CIVIL SERVANTS SALARIES

Timaru Herald, Volume CXXXIV, Issue 18821, 9 March 1931, Page 2

CIVIL SERVANTS SALARIES

MEETING OF PROTEST IN TIMARU

At a representative meeting of public servants held in the Little Playhouse. Timaru, on Saturday, March 7th, the Rev. Clyde Carr attended by invitation. On behalf of the combined public servants, the' chairman presented the following statement: — “Mr Carr—l must thank you to-night for attending the meeting of our organisation, in order that we may put before you the position of the public servant which has arisen as a result of the Prime Minister's pronouncement on the question of our salaries. I very much regret that you have attended here alone: I have explained to the meeting that we have made several attempts to get Mr Burnett and Mr Bitchener to attend, and although we left the date of the meeting open as long, as we possibly could, we And thawe could not meet either of these gentlemen. We want to state before you to-night, our side of the question, m order that you may go to the House fully armed with the facts as they affect the public servants. We want you to be fully armed and aware of our decisions before you go to take part in the discussions which are going -o have the effect of reducing our salaries. We are probably not as well versed JR the affairs of the country or the country's financial position as Mr Forbes. There is one thing that we would like to put before you, and that is, that w'e do not want to dodge our share of the burden if it can be shown fair.y that the country is in such a bad way that some assistance is required from the Public Service. We do not want 1 anything unjust, but at the same time, if there is any hardship in the country, | w'e would be only too willing to assist. We have heard it stated by the Prime Minister that it is for the benefit of the poor farmer who is struggling and is in a bad way that these reductions are going to be made. I think that if we could be quite certain that the small farmer was going to benefit by a reduction of salary in the Public Service, we would show a willingness to help. It has been stated that everyone is called upon to make sacrifices; perhaps that is true; but I think it would be just as well before we go anj further to look and see the amount oi sacrifices we have already made and made over a long period. I have prepared a table of the figures taken froir the Official Year Book. This table show; the retail prices which governed th( cost of living during the period 191( to 1930. It also shows, the effect or ■ earnings and the additional amounts of wages which would be required t( ■ bring the standard of living of the Pub- ■ lie Service rip to the 1914 standard. Ii > is probably well known to you that ir s 1915, after the commencement of th' > war, the cost of living commenced t> l rise very rapidly. That is not so witl ■ the Public Service salaries; they re ■ mained stationary. As a result, thi 5 ' purchasing power of the salaries pai< J to public servants fell lower and lowe - until 1919, when they were really u rather a bad way. At that time the; got an increase in salary which slightl; ! improved their position, but did no nearly bring their salaries up to th 1914 standard. The amounts are set ou in the table below;—

fl i, * o t -Si g 3 s % B £ s .8 S « § 1 * - g *& i g y § H a ■s H -a 0 « d « W s. £■

“That is the amount of sacrifice which has been made by every man in the clerical division of the Public Service, and in the General Division probably the amount will be found to be more. We have on several occasions met the Prime Minister, and we have received from him several statements. If we summarise his statements we can bring them under three headings. First of all, the Prime Minister told us that his proposals when he brought them down would be based on equality of sacrifice. Everyone would be called upon to bear a share, and it would not be unduly hard on any one section of the community. He also stated that in times of prosperity huge social services had been built up which were becoming top heavy, and in his own words, ‘unless he shortened sail the boat was likely to capsize.’ He also said that the cost of living would fall. He was quite sure that the cost of living was going to come down, that really we would not be any worse of under the reduced salaries

than we would under our present rate. Now, the Prime. Minister's proposals do not go towards equality of sacrifice. I would like to draw a comparison Detween a public servant drawing a salary of £295 per annum, and a business man drawing £IOOO per annum, presuming that both men had four children. The public servant with a salary of £5 7/6 per week Is going to be called upon to pay £29/10/- to help to balance the Budget. The business man who is drawing £l9/4/7 per week is going to pay £2B/17/6 to the Treasury in the form of income-tax. You will notice that our £295 man pays more than the business man on £I,OOO a year. The Prime Minister describes that as equality of sacrifice. I will make one more comparison, that is, between a public servant on £240 per annum and a single man with an income, of £7OO per year. The public servant from an income of £4 7s 6d per week pays £24 to the Treasury under the Prime Minister’s proposal. The other man, from an income of £l3 9s 2d per week, will be called upon to pay only £22 5s Id in income-tax, considerably less than the public servant on £240 per annum. That shows rather clearly that equality of sacrifice has been entirely overlooked in the Prime Minister's proposal. Mr Forbes stated that social services have been built up in times of prosperity. Now, it would perhaps be of interest to find out what those social services are. Professor Condliffe's book, “The Life of Society,” gives some rather figures there concerning the workings of the Farmers’ Union 1r New Zealand. He instanced the Farm, ers Union Conference in 1922. Thej considered some hundreds of remits ai

that Conference, and of the first 88 on their order paper, 87 asked the Government to do something in the way of extending social services or to create some new service, or in any case, to take some action. Taking the shale of the remits discussed at that Farmers' Union Conference, threequarters of the total remits called upon the Government to take some action. Now, if we take a number of State services, a good many of them are for the benefit of the farmers, and I do not think that any of us wish any of the services to be taken away from the farmer. Take, for instance, ■he ouestion of rural deliveries. I do not think there is one rural delivery in the country that pays, but what a hardship it would be to farmers to cut out these deliveries, in spite of the fact that they are not paying. I think we should also discuss the Prime Minister's proposal and his statement when he .said that the cost of living is going to drop after this proposed cut takes piace. I loo’«rd up the cost of living movements to see what was the effect on the cost of living following the cut in the Public Service salary which was made in 1922. In that year tte cost of living was 59.7 per cent, above the 1914 standard. The Prime Minister at that time, (the late Mr. Massey) stated that the cost of living would fall when he made his salary cuts. The position showing the cost of living movements following the salary cuts in 1923 is set out in the following table:—

“I think that the table shows very clearly that after the previous cut no cost of living reduction followed the reduction in salaries, and it is possible that no reduction will follow the present proposed reductions. The Prime Minister said that he was determined to reduce costs. He is very vague as to how he proposed to go about it. But in any case we wonder if it will be a good thing for the farmers of this country if the cost of living comes down. To me it appears inconceivable that the cost of living will come down and that the cost of primary produce in New Zealand will go up. The trouble with the farmer to-day is that the price he is receiving for his produce is too low, and if the cost of living does come down, it will mean a still further reduction in the prices of primary produce and that wifi be a very bad thing for the farmer of New Zealand. Now, perhaps the Prime Minister intends to bring commodities in New Zealand down to world’s parity prices. If that is the case, it is going to inflict a furtheir hardship on the farmer, because if we take certain commodities produced abundantly in New Zealand, such as wheat and butter, we find the New Zealand price is considerably higher than the London price. I have taken from the Official Year Book the figures for March, 1930, which are as follows:

London. N.Z. n Flour, 20001bs .. £l2/19/2 £l6/16/5 |ti Wheat, cwt. . 8/4 12/3 si Butter £7/0/6 £7/17/3 p “We get the statement very frequ- S ently that we are sheltered workers and a that we are enjoying privileges. I P would like to quote further figures to t show you that we are sheltered more ” from increases or from getting the salary which in any way meets the cost a of living. As a matter of fact, the s public servant is in a much worse posi- r tion than workers who are under Ar- a bitration Court awards from the view- I point of getting increases which rise t and fall with the cost of living. I have s taken out another table of figures, and f I will quote the different percentages t to show that workers under awards of rthe Arbitration Court enjoy advantages v greater than those of the public ser- l vants. The position is set out in the 3 following table, showing comparison t with workers protected by Arbitration i

s “1 think that that table shows that I ' the Public Service wages are the last " to rise and the first to fall. Now, It 5 may be stated that we have just simply 1 taken Arbitration Court awards, but I e have taken the Incomes which exceed 5 £3OO a year and made a comparison bes tween present day figures and five “ years ago, apd the Year Book shows 1 that incomes over £3OO a year have e increased from 62,551 in 1026 * to 76,484 in 1929, an increase ■ i of 13,933.' That shows clearly ! that salaries outside the Public Service have been inclined to rise very rapidly. n We do not wish to suggest that the c workers, under Arbitration awards are <1 overpaid. In fact, we feel that they y earn every penny they get, particularly .1. when we know that they work broken >f time.

“A statement has appeared in the Press to the effect that the Public Service enjoy princely salaries and liberal pensions. I think it would be just as well to show that the pensions in the Public Service are not liberal. Wc have one case where a man has paid into the Superannuation Fund for 30 years, and when eventually he goes on superannuation in three years time, his superannuation wifi be so small that he will still be eligible for the old age pension. That is a remarkable thing. If we take the original contributors to

the Fund, perhaps their pensions are liberal; that Is, those men who joined the Superannuation Fund when It was

established and went out on superannuation within a lew years or a few months. There are cases where a man paid only one contribution to the Fund and then retired immediately after on superannuation. Many of these men are liberally treated, but from the viewpoint of the man who is in the service to-day and has to pay in for 40 years before he receives superannuation, he actually is paying for his pension—in fact, I think an actuarial investigation shows that the average man who pays ;u for 40 years has to live 20 years after,, he retires before he gets his money back. Unquestionably, the Government subsidises the Superannuation Fund to the extent of £86,000 per annum, but in view of the number of contributors to that fund it amounts to only about £4/10/- per head per annum, or something like two per cent, of the salaries, so that really it is not a dram on the onsolidated Fund. Some of the Farmers' Unions’ discussions would suggest that the civil service workers are the only ones who claim superannuation. That is not so. Many big firms in New Zealand have established a superannuation fund, and in most; cases they are more liberal than the Public Service Fund. In addition to the Superannuation Fund, the Government has established a fund which will sell superannuation to any citizen of this country. That is the National Provident Fund, and it is rather interesting to note that last /oar the Government paid a subsidy of £IOO,OOO to that fund, which helps to provide superannuation to any worker in Jsew Zealand. Now, from time to time we have heard statements that the wages in the Public Service should be based on the export prices of New Zealand produce. It has been stated that because the prices of our produce have fallen the Government cannot continue to pay their employees' present salaries, and that our wages should be based on the export prices of New Zealand produce. In order to show how that would work, I have some * figures from the Year Book, and have taken the export prices covering all produce from the period 1914 to 1929, which are the latest ngures available. The following table sets out the

•d o | o Year. 3 I Index figure export prices all groups. Additional amount payable had wages ttbeen based on export prices of New Zealand produce.

Total underpayment over period of < 16 years, £1263 per head. i Had this means of assessing salaries \ been in operation since 1914, the ad- ; ditional cost of maintaining the Public : Service would have exceeded £6,000,000. ( “Not very long ago the ‘Wellington < Post’ made an inquiry into the present : position of wages and salaries. They i produced a really excellent article, and ’ there is only one thing wrong with it, ' and that is that they used the salaries of the Clerical Division in the Public 1 Service, and ignored entirely the £240 ; men in the General Division, who un- : fortunately comprise the majority. It ; is stated that the public servant enjoys special privileges. Amongst those is superannuation, and the fact that most public servants are likely at any time to enjoy promotion to a higher salary. Now, it is true that about 20 per cent, of the men in the Public Service to-day—l am talking about the men in the rank and file—will get promotion, but there are amongst those men a number on £240 who never will, and it is on account of those men that we are going to make a particular appeal to see that their salaries are not going to be cut. Already they are very much under-paid, and we are very anxious to see that no further reduction is made. Following the war the Clerical Division was swamped out, and the opportunities for transfer from the General Division to the Clerical Division were very few. There are many men in the Public Service who are going to be definitely barred from getting any promotion beyond the £240 per annum, and X think that is a point which should be taken into consideration by the Government. The last time the Post and Telegraph employees met Mr Coates he stated that if he were in office a little longer he was about to do something for the Public Service. We have noticed a good deal of criticisms of actions of the public servants in the newspapers, and there is a large section of the community that think that we are quite unjust in pressing to retain our present standard in view of the financial position of the country, but I would like to read a statement which has probably been seen by a good many of you. This statement was made by Sir Francis Bell, who is the type of man not given to excessive sympathy with the workers, nor is he the ■ type of man who makes illi considered statements, and I feel sure that his pronouncement to the people of the country at this time is of particular interest. “The following appeared in the ‘Dominion’ on the 28th February:—

Special Levy On Civil Servants; “Sir,—lt is possible to fully agree with the Prime Minister’s insistence that further taxation must be levied to produce revenue sufficient to meet necessary expenditure and still to be absolutely opposed to his proposal to levy a special tax on Civil Servants for that purpose. If lam reminded that I was a member of a Government which proposed and adopted that method in 1922 I reply that for that reason I am better able to realise not only the hardship such a process inflicts, but also its inefficiency in production of permanent economy in the cost of administration. It is well understood that a levy on the higher salaries only would effect a negligible reduction in the Estimates. The sum anticipated by the Prime Minister in his manifesto would be practically derived from a levy on the smaller salaries, which by process of regular annual increment gradually attain in succeeding years their former standard. I write for myself alone, and do not know what view others with whom I am in general agreement in politics hold on this subject. But I trust that the present Government may yet appreciate the injustice of requiring a special class of persons, who are specially defenceless, to provide a large part of the estimated deficiency in revenue. Surely the taxpayers of the Dominion as a whole should provide what is necessary for the Dominion purposes.—L am, etc— F H D Bell. Lowry Bay, February 27.” “I'do not propose, Mr Carr, to go anv further, but just to impress on behalf of the Public Servants of South Canterbury the position in which we find ourselves. You will be called upon in the course of a few weeks, to decide what is to be done. Perhaps I should say that you will help to : decide that factor, but when you go

there we want you to understand that it is our message to you not to save our salaries at any cost, but just simply to ask for justice to public servants. (Applause). , The Rev. Clyde Carr, M.P., expressed appreciation of the privilege extended to him of attending the meeting. They did not expect him to make a speech, nor was he prepared to do so. He thought, after hearing the statement of the previous speaker, that they would realise that the ground had been thoroughly and effectively covered. He had just been inquiring what steps were being taken to bring these facts before the Government and before Parliament. He did not know whether the Public Service Association was bringing a deputation to the Prime Minister or any members of the Government before the session opened. He did know that various deputations had approached the Minister and that they had all been met with the same assurance, that the Government had been compelled to adopt measures of economy; that there was no other alternative open to them but to reduce salaries as proposed, to interfere with the Arbitration Court, and so on; and that Parliament would have the opportunity of deliberating, discussing and deciding in regard to those proposals. He could only say that if ever he had had any doubts concerning the injustice of the proposals of the Prime Minister, particularly in regard- to the Public Service that evening, they had been effectively dispersed and blown into thin air after hearing that overwhelming argument in favour of the Prime Minister reviewing the whole position, and in the light of those facts giving Parliament an opportunity of discovering if he could not find some more just, reasonable and honourable means of meeting the anticipated deficit in his Budget. (Applause). He found that one-ninth of the wage earners of the Dominion, i.e., the Public Service, will be ask-' in the terms of the Prime Minister’s proposals, to find one-third of the anticipated shortage, in addition to paying their share of direct and indirect taxation as proposed. He knew something of the position of the men who were down on the lower scale, in various departments of the Public Service. He knew that some of them had scarcely enough to keep body and soul together; no prospect of promotion or increase in salary; nothing to stir their ambition, to inspire them, with hope, to give them any affection whatever for the Government and the nation, that employed them; nothing but a grey future to look forward to; and he would hke to say that it seemed to him most repre- | hensible that a community who employed for certain necessary public services certain of their own members should make them the victims of such ■ a proposed onslaught as the Prime Minister had now made. Whenever there was a fall in the standard of our primary products and their prices, they were mulcted to a disproportionate amount; and when there was a rise in the standard of living, when prices went up, then they received no share in the benefit. argument had only to be placed before Parliament, and if Parliament were reasonable, let alone human, they would immediately disallow the proposals of the Prime Minister and hi Government. (Applause). He had said on more than one occasion that he did not think there was any excuse whatever for a reduction in the standard of living of the wage earners and salary earners of this country. However' bad the financial position of the country migh« be, there were other means of obtaining the money. They all knew that the man who was on a wage or a salary never became wealthy, he was never able to save very much, to anticipate retiring at an early age, or leaving much to his descendants, or enjoying a very rosy leisure in his years of retirement, if he ever had any. It seemed most unjust that that particular class of people should be the only Class for whom Mr Forbes had suggested any reduction In income, any fall in the standard of living. He (the speaker) was not a financier, or a statesman, but he was assured by those who might lay claim to those qualifications that it was quite possible, even at this stage of our country’s history, to meet the situation and tide themselves over their difficulties without touching the standards of the wage and salary earners at all. He agreed that if there must be wage and salary reductions, they should be on some equitable basis; there should be positive exception taken in the case of those below a certain standard of income. He could only say once again that he considered the proposals were absolutely inhuman and uncalled for, and that he would do his utmost, as he wag sure ever member of the Party to which he had the honour to belong, to fight this thing to a man, to the very last ditch. Applause.)

1914 .. 1000 1000 — 1915 .. 1072 932 15 1916 1160 862 35 1917 .. 1287 777 63 1918 .. 1426 701 93 1919 .. 1567 783 74 1920 1776 818 70 1921 1174 819 69 1922 .. 1597 838 56 1923 .. 1580 859 52 1924 .. 1604 835 57 1925 .. 1662 825 61 1926 .. 1628 823 63 1927 .. 1615 836 60 1928 .. 1618 829 60 1929 .. 1600 838 57 • 1930 .. 3554 862 46 Total deficiency £931

Year Cost of living percentage abov e 1914 standard. 1922 . 59.7 1923 58 1924 . 60.4 1925 . 62.4 1926 . 62.8 1927 . 61.5 1928 . 61.8 1929 . 60.7 1930 s . 59

iilllliilHHIII 1 '"' ! | lllllllllllllilll other — — — “ Bsegfiggggg 1 agg-c i

1909-1913 1000 #0 1914 1108 23 1915 .. 1315 69 1916 1529 116 1917 1744 163 1 1918 1198 HO 1 1919 1851 . 137 1920 1823 79 1921 1687 52 1922 1270 -16 1923 1554 46 1924 1769 94 1925 1886 119 1926 .. .. .. 1526 40 1927 1513 37 1928 .. .. ft 1684 75 1929 1613 .59