"COMIC OPERA"

Otago Daily Times, Issue 22716, 31 October 1935, Page 9

"COMIC OPERA"

DEMOCRATS' PROMISES NEARLY £22,000,000 A YEAR (SrEciAL to Daily Timesl AUCKLAND, October 30. The cost to the country of the fulfilment of the Democrat Party's promises was the subject of comment by the Minister of Finance, Mr J. G. Coates, during his speech at Riverhead. Mr Coates explained in detail his estimate that the promises of the Democrats, if carried out, would involve a national cost of nearly £22,000,000 a year. " I do not know whether to describe the Democrat programme as comic opera, political burlesque or a fairy tale," said Mr Coates. "It is a pity that Gilbert and Sullivan are not here to help Mr Hislop with a libretto and put it to music. However, perhaps a revised version of 'Alice in Wonderland' would serve just as well. At Masterton Mr Hislop said something about a frog and an ox, apparently likening himself to the ox. The Democrats will at least share the fate of the ox in November, when their political slaughter takes place. Recently I stated the cost of the Democrats' promises to be £22,000,000 a year, quite apart from the provisions of the Budget. Mr Hislop tried to cover this with a smoke screen. " With regard to the reductions in taxation, Mr Hislop was quite specific, and we can nail him down to figures without difficulty. The amount of his reductions would be as follows: —Sales tax £2,500,000, gold tax £IOO,OOO, income tax £425,000, unemployment levy £410,000, and wages tax from„Bd in the £1 to Od in the £l, £758,000. This makes a reduction of £4,193,000 in revenue, out of which £3,000,000 would fall on the Budget and over £1,000,000 on the Unemployment Fund. The increases in the annual expenditure pron.ised by the Democrats are as follows: —Health insurance £2,000,000, increase of 25 per cent, in pensions £858,000, full restoration to civil servants £BOO,OOO, annual cost of restoring the Superannuation Fund £500,000, export subsidy to give a benefit equal to the exchange £9,000,000, a similar subsidy on locally consumed production £4,500,000. These make a total of £17,058,000, so that the complete gap is therefore just under £22,000,000. In addition, there are other smaller items of expenditure, such as the increased cost of education, extending the school age and the increased cost of teachers' salaries." Mr Coates referred to the cost of the proposed subsidy in place of the exchange. Mr Hislop had said the Democrats would help the farmer by direct personal payments of an export subsidy to a degree at least equal to the exchange benefits with half the cost to the community. Since the payment was to be personal, the subsidy would have to be given on local consumption as well as on exports, and the cost would then be £13,500,000. Mr Hislop's policy either meant that or else it meant that some farmers would receive a subsidy and others would not. In the latter case it appeared that Mr Hislop would have to determine who would get the payment. Perhaps there would be an army of inspectors deciding which farmers needed assistance. It was judged, however, that the whole scheme was fantastic beyond description.

"The gap of £22,000,000 to which I have referred," Mr Coates added, ;'' takes no account of Mr Hislop's proposal to put 40,000 unemployed in full work at standard rates of pay. This would cost at least another £12,000,000 a year, and possibly as much as £17,000,000. All I want to ask Mr Hislop and Mr Caughley is how they propose to close these gaps."