BRITAIN’S BILL FOR SUBSIDIES

Press, Volume LXXXIII, Issue 25244, 24 July 1947, Page 8

BRITAIN’S BILL FOR SUBSIDIES

BUTTER AND CHEESE COST £32,000,000

LETTER TO CANTERBURY DAIRY COMPANY

Interesting comments on the large cost to the British Treasury of its subsidies on imported butter and cheese are contained in a letter received in Christchurch. by Mr P. J. Byrne, as secretary of the Barry’s Bay Co-operative Dairy Factory Company. Ltd., from Mr M. J. Foley, a director of Foley Bros. (London), Ltd., colonial dairy produce importers. Mr Foley also discusses the economic crisis facing Great Britain. The system of “government to government” contract has become so complicated that it is almost impossible to compute the proper value of any commodity. says Mr Foley. Terms of one contract are offset against those of another. overall lump sums running into millions pass from government to government in respect of past and future contracts. Political support and Empire solidarities also come into the picture. Mr Foley goes on to compute the cost to the British Treasury on the present ration and price basis, as at May 1. On butter and cheese alone the Treasury pavs out subsidies aggregating £32.000.000. These subsidies keep the retail price ot butter down to Is 4d per lb. against a cost of about 2s 4d pei lb. which, says Mr Foley, would be nearer to 3s 6d per lb on the open market, and, in the case of cheese. lOd per lb as against Is bd and 2s per lb. respectively. Tn computing the cost of these commodities to the Treasury. it should be noted that butter from Empire sources costs Britain 175 s per f.0.b., as against 275 s for butter from foreign sources. and cheese 100 s per cwt as against 1755.

Foreign Produce Dearer “The public accept retail prices,” continues Mr Foley, “as being the true values and that without the ‘government to government’ contract subsidy system of trading, prices would be prohibitive for almost a non-existent supply. There is no appreciation that 75 per cent, of the existing ration of butter and cheese is being supplied by Empire producers at 50 per cent, of world values, purely out of goodwill towards the peoples of Great Britain ”

Mr Foley concludes his summary ot conditions in Britain with the following observations: "Britain to-day faces an economic enemy more ruthless than any human foe she has defeated in the past. May be at present too many people have their heads in the air. but it is up to some of us who have the opportunity of seeing a little more clearly and farther ahead to keep our feet solidly on the ground. "We can survive only by the intelligent application of our own energies, and the proper use of our own resources. We know we will win the battle and that we shall survive, but also we know that we can only do so by the continued backing and support of the Dominions, who have always so generously come to our aid in our hour of need.”

BRITISH TEXTILES MISSION TO U.S.

(N.Z. Press Association—Copyright) LONDON, July 21. British wool cloth, hosiery and clothing industries are to send a mission to the United States in September. It will investigate the prospect of exporting more goods there as part of the Government’s drive to sell more textiles to hard currency markets. Recently a wool working party recommended that the wool textile industry should not be content with- its present specialty trade with America, but should consider the possibility of obtaining a larger share of American trade in medium price cloths. It is stated that in the first five months of this year SI per cent, of the value of United Kingdom wool textile exports went to hard currency countries, compared with 14 per cent, in 1946. SINGAPORE EXCHANGE

The Bank of New South Wales advises that telegraphic rates of exchange on Singapore have been amended. Current rates (N.Z. pence to the dollar) are as follows, the rates formerly obtaining being shown in parenthesis:—buying 34 17-32 (34 3.9-64); selling 35 9-16 (35 21-32).

COMPANY NEWS

FARMERS’ CO-OPERATIVE “ The Press ” Special Service NEW PLYMOUTH, July 22. A profit of £57,147 is shown by the Farmers’ Co-operative Organisation for the year ended March 31. 1947, states the annual report to be presented to shareholders at Hawera next month. After paying rebates exceeding last year's total by 20 per cent., and after providing depreciation on plant and properties to the extent of £7184, profit amounts to £15,147. Gut of this has been provided a sum of £33,786 to meet expected commitment! for income and social security taxes. The balance of net profit then remaining, £22.360, together with the balance carried forward from last year. £17,390. amounts to £40,751. In addition £2707 provided in last year’s accounts to meet expected commitments for income tax is now available through a reduction in the rate of taxation, making a total of £43,458 available for distribution. The directors recommend that this sum be dealt with as follows: (1) Payment of a dividend at the rate of 3J per cent (social security tax paid), absorbing £7987 17s lOd; (2) carried to general reserve, £15,000: (3) balance to be carried forward £20.471 0s Id.

HAWKE’S BAY FARMERS The fifty-sixth annual meeting of the Hawke’s Bay Farmers’ Co-operative Association Ltd., was held in Hastings on Friday. The directors’ report stated that the net profit for the year amounted to £25.170. to which had to be added the balance carried forward from ’ast year of £15.772, making a total available for allocation of £40.942. This amount the directors recommended be appropriated to paying a dividend of 7 per cent, on paid-up capital absorbing £11.605. and transferring £13.048 to the building reserve, the balance of £16.289 to be carried forward.

New Australian Fabric Project.—Woolcord Fabrics. Ltd., of which authorised capital is £250,000. is making an issue of 60.000 ordinary shares of £1 each at par. The primary object of the issue is to provide funds for the manufacture of furnishing fabrics not previously produced in Australia. Plans have been completed for buildings to be erected at Seymour. Victoria. Limited production. • is expected to begin next March. English technician! will be brought Co Australia to train local staff. A complete set of weaving plant and equipment will be obtained from Britain and auxiliary plant will be made in Australia. Zinc Issue Over-Subscribed.—The offer by Zinc Corporation, Ltd., London, of 750.000 4j per cent, redeemable cumulative preference shares of £1 in Broken Hill Corporation, Ltd., which was made to its shareholders, has been heavily oversubscribed, according to advice from London. '

BRITAIN’S OVERSEAS TRADE

GAP BETWEEN EXPORTS AND IMPORTS

(N.Z Press Association—Copyright) LONDON. July 22. United Kingdom overseas trade export figures for the first six months of the year show that over the whole period, Britain's hard currency deficit was just under £50.000.000 monthly and that the gap between the value of exports and imports is £270,000,000 sterling for the half-year. The "Financial Times” says: "Attempts to substitute hard for soft currency exports cannot even begin to deal with a figure of this magnitude. Alternatives are fewer imports, different sources of imports. and/or more dollar credits. All are unwelcome, difficult, or uncertain policies under to-day's baffling conditions." The “Manchester Guardian’’ says: "There seems to be no prospect of doing better in the second half of the year. Although the direct effects of the fuel crisis are past, we have done little more than get back to where we were one year ago.”

ANOTHER FALL IN SILVER (N.Z. Press Association—Copyright) LONDON, July 22. The price of silver has been reduced by Jd for both spot and forward to 3s 3d a fine ounce.