PRICE CONTROL IN AUSTRALIA

Press, Volume LXXXIV, Issue 25607, 23 September 1948, Page 5

PRICE CONTROL IN AUSTRALIA

EFFECT OF CHANGE ON CAR SALES USED VEHICLES FLOOD MARKET (Rec. 9 p.m.) SYDNEY. September 22. Sydney dealers report to-day that used cars are flooding the market after the removal of price control, and that sale rooms are unable to cope with them. Somq. dealers have refused to accept more cars until they can sell those already crowding their floor space. Dealers are.unanimous that though prices are 30 to 40 per cent above the ; previous pegged figure, the black market is smashed. The older used cars appear to be falling even below the pegged prices. C. R. Mentiplay, special correspondent of the New Zealand Press Association, says that after two months of hard and painstaking work by the State Governments and of somewhat gloomy prophecy by some observers, control of prices within the Commonwealth has passed smoothly from the Federal authorities into the hands of the States. To-day no dissentient voice is raised against the programme, the first mention of which by Mr Chifley raised a storm of protest. It was after the people of Australia, by an overwhelming majority, had refused the Federal Government’s request for permanent control of prices, rents, and charges, that Mr Chifley announced the almost immediate handing over to the State Governments of these responsibilities. Many correspondents were quick to describe his decision as one dictated by pique and designed to cause the maximum embarrassment to the States, all of which had shown signs of rebellion. The State authorities went smoothly to work, however, and well before the time all the necessary legislation was passed through the State parliaments. Although they have established a common basis .for price control, the various State Governments have differed in their handling of the situation. In the Queensland legislation, emphasis is laid on strict regulation backed by heavy penalties. The New South Wales act is not so drastic, but retains features of the Commonwealth Emergency Regulations which many consider undesirable. The States have generally passed blanket legislation to carry on the existing Commonwealth regulations, but have taken the precaution of limiting their legislation to periods. In Victoria the period is as short as six months. Most of the States favour complete abolition of controls, but have been forced to admit that in face of the retention of some subsidies, and of shortages of materials, such a course is not immediately practicable. “At the outset. Mr Finnan (the New South Wales Minister of Labour and i Industry) has recognised what the Commonwealth so persistently refused to admit—that prices and not proflta should be controlled.” says the “Sydney Morning Herald.” “The former policy robbed an efficient firm of itl reward and the nation of production. It also introduced intolerable uncertainty into the system, since nobody save the Prices Commissioner himself was able to decide with any confidence what constituted a reasonable profit.” This opinion is echoed by the “Daily Telegraph.” which says: “This first lifting of controls gives industry a glimpse of the freedom it thought it had lost for ever.”