"GLARING ERRORS"

Evening Post, Volume CXXVI, Issue 116, 12 November 1938, Page 22

"GLARING ERRORS"

JOURNAL CORRECTED

MINISTER'S LETTER

NEW ZEALAND FINANCE

The Minister of Finance (the Hon.! W. Nash) has written in reply to two! unsigned articles which appeared recently in the "Stock Exchange Gaz-j ette," London, in which, he claims, incorrect 'statements were made relating to New Zealand. i The letter is dated November 3, and the Minister has sent it to the editor' of the "Gazette":— "Two articles on New Zealand, in the 'Stock Exchange Gazette' of September 3 and September 10 respectively, have just been brought to niy notice. One can forgive the political bias in them, but the disregard for facts shows that the writer is ignorant, careless, or wilfully obscurantist. For the sake of accuracy and the reputation of your journal, I would like to correct some of the more glaring errors. "In discussing a reluctance to lend on second mortgage, your writer says that 'the Reserve Bank has departed from its true functions by taking on the duties formerly performed by the individual.' The fact is that the New !Zealand Reserve Bank does not lend rto individual persons—it deals with ;the Government or Government De|pai|tments. MORTGAGE LEGISLATION. , "Your writer says second mortgage Tending is unpopular because of 'interference by recent legislation for the relief of mortgagors at the expense of the mortgagee. . . .' Whatever may be meant by 'recent,' the fact is that two Governments have come and gone since this legislation was introduced early in 1931. The Labour Government which took office in December, 1935, was concerned merely with the finjal rehabilitation of mortgagors. "Your writer says that housing in New Zealand 'fell into arrear' because of rising costs of labour and material. The fact is that the biggest part of the housing shortage is due to the cessation of building during the recent depression, when the cost of labour and materials was at its lowest. "Your writer says that 'the introduction of the 40-hour week has led to a severe shortage of skilled labour.' The main-reason for any shortage of skilled labour are that almost no apprentices were trained in the .depression, some men lost their skill in the depression, and that the work resulting from the Government's policy, j both, in making up arrears and in I building for.the future, means that our i resources are being used to full capacity. REVENUE BY TAXATION. "In discussing the revenue for the 1938-39 financial year, your writer says that 'the still further drain on the taxpayer's purse which the new Social Services Bill will entail leads to the inevitable conclusion that the estimated revenue will not be reached.' The name of the Bill (now an Act) was the Social Security Bill; any additional costs under it come to charge in the 1039-40 financial year. The Act does not come into operation until April, 1939. The revenue for 1938-39 will not be affected. Yet your writer calmly states the reverse as a fact

"In discussing the guaranteed price for dairy produce, your writer says, 'No attempt was made to relate price increases to the rising costs of production, and the original scheme of a sliding price scale seems to have deteriorated to a haphazard and complicated form of export subsidy.' It would be difficult to get more misrepresentation into one sentence. In the first place, the guaranteed price scheme is not, and' never was, "a sliding price scale"; secondly, it is in no way an export subsidy—in fact, for the 1937-38 season the' Marketing Department received from sales over £500,000 more than it paid for the produce under the guaranteed price; thirdly, the very basis of the guaranteed price is that it shall cover all the reasonable costs of efficient production (including interest on capital) and leave a net return to the farmer which will give him a reasonable standard of living. If your writer knows anything he must know that the guaranteed price has been fixed each year after consideration of the evidence and recommendations of expert committees who have assessed in terms of butterfat every item of farm costs at the level existing at the time of the fixation of the price.

"Your writer says that 'the dairy farmer who employs labour is in an extremely unenviable position.' He goes on' to infer that his (labourers have the 40-hour week and must be paid double time for weekends and overtime. Nothing could be further from the truth. There is no legal limitation whatsoever of the working day "or working week for dairy, farm labour. To make up for this, the worker must be given seven days* holiday for every twelye weeks of work. Payment is not by hours of work, but at a weekly rate. "Your writer goes on to say 'that it 'is still more true today that at least 50 per cent, of the dairy farmers in the Dominion are, in varying degrees, unable to meet their financial commitments.' This is the most imaginary and absurd of your writer's statements.. In 1937, the latest year for which statistics are complete, there were in the whole' of the agricultural and pastoral industry only eighteen bankruptcies; of these, eight people described themselves as farmers.. Among these eight would be any bankrupt dairy farmers. And the mortgage relief legislation was no longer applicable.

"I would ask that you give this letter a prominence equal to- that given to the articles discussed, for it is not a matter of political considerations, but of the reputation and integrity of New Zealand."