FUTURE OF INDUSTRIES

Otago Daily Times, Issue 22958, 13 August 1936, Page 9

FUTURE OF INDUSTRIES

DEVELOPMENT RETARDED EFFECT OF INCREASED TAXATION BUDGET PROPOSALS CRITICISED (From Our Parliamentary Reporter) WELLINGTON, August 12. The opinion that increased taxation would have a harmful effect on the future of industrial development was expressed by Mr W. J. Broadfoot (Opposition, Waitomo) in his general criticism of the Budget during the financial debate in the House of Representatives to-day. “If the Ministei of Finance has anything to crow about he crows vociferously,” Mr Broadfoot said. “ He might well be described as the chanticleer of the Labour Party. The promises for the future over which he flaps his wings and crows so loudly will, however, only have the effect of piling up costs. We will find that as a result of the spectacular legislation many industries which at present are working on a thin margin will eventually come to grief. There are many men willing to work harder and for longer hours, but it seems that that will not be allowed. Before long we may not be allowed to work at all. Higher wages, shorter working hours and record taxation constitute a series of knock-out blows aimed at private industry. The Budget penalises the man of initiative and enterprise. Its benefits are illusory because in the main they must be wiped out by the rising costs. As the Prime Minister says industry at present is working at full capacity in an endeavour to supply orders. What is the cause of that? Is it the demand for the supply of immediate wants or is it a false demand created by the desire of retailers to fill their shelves while prices are still low? In the latter alternative there must be further increases in unemployment in the near future.” Referring to unemployment Mr Broadfoot said that the last monthly abstract of statistics proved that there had been really no diminution in unemployment during the past year. The figures for June, 1935, were 39,330, and those for June this year 39,038. One almost needed a microscope to observe the decrease Apart from that the number of men employed by the Public Works Department had increased by 3711. These works were really relief works. They were not immediately necessary but they were started in order to employ labour. By rights those 3711 men on public works should be added to the total of unemployed receiving State assistance, and it would then be seen that the Government had made no progress at all. Mr Broadfoot criticised the system on which the Government calculated the guaranteed price for dairy products. Mr Broadfoot repeated the argument first advanced by Mr J. G Coates (Opposition, Kaipara) that the dairy fanner was being denied the full benefits of the exchange and he also criticised the basing of the price on a weighted average for 10 years instead of a flat average The only fair way to calculate the guaranteed price, Mr Broadfoot said was to take the average of the sterling realisations for the past ten years and then convert that average into New Zealand currency at the present rate of exchange. The member for Thames (Mr J. Thorn) had not stated the position fairly when he said the price was based on the average pay-outs. The pay-outs had been made in currency which varied considerably during the past ten years. Already there was a movement to reduce the retail butter prices on the local market. In some cases the price had dropped already by 2d a pound. That was another hit at the producer. It had been customary to fix the local price on London parity but the dairy farmer now was to be fleeced of 2d a pound on all sales on the local market. Dealing with the fixing of the price on a weighted average, Mr Broadfoot said the figure of 12.79 d was obtained instead of 13.59 d on a fla + average. “ The Government said it would give a most generous interpretation of its promise,” Mr Broadfoot added, “ but there is a difference of ,4-sd. The loss to the primary producer from this difference amounts to about £1,690,000 a year. It is not much when you say it quickly “The Minister of Finance can be called the Billy Sunday of New Zealand politics,” Mr Broadfoot concluded. “He is making New Zealand a safe place for trades union secretaries to live in.”