“INSULATING” NEW ZEALAND

Timaru Herald, Volume CXLV, Issue 21156, 1 October 1938, Page 18

“INSULATING” NEW ZEALAND

Example of Flax and Potatoes Mr Hall at Salisbury School Stating that in spite of a contention by the Prime Minister that Labour was able to "insulate” New Zealand against falling prices overseas, the flax industry in the Dominion was being “insulated” out of existence, Mr W. H. Hall, National candidate for the Timaru seat, speaking at Salisbury School last night, asked what the Government would do if the major industries experienced a downward cycle. Twenty electors were present, the meeting being presided over by Mr G. J. Gavigan, chairman of the school committee. Why Not Increase Prosperity? Time after time to the point of weariness, said Mr Hall, the Socialist Government had claimed that the present prosperity was brought about by the Government’s measures and general policy. If that was so, then why could not the Socialistic Government keep on increasing prosperity and increase the return to the primary producer, until the threat of depression was banished for all time. Why? Because the Labour Government knew that it held no magic that charmed away market depressions overseas, and in spite of that knowledge, it continued to spend millions and millions, committing the country to millions more for the future, against which there was no guarantee whatever. The pity of it was that so many poor deluded individuals were being led to their economic ruin by false doctrines and pernicious propaganda. Mr Savage had said: “Let there be no mistake about it or misunderstanding. Even if there is recession overseas, Labour’s policy is being framed to avert the effects from being imposed on the people of this country. We have always stated that it is possible to Insulate New Zealand economy from the effects of world depression. Should such an occurrence again affect this world, and I see no reason why it should, then I can assure you that there will be no better test for the success or failure of our policy.” Decline of Flax Industry “If it has plans ready, why has the Labour Government not coped with the depression and increasing unemployment in the flax industry?” asked Mr Hall. Twenty years ago flax was a considerable industry but since then it had declined. The Socialist Government had used all its powers to stimulate artificially the industry. It had lent £20,000 to provide new machinery for wool pack manufacture. Woolpack manufacture had been further stimulated by the Government decree that last year out of every five woolpacks used by sheep farmers, they had to take two made in the Dominion. Merchants could buy woolpacks in Calcutta at 2/-, land them in New Zealand for 2/7, and sell them at 3/-, yet they had to give 4/11 for Foxton packs to sell them at 3/4'. On top of that, there was a subsidy of £3 to £7 according to quality on every ton of fibre exported. So flax was well protected (insulated) at this end. The Hon. H. T. Armstrong, in the course of a speech (Manawatu Standard, 1/4/38), said: “I am just beginning to wonder if we ought to do anything with the industry or let it go.” Later Mr Armstrong said: “If the Government were given the chance, as I think they will be, at the next election, it will make a real industry of the flax industry, and meet the people’s requirements without sending raw materials to Japan and Timbuctoo.” Why must the Government wait till the election to make “real” industry of flax?” asked Mr Hall. Why did it not insulate the industry from the overseas influences which had affected it? Though it was worth £1,750,000, 20 years ago, it was worth only £186,475 to-day. It did employ 2,000 men on 130 strippers, and sent 32,000 tons of product overseas, and now it was being insulated out of existence. Mr Armstrong and the Socialist Government were quite unable to cope with even a price recession of £22 16s to £2O 10s per ton overseas, and would apparently throw up the sponge. Mr Savage with all his vaunted preparations could not insulate even a small industry like flax against overseas price variations, nor could he insulate potatoes against a fall in price. What would he do with major industries like dairy produce, meat and wool, when they next struck a downward cycle? • Candidate Questiond

Replying to Mr W. J. Black, Mr Hall said that taxation per head of population had increased in the last five years as follows: 1935, £l5 18s; 1936, £l6 6s; 1937, £l9 15s; 1938, £23 Is.

In answer to a further question by Mr Black the candidate said that taxation in Australia was about £l5 18s a head. It had been reduced considerably. In reply to the chairman Mr Hall said that between the years 1921 and 1931 the public debt had been increased by £70,000,000. Referring to the “National News,” the chairman inquired of the candidate if it were correct, as stated in the publication, that Friendly Societies paid a sickness benefit of £2 a week for the first 12 months and £1 a week thereafter, and whether there was an age benefit of £1 10s a week over the age of 60.

The society to which he belonged did not pay such high benefits, but there might be a society In New Zealand which did, said Mr Hall.

The chairman: I do not think any registered society pays that sickness benefit or any pension unless special payments are made.

Another question was whether the candidate thought it fair under the Social Security Bill that domestic servants should have to pay 5 per cent, on their wages, and 5 per cent, on their keep if it was assessed at £1 a week? If keep was assessed at £1 10s a week then the domestics would have to pay 121 per cent, in all. Mr Hall’s reply was that the National Party was going to exempt the domestic servant from tax. He did not think that low-wage people should have to meet such charges. On the motion of Messrs L.

O’Donoghue and W. J. Black, Mr Hall was accorded a vote of thanks by acclamation for his address. The chairman was also extended a similarcourtesy. (Extended Renort hy Arrangements