Government Budgeting
Further increases in the Unemployment Tax in 1931 and 1932 as well as dissatisfaction of the 'schemes' provided by the government as living situations grew worse, led to demonstrations outside the Parliament for action and eventually to riots across the main cities.
As unemployment continued to rise, it became increasingly costly for the government to provide work under ‘Scheme 5’. By July 1931, the Unemployment Board was overspending its income at the rate of £16,000 per week. This led the government to increase unemployment taxes with the Unemployment Amendment Act 1931. While the levy of $3.00 per year was reduced to $2.00, an additional tax of 2c was levied for every $2.00 earned. This new tax applied to all wage and salary earners and even women and boys under the age of 20 were included, even though Board put in minimal effort to supply them with relief work. One of the worst features of this scheme was that through this system, women and working boys paid taxes, but could not get any assistance. Because women were given no assistance under the Act, some employers exploited the women who worked for them.
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This Evening Post Article explains that women were also liable for the new taxes put forward by the Unemployment Amendment Act 1931, regardless of the fact that they would receive no benefits from the Board. clause led to the
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The Coates-Forbes administration was focused mainly on balancing the budget, rather than meeting the demands of the people and this further increased public anger towards the government.
There were 10% cuts in the Public service workers’ wages in 1931 and 1932 as well as cutback in the education sector. As a result, many teachers lost their jobs and the average classroom size rose to around 60 students. The government was determined to cut expenditure where possible and it seemed downright petty in some situations. Old-age pensions and war pensions, for example, were decreased by 30%. Family allowances were stopped, kindergartens closed and fewer meals and shorter lengths of stay was established in hospitals. The Court of Arbitration was given allowance to lower wages and there was no longer a minimum wage rate, again leading to exploitation of workers in some instances.
During this time of relief work and “humiliating dependence for many people” as is stated in the book Protest In New Zealand, by Brent Coutts and Nicholas Fitness, people began to feel more and more bitter about the seemingly unsympathetic government. The worst times during the Depression became known as “The Sugar Bag Years” because some children and others worked under Scheme 5, wore sacks from Auckland’s Chelsea Sugar Refinery as they could not afford more clothing and they did not want to spoil the few good ones they owned. When questioned about whether a universal unemployment benefit could be given to the people, Forbes responded that “the Government and the Unemployment Board...is continuing to provide to the fullest extent of its resources unemployment relief in return for work performed.” He avoided speaking of possibilities of payment outside of work and how men could find work when relief work was in shortage. Most people at this time were feeling the effects of unemployment in one way or another and the government saying that they could all get by if they just “ate a little less” did not do them any favours in making them popular. Increasing numbers of families became entirely reliant on church groups such as the Salvation Army for assistance and on Mobile soup kitchens for evening meals. Many families in the cities were evicted as they could no longer afford rent.
By the beginning of 1932, the unemployment programme put in place by the government was deteriorating. The ‘schemes’ were for the great majority unsatisfactory because of the low pay rates, dreadful working conditions and the arrangement of no work in every fourth week. In March 1931, people marched in the streets and on Parliament grounds, saying that further action would be taken if wages were reduced further.Deputations of unemployed waited outside the Parliament and for the Prime Minister daily. A great majority of those people were poorly nourished and seeking food and work and they grew increasingly hostile as they were given no response.
Ultimately, the built up anger and frustration burst out into riots in the four main cities in New Zealand.
This image shows a demonstration on the Parliament Steps by people who demanded answers from the government for the dire situations in which they found themselves, with no relief.
There were 10% cuts in the Public service workers’ wages in 1931 and 1932 as well as cutback in the education sector. As a result, many teachers lost their jobs and the average classroom size rose to around 60 students. The government was determined to cut expenditure where possible and it seemed downright petty in some situations. Old-age pensions and war pensions, for example, were decreased by 30%. Family allowances were stopped, kindergartens closed and fewer meals and shorter lengths of stay was established in hospitals. The Court of Arbitration was given allowance to lower wages and there was no longer a minimum wage rate, again leading to exploitation of workers in some instances.
During this time of relief work and “humiliating dependence for many people” as is stated in the book Protest In New Zealand, by Brent Coutts and Nicholas Fitness, people began to feel more and more bitter about the seemingly unsympathetic government. The worst times during the Depression became known as “The Sugar Bag Years” because some children and others worked under Scheme 5, wore sacks from Auckland’s Chelsea Sugar Refinery as they could not afford more clothing and they did not want to spoil the few good ones they owned. When questioned about whether a universal unemployment benefit could be given to the people, Forbes responded that “the Government and the Unemployment Board...is continuing to provide to the fullest extent of its resources unemployment relief in return for work performed.” He avoided speaking of possibilities of payment outside of work and how men could find work when relief work was in shortage. Most people at this time were feeling the effects of unemployment in one way or another and the government saying that they could all get by if they just “ate a little less” did not do them any favours in making them popular. Increasing numbers of families became entirely reliant on church groups such as the Salvation Army for assistance and on Mobile soup kitchens for evening meals. Many families in the cities were evicted as they could no longer afford rent.
By the beginning of 1932, the unemployment programme put in place by the government was deteriorating. The ‘schemes’ were for the great majority unsatisfactory because of the low pay rates, dreadful working conditions and the arrangement of no work in every fourth week. In March 1931, people marched in the streets and on Parliament grounds, saying that further action would be taken if wages were reduced further.Deputations of unemployed waited outside the Parliament and for the Prime Minister daily. A great majority of those people were poorly nourished and seeking food and work and they grew increasingly hostile as they were given no response.
Ultimately, the built up anger and frustration burst out into riots in the four main cities in New Zealand.
This image shows a demonstration on the Parliament Steps by people who demanded answers from the government for the dire situations in which they found themselves, with no relief.