A DROP IN WOOL

Waikato Times, Volume 93, Issue 14493, 16 October 1920, Page 7

A DROP IN WOOL

EFFECT ON DOMINION'S FINANCES. MR. MASSEY'S WARNING. NEED FOR CAREFULNESS. (By Telegraph—Special to Times.) WELLINGTON. Friday. "Circumstances have arisen during the last month or six weeks that have made it necessary for us to strengthen the finances of the country," said the Prime Minister in moving the second reading of the Death Duties Amendment Bill. Mr Massey did nol think that there need be any alarm ah.nit the situation, but undoubtedly there was likely to be a drop in the price of wool, New Zealand's principal export. If the difficulty was handled successfully New Zealand would get over it without trouble, but the financial side of the operations would require to be very carefully handled. Many members would recollect about J 2 years ago when the price of wool fell from about lid to 6d per pound, that the drop forced the Government to dismiss persons from the public service, and caused unemployment all over New Zealand. He did not want thai to happen again, and he did nol believe it would happen if there was careful management. The fall in the price of wool, added the Prime Minister, was likely to be balanced to some extent by (he very strong demand, al high prices, for dairy produce. He added that while he was calling attention to the somewhat serious position into which the Dominion was getting in regard to exports, lie had not altogether abandoned the hope of being aide to make a start with a reduction of taxation ncxl year. The Government was paying oul roughly £1,000.000 a year to keep down the prices of flour and butter within th i Dominion. The lime would come, although he could not. say how soon, when the prices of these commodities would gel hack to normal. When th it time came it would be possible for the Treasurer to reduce taxation by a million a year.