PUBLIC SERVICE.

Star (Christchurch), Issue 16635, 18 January 1922, Page 5

PUBLIC SERVICE.

ADJUSTMENT OF SALARIES. BONUSES TO BE REDUCED. BILL BEFORE HOUSE. (Special to the ‘'Star.”) WELLINGTON, January 17. The Government’s retrenchment proposals, affecting whole of the Public Service and Parliament, were an. nounced by the Prime Minister on the introduction of an -enabling Bill tonight. Briefly it is proposed to make three reductions this year in the cost of living bonuses, which have in the aggregate totalled and thus affect a saving under this heading of £2,200,000. Further reductons may follow next year, but Mr MaSsey indicated that if the revenue does not improve a further inroad will have to be made into the cost of living bonuses though it is hoped to leave intact the first bonus of £-50 per annum granted to meetVtlie increased cost of living war period. ✓ explained that although the Bill was necessarily complicated, and there had been great difficulty in planning the proposals the result was simple. Members would recodees that on manv occasions attention V.ad been called to the rapidly increasing cost of the Departments. The cost of living steadily rose from 1913, anl to meet this bonuses or increased wages bad been granted to public oCrvants 1 ho total expenditure of Government Departments had risen to £28,000,000. Over half of this was on account of matters arising from the wnr, interest and sinking fund and the wage increases to which he had referred. There had been an impression that these cost of living bonuses were a tntle, hut their total cost to the Govt' rurueni was four and a half millions per annum. This was what the Bill dealt with. These increases totalled £45 per annum to every individual getting less than £750 per annum. Those who at the beginning of the last year were receiving the £45 increase found that there was need for an additional increase, owing to the sharp rise in the cost of living. Three boards were set up to consider the position. They did good work, and as a result of their/ recommendations railway-men and other public employees received a further £SO per annum, which was made retrospective. Thus there was an increase of £95 on what he would call the pre-war basic wage of £165. There was an understanding between the parties that when the cost of living, which at the time was 62 to 65 per cent above prewar point, fell to 52 the matter would be reviewed. Mr TVilford : Who made the arrangement ?

Mr Massey replied that ho had records of a deputation, showing that tin's was understood by the parties. There had now been a drop to* 50, and probably by this date it was 48. Mr Holland : On food groups alone. Jt is another story with clothing. Mr Massey replied that a comparison was first made on food groups, and it was impossible to change the basis. He need not remind members of the drop in prices of staple products. This made it necessary to cut down Government expenditure. “ Otherwise,” lie declared with an emphatic smashing blow on his desk, 11 we shall face disaster. Wo must faco the position with courage, resolution and determination to do everything we possibly can. If we do so we will get through before a few months are over, but if wo do not I don’t know how Jong it will last ” The Prime Minister went on to say that in addition to cutting down expenditure the Government had also, by reasonable methods, to increase its revenue. Members had done work this session with that object, but results would depend on the increased prosperity and purchasing power of the people. 44 I do not know,” he continued, “ liow long it will be necessary to go on cutting down expenditure. A good deal has been done, more than we get credit for. Including this cut the reduction in expenditure will total over £4,000,000. FIRST BONDS INTACT. ‘ 1 T do not propose to touch the first bonus of £45. The time may come when it. may have to be touched. I don’t know what next year is going to bo. hut the present intention of the Government is to leave that intact. We now come to the £SO bonus. We do not propose to go beyond that, and we will divide it into three cuts, one now (he indicated subsequently that the first cut operates from January 1), one not earlier than three months afterwards, and the third cut not earlier than a further three months. My own opinion is that no more will be required this year. These cuts amount to one shilling per day from ordinary wages men. ’ ’ MINISTERS AND MEMBERS. 44 Ministers and members are in it,” continued Air Alassey. “That ivas expected. Alinisters commence with a reduction of 10 per cent. 11 is 10 per cent all round for members. Some have told mo they would not mind 20 per cent.” Mr Wilford: Those who can afford it. A member: What about equality of sacrifice ? Air Alassey: Talk about equality of sacrifice! We are touching no man’s ordinary salary in the Public Service, only the increases, and I propose to take just a little than half the increases which have been made. 1 don’t guarantee that the Government will stop there, but unless things get worse than at present I think we shall he able to leave the rest alone. Mi* Holland: Why not put Alinisters on the same footing as members and get equality of sacrifice? Air Massey replied that he had secured the assistance of some of the best men in the Public Service in framing the proposals, and it was exceedingly difficult. They had done the best they possibly could. Alembers would be surprised if they knew how much it cost to he a Afinister. Alembers would lose £SO and members of the Legislative Council £35. PUBLIC SERVICE REDUCTIONS. The Prime Alinister went on to enumerate the actual reductions proposed in the various grades of salary in the Publio Service. Persons receiving £320 pei* annum’ or lees would he. subject to a first cut on January 1 of £ls, another £ls on Julv 1. and £lO not earlier than three months afterwards, a. total of £4O- - Wilford : And only £SO on £SOOI Air Massev replied that he had not come to the £SOO class. If a. man got £lls salary the basic wage was placed

at £SO in addition, and he would not be touched. Thev would not go below £165. Reductions in cases of officers receiving £320 to £SOO would be: Jan--1 uary 1 £2O, April 1 £ls, July £lO, total £45; officers receiving more than £SOO anrt not more than £800: Januarv £25, April £ls, July 1 £lO. total £SO Officers receiving not more than £1250 would have a reduction of ten per cent. There were, he said, only 85 officers receiving over £IOOO. Officers receiving £IOOO and not more than £1250 would pay a reduction of nine per cent. They had received no cost of living increases, but only statutory increments. Officers receiving £9OO and not more than £IOOO would have a reduction of eight per cent, while in the ('a so of the £BOO and not more than £9OO class the reduction would be seven per cent. TEACHERS’ SALARIES* There was a difficulty about teachers’ salaries, continued Air Alassey, though these would not be omitted. There were classes he would have liked to omit but the proposals applied to Ml public officers who got increases due to the cost of living. Air Alasters: School teachers did not get it. Mr Massey : The lion, gentleman knows better than that. He knows perfectly irell that 1 handed over £300,000 for the specific purpose. It was handed over in a lump sum to the Education Department, to divide it According to requirements, as there were serious anomalies. The Bill does not ask for the return of £300,000, but for the return of £190,000, leaving £IIO,OOO remaining, if possible, for permanent increases in salaries of teachers. We hope to save £BOO.OOO by the first cut, £750.000 by the second and £650,000 on the third, making a total saving of over four millions, including' the cut already made. Officers paid at a daily rate or hourly rate will be reduced by one hilling per day. In conclusion the Prime Alinister remarked that retrenchment was an unpleasant business for all concerned. Alinisters did not like it. but it was a duty which bad to be done, and the effect of the reductions would be to bring about a gradual decrease in the cost of living. Other countries had had to go through the same process. A commission in England had recommended a cut totalling £200,000, 090. No doubt he would receive all sorts of suggestions, and h© would be quite willing to consider them, though ho did not think it possible to make any improvement on the proposals sub mitted to Parliament. THE DISCUSSION, (Per Press Association.) WELLINGTON, January 17. The Adjustment of Public Expenditure Bill was introduced by GovernorGeneral’s message to-night and ex plained by the Prime Alinister. Air AX’Combs contended that in other countries bonuses aliyrtys had been given as high as the increased cost of living, but that was not the case in New Zealand. The reduction in the cost of living which was being claimed was based only on on© group of figures, the food group, but that was not fair, because it did not include rent or clothing, which were on the increase. What was being proposed meant not merely reductions in public service salaries, but a general raid on the workers’ wages. That at least was the! wish expressed from the Government side of the House, and that was what members were voting for who supported these proposals. Desiring to deal with this subject on scientific - lines be had asked for a iciurr, showing the cost of living based oil all groups of figures, but he had been refused, because when the Government found tlx© figures agamst them they refused to supply them. The Government Statistician in June and September last said that the food groups figure could not be taken as representing all groups in the cost of living. The Prime Minister interjected that the Statistician now said the opposite. Air Al’Combs said that the workers had to wait a long time to get an increase in wages, then at last got 50 per cent to meet an increased cost of living amounting to 80 to 90 per cent. There was no justification for the proposed reductions. Railway men, teachers, postal and other employees wore much underpaid. The Hon J. A. Ha nan said that everyone must recognise that the cost of the government of the country must I>e out down. The national income had shrunk, and the question was how were economies to he made. Salaries, however, should ho the last thing to botouched. Extravagance and waste in various directions in the public service, arising out of the war, should be cut out. H© believed that w© had not touched bottom in New* Zealand yet. It was futile to buoy people up with false hopes by a too optimistic view' of the country’s financial prospects. We, therefore, had a *lut.v to the country and to future generations, and must stem the current of expenditure. He thought the reductions were not equitably made as between officials in various grades. In answer to Mr Holland Air Alassey j said that lie proposed to take the second reading on Thursday afternoon. CERTAIN EXEMPTIONS. POSITION OF SCHOOL TEACHERS. (Special to the “Star.”) WELLINGTON, January 17. The retrenchment measure is entitled the Public Expenditure Adjustment Bill. Tt exempts from its operations The Governor-General. Judges of the Supreme Court and Court of Arbitration. The High Commissioner for Now Zealand. Any person employed by the Government or by any other authority for a specific limited term of office pursuant to contract made out of New' Zealand. Anv person who is remunerated by fees or commission and not by wages or salary.

Any person in the public service who is at the passing of this Act on leave of absence prior to retirement TEACHERS’ DECREASES. Clause 5 of the Bill provides that the aggregate annual rate of salaries payable to persons employed as teachers (including relieving teachers, temporary teachers, pupil teachers, probationers and training college students) in the service of any education board, technical school of which an education "board is controlling authority, or in the service of the governing body of any secondary school and who participated in the distribution of the sum of £300,000 shall as from the first day of January, 1922, be reduced by an annual rate equal to thirty per cent of the aggregate annual rate of increases to salaries, made as from April 1. 1920. COST OF LIVING RATIOS. It is provided that the Arbitration Court shall ascertain for the Alinister of Finance the ratio between the standard cost of living a-s at February 28, 1922, and May 31, 1922, compared W'ith that, at Alarch 31, 1920, and that the Alinister shall as far as practicable fi.x rates of reduction proportionate to the variations reported by the Arbitration Court. RAI*E OF REDUCTIONS. Aggregate reductions in respeot of teachers as from April. 1922, shall not exceed £60,000 per annum, and as from July 1, 1922, shall not exceed the rat© of £40.000 per annum. Reductions in the case of public servants earning less than £2OO per annum shall not exceed the rate of £ls per annum in April or £lO per annum in July, 1922. Graduated reductions shall not operate so as ,to reduce the salary of any officer below that of a subordinate. The reduction of Is a day in the case of persons employed by the hour or day is to he increased by 4d a day or its equivalent where the rate of remuneration exceeds £320 per annum. The rights of contributors to a superannuation found to assessment of pension on the original scale of wages arc. preserved.