HOUSE OF REPRESENTATIVES.

Otago Witness, Issue 3886, 4 September 1928, Page 24

HOUSE OF REPRESENTATIVES.

WELLINGTON, August 28. The House met at 2.30 p.m. HOSPITAL LEVIES. Replying to Mr T. M. Wilford (Hutt) the Minister of Health (Mr J. A. Young) said that the introduction of legislation this session dealing with the incidence of levies made by hospital boards on local authorities was not contemplated. The expenditure on hospitals was primarily in the hands of the hospital boards. The expenditure had increased in recent years for various reasons, but boards had to make levies on the local authorities. At present the hospital boards were elected by precisely the same electors who voted for local bodies. It seemed to him that the work of collecting the levies could best be done by the local bodies who had the necessary machinery for the work. If local bodies did not like that work the obvious reply seemed to him to be that hospital boards should be made rating authorities. The Minister said that that seemed to him to be undesirable because they would multiply the methods of levying on the rates. If there was any complaint about levies the people who were responsible for local representation were to blame because they elected ths hospital representatives. He had asked for a conference between the municipal and country authorities on the question, and had stated that when they agreed on a basis for the levies he would be pleased to consider fresh legislation. THE LICENSING BILL. Replying to the Leader of the Opposition (Mr H. E. Holland) the Prime Minister (Mr J. G. Coates) said the Licensing Bill would probably be in-

troduced next week, and if Parliament passed it there would be ample time to have all the necessary’ ballot papers printed. PRISONS DEPARTMENT. The Minister of Justice (Mr F. J. Rolleston) laid on the table the annual report of the Prisons Department, discussion on which occupied the whole of the afternoon. The speakers generally eulogised the improvement which had taken place in the system of prison reform during recent years. The Minister, in reply, said that the main purpose of the prisons was reformation, but they could not be administered without a certain amount of discipline and author-, ity. He paid a tribute to the prison officers and to the voluntary workers who have laboured for the benefit of the prisoners. THE PROBATION DEPARTMENT. The Minister also laid on the table the report of the Probation Department. The Leader of the Opposition (Mr H. E. Holland) drew attention to the report on the operation of the probation system in Victoria where, he said, out of 162 prisoners released on probation only seven had been returned to gaol, and he asked if the Minister could give similar information as to the operation of the system in New Zealand. He thought more prisoners might be released on probation. The Minister, in reply, said the question of probation was entirely for the magistrates. The number of releases in New Zealand had not been quite so great as quoted by the Leader of the Opposition, but the position was quite satisfactory. During the past five years 957 prisoners have been released, of which only 120, or 12.5 per cent, had been returned to prison. ,

PRISONS BOARD. The report of the Prisons Board was laid on the table without discussion. EDUCATION DEPARTMENT. The report of the Education Department was laid on the table by the Minister (Mr R. A. Wright), and was being discussed by Mr R. M'Keen (Wellington South) when the House adjourned at 5.30 p.m. PUBLIC WORKS ACT. When the House resumed at 7.30 p.m. the Public Works Act Amendment Bill was introduced by Governor-General’s Message. In reply to the Leader of the Opposition (Mr H. E. Holland) Hie Minister of Public Works (Mr K. S. Williams) explained that it was intended to introduce a Consolidation of Public Works Act Bill before the end of the session, and these were some of the amendments they desired to get into the consolidation. They referred principally to the dedication of lands and streets, etc. The Bill was read a first time. POST AND TELEGRAPH BILL. Mr K. S. Williams moved the second Tending of the Post and Telegraph Bill. He explained that the Bill was purely a consolidating measure, and contained no new matter whatever. Mr M. J. Savage (Auckland West) said he was glad there was no new matter in the Bill, but he supposed there was enough in the old Bill to keep them going for a considerable time. He then entered upon a criticism of Section 82 authorising the Minister to pay interest to depositors in the Post Office Savings Bank. He argued that the Post Office Savings Bank was not being sed to the best advantage. By refusing to receive deposits of amounts over £2OOO they had 1 driven that money into the coffers of the

private competing banks, whereas it might have been used ’ y the State Advances Office to lend to settlers. The policy of the Government had driven away from the public funds money which could have been had at 3i per cent. Then when the Government wanted to borrow it had to pay 5| per cent, and there were millions of money in that category. Mr J. A. Lee (Auckland East) said the Minister had not answered the question repeatedly put to him: “ Why did the Minister take power to attract deposits to the Post Office Savings Bank if he did not intend to use it ? ” The Minister of Finance (Mr W. Dewnie Stewart) said the point raised by Mr Savage and Mr Lee had been raised so often and answered just as often, that he could not help thinking they were speaking with their tongues in their cheeks. If they had watched the course of events they would have seen what was happening. In May, 1927, the private hanks raised the rates of interest on deposits, but the Government did not legislate till October. By that time large sums of money, which the Opposition said was driven out, had already gone out, and legislation was brought in to stop that sort of thing happening again. He had been charged with not raising the rate of interest to depositors to attract deposits, but how could he raise • interest u £50,000,000 just because £2,000,000 had gone out. That would not have been a business proposition at all. The case might have been different if £20,000,000 had gone out of the Post Office Savings Bank, but for a mere drop in the bucket the rates of interest could not be increased to all departments borrowing from the Post Office. To say that the Government drove money out of the Post Office Savings Bank when that money had

already gone out was so absurd that he could not understand why the Opposition persisted in it. The Government had not used its power to pay increased interest because there was no need to do so. He would have done so if large sums had continued to leave the Post Office. The money was not now leaving because small depositors were not influenced by the bank rate of interest, and matters were again normal. It was absurd to say that the banks were dictating the financial policy of the country. The Government had taken the only possible course, which was a perfectly business-like course. Mr G. W. Forbes (Hurunui) said he thought the whole difficulty with regard tn the sudden withdrawals of large deposits might have been got over if it had been stipulated that certain notice must be given before withdrawals could be made. With such a safeguard as that he could not see any objection to the Post Office Savings Bank taking large sums on deposit. The Leader of the Opposition said that the Minister had clouded the issue considerably. It was well known that private banks were attacking the manner in which the Post Office Savings Bank was conducting its business, and on that the Minister had made a statement that interest would not be paid on the larger deposits. It was then that the heavy withdrawals took place, because there was no certainty what exactly the Government was going to do. That was as clear as day, and that was the true explanation of what took place. The Acting Postmaster-general (Mr K. S. Williams), in reply,' said the Minister of Finance had covered most of the ground. There had been criticism on the score of toll charges for telephone calls, but the New Zealand rates compared favourably with other countries. Every effort was made to keep the charges down in order to help the country* people. , The Bill was read a second time. STATUS OF ALIENS. The Minister of Justice (Mr F. J. Rolleston) moved the second reading of the British Nationality and Status of Aliens, (in New Zealand) Bill, which originated in the Legislative Council. He said all the Bills introduced throughout the British Commonwealth of Nations were on similar lines) and the Bills were designed to secure uniformity throughout the Empire’ in the matter of the naturalisation 6f aliens. In 1923 New Zealand had? not gone so far as other portions of Ahfe Empire, and had not accepted the principle of Empire citizenship. r. person who was a British citizen in one part of the Empire was a citizen in all parts of the Empire. On the contrary, we had adopted local citizenship, which was good only so far as -New Zealand was concerned. New Zealand was the only country in the British? Commonwealth of Nations standing of the generally accepted standard o£naturalisation, and this had created ai|t<ißlolies. It was now proposed to adopt part II of the British Act, and so adopt the British standard of naturalisation ■which was rather higher than our present standard. The reason New Zealand had not done this before was one ofr taution, but five years of the working ,of the Act had shown that this policy was not now necessary, and with certain safeguards which it was proposed to impose he thought we could fall into line with other parts of the Empire. Mr P. Fraser (Wellington Central) said that so far as the Bill sought to unify and simplify the system of naturalisation, unless we were prepared to take up the attitude that we would ignore the recommendations of the Imperial conferences and legislate only for ourselves, there could be no particular objection to the present Bill. Mr E. P. Lee (Oamaru) said that the cardinal principle of the Bill was uniformity in the system of naturalisation. The Leader of the Opposition said ' that all that was wrong with the Bill W’as that it came five years too late. It represented what the Labour Party was advocating in 1923. Mr H. Atmore (Nelson) and Mr H. M. Campbell (Hawke’s Bay) regretted the introduction of the Bill. The Minister, in reply, said that New Zealand’s position was not weakened by the Bill because we still had the power to restrict the introduction of undesirables under the Immigration Restriction Bill. The second reading of the Bill was challenged, but on the division was carried by 38 votes to 15. The House rose at 1.52 a.m.

WELLINGTON, August 29. " The House met at 2.30 p.m. ' GROUP SETTLEMENTS. . Replying to Mr T. M. Wilford (Hutt), the Prime Minister (Mr J. G. Coates) said the Minister of Lands had already dealt with the question of group settlements in Western Australia, and the information given by that Minister to the House showed there was no need for young New Zealanders to go to that State in search of land as there was nothing to be got there which was not available here. THE POLICE FORCE. Replying to Mr P, ; Fraser (Wellington Central), Mr F. J. Rolleston said aßill dealing with . the Police Force had been drafted. He had not yet fully considered it, but he anticipated that it would be brought ..down this session. ’lndustries . and- commerce. . The Minister of Industries arid Comnierce (Mr A.. D. M'Leod) laid on the, table the report of the Industries‘and

Commerce Department. Labour members attacked the Government for not giving sufficient encouragement to secondary industries. Mr M’Leod, in reply, said the policy of the Government had always been one of moderate tariffs, not one of excessive tariffs to force on the secondary industries. Before we could make the secondary industries flourish in this country there would have to be much greater co-opera-tion between the employer and the employee. Labour had something to answer for both in Australia and in New Zealand. REPLIES TO QUESTIONS. Members then proceeded to discuss the answers given by Ministers to questions asked. . Amonst others Ministers gave the following answers:— That it is the intention of the department to provide stretchers in The guards’ vans of all trains. Investigations are now being made with a view of adopting a standard stretcher which will readily lend itself to the transference of patients from guards’ vans to ambulance vehicles. That the installation of warning signals at level crossings is being pushed forward as rapidly as possible. The list of crossings to the dealt with is, however, somewhat lengthy, and work can be undertaken only in the order of urgency and as finance becomes available. Several flashing light signals (which show an alternating red light to approaching traffic) have been erected and are proving satisfactory in the service. As circumstances permit additional signals of this type will be installed at level crossings where they can be suitably used. That no steps are being taken by the Government in the direction of establishing an Empire settlement scheme in this Dominion for British immigrants. That women are already employed in the Police Department and the question of providing legislative authority for their functions is now before Cabinet.

That the policy adopted in connection with the construction of new railway lines is as set out on P II of D 2 report (Railways Statement) for the year 1924. It is the practice for the Public Works, Railways, Agriculture and other departments concerned to scrutinise closely the estimated cost of construction, revenue and working expenses of all projected lines.

That the rates for toll calls are at present under consideration with a view to an alteration of the present system of charging and a better distribution of the calling rate over the working hours. That it is not proposed to make any amendment this session to the pensions law which at, present does not provide for orphan children. That the Government is giving earnest attention to the matter pf the maintenance of regular and ample supplies of phosphate to meet New Zealand requirements, and has already initiated action on the lines of endeavouring to secure .fuHher.. permanent supplies. ' In the circumstances it is not considered necessary io undertake at the present time any general survey of the islands of the Pacific.

That- the question of fixing teachers’ salaries on some other basis than that of the position held is being considered • at the present time by the department, and if the difficulties in the way are not insurmountable it is hoped that something may be done in the direction of paying teachers on the basis of their qualifications and success in the profession and not on the grade of the-school. TEACHERS’ SUPERANNUATION. The Minister of Education (Mr R. A. Wright) laid on the table the report on the teachers’ superannuation scheme. Mr T. M. Wilford (Hutt) wanted to know -why there was such a disparity between superannuation earned by the men in one department of the public service and those in another. Why, for instance, were members of the police force paid less than other public servants ? Mr P. Fraser (Wellington Central) advocated higher superannuation for the police force. A policeman did not begin to earn superannuation until he was at least 21 years of age, and was in most cases compelled to retire before he had 40 years’ service. Sir George Hunter (Waipawa) advocated superannuation for nurses in public hospitals. Mr J. A. Nash (Palmerston North! supported this plea and said he hoped the Minister would be able to include nurses in private hospitals. The discussion was proceeding wh :n the House adjourned at 5.30 p.m. BILLS INTRODUCED. When the House resumed at 7.30 p.m., by Governor-General’s Message, the Land and Income tax Bill was introduced, and also the Industrial Conciliation and Arbitration Amendment Bill. JUDICIAL PROCEEDINGS BILL. Mr P. B. Fraser (Wellington Central) moved the second reading of the Judicial Proceedings (Regulation of Reports) Bill, which is designed to restrict newspaper reports of cases which can have no effect except to arouse the morbid curiosity of a section of the public. The Bill, he said, was framed on the lines of the British Act, which had now been in operation long enough for a definite opinion to be formed about it. The result had been a cleaner' press, <and he submitted that in this country the same law would be extremely beneficial/" No good purpose was served by pubishing in salacious form the unsavoury details' of divorce and other -cases, where sex' matters were involved: He asked the; House, -in -view of the public support given , to the principle.. of the Bill, to give it a second reading, and suggested

that at that stage the Government should take the Bill up and pass it, since a private member could hardly succeed in getting it through. The Minister of Justice (Mr F. J. Rolleston) said he did not wish to appear hostile to the Bill, but he would like to point out what -the existing law in New Zealand was, and he would like to ask whether in view of the high standard of the press in New Zealand such a Bill was necessary. He had not heard much of the British Act lately, but he doubted if it had been in operation long enough (about 18 months) to enable them to form a final opinion about it. In the - Indecent Publications Act ” New Zealand put a pretty severe curb on the publication of undesirable matter. Between that Act and the Bill introduced by Mr Fraser there was not a great deal of difference. There were also restrictions under the Crimes Act and the, Divorce Act, thougn the courts were generally' reluctant to enforce' those restrictions. He doubted the wisdom of repressing reports in every case. In some cases it w’ould be wise, and in those cases the court had the power to forbid publication in the interests of public morality. He also thought that the fear ot publicity was a deterrent. The standard of New Zealand journalism was so high that he was reluctant to place any further restrictions upon it. He would closely watch the operation of the British Act, which might induce him to alter his present attitude towards the question.

Mr Fraser had briefly replied the Bill was read a second time.

ENGINEER’S REGISTRATION. On notices Mr VV. H. Field (Otaki) moved the second reading of the Engineer Registration Amendment Bill, designed to enable certain surveyors to secure registration as engineers. The Bill received general support from speakers, and after Mr Field had replied it was lead a second time and referred to the Lands Committee. LICENSING AMENDMENT BILL. The Licensing Amendment Bill was introduced by Mr H. G. R. Mason (Eden) and was referred to the Industries and C ominerce Committee. The House rose at 11.40 p.m. rp. „ WELLINGTON, August 30. -the House met at 2.30 p.m. LONDON AND NEW ZEALAND BANK BILL. The first business taken was consideration of the report of the committee on the London and New Zealand Bank (Limited) Bill. the adoption of the report, Mr J. G. Eliott (Oroua) said he desired tc make it clear that the Bill was not. promoted simply for the purpose of giving a rake off ”to these men who were promoting the Bill. Those who were behind the movement tc establish a. new bank were men of independent means. Lhe fact that such nen were connected with the proposal showed that, in the opinion of responsible business men, farther financial facilities were warranted in view of the . development in recent years of the farming and commercial life of the Dominion. He proposed to quote figures to show* how the trade of the Dominion had grown, »nd that in consc- ■ quence of this growth an additional bank was justified. The last time the House passed legislation dealing with the estab: lishment of a bank was in the early ’seventies of last century, ami a good deal had happened since then. The Bill had been referred to a Select Committee, ami had come back with the approval of the committee, “arid with the approval ot expefts who had given evidence before that committee. The nominal capital was now fixed at £3,000,000. The bank would not open its doors for business until a sum <.. £1.000.00(1 was in its hands. Restrictions had been placed on the bank note issue,, such as applied to other banks. The promoters’ fees had been limited, so that at best they would receive 312 fully-paid-' p shares in the bank, which could not bo considered unreasonable. No shares were to be issued at a discount, but at par. Speculation on the part of the promoters in their shares was fairly well guarded against. The chairman of the associated banks had given evidence that his association had no objection to a new bank, although the present banking facilities were still sumcient. He also said that any attempt on the part of a new bank to cut the rates would lead to “ war.” and would result in the existing banks putting the new bank out of business. Colonel Esson stated that if the bank failed tn raise the necessary capital it would not harm the Dominion, but if it failed, after its establishment it would do harm to the Dominion's credit. Mr Ha/es, Scene tary to the Treasury, said there was no objection to a new bank. He considered, however, that failure to obtain the subscription of £1.000,000 necessary for the granting of the charter might possibly have a detrimental effect on the credit «.£ the Dominion. The chairman of the Sharebrokers’ Association expressed the view that there was room for a new bank, and the Solicitor-general had said the bank’s regulations would be in accord with the banking cgislation of the' Dominion. Mr Alexander MTntosh, an, ex-banker, thought there was no room in the Dominion for a new bank. On the whole, the evidence was distinctly in favour of the establishment of a new ' bank. Mr Eliott proceeded to discuss the growth of the tride of the Dominion between the ypars 1893 am 1925. .A;

Mr J. Mason (Napier) raised the point of -order, that the- House, having agreed to the second reading, it could, not, noiy discuss the principles of the measure but

should confine itself to the clauses of the Bill.

i'he Speaker ruled that when the House agreed to the second reading, it did so conditionally, and members were therefore now entitled to discuss the expediency of the Bill, but he asked members to confine themselves to the Bill and not to allow their arguments to wander too iai.

Proceeding, Mr Eliott said that in the last 13 years the trade of the Dominion had expanded by £62,500,000. and that, he thought, fully justified the establishment of an additional bank. Discussing the profits of the banks, he said that during the last eight years the Banks of New Zealand earned £6,500,000 net dis closed profits, and paid from 13 1-3 to 17£ per cent. The National Bank in the same period had paid a uniform dividend of 14 per cent. There was no doubt that the banking business of the Dominion was in the hands of a close corporation, and he did not agree that there was anv foundation for the statement that this new bank must link up with the estab lished banks.

Mr M. J. Savage (Auckland West) said the evidence given before the committee had made it clear that there was no competition in banking in Nw Zealand. The promoters had made their bona tides good, and so far as that was concerned the Bill was all right. The only question was whether th e new bank would fulfil its mission. The chairman of the Associated Banks said straight cut that if the new bank entered the field as a competitor with the existing banks it would be run off. There was no mistaking what that meant, and a stronger argument in favour of a State bank he had not heard. He did not doubt the sincerity of the promoters, but he did doubt whether they would be able to survive th e fight with"the existing institutions. There was no competition in banking in New Zealand just now A few persons had the power to make o r break industries and individuals. He thought the chairman of-the Associated Banks knew what he was talking about when he hinted at crushing the new bank. He did not think that the new bank Would find a great deal of new money for the people, and instead of legislating for new private banks the only solution of the problem was to insist upon the State taking a greater part in the banking business. He welcomed the new institution because if it did nothing else it would supply additional evidence that the existing banks were so powerful that, in order to save their shareholders, the new bank had to join in with the other banks. He hoped the Bill would go through, but he did not expect the new bank would help the people who wanted to borrow money, because it would have to fall into line with the other banks, and those banks were not helping the people. Mr W. A. Veitch (Wanganui) said the Bill had been greatly improved by the committee, but what struck him was that there was not one amongst the promoters who had any prior experience in banking. This might not be a detriment, but he agreed with the* last speaker that this new bank would not be able to com pete with the existing banks. It had been said here were six banks doing business here, but there was in fact only one bank, and after this new bank started there would still be only one bank. The only difference the new bank would make would be that it would receive a share of the profits arising cut of the general banking business The new bank would not relieve the banking situation. Only the most complete and drastic revision of oui banking laws would effect that. Mr D. Buddo (Kaiapoi) thought the promotion of the Bill was an evidence that another bank was justified." What was not good security to one bank was quite good security "to another, hence the advantage of having an active competitive system of banking. There should be no lack of business for another bank.

Mr W. D. Lysnar (Gisborne) thought that, in view of the necessity for stability in finance, some form of combination must be expected amongst the banks. He did not think that combination had been greatly abused. There might be exceptions, but generally he thought the banks had served the country very well. He would, however, support the Bill, and he hoped the new bank would be of service to the people. Mr F. F. Hockly (Rotorua) recommended the frankness with which the promoters had put their case before the committee. He thought the capital of the new bank was adequate for its purposes. He welcomed the new bank and wished it every success. The Minister of Finance (Mr W. Downie Stewart) said that when first approached on the subject he had said he saw no objection to a new bank being started. Much depended on what was called banking business, but, looked at broadly, the banks were not the only institutions doing banking. It was, therefore, wrong to say there was no competition. Competition centred mainly around the question of security. Whether another bank was iVanted • or not could only be tested by experience, and could not be settled by the House. The trade figures quoted by Mr Eliott must be regarded with caution, because they were to some extent figures of years of inflation. The dividends were also not quite a safe, guide, because tliese were partly , due to interest derived from reserves, winch all banks must have, and were due entirely to earnings on the working capital of the bank. The proposal to start a State Bank in New Zealand should be approached with caution,- because from nil he could see, .hear and re.ad, banking. was riot going,to be as popular in the near future as it was now. Returii- ' ing to,. the, question of competition,., he said he oiily wished that the companies

which were doing a class of banking business gave him as little trouble as the banks did. He could only say he would support the Bill. The Leader of the Opposition (Mr H. E. Holland) said he would like to know whether the new bank would lend money to settlers at a lower rate of interest than thp associated banks, and what the new bank would do to meet the offensive which the chairman of the associated banks was said to have threatened against it. A million of capital would not carry them very far, and he wanted to know how long it was thought this capital would carry the hank on, and what difference it was thought it would make to the people. The only justification for the new bank starting in New Zealand would he the benefit it would confer on the people. Then he wanted to know what guarantee there was that the new bank would not join the existing combine. They had been told that the associated banks would bludgeon the new bank out of existence, and he thought that Parliament should take steps to prevent that sort of thing. If the bank would set out to help the rural and secondary industries of the Dominion he did not ’think there could be much objection to the Bill. Mr J. Mason (Napier), considered a million of capital would be sufficient with which to start the business of the bank. As the business increased its capital could be increased even beyond the three millions nominated. He* did not take the statement of policy towards the new bank, made by the chairman of the associated banks’, as a threat, The chairman may have meant that if the new hank began to cut rates the other banks must do likewise as a business proposition, and the weakest bank must go to the wall. He thought the Bill was one that should be passed bv the House. Mr J. Horn (Wakatipu) and Mr G. \V. Forbes (Hurunui) gave general support to the Bill. Mr Eliott, in reply, said he was not responsible for the policy of the bank. Whether it joined up with other banks, whether it traded exclusively in New Zealand or whether it lent monev largely on rural securities were matters entirely for the directors who managed the bank. So far as its policv towards rural securities was concerned, he could only say the jtisiness of the bank was to provide capital for carrying on the trade and commerce of the country, and for that reason it must keep its capital as liquid as possible. The report was agreed to. IMPREST SUPPLY BILL (No. 3). An Imprest Supply Bill (No. 3) was intioduccd by Governor-General's Message. Mr J. M'Conibs (Lyttelton) said he proposed to move the following amendment to the motion that the House go into Committee of Supply: “That in view of the facts (!) that the cost of living bonuses granted to public servants in 1920 were based on an increase in the cost of living of 62 per cent.; (2) that the cost of living is now 62 per cent; above the pre-war level, whereas the average increase in the salaries of public servants is only 35 per cent.; and (3) that the cost of living has been stabilised, and has not varied more than two points since 1924, it therefore be a recommendation to the Government that the salaries of public servants be restored to the 1920 standard.” In moving the amendment, he maintained that there was an agreement between the Government and the public servants that the bonuses were to be increased as the cost of living rose, but the agreement had never been carried out by the Government; consequently the increases in salaries had not been commensurate with the increase in the cost of living. \\ hat they were asking for now was not a restoration of the “ cuts,” but that salaries be restored to the 1920 standard. This ruled out those whose salaries had been increased under de* 'partmental classification.

The amendment was seconded by Mr F. N. Bartram (Grey Lynn). He said the Government had recently raised the wages of policemen, and he wanted it to go on and increase the salaries of all the public servants. It was desired that the Government should not grow weary in well-doing. It was a fair proposition to ask that the Government should raise the wages of the public servants, so that they could live at a standard higher than prison fare, and in that way restore to them payments that were taken from them bv force in 1922.

Mr W. D. Lysnar (Gisborne) said the subject of civil servants’ salary “ cuts ” was a subject now worn threadbare, and the civil servants might very well say, “ Spare us from our friends.” The civil servants knew perfectly well that the Dominion in 1920-22 was passing through a period of great trial. The public salaries then amounted to £9,000,000. There was a “cut” made of £BOO,OOO, and, as compared with the total sum, that was only a small proportion. Some of the civil servants had had their salaries raised, but members of the House had also suffered “ cuts,” which had not been restored.

Mr G. W. Forbes (Hurunui) saidJiS would support the amendment. 'lt was distinctly understood when the “ cuts ” were, made that when the position of the Dorninion improved the “ cuts ’I would be restored. The speeches of Ministers who said . we were, .‘‘round ' the corner” had led everyone-to believe-that prosperity was restored, and, that being so. the Government should carry out its undertaking to the public servants.

The Minister of Lands (Mr A. D. M'Leod) said the speech of the member for Hurunui served to disclose him as a political time-server. Throughout the country during the past few months he had said that the position of the country was hopeless, but now, for political purposes, he pretended to believe we had turned the corner,” and for that reason declared that the Government should increase the salaries of the public servants. He (Mr M'Leod) agreed that wlfen we returned to permanent prosperity the. salaries might be increased, but he maintained that since the war period wages had increased at a faster ratio than had the value of the Dominion’s products. Mr R. M'Keen (Wellington South) argued that in the fact of the increased value of wool and other products an increase of the public servants’ salaries was justified. The public servant today was just as efficient as he was in 1920, and public feeling was warmly in favour of such an increase. The public servants had been shabbily treated by the Government, and justice should be done to them. The Minister of Finance (Mr W. Downic Stewart) said there were several matters that had not been put before the House in the way they should be put to enable the House to get a proper view of them. It had been said the surplus of the Post Office /as £1,100,000, and that out of this sum there was plenty of money to pay increases to the public servants. The fact was that that surplus was computed before the departmental charges had been met, and when those charges had been met the surplus was only £20,000. Reference had been made to some agreement which the Government had not kept, but no mention was made of the fact that under that agreement reductions might have been made but were not made. Mr Stewart added that in the case of 10,456 officers in the Public Service on April 1. 1914, the average salary was nearly £159, but on April 1, 1928, the average was £243 10s, the average increase being £59. If the amendment were agreed to, it would mean that many public servants would have to suffer a reduction instead of obtaining an increase. To do what the Labour Party desired would mean increased taxation, and he did not think the public servants, or anyone else, would thank them, for that. Mr D. G. Sullivan (Avon) said the Minister had endeavoured to show wages had kept pace with the increased cost of .living, but his figures were all wrong, for instead of the increase in the cost of living being 42 per nt. in 1922 it was actually 59 per cent. This error was due to his use of only portion of the figures relating to the cost of living instead of the whole of the groups. Whatever intention the Minister might have had, his figures were calculated gravely to ihislead the House. If the increases in salaries already given were sufficient to cover an increase of 42 per cent, in the cost of living, obviously they were not sufficient to cover an increase of 59 per cent. Mr V. H. Potter (Roskill) said he amendment was brought forward purely as a piece of political propaganda, and was easily understood. At 10.30 p.m. a division on the amendment was taken, when the voting was:— For the amendment 20, against the amendment 43. The Nationalists and the Labour Party comprised the minority. Mr W. A. Veitch (Wanganui), continuing the debate on the main question, said there seemed to be money for anything and everything except wages. He wished to discuss the position with regard to the East Coast railway. For this railway there were two proposed routes, and a conflict had arisen in Gisborne as to which should be selected. The inland route was still under survey, and while that was going on a deputation had visited Wellington and urged the selection of the coastal - route. He had received a telegram from several reputable citizens of Gisborne stating that at a political meeting held in that town a member of the deputation had stated more than once that the Prime Minister had said he would confirm the coastal route within six weeks if the delegation would support the Reform Party. The Prime Minister asked for the name of the man making that statement, but Mr Veitch refused to give it. Following some crossfire, the Prime Minister then emphatically declared that the whole statement was absolutely untrue. The Leader - of the Opposition (Mr H. E. Holland) raised the question of the treatment of a Chinaman named Wong See at Samoa while a prisoner in gaol. The prisoner was under sentence of death, but became ill, and while handcuffed and chained to the floor was subsequently found strangled with pieces of his torn blanket. He (Mr Holland) was not making charges, but was asking for the most complete inquiry into the ■whole of the circumstances attending this man’s death. Another Chinaman, also under sentence of death, was put into the witness box to give evidence against another Chinaman. This proceeding, he thought, was most improper, because it was impossible. to say how the distressed mind of a man under sentence of death might be affected, or how his evidence might be coloured. The case of Chu Fook, who was alleged to have been ill-treated in prison, was also referred to, as was a letter written by a military policeman in Samoa, suggesting that what the Samoans needed was the “ heel.” That letter should have been contradicted and repudiated by 'the Government, and he wanted to know- what action the Government had

taken in connection with these cases or what action they proposed to take. The Minister of Public Works (Mr K. S. Williams) said, in reply to Mr Veitch, that a decision in connection with the east coast railway was awaiting a survey now in progress. Whether that decision would be made in a week or in six weeks he could not say. With regard to the allegation that the Prime Minister had made a promise, he emphatically denied it, and read a telegram from Gisborne stating that no guarantee whatever had been given. The Prime Minister defended the administration of General Richardson in Samoa. He said that no man had higher ideals or a more intense desire for the good of the Samoans. So far as the statements made by the Leader of the Opposition were concerned he (the speaker) had asked for the files, and would go into the position. With regard to the accusations made by Mr Veitch he desired to say he had the notes of the interview and the statements regarding his promise were completely incorrect. The Government was doing its best to secure ample supplies of phosphates for New Zealand, but he could not disclose all that it was doing. He could say, however, that there would be no shortage of supplies from Ocean and Nauru Islands. The debate then concluded, and a Bill appropriating £2,008,000 was put through all its stages, and the House rose at 0.50 a.m. WELLINGTON, August 31. The House met at 2.30 p.m. NATIONAL INDUSTRIAL CONFERENCE. The Prime Minister (Mr J. G. Coates) moved that the report of the National Industrial Conference, nd his statement thereon, be referred to the Government for consideration.” He did this to open up a debate’ on the sub-ject-matter of the paper. Mr M. J. Savage (Auckland West) speaking to the motion, said he approved of round-the-table discussions on industrial questions. He entirely agreed with the suggestion that another conference should be held in the recess to again discuss the future of the Arbitration Act. The object of all the parties should be to endeavour to raise the standard of living all round. That could not be done by reducing wages, and it was hopeless to expect the workers to meet the employers for the express purpose of having their standard of living reduced. They would discuss all phases of the labour problem, and he hoped the employers would see the matter in that light. The industrial conference was to be commended, for it was the first time there had been such a gathering in New Zealand, and the more the w could promote good relations by the understanding of one another’s problems the better. However, he did not suppose the lion and the lamb would ever lie down together. An hon. member: “Why not?” Mr Savage: “Because the lion generally wants the lamb inside.” Advocates of more work for the same wages were in favour of a reduction of wages. A reduction of wages was not in- the interests of the country, because the purchasing power of our own_people was the measure of our home and foreign trade, and it was the duty of everyone to see that that power was increased. Any attempt to cut down the power necessarily meant the narrowing down of our home and foreign markets, and comparative industrial stagnation. New Zealand could not export indefinitely without taking goods from the country to which they exported. No country could import goods unless it was able to purchase them. Any discussion at an industrial conference should be founded on the realisation of the economic fact that anything that made for the lowering of the purchasing power of a people nmst result in industrial stagnation.-* It was a decided step forward to know that the Government was prepared to call together all parties to industrial contracts, and if that conference arrived at a unanimous decision it was the duty of the Government to give effect to it. Mr W. E. Parry (Auckland Central) said he was pleased at the frank statement made by the Prime Minister to the House. There was a tendency on the part of the press and others to place on the shoulders of the workers all the responsibility for industrial disputes, and to hold the employers blameless. The workers, however, while not wishing to minimise their part in industrial disputes, wished to emphasise that their struggles were due to bad economic conditions. He advocated national organisations, based on unionism, as the best means of settling industrial disputes. Sir John Luke (Wellington North) said that New Zealand had reached a stage when representatives of the farming and secondary industries should get together and discuss their mutual grievances. The next conference should be productive of much good, but he hoped a third party, which was the public, would not be left out of consideration.

Mr W. A. Veitch (Wanganui) said it was evident that for industrial disputes there must be some final arbiter to decide between the conflicting parties. The problem of unemployment could not be solved by industrial conferences. Something much more comprehensive must be devised. The road to prosperity lay along lines of industrial peace and of co-ordination of capital and labour and machinery. In that way goods could be produced at a price, which would not only increase the standard of living of

the workers, but would improve the profits of the employers. Mr' R, M'Keen (Wellington South) asked why the farmers should obtain special concessions by being excluded from, the operations of the Industrial Conciliation and Arbitration Act. There was one answer only. There was a large majority of farmer members in the House. In his opinion the farm labourers were as much entitled to protection as were the workers in factories. Valuable recommendations had come from the last national industrial conference on questions of unemployment, immigration and workers’ compensation, and if these were given effect to by the Government it would greatly assist the deliberations of the second conference it was proposed to hold. If any amendments were made to the Industrial Conciliation and Arbitration Act, added Mr M'Keen, he hoped they would be in the direction of removing anomalies and would not affect the compulsory provisions, which he contended should be extended to every form of employment from one end o*f the Dominion to the other. Whether farm or jam factory was concerned, it did not make the slightest difference. The workers should be protected by Act. D k G ' Sullivan (Avon) said that it the Government gave effect to the recommendations of the last conference it would be taken as an indication that they were earnestly endeavouring to find a solution of the industrial ills. Die only time the workers and the employers came together to discuss their affairs was during an industrial dispute. Tins was to be regretted, and more frequent and friendly discussions should be held. So far as the Arbitration Act was concerned he was satisfied there must be some final court of appeal for industrial disputes, and they were only going to create trouble if they abolished the Arbitration Court and did not put something in its place. Mr J. A. Nash (Palmerston) did not far our the Government attempting to tlmt le B lslatlve effect to the matters confeXT a F eed tO at the a ’bitration to wrii f a \, Once - Tt w ould be safer to wait for -the present and see what another conference would bring forth. -the debate was adjourned.

NOXIOUS WEEDS BILL. Amendments made in the Noxious Jceds Amendment Bill by the Legislalive council were agreed to. The Minister of Agriculture (Mr O J. Hawken) stated that the amendment made was the inclusion of lautama as a noxious weed in the second schedule. THE ESTIMATES. The House went into Committee of Supply to further consider the Estimates, .ci O? "pi T° te for tbe J ustice Department. ildl,bl4, was passed without discussion, Prisons Department vote, ±9u,609, was next taken. Mr E. J. Howard (Christchurch bouth) said that in spite of our boasted up-to-date ideas we were filling our gaols while older countries were closing theirs. This was due largely to the method of classification used, and our Borstal system was an incentive to magistrates to send many children to prison who should be otherwise reformed. Mr A. Harris (Waitemata) said that under the name of “ Reformative Retention the magistrates were giving larger sentences than they would have done had it been ordinary imprisonment, and he doubted if this was a good thing. Mr T. M. Wilford (Hutt) said, in his opinion, Borstal institutes and reformative camps were first-class institutions, and the Prisons Board was a most humane body. New Zealand was a country that was remarkably clear of serious crime. Our systems of declaring certain people habitual criminals, indeterminate sentence, and summary jurisdiction given to magistrates had reduced crime, but the reduction in crime was due more than anything else to the fact that we were British people and a clean race. The Minister (Mr F. J. Rolleston) said in reply to Mr Howard that the prisons report showed that the prison population was decreasing, and the cost of maintenance was actually much less than Mr Howard had stated. A comparison between New Zealand and England was not fair, because in England they had many institutions we did nol have here yet, but which we hoped to have. Many people .vere sent to gaol here who would not be sent in England, but he was pleased to say that the offences of these people were not serious. Generally speaking, serious crime was not prevalent in New Zealand, and our reformative systems were proving quite effective.

The vote was passed. The Crown Law Office vote, £5812, was agreed to. The Lands and Survey vote, £60,295, was passed after a brief discussion. Scenery Preservation, £15,550, was agreed to. Valuation Department, £54,713, was passed without discussion, as also was the vote of £290,868 for mental hospitals. The Public Health vote was £240,773. The Minister (Mr J. A. Young) answered a number of questions with regard to local hospitals, and the vote was passed. CHURCH OF ENGLAND EMPOWER. ING BILL. The Church of England Empowering Bill was received from the Legislative Council. ' J The House rose at 11.50 p.m. 'till 2.30 p.m. on Tuesday