NATIONAL RECOVERY

Otago Daily Times, Issue 22714, 29 October 1935, Page 10

NATIONAL RECOVERY

PLAN OF RECONSTRUCTION ACHIEVEMENT-NOT IMPOSSIBLE PROMISES GOVERNMENT'S APPEAL TO ELECTORS (Per United Press Association.) WELLINGTON, October 28.

The National Government has issued the following manifesto signed jointly by Mr 6. W. Forbes and Mr J. G. Coates. The National Government comes before the electors with a record of successful performance and a message of encouragement and hope for the future. In common with all other countries New Zealand has suffered severely from the world depression. When the National Government took office in 1931 it was faced with the most eerious economic crisis in the history of the country. Within the short space of two years the price of greasy wool had fallen from 17d per pound to 5Jd per pound, lamb from 7.1 d per lb to 3.3 pence per lb, and butter from 162 s Od per cwt to 100 s per cwt. The prices of other products fell in the same way. During the previous three years the value of exports had fallen from £56,000,000 to f 35,000,000, and of farm production from £83,000,000 to £50,000,000. Unemployment had increased from 2504 to 40,335, the national revenue shrank heavily and the Budget showed an enormous deficit. Our economic life was out of balance and chaos threatened. GRAVITY OF THE PROBLEM These figures are sufficient to illustrate the gravity of the problem facing the Government. The problem was tackled ■with determination and foresight. The Government followed a consistent policy and the evidence of recovery on every hand shows that it has succeeded. Here are the fruits of the Government's policy. Since 1931-32 the value of the total production has risen from £83.6 million to £98.8 million, and is still rising. The value of farm production has. risen from £49.2 million to £63.3 million, and is still rising. The value of exports has risen from £34.7 million to £43 million, and is still rising. The value of imports has risen from £24.7 million to £34.3 million and is still rising. Since 1933 the wages and salaries paid have increased from £58.9 million to £65 million and are still increasing. Post office deposits are now a record and total over £SO million since September, 1933. The number of unemployed who are a charge on the fund has fallen from 74,000 to 58,000, and will continue to In 1931 there was an estimated deficit of over £8,000,000, and the Budget is now balanced and will continue to improve. SPIRIT OF THE PEOPLE Our national resources are unrivalled and unimpaired. The spirit of our people has enabled them to meet the common sacrifices imposed by the crisis. With courage and fortitude the road to prosperity has been cleared. Reinforced in confidence by the recovery brought about by the policy of the National Government our people can now press forward towards the goal of complete re-

duced. The Dominion has benefited substantially from the Ottawa agreement and the subsequent negotiations. The recent meat negotiations avoided a loss of over £1,000,000 per annum to our producers. Regulated expansion is the keynote of our policy. New Zealand has faithfully carried out her obligations under the Ottawa agreement, and the last tariff revision reduced the duties on 100 items. Our tariff on British goods is lower than that of any other country with the possible exception of Holland. STABILITY WITH PROGRESS When the National Government came into power in 1931 it was faced with a position of unprecedented difficulty. The fall in prices had undermined the basis of national prosperity. The policy of the Government has re-established the foundations on which prosperity can be steadily built. Its policy is one of stability with progress. The need for drastic measures involving heavy sacrifices on the people is now passed. It will continue to build carefully and soundly. It will not endanger the foundations of the national economic life by extravagance. It offers achievement —not impossible promises. THE GOVERNMENT'S POLICY This is the policy which the National Government places before the electors: 1. Budgetary stability will be preserved. Increases in taxation must be avoided by refraining from extravagant expenditure. 2. As the economic and financial conditions continue to improve the rates of taxation will be reduced. 3. Wage and salary cuts in the public service will be restored and pensions improved as soon as the national finances permit. 4. The Government's aim will be to promote a continuance of cheap credit policy. 5. Unless there is a marked change in the conditions the Government and the Reserve Bank will co-operate in maintaining the stability of the exchange, This will help to sustain production and the national income. 6. During the 1933 session company law in New Zealand was very substantially improved. In 1934 the Companies Promotion Commission made a very full inquiry into bond-issuing companies, investment trusts and the organsation of stock exchanges. It is proposed to introduce measures giving greater protection' to investors while avoiding undue restrictions on legitimate company promotion. 7. A scheme of compulsory national superannuation covering pensions for old age, sickness, invalidity, widows and orphans has already been investigated, and as soon as financial conditions permit the scheme will be established. 8. Investigations into national health insurance have also been made. These will be carried further, and a scheme will be introduced as soon as the financial conditions permit. 9. A national housing scheme will be introduced involving co-operation between the State, local authorities and private enterprise. A most careful expert inquiry and the fullest discussion will take place before the scheme is launched. An Act providing for housing survey has already been passed. 10. The Government has plans well under way for the free distribution of milk to school children. An experimental scheme is already operating in connection with the Auckland schools. The general policy of the Government is that no person young or old shall go short of food. . . . 11. With the return to improved and more settled economic conditions it is proposed to have a general examination of our labour laws with a view to increasing the scope of employment, maintaining and where possible increasing the standard of the workers. 12. As a result of the decisions at Geneva inquiries are being conducted in every country into the question of shorter hours. Early next year a conference of employers, employees and other qualified persons will be called to investigate the whole problem from the point of view of unemployment efficiency and the standards of life. , 13. The Apprenticeship Act will De revised with a view to safeguarding more the interests of the boy. # 14 A scheme for the reorganisation of the library system throughout the Dominion, and in particular its extrasion to rural areas, is already under the course of preparation. This will be linked up with the school library system and the university system of adult education. ' 15 At the present time the director of education is investigating educational conditions in the United Kingdom and other countries. Our educational system will be revised and improved m the li<*ht of New Zealand conditions and advanced practice abroad. 16. With a view to reducing substantially unemployment and promoting industrial development, steps have already been taken in the direction of (1) Carefully planning public works for several jvears ahead. The policy is to encourage men to go on full standard rates of pay to where the most useful developmental work can be found The public works will be expanded. A plan has been prepared for a long-range programme covering the next five years. The public works policy is being co-ordinated with the unemployment policy. Works • have been selected on the basis of direct financial return and indirect financial or social benefit. (2) Providing a basis for co-opera-tion between the Government and the groups representing private enterprise for the development of industry. This is alreadv being investigated, and important schemes are actually under consideration at the moment. (3) Conducting soil,.mineral, oil, and regional surveys with a view to obtaining a full knowledge of the developmental possibilities of every region in New Zealand. This work has already been commenced in Hawke's Bay, North Auckland and the Waikato. 17. Assistance will be given where our industries are of proved efficiency. While expecting industries to assist themselves by reorganisation and co-ordination we will facilitate such voluntary action by legislation wherever necessary. *lB. Negotiations have already been completed leading to the early estab-

covery. We have built a bridge and its arches are sound. The National Governments policy will be to preserve the foundations on which these arches rest. They must not be undermined by extravagant and impossible promises. Our producers have been faced with keener competition on the world market than ever before. Competition will still be keen. The leaders of the National Government have a knowledge of the problems to be faced. They know the men and the markets. They are skilled negotiators. The future must not be endangered. Future negotiations must be left in their capable and experienced hands. PLAN OF RECONSTRUCTION Every step in the Government's policy was carefully thought out. When the crisis burst upon New Zealand' the Government called on prominent business men and technical experts to investigate and advise. This is what every business man would do, and the Government applied the same principle to the business of the country. On the basis of this advice the plan of reconstruction was formulated. Every step was based on a thorough inquiry. There were four main questions of policy. These were economic reconstruction and financial reorganisation, relief of unemployment, Budget stabilitv, and safeguarding of the markets. The Government's policy was a national policy designed to promote national recovery and to benefit ah classes. The gap between costs and selling prices in our basic industries was over 40 per cent. This was ton great to be bridged by the cutting of costs alone. The Government followed two lines. The national income was raised by increasing the exchange, and costs were reduced by orderly uniform action. This was better than abiding by the law of the jungle. To take one example of the reductions in cost. The bank overdraft rate was reduced from 7 per cent, in 1930 to 4£ per cent, in 1934. The Reserve Bank—the people's bank—was established last year. For the first time we have in Isew Zealand the control of currency and credit in the general interests by what is a national and practically non-profit-making institution. The Reserve Bank will help to stabilise nad cheapen credit. ' The Mortgage Corporation, established this vear, will put mortgage finance on a sound and stable basis and liquefy the frozen mortgage securities. The initial lending rate is 4J per cent. The Unemployment Board has instituted a wide variety of useful works. It has co-operated with private industry and given assistance by way of subsidies. The scale of sustenance for those for whom work could not be found is higher than in any other country. _ With the prospect of a Budget deficit of over £8,000,000 in 1931, the Government was faced with the most -vntical financial problem in the history of the Dominion. As a result of wise measures adopted, the Budget has been balanced for two consecutive years. Pension reductions and wage and salary cuts have been very largely restored, and the time is not far distant when the remaining cuts can be restored and taxation re-

lisLment of air services to Australia with the Imperial Airways and to the United States with the Pan-American Airways. Within New Zealand the necessary provision for efficient air services is being pushed ahead by the establishment of aerodromes, landing grounds, beacons and other facilities. This will facilitate communications and inevitably lead to much closer economic political and financial relations with the rest of the world. 19. It is the policy of the Government to facilitate voluntary settlements under the mortgage adjustment legislation. The necessary administrative steps have been taken to ensure reasonable and sympathetic consideration by the State lending departments of the position of the State mortgagors whose liabilities arc in need of adjustment. 20. The Government through the Executive Commission of Agriculture and in other ways will direct its attention to the improvement and development of our markets, the improvement in the quality of our products, and improvement in organisation. 21. The policy of close and cordial cooperation witli the United Kingdom in all matters affecting the Empire will be continued. The Government affirms its support to the League of Nations and its principles in furtherance of world peace. The Government will play its part in close co-operation with Great Britain and other parts of the Empire in the matter of defence. RECORD OF ACHIEVEMENT The Government has a record of achievement in overcoming the worst depression in history. Past difficulties have been surmounted by a clearsighted recognition of the factors impeding the way to progress. For its past record, and because of its progressive policy now placed before the country, the Government can with confidence ask the electors of this country to return a National Government for the national good.