FARMING PROBLEMS

Ashburton Guardian, Volume 54, Issue 196, 1 June 1934, Page 7

FARMING PROBLEMS

SOME HELPFUL SUGGESTIONS.

MANY SUBJECTS ANALYSED.

FUTURE POSITION OF THE FARMER.

ADDRESS BY MR NORTON FRANCIS.

Many aspects of the position of the primary industry at the present time were discussed in an interesting way by Mr Norton Francis, of Christchurch, when he addressed the MidCanterbury Farmers’ • Union conference in Ashburton this afternoon.

Mr Francis, who was warmly received after he had been introduced by the president (Mr A. P. Bruce), said that while he had been delighted to accept the invitation to address- the conference, he was somewhat diffident in putting forward his views on several subjects, because he knew how keenly interested and well-read in. farming problems were the members of the Canterbury branches of the Farmers’ Union.

, “I want to make it clear that although I have been closely associated with farmers’ finance in Canterbury for over 40 years, I was only farming on my own account for about half of that period, and since the War have neither farmed, nor had much actual experience of farming methods. 1 therefore do not pretend to be an expert in any sense of the word, but I do 'claim to be an m the help which economic systems and carefully organised agricultural research can give to all farmers who take an intelligent interest in the information' available. “I have been a member of the Massey Agricultural College Council since its inception, and for more than live years the chairman of- the Lincoln' College and Chamber of Commerce Bulletin Committee, this has brought me into close touch with some of the research work at both institutions, and I can assure you that much of it has been most valuable. . “Non one can afford to-day to scoff at research work when the extraordinary success achieved in nearly ©very part of the world is remembered. May I mention two instances —that of scientists in Java, - where the cultivation of am improved kind of sugarcane revolutionised the sugar growing industry because of the immenselyincreased yield, and the success of the Rust Research Station at a Canadian agricultural college, where the toll of rust was estimated to cost wheatgrowers alone about £5,G00, 000 a year. The Value of- Research. “How invaluable has been the work in Canterbury to eliminate', smut from barley amd other crops, to bay nothing of the investigations made in different varieties of’ grain and grass seeds, and diseases in stock. “My anxiety to-day is whether the best results are obtained from necessarily reduced money grants available in New Zealand for agricultural research'work. I content , that theie must be duplication of effort if each Agricultural College and the other scientific institutions are woi king independently of one another. I should like to see your executive seriously consider whether your* Union as a whole should not approach the Government with a proposition somewhat as follows: “Every one or two years a conference should he held •with representatives present from • your Union, the Sheepowners’ Union,. agricultural colleges, the scientific institutions, the Department of Agriculture and the Department of Scientific and Industrial Research, this conference to determine what is the most urgent research work to be carried out in the immediate future, in accordance 4 with the money allocated by the Government. Apportioning the Work. “The duty would then devolve on the Department of Scientific and Industrial Research, of which there should be, I suggest, an agricultural and pastoral section, to apportion out the work with a money grant to those colleges and institutions considered best for such work. “Much of the scientifio investigation would necessarily have to be spread oyer a period of years, as it is impossible to limit research as a general rule to any fixed period. “On the other hand, it appears necessary to have a body like the proposed agricultural section of the Department of Scientific and Industrial Research (which I contend should be prohibited from conducting any research work on its own account) with supreme authority to increase or cancel any money grants to institutions so that good work could be continued and neglect or unsuitable energy promptly stopped. < (i S ubmit that the actual reseai cb work done by the Agricultural Denartment should be quite apart from the every-day work of that Department, because research workers should not be liable to be taken off such work at critical periods *to undertake ordinary routine duties. All research results should be submitted by each institution to the Department of Scientific and Industrial Research, which ra turn would pass on all desirable information for farmers to the Agricultural Department for publication. Publication of Bulletins. “I mentioned earlier my connection with the agricultural bulletins which are issued monthly. These are printed at the expense of the Canterbury Chamber of Commerce after preparation by the Lincoln College staff. The original object of these bulletins was to supply to the farmer some of the invaluable information available in the College records, and at the same time

to show the practical interest of the Chamber in farmers’ problems.

“It is only since the -War that the Chamber has shown the farming community that it is a Canterbury and nob a Christchurch Chamber. It now has a rural interests committee consisting of farmers or business men keenly interested in farmers’ affairs. This committee is always available to examine any question submitted by a farmer or farmers’ organisation. Town and Country. “I hold that town and country interests must run together and each be always ready to help the oilier. 1 know of no better medium to achieve this than close co-operation between Ilia Farmers’ Union/ and Chambers of Commerce.

“Mdfet townspeople realise that tlio towns could hot survive without the country, and the country in turn receives valuable assistance from the co-operation and service of those in town. Another activity taken by the Canterbury Chamber of Commerce is its farmers’ finance scheme, which has, i think, been generally appreciated by the farmers, and their mortgagees.

“Its object was to keep every capable and hard-working owner on his farrh despite the slump, and at the same time to permit the mortgagee to receive his fair share of any profits. Its great value is that it is voluntary, and permits of special arrangements to meet each case. Despite the Mortgagors and Tenants Relief Act, and other legislation,, I think more cases have been dealt with under the Chamber of Commerce scheme than through the courts, 'and many of us who were instrumental in its formation think normal times might have been reached more quickly if ther e had been no legislation. “I admit that legal protection was necessary against the Sliylocks anxious for their pound of llesh, but fortunate: iy these were few in Canterbury, and public opinion would soon have ousted them. As bad as the Shylocks are those farmers who refuse to work or try to maintain their farms in reasonable condition, but put up a plausible story tp the Court. It is cases like these which, although only a small minority, for most farmers have done more than a fair thing, tend to alienate the sympathy of some mortgagees from the man on the land and the bad farmer should not be allowed to adversely affect the majority. “My experience in Christchurch has been that nearly all mortgagees are only too anxious to help the farmer overcome his difficulties in the hope that, with improved prices, full interest could be paid, and the condition of the farm eventually brought back to its previous efficient condition. Farm Mortgages Policy. “In my opinion this is tlie time to consider the future policy with regard to farm mortgages. Conditions under the existing legislation exxpire on March SI next, and it is imperative that Parliament deal with this question during the coming session. I think it will be as difficult to ease off ‘ slump ’ legislation as it was the War ‘ moratorium.’

“What is to be the future policy for farm mortgages? The slump which made it impossible for any interest, to be paid, in many cases caused terrible Hardship to those who were entirely dependent on their mortgage interest for their means of livelihood, and trustees with money to invest have been rushing to secure Government and local body bonds in preference to farm mortgage securities. lam one of many who consider that a good farm is the soundest possible security for an investment of trust funds, as long as the interest payable on the loan does not exceed what is a fair rent to pay under normal conditions. I also realise that if the farmer is to obtain his mortgage, money at a reasonable rate, there must be competition among investors to obtain sound mortgage securities and this is only possible when there is confidence as to the safety of the capital to he invested. Questilon of Interest Rates.

“It is generally admitted iliat throughout the world there is likely to be a period of low interest rates, and it seems probable that we in New Zealand shall see money lent out at lower rates than have ever been experienced here. Nothing will benefit the farmer to-day more than a further reduction in his interest payments, as the latter on so many farms is the piggest item on its budget. “With such a reduteion, it should be possible for him to find annually a 1 per cent, sinking fund payment. I have long held the opinion that eveiy mortgage of less than, say, £7500 should be amortised, and that a payment of 1 per. cent, per annum in addition to interest should be made compulsory, with the proviso that if profits did not permit the sinking fund payment in any year, no mortgage could be foreclosed so long as the equivalent of 5 per cent, of the capital were repaid in any five year period. “May I ask you to consider how much stronger would have been the position of many farmers in the past three years if they had been reducing their loans by 1 per cent- over the previous 20 or even 10 years? It is a system of compulsory thrift which so many of us have neglected to practise since the war. “Past experience has shown us that long term Government loans at a low rate of interest were only of real benefit to the farmer who first negotiated the loan, because as time went on and the farm was sold, the value of the cheap interest rate was inevitably capitalised and added to the purchase orice of the farm. This is a real evil which must, if possible, bo prevented in the future. One means to overcome this is, I hold, to obtain a loan which will redeem itself in some 36 to 40 years by a 1 per cent, sinking fund, and which so long as the contract is being performed, cannot be called up during the period. “Further, the rate of interest should be adjusted every seven years according to conditions ruling when these revaluation periods come round. Some such system would make it .impossible to capitalise more than the amount o the sinking fund, which is right and oroper, because interest rates beyond the seven year period would be unknown. , , “I ask you to consider'this, and als.o

a proposition of adjustment of rents, particularly Government and local authority pastoral runs. Tlieso rents, I think, should be adjusted as far as practicable on prices received each year from the wool, surplus stock and produce sold" off leasehold properties. Tho basis would necessarily _ vary according to working costs on different places, but the result would be an extra profitable rent to the lessee when prices were good, and in bad seasons a proportionately reduced, or possibly no, rent. . . . “Surely this would be more satisfactory' for all. The lessee would create a reserve fund to hold any surplus payments in the good years, which would be drawn against in tlie lean years. The relief to the lessor in an unprofitable year would be incalculable, and in a season of high prices, he would not be unduly inconvenienced by the higher rate payable.

“I trust I have given you some problems to consider, which, in my opinion, would help to ease the present economic difficulties of the farmer. I do not expect you to agree with me in all the proposals submitted, but possibly out of these suggestions you may be able in your wisdom to evolve some relief to the stupendous difficulties you have been up against. “I congratulate the sheepfarmer on the much better returns he has enjoyed this season,, and trust they will continue. He certainly deserves them after the past disastrous seasons. I sympathise with the wheatgrower and the dairy farmer in their troubles, but hope better days are ahead.”