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BENEFIT TO N.Z., Auckland Star, Volume LXXVI, Issue 191, 14 August 1945
BENEFIT TO N.Z.
FREE ENTERPRISE INSURANCE CO. EXAMPLE The importance to the Dominion's welfare of "invisible" exports such as insurance and the value of free business enterprise in developing the nation were two points emphasised by Sir James Gunson, chairman of directors of the New Zealand Insurance Company, in his address to shareholders at the annual meeting to-day. In New Zealand, said Sir James, we depended primarily for our prosperity upon what we could export at payable prices. Such "exports" might be classed into two sections:— <1) In the form of our products (wool meat, dairy produce, seeds and a jiumber of commodities of lesser volume). That class of export trade ■was termed "visible," for it was obvious to the public and understood thoroughly. (2) In the form of "invisible" exports, such as investments abroad, insurance, shipping to a degree and other services. "To this second group of exports this company makes a very substantial and direct contribution," said the speaker. "It sells insurance throughout the world and in the long run brings most of the profits arising therefrom to this country, thus providing relatively and just as surely the same form of benefits to the Dominion as arise from visible export trade in commodities under group one. In the same manner Great Britain is also greatly benefited by the world-wide operations of her United Kingdom domiciled insurance and shipping companies. Any public policy which in its operative effect restricts initiative and enterprise in the conduct of business generally is fraught with danger to the economic stability of the Dominion. Planning for Future "After the war it will be necessary for New Zealand to increase its exports, firstly, to enable us to import in sufficient volume those goods essential for our welfare and which cannot be manufactured economically in the Dominion; secondly, to maintain a normal and reasonable scale of expenditure both public and private. This company along with others similarly situated, is planning and preparing to render increasingly useful service to the community. From our domestic point of view all this may be put briefly in another form.
"Taking the past year of the company as an example, the following may be stated:—Of the total revenue of the company 19.05 per cent was earned in the Dominion and 80.95 petcent was earned outside the Dominion; whereas of dividend distribution 89.8 was paid in the Dominion to New Zealand holders of the company's stock, and 10.2 per cent was paid overseas. The shareholders number several thousands, indicating the widespread interest of the investing public in the company's activities."
Sir James said he gave these statistics to show both the overseas connections of the company, its value to the Dominion and the widely spread shareholding interests of the company among the people of New Zealand. Enterprise Misinterpreted The term ''private enterprise" as opposed to State trading and Statecontrolled trading was a totally misleading designation. It was used often in a derogatory .sense and chiefly by the advocates of a socialistic state as opposed to the organisation and direction of industry by those persons individually and collectively, who had proved by their ideas, skill, initiative and energy that they were capable of successful business and company organisation and management. Such people from time to time came from all ranks and classes in the community. The attack was against what might be termed correctly free enterprise, and, if successful, would undermine the liberty and freedom of the people with the intended suppression of all personal initiative and resource, with a consequent loss of opportunity to the individual, which should remain open, subject to all reasonable laws,' to every man and woman, boy and girl, according to his or her ability.
The company could never have attained its world-wide standing nor offered the services and the security which it did to the public, under any such over-riding measure of government restraint or control. These matters were referred to in order that the place and value of business enterprise might be more widely realised. State departments, with some exceptions, were spending departments and not earning agencies and tax-paying units such as were public companies and a host of men and women carrying on independent businesses. However well mtentioned the agitation emanating from some quarters for bureaucratic control and ownership might be, considerable elements of danger would have to be by all members of the community if it resulted in the attainment of the objectives desired by its supporters. It must be remembered also that efforts had been made to confuse the minds of the public with statements and innuendos that what was termed "private enterprise" was nothing more than big interests, whereas generally it consisted of economical and most useful combinations of small interests. Wartime Problems "The war has brought to us many difficulties and problems which vary in degree and nature and face us in most fields, in several of whicn, as you will understand, we are regarded as 'a foreign company, continued Sir James. "Our problems arise on governmental, technical and competitive grounds, into which you would not expect your directors to go further at this annual meeting but your board may say this—that at no time in the long history of the company has the responsibility for the conduct and the success of its business been as heavy as ltisnow. The company is fortunate m being so well served by its management and staff.
"Here it is not out of place_to> mention that in addition to the financial and economic value of our company to New Zealand, it provides steady employment for a of our own people with good cbances of P °rSnot P ionand the security of proper provision for.their declining years. To this latter end .many years ago, in agreement with the staff, tne company established and ad , m S. ters asfa separate entity, a staff provident fund whose, tottrt funds now amount to *6W,w»i. oy means its old employees have a strong assurance of financial safety after their years of service Anally, it may be said thaiyour directors do not under-estimate the difficulties which he ahead both ne re and abroad, but they assure you tna the widely spread. interests of your company will receive their unrem ting care." «,
BENEFIT TO N.Z., Auckland Star, Volume LXXVI, Issue 191, 14 August 1945
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