The REAL Party also believes that taxation of wages and salaries not only raises the absolute cost of labour to employers but also increases the cost of labour relative to the cost of machinery and so accelerates the replacement of people by machines. Progress towards a world in which human drudgery is unnecessary should be welcome but the REAL Party believes that government policy should avoid creating unemployment until the people are in a position to value their leisure time more than they value the money for which they can sell their labour.

The REAL Party would not increase wage and salary taxes. There are, however, a number of services which people have come to expect government to provide. Many of these, such as retirement insurance, health care and education, will continue to be necessary for a considerable period. The Resource Taxes must not be used for these purposes. The profits of natural resources belong equally to all individuals and must all be directed to the Natural Dividend. For some time it will be necessary to continue to tax wages and salaries to pay for the services people expect.

Some functions the government currently carries out are expected to become unnecessary when the Natural Dividend is fully in place. Special departments for women and Maori, for example, are not expected to continue to be necessary. Job creation is not regarded as a proper function of government nor as an effective way of improving the living conditions of the most disadvantaged in our society. When it becomes possible to discontinue these functions the savings will be used to reduce wage and salary taxes.