STATE SCHEMES

Auckland Star, Volume LXXII, Issue 247, 18 October 1941, Page 4

STATE SCHEMES

DANGER STRESSED INDIVIDUAL EFFORT IMPORTANCE TO FARMER Social services, with a warning against carrying them to extremes, hospital rates on land, which he described as unjust, the importance of reciprocal trade with Britain, and the necessity for encouraging individual effort, were among the topics discussed by Mr. E. M. Edkins, chairman of directors, in moving the adoption of the report and balancesheet at the 34th annual meeting of the Farmers' Co-operative Auctioneering Company, Ltd., at Hamilton to-day. Addressing shareholders, Mr. Edkins said:— Ladies and gentlemen:—To-day I have to present to you the annual report and balance-sheet, to which I will make brief reference. Capital and reserves show no variation from last year's figures, namely, subscribed capital, £658,267; paid-up, £479,953; reserve account, £30,000. The only other liability is sundry creditors, £36,397. The assets amount to £613,181, revealing a percentage of liabilities to assets of 5.93. Tne value of the company's properties stands at £182,983, a decrease on last year's figures of £3755. Depreciation on the whole of the properties has been provided for out of current earnings. The value of the working plant, machinery, office furniture and fittings engaged in the business, depreciation, stands at £5616, a decrease of £1084. Sundry debtors, less reserves, amount to £192,986, a decrease of £8224. Investments, £10,486. This is represented by shares in companies, mortgages ana other securities. New Zealand Government stock (compulsory loan) totals £35,000. Against this there is a reserve for market fluctuation of £3503, the loan thereby appearing in the company's books at 90. Subsequent to tne issue of the balance-sheet, the company subscribed a further £20,000 to the War Loan recently issued, due 1951-54, bearing interest at 3 per cent per annum. There was a credit balance with the company's bankers of £18,800. Stocks of merchandise were valued at £145,813, an increase of £21,361 on last year. In addition to the credit balance with the company's bankers, we had £25,000 on deposit at call. The percentage of expenses to gross profit is 65.2. Summary of Finances Summarised, the position is as under:— « Paid-up capital 479.953 Total liabilities 36.391 Total assets 913.181 Turnover 3.368,918 gross profit 191.109 Espsnsss 194.603 Net profit $6,506 The turnover referred to shows an increase on last year's figures of £67,452. Each branch ana agency has shown a profit The net return, however, Is only 2.81 over the whole volume of business. Of this percentage the State takes in taxation no less than 1.7 per cent, leaving the shareholderi 1.11 per cent on turnover. More Wool Bandied

Proceeding, Mr. Edkins gave a full review of the operations of the Wool, stock, merchandise, shipping and insurance departments. During the season the company handled 22,456 bales of wool, an increase of 3602 on last year, aggregating £400,051, an increase of £60,133. Growers, he said, would realise the extent of their indebtedness to Britain in purchasing the total clip of the Dominion for the duration of the war and one year afterwards at such a satisfactory price, as they had thereby been relieved of what would have been a position of grave anxiety, if not disaster.

"Speaking generally, the stock market has remained fairly steady throughout the year," added the chairman. "Farmers experienced a very good spring and summer, and feed has been more plentiful in the Waikato than has been the case for a number of years. It is not surprising, therefore, that although the winter has been a long ana hard one, stock came through in excellent condition and farmers are looking forward to a Successful year. The most serious set-back in the past season was during the autumn, when the works became congested. Exporters were able to handle almost all the ox beef available, but during the peak of the boner and pig season the freezing companies had to call a halt. This had an immediate effect upon all stock trade. High Prices for Stock

"One of the outstanding features was the excellent prices realised for dairy stock. Right through the year prices for good quality animals were from 30/ to £2 a head better than last year. Although there was a lesser numtA of clearing sales, a greater volume of dairy business was handled by private treaty and in the saleyards. It has been a remarkable year for store cattle. Graziers were always ready to buy, and recently prices soared to heights not reached for many years. "Although the demand for draft horses has been very erratic, this year's Cambridge spring horse fair was a record. Waikato farmers show a decided preference for South Island Clydesdales, and over 200 of these excellent animals, consigned from as far south as Gore, found new owners in this district. A large number of breeding ewes and store sheep from thd East Coast were again distributed to our clients, and the Increasing popularity of Southern sheep resulted in our handling pedigree consignments from the Wairarapa, Hawke's Bay and Manawatu districts. A good volume of business was again put through our pig saleyards, but unfortunately the hold-up at the freezing works in the autumn materially affected our sales. "The merchandise section of the company's business has had a satisfactory year, despite difficulties. Outside of those imposed by wartime conditions, business is continually being hampered by regulations and I restrictions. Most commodities are {in short supply, and some essential ones are unobtainable. Phosphatic fertilisers are rationed on the basis of 40 per cent of the average quantity used during the past two years. This shortage must retard production. unless the authorities, through the research departments, can find substitutes.

Shipping and Insurance "The shipping department experienced a very busy and satisfactory year," Mr. Edkins continued. "None of us can be blind to the fact that for the carriage of all our primary products we are indebted to the Mercantile Marine, who day and night face grave dangers. Those whose privilege it has been to come into contact with the officers and men have been deeply impressed by their cheerful courage in spite of the tremendous strain of wartime conditions. . "Earnings m the insurance department have been well maintained and thanks are due to all shareholders and customers who have given us their willing support during the year." "Free" Benefit* Illusory

To-day our Empire, with other peace-loving countries, is fighting for democracy and for freedom in the fullest sense of the word, Mr. Edkins continued. True democracy Is dependent upon moral values, responsibility, self reliance, and application of the nobility of hard work, thrift, tolerance and fair play to all. To be just, we must legislate for all the people, and there must be a due regard for the welfare and interests of the most humble as well as the most powerful. Modern politicians and would-be planners nave induced many people to imagine that the State, with some magic process, can provide its subjects with a maximum degree o f comfort, shelter, pleasure and leisure free of cost to the individual. There is nothing wrong with leisure and pleasure in themselves; relaxation in moderation is of value to mind and body, but an excessive Indulgence is dangerous and harmful.

We should have learned by now that these so-called free benefits must be paid for and become a charge on the income and wages of the people. The administration of this fund by a large State Department, with branches and staffs all over the country, naturally has to be paid for, and to this has to be added the cost of buildings, equipment, and expenses incidental to the work involved. The balance of the fund is then handed back to the people In the form of social services. The larger the staff and its equipment, the greater the amount absorbed. I would here refer to the question of hospital rates and their possible increase in the near future. With the enormous additions to our hospitals and staffs which are contemplated, the primary producer may be called upon to face a material increase in these rates. Hospital rates levied on land are definitely unjust, in that they become a fixed charge irrespective of whether the farmer makes a profit or a loss. They are a form of direct taxation levied upon one section only of the people. These rates should be borne by the community as a whole. If this country were to spend part of the money which will be used in doubling or trebling hospital accommodation in teaching our people how to keep their bodies in a nealthy state and avoid sickness, we would save much expenditure and bring about a greater degree of happiness. Value of Private Enterprise While there are public utilities that can best function under the control of the State, such as a post office, there is a vast number of activities better left to the individual. He can conduct them far more efficiently, and this is particularly so in the factory, on the farm, in the distribution of commodities, and in general trading. To aid in the development of self-reliance and enterprise, it is highly desirable that fewer restrictions should be placed on the Individual, and, Indeed, that a greater measure of freedom should be permitted to him to work out hie own destiny, provided ethical principles are carefully observed. The old idea of unrestricted competition, however, has probably gone for ever. It falls because it takes no account of the just rights of the other fellow. Some form of planning or restriction appears to be > necessary, and the vital question is, who shall do the planning? If this function be left entirely, to the politician, then the only result will De to reduce our elections to the level of a common auction, with the prizes of office knocked down to the highest bidder. Opposing political parties will vie with each in offering their plans to the electors and the appeal will be to' the selfish instincts of the voter. Along that road lies the destruction of democracy. If there is to be a planning authority, that authority must be independent of the need or temptation to buy votes election, individual effort is ?hPsiruS r < bene l 1 S? 110 State, and the Minister of Finance has stressed the point that the success of the social services scheme lately introS"? 1 on , ablllt y of New Zealand to increase its production s™* " ve, ? ue - , If anything should happen to reduce this revenue materiauy, the whole structure is liable to collapse.

Social SerrioM Overdone? * f 'b y «n unwise policy founded on exaggerated sentimentaUty, the number dependent on the community is u r duJ y- thAt Prorni* 1 ® 8 to P TO vide the "S. XfflStt vSSSSf become inadequate to provide « ne ®' B now enjoyed. » te s . oc ' a l services are good up to a point, but when carried to extremes destroy the initiative of toe people and the desire for honest haKu k * creating instead the habit of leaving everything to the Government. Tf we demand a high SEE!" h* mafntained only by hard work and everlnereasmg production. Individual effort and freedom must precede real progress, true happiness and humane assistance to those in need. It is individual effort and enterprise that developed and built up the British Empire. It is individual effort that has given to the countries Avhere it is allowed the highest standard of living vet attained by man. New Zealand, with its bountiful rainfall, moderate climate and fertile land, being in a better position than many other parts of the British Empire, can produce wool, meat, butter and cheese far in excess of' its own requirements. Upon the realisation of this surplus we must depend mainly for our revenue. As we definitely cannot live within ourselves, we must trade with people overseas, and it is most advantageous for us to do so within our own Empire. Tariffs, especially on British-made goods, are barriers to trade and to a reasonable cost of living, particularly in this country. It is vital to our very existence that we should have the protection of the British Navy, and we cannot expect to continue to enjoy this privilege unless there is reciprocal trade with other members of the Empire. Uneconomic Industrie*

We must the ships to exchange those goods that we can produce cheaply for those Great Britain can produce more economi-

cally than we are able to do. Someone has to pay for the movement of these ships, and if we do not permit them to come here loaded, our primary products must bear the cost of the one-way traffic, which is definitely uneconomical. We have no justification for any argument with Great Britain, when we realise that we depend upon her navy for our very existence, that she takes 75 per cent of our exportable produce and that we in return take from her less than 25 per cent of our requirements in the way of manufactured goods. We have no right, therefore, permanently to build up uneconomic industries to compete against British manufactured goods, when we know that Britain can produce those goods much more cheaply than we can. No one can fully Imagine the state of chaos that may exist when international hostilities cease, but there is surely an urgent need for some preparation to be made to meet the economic conditions we are likely to experience. The principal factor affecting this country is our exportable surplus, which will certainly have to face world-wide competition. We must have learned from this war that the Dominion cannot adopt a policy of insulation, and that our affairs are largely governed by forces outside New Zealand and quite beyond our control.

Before concluding, I wish to mention that 28 members of the staff have left for overseas. They are greatly missed, and it is the hope of all that ere long we shall again have them in our midst.

In seconding the motion for the adoption of the report and balancesheet, Mr. W. J. Lusty stressed the great disadvantage placed on farmers through the shortage of experienced labourers. There was still a drift from the country to the cities, where there was more remunerative work and shorter hours. He supported the chairman's reference regarding hospital rates, and considered some new method of financing hospitals should be introduced to relieve farmers of this burden of indirect taxes. Messrs. D. Stewart Reid and J. Pohlen were re-elected to the directorate, Mr. V. W. Simms, of Otoro* hanga, being unsuccessful.