UNEMPLOYMENT RELIEF

Taranaki Daily News, 9 August 1930, Page 13 (Supplement)

UNEMPLOYMENT RELIEF

WiiHK IX A Vl< F<>l s UHI'.’LE. ]■; ONOM 1U LOSS TO COINTIIY,. Great Britain seems to be in tl'<«. g , ‘i| ) of a vicious circle,- since she instituted her method of unemployment relief, which necessitated high taxation, which in its turn not only takes much needed money from industry and makes its development, more difficult, but also adds to the cost' of the article 'produced. This added cost again handicaps her in 'the. world’s markets and prevents • her-, from, securing orders, and the loss of orders throws a lot or men out of work, who go on to relief, and so we come round to the (starting point. These difficulties are intensified by the tendency to try to base wages and hours of work on the cost of living rather than' on production, a practice which results in greater cost- of the article produced, which means' that England works fewer hours per week/pays far higher wages and enormously higher taxes for social services than any of her European competitors. The result of this vicious circle wan recently shown when Germany secured orders from the. Indian railways amounting ,to £1,977.590. The German, price was £898,900, or It) 2-3 per cent, below the. British. This is explained by the fact that German wages are 20 per cent, lower than the -British. But the significant feature of this ca.se, and one which shows the working of the “vicious circle,” U the fact that on the one hand German firms obtained the orders at £179,500. below the British prices, and .on the I other .hand the loss of those .6'rdfers host the Unemployment Fund £184,990 for the men who -would have been working had England,secured the 'order?, s If these orders ; ha<l come to England it is stated that at lc;mt £345,000 would have, gone out in wages arid the Unemployment Fund , been saved £184,000. •

,4- Taking the above figures as correct, and our authority for them seems to be undoubted, it would seem that had some provision been made which would permit the Unemployment Fund to be used by way of subsidy, a grant of £180,(100 to the firms concerned would have enabled them to secure the orders in question, and British workers would have been able to earn £348,000 in wages —an economic gain to the community. There is a lesson to us in this, for we are going slowly but surely towards the same dead end. Taxation is becoming a dangerous burden to industry, the artificial fixation of wages regardless of production is increasing our cost of production above the world’s prices, and it is now proposed to introduce unemployment benefits where no work is done. Surely some scheme could be devised by which such waste, as above, could be avoided?'We urge our leaders to endeavour to.find a means by which money available for unemployment relief, could be used as a subsidy to -enable our producers to reduce their cost of production and thus be'able to meet , world competition. If the money has to be spent, such a scheme would at least ensure some return for the benefit of the community as a whole. (Contributed by the New Zealand Welfare League.)