BUDGET DEBATE

New Zealand Herald, Volume LXXVII, Issue 23699, 4 July 1940, Page 11

BUDGET DEBATE

•. WARTIME SACRIFICES \ example not set 'CRITICISM, OF GOVERNMENT 'STATE ECONOMIES URGED [RY TELEGRAPH —SPECIAL REPORTER] "\yELLINGTON, Wednesday •'I am not sure whether 1 am openjiin- this debate,' or replying to statements in the t"' t>ss alK ' broadcast addresses given by members of the Government since the Budget was presented," said the Leader of the Opposition, the Hon'. A. Hamilton, who was tho first speaker in the debate on the Financial Statement in the Houso of Representatives to-night. "This is wartime," however," ho added, "and I have io remember that, in spito of tho fact that it is my duty to be critical." The Government was asking for n earlv £'100.000.000 —largest amount ever sought from the people of New Zealand, -Mr. Hamilton said, and the subject of how tho war was to bo paid for provided the only possible approach to the Budget; These were abnormal days, calling for abnormal action and no one could shirk an equitable sacrifice. "Great Opportunity Missed" Nevertheless, the war itself would far harder cases than the system of financing it, for anyone who thought some proposal asked him for an excessive contribution should also remember the incomes lost by those liit by the war—tradesmen, importers, employers generally—not to mention the men who had volunteered front well-paid jobs for service -with the "forces. "Taking all this into account," Mr. Hamilton added, "it remains clear to mo that the Budget has not captured the proper approach. Above all it lacks the examplo of sacrifice which it demands in almost every line and, while Jacking this examplo and sacrifice, proceeds to distribute its demands in such a way that it can be said to be weighted against the family men on the lower income scales. A Budget that hits tho cradle or the family at this time misses iis greatest opportunity to protect tho basis of national life and provide for •the future." '' Paying for Past Extravagance : "The Doininioii was paying dearly to'day for the extravagant spending of the past five years, Mr. Hamilton said. In spite of three or four very prosperous years, with export trade averaging more than £60,000,000, the overdraft at the Reserve Bank was at .the limit, the sterling funds were depleted and rationed, there were huge domestic commitments and public works and sustenance were at peak. Nothing was available from the Reserve Bank for war, the very sort of purpose for which it was intended, Mr. Hamilton continued, and tho Minister of Finance, the Hon. W. Nash, had himself been reported as saying that jthe Dominion had lived beyond its income in this respect to the extent of £28,000,000 in four years. Large overseas funds would have been particularly valuable to-day, but instead the Dominion. had to lean on Britain. Domestic commitments had risen by 60 per cent in the past four years and, in spite of a contrary statement by the Minister of Finance, the Estimates this year would cost more, not less, than last year, even with defence expenditure omitted, Mr. Hamilton added. As far as .public Works and sustenance wore concerned, we were still struggling and there was no indication as to what fund was to bo / drawn on to pay the Echeme 13 men. This position must bo a nightmare to the Government in wartime. ... '

Necessity for Economies "Any lead in economy must come ' from the. Government," Mr. Hamilton said, in urging a reduction in the estimated expenditure for this year. He pointed out that New Zealand's estimated war cost for the year was only about 40 per cent of the total requirements, whereas in Britain the war was absorbing 751 per cent of public ex■t penditure. - ___ Domestic expenditure in the Dominion accounted for £61,000.000, and it was 'nonsense to sav that this could not be reduced, Mr. Hamilton, considered. H& loped a real effort would be made to effect economies. That sentiment was in the Budget and everybody agreed jwith it, but this was no time for the 7 leisurely fulfilment of good intentions. Mr. Hamilton pointed out that taxation was to provide 37£ per cent and ■borrowing 62£ per cent of the current year's war expenditure of £37,500,000. If the war continued for three years it •'"would take eight years of that taxation to pay the debt.' the taxation proposals were well spread and very few would feel they were not making a contribution to the war "effort. Discussing the public works, Mr. ■Hamilton said that an effort should, he made to halve this vote during the year as Jiad been done in 1915-16, when the total amount involved was £2,640,000. VARIETY OF ITEMS GOVERNMENT SUBSIDIES ASSISTING AGRICULTURE [by telegraph—special reporter] WELLINGTON, Wednesday Details of unauthorised expenditure Eubmitted by the Minister of Finance, the Hon, W. ■ Nash, to the House of Representatives, include amounts arising from various forms of State control . established since the commencement of the war. The fruit industry account received n grant of £2/84 for salaries and administrative expenses. Grants made for the same purposes to the meat industryaccount total £12,819, to the sundry products account £3760, and to the wool industry, account £BOOO. The Internal Affairs _ Department made advances totalling £735 to officers of the High Commissioner's Office in London to meet evacuation expenses. The cost of the visit of the Prime Minister,, the Hon. P. Fraser, and his party to Britain was covered by a grant of £2396. , , The Lands Department was allocated £50,000 as a subsidy on wages paid for the settlement of unemployed workers under the small farms scheme. Tobacco growers received a grant or £1498 on account of losses on ex ~ ported tobacco and the settlement or i claim for expenses. . A subsidy of £81,510 was paid by the Agricultural Department on raw materials used in the manufacture or superphosphate. 11*4.1 The broadcasting'account was debited with £3312 as the cost of purchasing the Radio Record, and.the Agricultural department expended'£229 as a grant to Mr. David Jones, a member of the Executive Commission of Agriculture Upon his retirement."