings—a method _ that must be crammed full of injustices—and you sour them instead of developing a spirit of devoted sacrifice." What did Mr. Keynes think would happen to the existing savings of £ 1,500,000,000 in the Post Office Savings Bank, the Trustee Savings Banks, and Savings Certificates when a start was made with compulsory deductions under his scheme? "I believe that a disgruntled public would bo likely to make heavy withdrawals of these savings," said Sir Robert, "with the result that you will lose in one way a large proportion of what you gain in another. You must either trust peoplo and have their goodwill or fail to trust them and lose it. i "Again, what is going to happen when people start to let loose tho flood of their compulsory savings after the warP The recipients will not have learned of their own free will to preserve their resources and spend them wisely, as voluntary savers do. When they receive this money in lumps it is likely to be spent wildly and pro-, duce an unhealthy inflation."