BUDGET DEBATE

Wanganui Chronicle, Volume 79, Issue 186, 7 August 1936, Page 8

BUDGET DEBATE

jucaders’ Speeches in Parliament GOVERNMENT EXPENDITURE MR COATES FEARS SERIOUS CONSEQUENCES PRIME MINISTER’S REPLY 1 - —— i [p._r Pre., Association! WELLINGTON, Aug. 6. I When the Mouse of Keprescita- ; lives resumed at 7.30 to-night the , Budget deoate was opened bj : Hon. -I. G. Coates, who said that |. ever since the Government had , assumed office it had been admin- | istering doses ot soothing sjrup to , the House in order to deaden the . pain, out what had been done | under the Government's Hood ot , platitudes; the number ot nn- ; employed had been increased, I tiiougn it was true that susten- , ance payments hau increased and j public works had been unde.- ; taken. Private industry had been , restricted in quite a number of . important ways. He be.ieved that . the Government did not care I whether industry was ruined or I not. The produce, of the dairy ■ industry had been commandeered without a thought to rising costs, expenditure was increasing by leaps and bounds and he believed that just round the corner there was inflation. Now they had Labours first Budget and the same old cry, •'There is nothing to fear." He forecast that in the next twelve months there would be a complete reaction and he hoped that it would not be a collapse. There was a taxation increase or five millions in one year. It meant a drain on revenue funds and reserves to that amount. He knew tne Minister of Finance had had an enotmous task and Mr. Coates said the country would suffer if the Minister were completely overloaded and the indications were that so much work in the public interest had been held up for so long that he could come to only one conclusion, that the Minister’was overworked or else was paying too much attention to detail. What was wanted was a broad policy. He asked why the announcement of the guaranteed price had been delayed and why had the directors of the Bank of New Zealand not been appointed earlier. The Public Service Commissioner had not been appointed. . Hon. F. Fraser: Why didn't the last I Government do it ? Mr. Coates: The Hon. Minister must take his gruel. He went on to ask where the money was coming from. He claimed that lhe last Government had left lhe finances in an unassailable position, but was the present Government ci o_ pieting the reserves? Public Works Referring io public works and the j expenditure on plant. Mr. Coates j asked whether machinery should al-i most wholly displace man-power. How ' tar was it wise to use machinery ? He i thought there was still room lor the j old w heel barrow. The use of machin- . <*ry might be very expensive and where did the Government intend to , draw the line? Mr Coates asked if the paragraph regarding the rearrangement of the . internal economy was a threat to the ■ British people. Did he mean that if ; Ihe British people did not give her • what she wanted New Zealand would ■ commence to manufacture her own ; motor-cars and other things? He . told the Minister that the question , of bilateral agreements had been raised and a reply had been received ■ (hat before those agreements could i be made they must be discussed at the Imperial Conference. He said that , New Zealand could not secure a bi- j lateral agreement with Britain. After all, the volume of trade had to be considered and New Zealand s contribution was small in proportion to the total of British imports. He said that New Zealand’s best policy was ! to stick as closely as possible to the policy that best suited Britain. The Minister had made a fetish of bilateral agreement between New Zea- i land and Britain, but it could not be i done. The Minister's statement should be considered in the light of its effect on New Zealand! credit overseas. What, he asked, was meant by a guaranteed price? Did it not mean guaranteeing a minimum price and if lhe farmers products realised more the farmer would be given the benefit of the increase. He believed the country from one end to the other believed it meant a minimum price. He believed the Government's policy would not be acceptable to the farming community. He thought the dairy farmer believed that he would be given more than the world price. Mr Coates believed there was a catch in the guaranteed price and he claimed that while lhe Government’s promises had been kept to the letter they had not heen kept in the spirit. The farmer had received the benefit of the exchange for only 31 years and he contended that lhe Government in fixing its price, obviously had taken f.o.b. prices in New Zealand currency. Was that fair? He contended that it was not. He said the Government should have taken the London price for ten years and converted it into New Zealand currency with the existing exchange, which would have yielded Is 2ld, whereas he was getting a little more than Is Old. The farmer was not getting a fair price and he left it to the Government to disprove what he said. The Minister had said that the increased costs were considered in fixing the price, but the price this year would be infinitely less than the price received last year. Pensions and Taxation. Reference also was made in the Budget to pensions and as far as the Opposition was concerned it was always ready and willing to provide recognition for those who had given the best years of their lives to the country but that had to be done on an economic basis. He doubted if that had been considered in the present cases. The old age pensioner

(IHU lippcu was Io receive a 2s 6d increase or 12£ per cent., but his costs had risen more than that. He said it was the experience of other countries that the granting of a pension to a deserted wife gave rise to all sorts of complications. What about the returned soldier? All he received was part of the return of the economic pension. The returned soldier was receiving no consideration at all. Mr. Coates said the graduated land tax was an iniquitous tax and when it reached the sixpence it became murderous. Many men would have to give up their holdings. Did the Minister realise that? Mr. Coates said the tax in the city would practically prevent rew enterprises commencing. He thought that many companies would go out of business as the reuslt of taxation and unemployment would increase. He did not think the Government realised the effect of its provisions for a hardship clause where a man who was in danger of being forced off his land could take his case before a tribunal. He urged that greater provision should be made for defence and he ' thought reasonable steps should be taken to protect the advantages New Zeitland and the rest of the British Empire enjoyed. Mr. Coates said that in the event of war New Zealand was just as likely to be involved as anywhere else and she was at present inadequately prepared. He offered the support of the Opposition in the examination of New Zealand's defences. Could they say that the Air Force was satisfactory and all that they required? Would the present machines in New Zealand be of any use in case New Zealand was attacked? He believed that the people of New Zealand would agree to a greater expenditure to secure adequate machines. He paid a tribute to the volunteer territorial i forces for the way they were carry- ■ ing on against great odds to-day and i he ottered any assistance the Opposi- ' [ t ion could render in the matter. Prime Minister's Reply The Prime Minister, Hon. M. J. ! Savage, said that soothing syrup was , preferable to the castor oil theory of I the last five years. He was advised I that in spite of all the disasters predicted, industry was going ahead and could not fulfil orders. He thought 1 Mr. Coates had cleaned up all the rej serves long before his term of office I had ended. Why didn’t Mr. Coates [fill the Public Service Commissioner - ’ship? He thought the Government ! had made reasonable progress to get [ w here they were to-day. He had told • the farmers exactly what they had Ito expert and the price fixed wa« a fairly liberal interpretation of his statement and the dairy farmers had been told that if there was any suri plus he would consult the dairy I farmers’ representatives to see what I should be done with it. Also, the farmers had been told that their j mortgages were to be readjusted. Was there anything left? He thought not. The Government wanted to pay the I farmer the difference in the price he i received overseas and what it took to keep him and his family at a decent standard in New Zealand and he did | not think the farmer expected more, jHe was going right ahead with the ! pledges he had given to the country. I Mortgages would be readjusted on J the basis of the guaranteed price. I Mr. Savage said the Government I wanted the primary industries to live. •as they provided the only way of [meeting their commitments overseas, j He was not thinking of smashing the financial system but reforming it so [that man would be the master, not [money. Hours had been reduced and [the wage cuts restored. It was a curious way to solve the depression by (giving people less money to purchase i things with. Houses would be built ■ for the people by using the public ' credit, and he wanted to see his honI curable friends going up and down the country saying that the Government [should not do it and see how they got 'on. He had never met anyone wno [could tell him why they should not [complete a railway if it were wanted, or erect a building. They pledged the I public credit in either case. j The Government was trying to alter | the existing system and it could not [pay off the existing debt by adding to it each year. Mr. Coates had added seme £24.000,000 in three years. He was not going to lei the people down in the job he had promised to do. Coming to the taxation proposals, Mr. Savage said that some people seemed to think the country could be carried on without taxing anyone. The people had to be levied to keep the public services going. While the Government was accused of all sorts lof things deposits in the Post Office I Savings Bank during .July had increased by £436,000. He wished he could have done more in the last eight months. He would have liked to make the old age pension 30s and predicted that this time next year they would be discussing a national superannuation scheme. They were not going to wait till a week before the election. They were shaping a policy now that would place everyone beyond the reach of poverty. He paid a tribute to the doctors and nurses of the country who did much good work for nothing and the Government was out to see that they did get paid for it. The Government would produce a superannuation scheme that would place the people beyond the reach of poverty and a

medical service would be at their disposal Mr Savage thanked Mr Coates for his offer regarding defence and said the matter was being examined. He said that when the Government spent money on de f ence it would be real defence. The offers of co-operation of the Opposition would be gladly availed of when the need arose. | The debate was adjourned and the House rose at 9.50 p.m.