"DISASTER AHEAD"

Press, Volume LXIII, Issue 18926, 15 February 1927, Page 10

"DISASTER AHEAD"

FREEZING COSTS TOO HIGH

FARMERS' PRESIDENT SOUNDS WARNING.

[THE PRESS Special Service.] WELLINGTON. February 14. Evidencp on behalf of the New Zenland Farmers' Union was given to-day by Mr W. J. Poison, president of that body, when the Dominion dispute in the freezing industry was before the Arbitration Court. Mr Poison said:— "We regard the present cost of freezing as too high, and we are of opinion that unless some relief is obtained from these and other high costs which are throttling our industry, disaster is ahead of us, and that the position in New Zealand this winter will be worse than anything since the days of the Atkinsou Government. We are the only people who cannot pass these charges on, and with the gradual fall in prices of primary products—a fall which economists agree is the natural corollary to the return to the gold standard—it is impossible for us to develop the primary industries in this country unless we get costs of production down.

Staggering Figures. "Many people believe that inflated land values are responsible for the position of the producer. That is only partly true. High costs, including labour costs due to the increased cost of living, the restrictions imposed on employers, by this Court, and a slackening of effort during the recognised hours of labour by workmen, generally, are the chief causes. The result is that land in New Zealand is deteriorating to an extent that if put into figures would stagger the Dominion. The 'Year 800k 1 gives the unimproved value of land used for fanning and allied pursuits at £ 144,220,469 for 1925-26. The gross capital value of counties is set .down at £344,043,853 in J925. I believe that the depreciation since the war in North Island'land alone amounts to as much as 20 per cent, in some counties and to probably 5 per cent, of the whole rateable value of North Island county land (£208,912)325), or, in other words, to over ten millions sterling. I regard this depreciation, duo to the growth of weeds >and second growth, as a significant indication of the cost of labour, which is the chief factor in controlling it.

Farming Industry Suffers. "The effect upon the farming industry, which is responsible for 04.2 per cent, of the exports from New Zealand, and abput 72 per cent, of the total production, Is easily ascertained. We find mortgages increasing, whilo production is at a standstill. Not only have our Imports exceeded our exports, but the latter are down ten millions. Producers are being driven off-their farms.in numbers which the bankruptcy figures give no indication of. Unemployment is greater tljan it has ever been in New' Zealand for many years, at a time when harvesting and other farm operations should absorb every extra worker. The point which chiefly concerns this Court is that in spite of the expenditure of the Government on land and soldier settlement since the war there is.practically no .increase in ,the output of mutton and lamb. The steady rise in quantity and value which took place up to 1920 has stopped, and the 1926 figures show a fall in value.

"Tha Vicious Circle." • "The responsibilityis upon this Court of seeing that the cost. of production is reduced. The cost of living is based on index values over which the farmer is the only, section of the community without any control. .The continual interference of the' Court in order to maintain a false standard has'had the effect of retarding a return to. sounder conditions. As an Australian authority recently put it, we are engaged in 'a futile and endless travelling of the vicious circle.' I do not wish tot reduce the workers' standard of comfort,' but I am satisfied that reduced costs of production would mean reduced cost oftliving. I have been able to make some investigations in such countries as - Denmark and Holland, where the basis of living is vastly lower than in New Zealand, but where, the standard of - comfort is undoubtedly as high, if not higher. The reaßon is that production costs are low..

Smaller Works Essential. "The price of. the service is'dictated by the largest works in New Zealand at the present time. All the small works are running at a' loss, with the result that they aro being closed down by the process of exhaustion. These works perform a distinct service to the producer in some cases, and their withdrawal .is in those districts a retrograde step from the point of view 9? efficient service, ideal observation and supervision, and prevention of loss thrqugh long railway journeys for such as lambs. A monopoly for some large works is rapidly bolng created in which labour conditions play a considerable part. The farmers' protection against unfair labour demands is the smaller works. The freezing companies are in a different position to the farmers; They are in .a position to pass, their charges on. Similarly, they would be in a position to pass on any reduction."