INEVITABLE REDUCTIONS

Taranaki Daily News, 23 July 1930, Page 12

INEVITABLE REDUCTIONS

| AUSTRALIA’S EXPERIENCE EXCESSIVE PRODUCTION COSTS. INTENSE ECONOMY DEMANDED. (Special Correspondent). Wellington, July 21. The situation in Australia is bad and the situation in New Zealand is by comparison really good, but that does not mean that this Dominion will escape the world-wide decline in .community prices. The Lard facts of the situation no longer admit of self-deception. For a long time in the Commonwealth strenuous eD forts have been made to bring about reductions in costs of production and manufacture, but such efforts have been as strenuously resisted, because in costs of production or manufacture wages and salaries amount to about SO per cent, of the total. The resistance of the Labour unions lias been futile, for it was inevitable that there should be a reduction in wages. They fell of their own weight, because they had been inflated. All advices from Australia show- that practically in every branch of trade and industry wages have been reduced. The Arbitration Courts on the other side have shown a little courage and some appreciation (■ the position and have actually ordered reductions in wages, as in the case of the shearers and pastoral workers. Of course the workers, have not accepted the situation calmly, and strikes arccertain to bo numerous. The shearers have apparently accepted the facts, and all others must do so. The miners of New South Wales after a prolonged struggle were forced to agree to a wage reduction, and they are probably now all the hapier for being at work and earning their daily bread instead of living on the charity of their fellows. In the Australian States, where the power of taxation is limited, other steps have been forced upon the Governments; that is to say, they have been obliged to revert to economy, and so we find expenses being reduced in all directions, In New South Wales salaries of members of Parliament have been reduced, and in Tas-

mania a similar gesture is intended by the Government of the day. The dole, such as is proposed in New Zealand, has been tried, especially in Britain, and has failed. On the face of it it seems reasonable and to some extent logical that those in work should contribute to those out of work through no fault of their own, but when the matter is seriously considered'it is an unsafe proposition. There is the real danger t that the dole tax once imposed will rei main, and if not required for its present 1 purpose will be devoted to some other i purpose, under the title of social legislation. Then again the amount of the - dole is bound to be increased, and at the 3 next election the Labour l'a v ty is bound ) to suggest that the dole should be in- • creased by 100 per cent., or at least I 50 per cent. Relief wages started at 12s ■ and 9s and now they are about 14s and 12s, and if Labour secured the control • of the Treasury benches the wages would soon be on the “standard 1 ’ basis. These are the dangers. ; The main requirement in the strained economic situation, according to a business man who voiced the above sentiments, is reduction of costs of production and intense economy in public

ahd private life, and that the Government should give a lead in the matter It is contended that rationalisatior should be extended to all Government departments. In recent' years the tendency has been to multiply the departments, and to realise this one has merely to compare the number of departments now with ten years ago. Amalgamation of related departments would save a good deal of expense. This business man was of the opinion that the Government should give a lead in salary reduction. Ministers’ salaries could be reduced at least 20 per cent, without injustice. Salaries of members of Parliament should be lowered to £3o'o a year instead of £450 now paid, and they should be called upon to refund the “lump sum” of £lOO that they voted themselves last session. It was also contended that the Arbitration Court should be wiped out, or at least preference to unionists be abolished. When told that his ideas were revolutionary and not likely to receive support, he replied that wages had fallen in Australia notwithstanding that a Labour Government was in power there.