ADDRESS-IN-REPLY

Otago Daily Times, Issue 21389, 17 July 1931, Page 10

ADDRESS-IN-REPLY

NO-CONFIDENCE AMENDMENT MOVED BY LABOUR LEADER DEFEATED BY 48 TO 19 (Peb United Press Association.) WELLINGTON, July 16. When the Address-in-Reply debate was resumed in tbe House of Representatives this afternoon the Leader of the Labour Party (Mr H. E. Holland) moved a formal want of confidence amendment in the Government. He said he wished to draw attention to the fact that in recent times people had only had one opportunity to express themselves on the Government’s fundamental wage reduction policy. The Hauraki by-election had been a crushing condemnation of that policy. The Government candidate had polled about one-third of the vote he had received at the general election, when he had stood for the Government’s policy o| standard wages. Mr Holland admitted that cross-currents had entered into the contest, but the predominant question was that of wage reductions. The Hauraki electors had left no doubt as to their opinion on that subject, and no was quite sure the new member would not go back on his condemnation of the wage-reducing policy. REDUCTION IN INTEREST RATES. Referring to the reduction in interest rates, Mr Holland said it was another crumb from the table. One-half per cent, represented a very slight relief, and anything under 1 per cent, would be of little use to the primary producers. It tbe banks were not willing to meet the present situation, then the legislative machine should be set in motion to compel them.

FIVE MILLION LOAN PROSPECTUS. Commenting on the prospectus for the recent £5,000,000 loan, Mr Holland said he considered it contained several misleading statements. He wanted to know why members were not given information with respect to the ,40 per cent, reduction in capital expenditure on public works to which reference had been made. This no doubt included stopping the East Coast and Midland railways, but it did not indicate the enormous losses that would result from the manner in which the East Coast railway had been stopped, which was anything but economic. The work should never have been earned along as far as it had been if it were to be stopped. Men had been taken from it. and put on to uneconomic relief works, and the formation work would suffer enormously as a result of the deterioration caused by the weather conditions. An extraordinary portion of the prospectus was that which indicated that the deficit for the last financial year was to be met from the balance of the accumulated surpasses since 1914 totalling £30,000 000 What should be said of a Government that sought to raise honey on statements of that kind? It was Quite' d«t “«t «» British press was deceived by that stat ment Why had the Government not stated in plain language what the balance of the accumulated surpluses really amounted to? °no side of the ledger certainly showed a total of £30,000,000, but on the other side there was ove £23 000,000 in four items alone which should have been mentioned. Nearly £14,000,000 had been sunk in * fc the Discharged Soldiers Settlement Account, a large portion of whichi had to So^ttUer;./^rV?ia, d «oVo“f been accumulated surpluses ' o £30,000,000 where would have been t need for wages reductions? TRADE RELATIONSHIPS. . Mr Holland went on to refer to the tariff alterations affecting Canada and asked whv was it that Australia cou d make arrangements and agreements with Canada while the New Zealand Gov ein ment had utterly failed in that; duec tion. There was need for a systemat eed plan for arranging commercial relatmn ships with other countries on thei basis of their trade with us. Ihe Kingdom, our best customer, took “ e ® rl £ twice as much of our products ns we took from her? while on the other hand we exported approximately £6,000,000 vyort of produce to other British countries, tikine £lO 000,000 worth in return, and to foreign countries, taking £15,000,000 worth in return. Mr Holland quoted figures to show that whereas Lee deposits in the banks had decreased to the extent of nearly £^ 00 tfier was an increase of over £I2,OUU,UU in fixed deposits, indicating: that the money had been withdrawn from indue try. It seemed that we were going to accentuate the unemployment problem instead of endeavouring to meet Government’s task should be to legislate for the stabilisation of productive effo t. This must mean a reorganisation °f th currency and credit system in New Zealand. There should be a stabilisation of the minimum price to producers an stabilisation of the m.mmum wage tor the workers. Every other count! y was making great changes m the direction of becoming self-reliant. New Zealand s problem was not so much production as distribution at the present time. Hie neople’s purchasing power had been reduced by P £10,000,000 to £13,000,000, and then it was wondered why farmers were feeling the effect at the moment. THE DEFENCE SYSTEM.

Referring to defence, Mr Holland said it had been stated that the training o cadets in secondary schools would bo encouraged. It had been aid down that Germany must not use the schools tor military training. Were wc going to do what we refused to allow Germany to do? Mr Forbes: Oh, yes. Continuing, Mr Holland asked whethi this training was to be compulsory, lae Labour Party stood for a voluntary system of military training, but it would not vote money for it until the unemploy ment question had been dealt with. Concluding, Mr Holland said he was confident the amendment before the House expressed the public sentiment. D there could be a vote free of the crack of the party whip there would be an overwhelming majority against the Government. Mr C. L. Carr (Timaru) seconded the amendment.

GOVERNMENT’S POLICY DEFENDED.

The Prime Minister (Mr G. W. Forbes) said he thought Mr Holland would have known bv now that the country had quite realised that vyhat had been done about wages was fully justified by the economic conditions, and he added that a Labour Government across the iasman had to face the question of a 20 per cent, reduction. That, he declared, vyas vyhere New Zealand would have been had there been a Labour Government in office. Mr Holland seemed to have an idea that the Government should set a course and keep to it even if there were dangerous rocks in the way. That might appear consistent, but it would, mean shipwre.ck This country was receiving £10,000,000 to £ls 000,000 less in revenue and h» coum not see how it could maintain the same rate in expenditure. Continuing, Mr Forbes said the policy pursued in this country by Mr W. D. Stewart and other Ministers of finance had placed the credit of New Zealand on a very high plane in the Old Countiy* The financial policy of the Dominion had been carried on on very sound lines, and the people of New Zealand were reaping the benefit to-day. The fact that thcountry had faced the position that had arisen enabled it to maintain its credit * “ Our securities in London are nign, Air Forbes said. “Our 5 per cents, are back to par, and the underwriters holding some of the stock are able to get rid ot it at a profit. It can therefore be seen that the position when the loan was floated was only temporary and we were unfortunate in striking the market when had been made to the reduced loan requirements for Public Works, continued Mr Forbes. During the last session there bad been one continuous protest against the amount of loan money being expended on Public Works, saying that the one thing we should do was. to reduce it When the Government accepted that position and made a reduction, members

got up and stated it should have what it was doing. He liked to' give effect to the wishes of members where possible, and accordingly the reduction had been made. The Prime Minister contended that in the loan statement it was justifiable to show how the accumulated surpluses had been used, because this demonstrated that the Government had not depended entirely on borrowed money for its activities. In putting out the loan prospectus it was justified in pointing this out, and also that the deficit could be met out oi the balance of the accumulated surpluses. Referring to Mr Holland’s statement that the banks should reduce their interest rates by 1 per cent., Mr Forbes said that quite' a number of people bad to be taken into consideration. The reduction of i per cent, was the first step, and one that would be appreciated by the country. He was pleased with the attitude adopted by the financial institutions. He knew that so far as the mortgagees in rural lands were concerned they were meeting in a sympathetic manner the needs of the mortgagors TRADE WITH CANADA. Dealing with the negotiations for a better trade relationship with Canada, Mr Forbes said that when he reached Canada on the way to the Imperial Conference he found that largely on account of the agitation of Canadian farmers the duty on our butter had been increased from four to eight cents per lb. Mr Forbes pointed out that the preferential rate under which Canada had been sending goods to this country had been instigated primarily for the benefit of Great Britain and not with the idea of doing business with the other dominions. It had been established as a principle by the present Government that so far as possible New Zealand should buy from those to whom her produce was sold. The Government wag only too anxious to have a reciprocal trade agreement with Canada, but it must not be a one-sided agreement. Canada had gained more under the Australian treaty than New Zeal..ml had, and as Britain was almost our sole market it was our bounden duty to encourage trade with her. Mr J. S. Fletcher (Grey Lynn): Why did you not call at Canada on your way back and negotiate?* Mr Forbes: If yon- think the Prime Minister of New Zealand is going to go round crawling after people for trade advantages you have made a mistake. He added that he had met Mr Stevens (Canadian Minister of Customs) in London, and had asked him if there were any chance of a reciprocal agreement with Canada in regard to our butter, and had been told that there was no chance at all. Mr Forbes declared that during the depression when the country was up against it it was time for stocktaking with a view to reducing costs in every possible direction, and applying the lessons of science to production and to improving the quality of our produce. An important clause in the GovernorGeneral’s Speech was the forecast regarding legislation to deal with the reorganisation of the scientific research system so that we would be able to concentrate upon our primary and secondary industries to a greater extent than in the past. This legislation would be introduced during this session, and be believed it would assist in getting New Zealand back to prosperity.

ACTIONS OF CONTROL BOARDS, Mr W. D. Lysnar (Gisborne) said that members of the Opposition were continually getting up to talk about the desperate .position of the primary producers, but they were doing nothing to remedy matters. He condemned the actions of the produce control boards, and said that the country had lost millions because the Reform Government had put the wrong men on the boards. DEVELOPING SECONDARY INDUSTRIES. When the House resumed after the tea adjournment, Mr Carr said it was important that New Zealand should increase its Home market. This could he achieved by developing our secondary industries. THE INTEREST RATES. Mr W. Nash (Hutt) expressed regret that the Government had agreed to reduce the rate of interest paid on deposits in the Post Office Savings Bank. He could not see why it should bo reduced to per cent, when the trading banks were paying 5 per cent. , , , , Mv Holland’s amendment was defeated by 48 votes to 19, only the Labour members voting for it.