PRICE FIXATION OPPOSED

Press, Volume LXXIV, Issue 22465, 28 July 1938, Page 11

PRICE FIXATION OPPOSED

View of Sheepowners’ President “COST REDUCTION NECESSARY” “Disparity in Payment For Service” [THE PRESS Special Service.l WELLINGTON. July 2T. “Should the Government decide to attempt to give effect to the demand by one section of primary producers for action to be taken ensuring immunity from risk of loss in production, other sections of industry, both in town and country, "will naturally demand equal treatment and would appear to be quite justified in their demand,” said Mr H. D. Acland. provident of the New Zealand Sheepowners* Federation, in his annual address. He was sure that if the issue were put to the community generally and the sheepowners particularly, an overwhelming majority would show a preference for individual and independent activity and stand or fall by tne result of individual effort. Any attempt to guarantee immunity from loss in production would entail exhaustive inquiries into every form of business activity, whether in town or in country, and would mean regimentation of the whole productive effort within New Zealand, and tney should ultimately find themselves classified in various groups under bureaucratic control on a totalitarian basis. “Any attempt to lift local prices sufficiently to be of any real assistance to our primary producer exporters, would obviously be nullified through the comparatively small percentage of consumption possible within New Zealand. of the total of our production for export,” said Mr Acland. “There is, however, far too wide a disparity in currency payments made for services rendered by city industries and services generally, mid thOve received by the cities from the country districts and primary mausme*. This want of balance between New Zealand currency returns xor the two services is the primary cause of tne unrest expressed in resoffiuons moved by gatherings of farmers throughout New Zealand during recent years. Effects of Legislation This difference was becoming more marked as the effects of recent legislation affecting costs to the farming community for essential requirements on the farmwas more fully appreciated. Most of these goods or services were only procurable either from New Zealand manufacturers whose costs oi production were arbitrarily hxed e.fficr under Court awards or special legislation; while competing gooos oversea* «rere forced to car ?' ently heavy tariff charges as to luLy protect local industry and enaiAen to maintain its arbitrarily fixed costs of production and still siirviv^ “The primary producer exporter, however, has no such protection accorded him, and I am conmceo an adequate inquiry should-be undertaken, with a view to reaching an ap~ proximate estimate of the actual disability under which primary producers for export are working as compared with industries catering tor our protected domestic market only- r would again stress the need for a fnu inquiry into the alleged discrepancies in net returns to the various sections of industry*, whether engaged in production for local consumption or for export and sale overseas. The effect of this has been to create many sections or separate classes m the community, and each section finds it necessary to approach the Government with the request that they be protected from the results of concessions granted to other sections, and so on, ad. Ixn. Principle of Compensation It was imperative, taking the long view, that all costs should be kept at a general level which will enable Reduction for export to continue and a possible increase along lines leaving a sufficient margin of return to ensure a fair living to producers. He was glad to note that there was no longer any suggestion that a compensatmg price plan was to be advocated bythe promoters of the Compensated Price Campaign, but that the question was to be regarded as one of P”inoiple. the basis preferred being a reduction of costs to a point where the fanner could continue to produce with a reasonable return for his labour, ant* the use of his capital and experience. This principle had been consistent!, laid down by the federation for more than 20 years, and he felt that members would gladly endorse it once more cn behalf of producers for export“We must face the facts as to wear costs our industry can stand, and we appear to be rapidly apcroachmg the position reached in wnen the gross returns from many high country runs in the South Island were insufficient to meet costs of shearing, mustering, and the other necessary work on the station, without taking any account of materials required. Government rents, capital involved, etc. Complaints of Dairy Industry The result of attempts at fixation of prices of dairy produce to date, had fullv justified the policy consistently followed by the federation of opposm| Government control of the products cf their industry and price fixation cr meat and wool. While the present ' Government under its policy had raised costs of production beyond all precedent, in no case had the price of produce for export been raised above world parity, with the exception cf subsidies granted in some of the minor primary industries for export, such as fruit growing, etc. The gross amount of subsidy paid in these cases was negligible. . . “The main or key* exporting industries, however, appear to have received no consideration whatever by the Government, and we find dairy farmers throughout New Zealand complaining that as a result of the Government’s attempt at price fixation, t~e dairy farmer, broadly speaking, nas been prevented from getting the fu.l market value of his produce. It tne experience of the dairy industry, as expressed in statements by its representatives, is any criterion. I fee. that you will agree that every* effort snould be made bv sheepowners thro” heut New Zealand to maintain frecc. * of action with regard to the managi_ ' “t of the productive side of their c uness, and the marketing of their product. , , . , The value of the products cf me sheepowning industry exported during the year ending on March 31 last wa> approximate!'* £32.300.000, cut cz a total production for exmort from the Dominion of approximately £60.000.T00. The industry* was producing rougruy 50 per cent, of the total value of exports from the Dominion, ana the maintenance of the interests o. sueepowners generally was a heavv responsibility on their representatives. He believed that those interests can oe best conserved through their organisation in friendly co-operation with other primary producers* unions on matters affecting farmers genera;.:-.