FINANCIAL MATTERS.

Otago Witness, Issue 3615, 26 June 1923, Page 53

FINANCIAL MATTERS.

SURPLUSES AND TAXATION. ANOTHER STATEMENT BY STR J. G. WARD. WELLINGTON, June 22. Sir Joseph Ward, who was interviewed today, replied at length to Mr Massey regarding the controversy which arose through Sir Joseph Ward’s speech at Bluff, when he declared that the "Motherland bad, since the war, decreased her Budget by over £500,000,000, but that the New Zealand Government, in the same period, had increased her borrowing by millions, and these, with the surpluses used and spent, totalled over £100,000,000. Referring to Mr Massey's statement that Great Britain’s debt had increased oy £1,821,000,000, Sir Joseph Ward pointed out that Britain had undertaken new responsibilities in Irak and Palestine, had spent scores of millions in consequence of the Graeco-Turkish unsettlement, and was maintaining at an enormous cost a standing army on the Continent, while at the same time she avas not. receiving interest on loans made to the Allies. Notwithstanding this her annual Budget had been reduced since the war, and her war income tax had been reduced to 4s 6d. Sir Joseph asserted that his statement at Bluff was undeniable, and Mr Massey did not deny it. Mr Massey s attempted justification would deceive no sane person in New Zealand.

“The question,” said Sir Joseph, “is: Can this country now, four years and seven months after the war, continue to stand it, even with a further £2.000,000 of taxation taken off, which, of course, everyone will admit is in the right direction. I say unhesitatingly that we cannot go on as w T e are doing.” Sir Joseph Ward asserted that the system of company taxation would, if continued, compel members of New Zealand’s bestindustrial companies to go into liquidation. After auoting the balance sheets of the Bank of New Zealand and the National Bank of New Zealand, he remarked: “If anyone takes the trouble to analyse these results he will find that in location these two banks are handicapped to the extent of between three-quarters and one per cent, in the rates thsv charge clients for advances compared with what is payable by the Australian bank cited (the National Bank of Australasia). Referring to the happenings of 1919. Sir Joseph Ward said that during the debate on Sir James Allen’s Budget in September of that year he appealed to Sir James Allen not to try to drive two years’ land settlement into one, and so cause an increase in land values to an extent certain to 'tirove disastrous to all settlers. “I was positive.” said Su* Joseph, “that- the policy followed would establish a land boom, with all they dreadful consequences of inflated land values. Could it have been avoided? In my opinion it could. It was a positive calamity to take accumulated surpluses for land buying.” Sir Joseph Ward said his proposal, made in Parliament was to keep £20,000.000 of surplus and use every penny piece for advances to soldiers, to settlers, to workers, and local bodies. He proposed, also, to purchase all land required for soldiers by Government stock bearing from M to 5 per cent, interest. He had ascertained in London that it was possible to get the money there. “However, the policy for purchasing land for cash had actually started on a large scale before I returned to New Zealand on the last occasion, and as I believed that it would end disastrously I called the Liberal Ministers together and toid them that in my opinion it would result in a land boom and financial difficulties, and that I would not accept the responsibility for it, and that the only course was for me to resign. Every ojie of my Liberal colleagues knows that this was so, and whether I was right or wrong I acted upon my judgment at the time, and I took the course indicated. I cannot be accused by anyone of saying now. ‘I told you so. after the policy to which I was opposed had been tried for nearly four years. I acted quite loyally to all my colleagues throughout the whole time I was in the National Government, and none of them can say to the contrary. Every one of the Ministers —Reform and Liberal alike did their utmost to carry the Government during the time of trial and difficulty, and on the whole they succeeded uncommonly well. To he told now that lam in any way responsible for anything that occurred after I resigned from ihe Government and to have doubt cast on my having put the whole of our indebtedness to tin British Government into war loans is, to say the least, unexpected and ungenerous. It cannot be truthfully asserted by anyone that there was any failure on my part in financing the war. When I left the Government our finance w 7 as strong and clear, with a surplus of millions that no other part of the Empire had similarly provided. There was a sinking fund provided for our whole indebtedness. I have _ spoken recently about the financial position, and I do so now solely because I am more than anxious about the future. T have, and always had. the greatest confidence in the country, hut with the present population the extraordinarily hoavv taxation burdens bearing upon the industrial world now—four years and seven months after the war —are having a far-reaching effect upon the whole country. Expediency and assertions that all U well are not going to prevent further difficulties from presenting themselves within the next few years.”