The Press FRIDAY, JUNE 24, 1938. The Government and the Dairy Farmers

Press, Volume LXXIV, Issue 22436, 24 June 1938, Page 10

The Press FRIDAY, JUNE 24, 1938. The Government and the Dairy Farmers

The Hon. Walter Nash’s speech to the conference of the National Dairy Association was an adroit attempt to defend the guaranteed prices scheme against two different and conflicting bodies of criticism. The Minister must have been conscious that this was his last chance before the election to rally the dairy farmers to the support of the scheme and of the Government. On the other hand, he also showed his awareness of that substantial, if not very articulate, body of opinion which sees in the progressive liberalisation of the guaranteed prices scheme a potential menace to the stability of the national finances. Accordingly, he was under the necessity of making concessions to the dairy farmers and at the same time of showing that those concessions did not amount to an abandonment of the scheme as originally formulated. The main concession to the dairy farmers was an increase in the guaranteed prices for butter and cheese sufficient to absorb all but £113,000 of the £928,000 surplus in the Dairy Industry Account. 'A further concession, which may ultimately have the greatest importance, was embodied in an answer to a question. If, said the Minister, costs rose heavily after the guaranteed price had been fixed by the independent tribunal which is to be set up, “ the Government would certainly “ have to consider the position.” The answer dispels any hope that the tribunal will be a means of eliminating the possibility of political pressure as a factor in the determination of the guaranteed price. The Minister has, in effect, told the dairy farmers that if they object to the price fixed by the tribunal they are free' to appeal to the Government for an increase. In the circumstances, his prophecy that the tribunal will “take a lot of worry off his “shoulders” is likely to be very wide of the mark. The Minister’s defence of these concessions, for the benefit of those who charge him with abandoning the original guaranteed prices scheme because of political pressure, is disingenuous. It has been said that the guaranteed price principle has been abandoned. It is not true. The principle remains that the dairy industry account stands on its own. The Government does not propose to touch the account in any way. The adjustment of the price for the current season does not break the principle. It is an increase in the price to meet some of the added costs that are known, and to some extent to provide a sum to enable the farmer who does employ labour to pay a higher price than he has hitherto been able to pay.

The statement that the Government “ does not “propose to touch the (Dairy Industry) account “in any way” is a flat contradiction of the Minister’s previous statement that the deficit on the scheme for last season, amounting to £272,000, would be transferred to another account and would not be a charge on the dairy industry. The statement that the increase in the guaranteed price, this season has been made “to meet some of the added costs that are “ known ” and to enable dairy farmers to pay higher wages to their labour is ingenious. Unfortunately for Mr Nash, the Prime Minister has already given a less discreet but much franker explanation of why the original guaranteed price for this season is being increased. In an address to the interprovincial conference of the Farmers’ Union on May 24, Mr Savage, after announcing that there would be a substantial surplus in the Dairy Industry Account, said: “It belongs to you and you are going to “ get it.” A plan “ for making that surplus “available to the dairy farmer” was, he explained, being worked out by the Minister for Finance and his officers. And in case anyone should mistake his meaning, he added: “It “ means yoU‘ have a minimum price of 112s and “you are also going to get everything above “the minimum you can get in the open “market.” Not for the first time, the Prime Minister has told the truth at the wrong moment.