THE COST OF SOCIAL SERVICES.

Taranaki Daily News, 29 April 1931, Page 6

THE COST OF SOCIAL SERVICES.

Sir Robert Horne, who as a former Chancellor of the Exchequer speaks with authority regarding public finance, has been commenting on the huge growth in the cost of social services in Great Britain, It is his opinion, shared by a great many earnest thinkers, that the Old Country cannot continue to support social services on the present scale, the annual outlay being at the rate of £3 ISs, 6d. per head of population. With the British figures he compares those of Germany, which, spends 37 s. 6d. per head, France, 135., and Belgium, ss. 6d., and he points out that the disparities constitute a severe handicap on one manufacturing country in competition with others for markets. How Sir Robert arrived at his figures is npt stated, and since Sir Ernest Benn in 1927 stated the cost of social services at about £8 10s. per head, it is evident that doubt exists as to the items that should be included. Sir Robert’s comparisons, however, are sufficiently impressive, and they are the more interesting in this country because here also the cost of social services is embarrassing the Government. When certain members of the House of Representatives were objecting the other day to the Government’s efforts to make small savings in respect of the maternity bonus paid to subscribers to the Natiqnal Provident Fund the Prime Minister declared that it was essential to call a halt before the growing cost could “break down the whole system” and "sink This country.” Figures quoted recently in the Legislative Council by tm> I-Iqn. R. Masters would appear to give ample justification for Air. Forbes’ remarks. Social services had grown, Mr. Masters said, until they were costing the Dominion £0,750,000, or one-third of the total revenue from taxation. Reduced to the terms employed by Sir Robert Horne, social services administered by the Government demand an annual outlay of just on £5 from each man, woman and child in the Dominion, and that, of course, is not the whole tale. Hospital rates are an important item in New Zealand, and some portion of the rates levied by other local bodies also goes in subsidising social services and amenities. Undoubtedly the Dominion is paying an extremely large sum annually as the outcome of what would have been described a few years ago as its advanced humanitarian legislation, and at a time when public revenue is necessarily declining it is right to count the cost.' As Mr. Forbes aptly put it to the House, the whole of the social services must rest on prudent finance and the solvency of the Government, Everyone admits that New Zealand is all the better in many respects by reason of tile efforts that have been made over a period of years to improve the healtu of the people and ameliorate their social condition, but a careful survey of the position must suggest that the tendency has been to have too much of a good thing- At tlie present time there is ao possible alternative to the policy of ecoiip|jiy, and the country has been so well’served in the past that it should not sutler during the time that expenditure mtist be rigidly controlled.

LABOUR AND FINANCE. The Labour Party in New Zealand has never had such a concentrated opportunity of demonstrating its Xinfltness for (he responsibility of controlling the public purse as it has had during the past seven weeks. And it has used the opportunity very effectively. The business of the emergency session of Parliament was almost wholly concerned with finance, and difficult finance, inasmuch as it was Parliament’s task, under the guidance of the Government, to make provision to meet a rapidly dediniijg revenue, Parliament lias done its job, and done it very conscientiously and satisfactorily, but not with any help from Labour. The members of the Labour Party have resisted almost every effort to curtail public and private expenditure and readjust the Douiinion’s way of living in order that it may have a reasonable prospect of flourishing under new economic conditions. The Labourites have been wilfully b|ind to the significance of what is going on around them, and if they had thejr way they would continue to pay high wages and encourage waste of public money as long ap they could find funds; that is to say, until it was no. longer possible to beg, borrow or draw money from the pockets of exhausted taxpayers. The idea seems to be rooted in the Labour mind that there is any amount of money somewhere or other, and that Labour as a Government would be aple to command an inexhaustible supply. It was, no doubt, with this idea uppermost that Mr. H. E. Holland on Monday afternoon propounded his views on the Earthquake Relief Bill. The Leader of the Labour Party censured the Government for not having taken immediate steps to raise a loan for restoration in Hawke’s Buy. He suggested that if the Government had g<?nc on to the local market for a loan there would have been a ready response —sympathy, no doubt, would have been a factor—and money could have been raised at a low rate of interest. Perhups so,, but there would have been another result, though. Mr. Holland’s limited intelligence apparently could not foresee it. Money which the banks need to lend their customers—they are lending, as the returns show, generously as well as judiciously—and which private lenders can employ to finance mortgages and other securities would have been diverted to the one purpose of restoration in Hawke’s Bay. The business of the Dominion inevitably would have been seriously crippled at a time when the wise use of capital means in many case? the difference between solvency and failure. Fortunately for the country, Mr. Forbes has realised the dangers that Mr. Holland has overlooked. The Prime Minister has adopted means to finance Hawke’s Bay that will actually increase the country’s liquid resources instead of impoverishing them, and thus will tend to promote the restoration of stability throughout the Dominion. If he had adopted Mr. Holland’s plan he would merely have added a penalty to an already severe handicap.