PRICE TRIBUNAL

Ashburton Guardian, Volume 60, Issue 20, 3 November 1939, Page 3

PRICE TRIBUNAL

“ AVERAGING ” OF PRICES. NEW SYSTEM WELCOMED. (Special to the “Guardian.” CHRISTCHURCH, November 2. Hopes that the now arrangements under which the Price Investigation Tribunal may apply the procedure of “averaging” prices where necessary will help to solve many pressing problems, are expressed by city merchants. They condemn the system as previously operated, describing it as unworkable. ■Merchants pointed out that advances of up to 7 b per cent, in the imported cost of various foodstuffs and other goods have compelled shopkeepers to make sharp advances in prices, regardless of the price-control regulations.

The tribunal, it was said, was snowed under with applications and wholesale distributors had been unable to wait for the slow-working machinery to operate. In instances where firms had endeavoured to carry out the strict letter of the regulations, they had been compelled to withhold goods from sale until the tribunal decided on the rise which would permit them to sell without loss. In the meantime, they had to rejectorders from retailers. As was shown by the experience of the City Council this week, when an order for water meters was found to involve expense much in excess of the original figure, large advances in commodity prices have followed the rise in value of the American dollar. Lines Affected Ly the War. Itice, sago, tapioca, pineapples, coconut oils, and Californian dried fruits are some of the lines which have been immediately affected by the war, and each week, as the replacement of goods at higher prices extends to additional lines,, the forward move in prices becomes wider. It is predicted that Christmas lines, such as dates, figs and nuts, will be much dearer than in the past. -lain criticism of the Price Tribunal has been that it over-loaded itself with -detail in attempting to deal with iuufividual applications by merchants and shopkeepers. The view was that the only practicable course was to make its decisions general, which will be one result of the new regulations One suggestion that could he adopter 1 .mder the amended system is that the vribunal should enlist the eo-operatie* h organised business associations an., trade sections in continuous touch rt'itli day-to-day changes in the cona - tions governing prices. This is saia to be the basis ot the Australian method of tackling the problem.

Provision has been made in the Commonwealth for direct negotiations with organised bodies representing industries and trades so that common ayerage prices may be arrived at for any commodity. Special Provisions, Special provisions relate to proprietary linos, and care is taken to make the definitions, gross profit and other terms, consistent with recognised trade practice. In determining retail prices, the Australian method is to arrive at maximum prices by adding to wholesale prices, as calculated by averaging the normal rate of gross profit as charged by retailers. ]’n all cases gross profit may be subject to review, and if found excessive, is varied. In dealing with imported goods, traders may average the price of old and new stock. The maximum price h then the average price thus ascertained. The same operation may be repeated from time to time as new stock arrives. Goods expected to arrive within three months may be included in the calculation.

For goods manufactured in Australia, tho averaging principle is applied in a similar manner as regards old and new stock. To deal with the purchase of materials at higher eosts, a variation of the averaging principle is allowed in dealing with manufactured goods. The manufacturer may work out the cost of materials in such a way as to arrive at the average cost of all the stocks of materials, both old and new.