NEW ZEALAND FINANCES

Wanganui Chronicle, Volume LXXXII, Issue 19439, 27 October 1925, Page 7

NEW ZEALAND FINANCES

FINE SPEECH BY PRIME MINISTER EFFECTIVE REPLY TO CRITICS SOME CAREFULLY OVERLOOKED FACTS The Prime Minister who is now in Taranaki, is, meeting with the same enthusiasm which has made his tour of the Dominion a triumph. Yesterday afternoon he spoke at Inglewood, where he made an effective reply to critics of the Dominion’s finances. (Special to 4 4 Chronicle. ”)

NEW PLYMOUTH, Oct. 26. In. the course of a speech iat Inglewood this afternoon, the Primo Minister made special reference to the subject of finance, and replied to some of the criticism which has been levelled at the Government under this head. The meeting was largely attended, notwithstanding that it was held in the afternoon, and on a public holiday, when there were strong counter-attrac-tions. Mr. Coates reminded the electors that they were going to the polls on November 4 and that it was a matter entirely for them whether they got a Labour Government or a Government with a sound stable platform. He said that the present Government stood for sound finance, and aimed at giving lan equal opportunity to all. They realised that to do justice to all the State must be wealthy, and that in order to attain that the Government must make a success of the business of the country. If the Government so managed affairs that there was wealth accumulated, there was something to distribute among the people. He thought it was fairly clear in the minds of the electors that tail the humanitarian legislation which had been found on the Statute Book in 1912 had been extend-

ed and brought up-to-date, and it would be admitted also that many new and beneficial measures had been added. Financial Critics. In regard to finance, the electors would hear that -the present Government were extravagant, and all sorts of figures would be quoted to endeavour to prove that it could not manage the country. 44 Lot me tell you,” he added, 4 4 that no set of men could have been more careful that those who form the Government at the present time. Some of those who have been criticising the finance of the Government know when they lare using them that their figures are incorrect. They say i that the cost of administration has | been increased by £15,000,000 since j 1912. Take some of the causes. The first is war debt. There was the amount of money borrowed to allow New Zealand to take her place alongside England when honour land freedom were threatened. To criticise that expenditure is simply to say that New Zealand should not have taken her place in the field. Do any of the critics want to say that? Of the £15,000,000 the sum of £8,000.000 goes down to the war. There was a balance of £7.000,000. Thg critics will persist in ladding the cost of railways and Iho Post Office to annual administration costs, and you know that both have paid their own way, and have showed surpluses above the cost of working. That reduces the £7,000,000 to £6.000.000 increased cost. Those opposed to the Government forgot that the GovernI ment had to minke up to the employees ‘ the equivalent of the increased cost of living. That amounts to about 60 nor cent., but we will say 50 ppr cent. That means increasing bv one-third, so that we have £2.500.000 to bo added for i cost of living, and anyone who argues against that says tha«t the Civil Servants should not have had an increase. ” The Real Test. 44 The real test,” said Mr. Coates, was how much more had the Government loaded the people up with since 1914. Well, the amount in 1914 was

£3 5s 6d per head, and the amount today was £3 0s 9d. Then they say: “Where is tho Government getting to in connection with the Public Debt?’ They say there is a Public Debt of [£221,000,000. You have to remember I there has been a war which added I £76,000,000. They try to compare our position with that of European coun- ! tries, but there is no comparison at all, I for tho reason that they have a dead weight debt, and much of our’s is developmental. Interest-Bearing Loans.

44 0 f the £221,000,000 of our debt, 75 per cent is interest-earning. Since 1912 £66,000,000 has been borrowed, and £60,600,000 is interest earning, or 90 per cent is not costing us a penny. We have borrowed money for developmental purposes, and we are getting interest from all except that put into schools and roads, and as long as we. aro developing the country and making no charge on tho taxpayer I see no reason why we should not go on. We arc told that it is time to call a halt. There will bo no halt so far as I am concerned. We have a great country, and so long as we follow sound business lines it will not be wise to stop developing. Something for Critics to Answer. 44 Now, I want to know, seeing that it is said that our borrowing policy is criticised, how you can develop without money? What are they going to say? They must say stop developing if they say stop borrowing, and it will be interesting to know what it is they really want to say. They cannot blow hot and cold. If they say we must call a halt, they must stay that we have to stop the finishing-off of our incompleted railways, roads, our swamp drainage works, and all sorts of things, and such a course is one no sano business man would , take. It seems to me that if wo can borrow money at a rate at which it will pay us to continue these developmental scheme, it is far better to go on developing the resources of New Zealand than to ho standing still and making no progress wathever. <4 lt is contended also that what money we borrow we should borrow in New Zealand, but my opinion is that it is unwise to take that course, and wiser to leave the money that is in tho country free to be used by the people in the development of their own industries. If you put the present Government back into power you will see the programme put into operation. and you will see the country pros-

per in consequence. If you stop development the country is going to bo stagnant. Everyone knows, of course, that care has to be taken, and move more than we do, hut we are not afraid of the future.” Hearty Applause. Mr. Coates’ reply to his critics was heartily applauded, and Mr. A. Alorton moved a vote expressing confidence in the Government and expressing also tho hope that the Urimo Minister would return from tho polls with a majority sufficient to enable him to carry out his policy. Tho seconder, Mr. Stewart, thanked tho Prime Minister for the verv fair treatment he had meted out to the settlors of the district. The motion was carried by acclamation.