"THE RAINBOW BUDGET"

Taranaki Daily News, 7 August 1930, Page 13

"THE RAINBOW BUDGET"

CRITICISM AND DEFENCE ~ ADMINISTRATION OF- RAILWAYS INCREASED TAXES DISCUSSED. By Telegraph.™ Press Association. Wellington, Laflt Night. The Budget debate was resumed in the House of Representatives to-day by Mr. E. F. Healy, who said the removal of duty from barley would be a serious blow to growers in Marlborough, who would be°placed on an unfavourable footing in competition with Australiangrown barley. Huge quantities of barley were produced in South Australia and could be landed in Auckland at 3s (id per bush< ’ Growers in Marlborough were supplying grain on contract with a brewing firm at sfl.zper bushel, they would not be able to produce barley at a lower cost than that, and if they were faced with such dangerous competition from Australia they would have to turn their attention to growing other cerealfl. Mt. Healy regretted that the flaxgrowincr industry was waning, and ho trusted the Department of Agriculture would eee that this valuable industry was not lost to New Zealand. He defended the completion of the South Island Main Trunk-railway, stating ho was prepared to show critics over the country. They would, after six or fleven days on horseback, still be passing through good land. . Mr. A. Harris said it .might be argued that the South Island Mam Trunk railway-should have been built several years ago, but it could'not be claimed it was desirable to-day when there was , need for the curtailment of capital expenditure on railways. He declared no thanks were due to the Government for the removal of the .primage duty as it had substituted a surtax amounting to treble the amount of the primage on the average. He asked whether the surtax was to be a permanent increase.. Everyone knew the difficulty of removing taxation once it had been imposed. Tlie Government’s proposals were aggravating to too many sections of the community and would hit tne working man hardest of all. “INCREASE BEER DUTY.”

Mr. Harris advocated increasing the duties on beer, wines and spirits, and supported the suggestion of Mr. Stewart than an increase of the postage rate to a penny halfpenny would have been preferable to some of tho methods adopted by the Government. He also believed the Government should take totalisator fractions which, he estimated, would produce about £40,000 annually. Pacing clubs could not complain against such a course. Mr. Harris said he favoured increased death duties, and he considered that by the means he had mentioned the Government would have been able to obtain all the additional revenue it said it needed without harming anybody. It seemed the only people who had escaped the Budget were bookmakers and publicans. Mr. J. W. Munro said he had been impressed by the suggestion by Mr. Stewart that an increase in the postage rate should be utilised to- produce revenue. He was, however, more in favour of the suggestion of Mr. Harris that duties should be increased on beer and spirits. Mr. Munro defended the action of the Labour Party in keeping the United Party in office, expressing the opinion that'it was not the desire of the country as a whole to have a general election at the present time. There was little to be gained by it. It was his opinion that both the Reform and Labour parties would suffer if they were to force such a position upon the country, .which as a whole was not as much interested in what party was in power as in restoring the economic situation. The people expected the best brains of all the .parties to be applied to the solution of the national difficulties.

Dealing with the railways, Mr. Munro said in his opinion there was no possibility of their paying unless a large amount of the capital cost were transferred .to the Consolidated Fund. At the present time th,e railways were overcapitalised to the extent of £25,000,000 and were expected to earn interest on the whole amount. BACK TO HORSE WAGONS. Mr. D. McDougall defended the increased petrol tax. He declared it would not affect one small carrier. Its effect mi"ht even be advantageous because it would result in the replacement of motor lorries by horse-drawn vehicles. It would further enhance the market for chaff and would enable farmers to employ more men. Delivery of goods by horsedrawn lorry would also be more economical than employing a £lOOO truck. He asked what was going to be with the new railway workshops if motor transport was to be encouraged to oust the railways. There was also a danger of many railway employees being forced out of work. What were the miners going to do if the railways demand for coal fell off? Mr. McDougall defended the increased amusement tax. He said it might be a good thing if poor people were discouraged from wasting money on pictures. The money might be more profitably spent in buying food and clothing. He strongly criticised the despatch of warships and armed men to Samoa. He remarked that militarism would never be a successful policy in Samoa, and he condemned the attempts of the Reform Party “to bring the natives to heel.” Mr. C. E. MacMillan asked whether Mr. McDougall was aware that the actions in Samoa to which he had taken exception had been those of th© United Party. Referring to the Hon. E. A. Ransom’s speech, Mr. MacMillan said the Minister had stated it was the policy of the Government to prevent “drift,” but he had not shown that there was anything in the Budget to achieve such an aim. T icre was nothing that would assist primarj production or tend to promote a return to prosperity. It gave ■». no encouragement to the people to go •oi to the land, nor did it encourage those already on the land to increase production. The House was told that the petrol tax was to assist backblock settlers by providing good roads, yet the Government’s withdrawal of grants, subsidies and other savings affecting these people amounted to £541.000. In return they were to get £450,000 from the petrol tax. leaving them £91,000 worse off. In addition th” would be paying a large ehare of the petrol tax themselves. Mr. H. T. Armstrong said it would be easy for the Government to save i Somethin!? like half a million pounds

in defence expenditure. Instead of maintaining a comic opera system of boy conscription it would be better to spend money on disabled returned soldiers and their dependents. Mr. Armstrong said the Budget did not offer any hope of solution of the unemployment problem, while on the other hand it disclosed many ways in which the burden on the working man would be increased. He believed 11,000 men could be employed on the South Island Main Trunk railway work alone. He had heard strong opposition to the completion of this work, but he pointed out that the same arguments had been raised against the construction of the railway from Christchurch to the West Coast, which had fully justified itself. He submitted that if the general manager were instructed to make the New Zealand railways pay he could do so, but it would b° a bad business proposition for the country. It would drive the primary producers off the land altogether. The railways policy should be to provide efficient services, at a reasonable cost, and if there were any losses on the operations it should be paid from tho Consolidated Fund. He did not believe the Railway Commission would be able to tell the general manager anything he did not already know. The whole thing was a waste of time. The Hon. A. J. Stall worthy said it had been stated there was nothing in the Budget co provide for unemployment. Members would remember that special legislation had been introduced to meet this position, and ho hoped it would provide a sound remedy. “THE RAINBOW BUDGET.” The Minister said the Leader of the Opposition had referred to a “black” Budget. Perhaps black was * fitting colour to assume after 16 years of Reform administration. Others had described the Budget as “red,” “yellow,” and “blue,” and the only alternative to the theory that the critics were colourblind was that it was a rainbow Budget. The Minister added that in the Biblical sense the rainbow was a sign of promise, and he trusted that ‘in the political sense the Budget was also a sign of promise embracing a change from the black times of the past. Replying to the suggestion by Mr. D. Jones that the surplus of the post office account should be employed to meet losses in other departments, Mr. Stallworthy said it had to be realised that the time might come when there would be full need for all the reserves that the post office could accumulate. He pointed out that the suggestion that the railways would be seriously challenged by other forms of transport would not have been entertained some years ago. It was likely there would be developments challenging the status of the telegraph system. The time might come when as a result of the progress i:. radio invention everybody would carry both receiving and transmitting sets as commonly as watches were carried nowadays. Mr. K. S. Williams said he thought Mr. Stallworthy had found the right name for the Budget. As ne understood the meaning of “rainbow” it indicated that although there was going to be a flood not everybody would be washed away. It would be a relief for the people to learn that although there was to be a flood of taxation some of them would survive.

Dealing with the petrol tax, Mr. Williams said while he realised that more money was required for roads he did no* think it was sound policy to raise a large sum from one section of the community and then place it in the Consolidated Fund for the use of all and sundry. He did not think motorists would object to the tax if it was clear it was going to be used for roads. The debate was adjourned, and the House rose at midnight.