MORE CONFIDENCE

Southland Times, Issue 21850, 29 October 1932, Page 6

MORE CONFIDENCE

GOVERNMENT ASSISTS TAXATION BURDEN LIGHTENED COSTS OVERHAULED (Per United Press Association.) Pukekohe, October 28. “The results of the Ottawa Conference in the Dominion will be seen not jn the immediate future, but in about nine months time in a gradual but definite improvement in the price levels of produce. We depend on the products of the farmers,” said the Rt. Hon. J. G. Coates addressing an audience of 600 at Pukekohe to-night. On the general atmosphere surrounding the conference, Mr Coates remarked that he felt more confident about the future than before the conference. Our export field was not now the narrow field of New Zealand but was spread out to include a quarter of the population of the world. The discussions were of interest not only to the partners of the Empire, but the world as a whole. Our conditions were no different from those sister dominions and the remedy beyond a single-hand-ed effort of any individual nation. Mr Coates dealt with the Ottawa concessions on the lines previously published. New Zealand had gained a reputation for good products and he urged the producers to maintain their high standard. A great deal had been done in the matter of effecting economies in public expenditure and the result was that a substantial improvement had been effected in the position of public finances for the current financial year. The restoration of business confidence would undoubtedly do a great deal to accelerate progress along the road to recovery. In order not to check incipient recovery of such confidence the Government has this year adopted an extraordinary course of budgeting for a deficit not exceeding £1,000,000 and refrained from imposing any further taxation either for general purposes or the Unemployment Fund. In fact, there had been some movement in the opposite direction in that the Government had restored penny postage and pursuant to the Ottawa agreement had made a reduction in Customs taxation estimated at £250,000 for the balance of this financial year. In addition, every effort was being made in providing work for the unemployed by the use of moneys in such ways as will provide a maximum amount of assistance towards the revival of business activity. The building subsidy scheme was a case in point. In short, the Government had so arranged matters to provide breathing space from further taxation burdens and was doing its utmost in other directions to encourage business recovery. At the same time it should not be assumed that the country was out of trouble financially. The Budget for the current year allows a deficit not exceeding £1,000,000, after taking into credit £2,500,000 to be obtained from reserves. These reserves were not in a liquid state and special arrangements had had to be made with the banks to make the amount available. It must now be realized that this was practically the end of reserves built up in more prosperous times and that to obtain a balanced budget next year the amount of the reserves being used this year nlus the estimated deficit, a total of £3,500,000 must be made up from some other source or obtained by a further reduction in expenditure. Certainly the Government could not go on budgeting for deficits. Such a course would inevitably increase the difficulties instead of relievin'* them. This being so it was imperative that there should be a vigorous control of expenditure and a campaign of economy in all directions must be continued without abatement.

Mr Coates said he would like to impress this on the people of the Dominion; furtherm' — ■‘hat they must press forward with permanent far reaching economies designed to afford a maximum amount of service at a minimum cost. After what had been done there was no possibility of effecting further substantial savings in administrative costs. Service on an existing basis and a permanent lightening of the burden of expenditure must to a large extent depend upon far reaching changes to obtain equal service at less cost or on a definite curtailment of these services rendered by the State. Just as the Government was overhauling the cost it was expected local bodies would do likewise.