DAIRY FARM INCOMES MAY BE CUT IN HALF

Press, Volume XCVII, Issue 28642, 19 July 1958, Page 12

DAIRY FARM INCOMES MAY BE CUT IN HALF

(New Zealand Press Association)

WELLINGTON, July 18.

A cut of more than 15 per cent, in the gross incomes of dairy farmers—as envisaged in the Government’s proposals for the guaranteed price—would mean a reduction in dairy farmers’ net incomes of from 30 per cent, to 50 per cent., said the chairman of the Dairy Board (Mr A. Linton) in a broadcast today.

“The economy of New Zealand is like a pyramid, with J primary industries at its base, responsible for practically the whole of our export receipts,’’ said Mr Linton. “The dairy farmers’ reduced income would immediately be reflected in his lower purchasing power—firstly in the rural towns, but very shortly afterward in the cities also.”

It was for that reason that the Dominion dairy conference viewed with “tremendous dismay” the Government’s decision to impose a cut of more than 15 per cent, in dairy farmers' gross incomes. At the same time, the Government’s own actions, through the Budget, had made it inevitable that the dairy farmers’ costs would increase.

Delegates had expressed their amazement that the Prime Minister—the originator of what he claimed was a guaranteed |srice—should come to the conference with proposals that, in the industry’s view, undermined the whole basis of the guaranteed price. Mr Nash’s Promise Both before and after the General Election—and, only a couple of weeks ago—Mr Nash was saying that the price would cover the dairy farmers’ costs, said Mr Linton. The announced price had no relation whatever to costs, and its imposition by the Government would cause very great hardship to rural communities and to many dairy farmers.

One delegate had told him the Government’s proposal would

mean that his small community would receive £lOO,OOO less than last year—and that was typical of what would happen in the country areas. The reduction in the net incomes of the dairy farmers would also come at a time when other sections of the community, because of the Government’s inflationary and industrial protection policy within New Zealand, would be looking for increases in incomes and wages, said Mr Linton. The proposed “two-tier” system—with' a higher price paid for th'e first 10.0001 b of butterfat production—was “unjust, unfair and unworkable.” Billy-can Suppliers “It would give an extra payment to thousands of billy-can suppliers who work in other jobs, who are not even dairy farmers, who use dairy factories to add to the incomes from their other occupations and who don’t really need the additional amount,” said Mr Linton.

“Sheep farmers and owners of mixed farms who keep a few cows—and there are many of them —would be getting the higher payment, while the dairy farmer producing 20,0001 b of butterfat or more would not be benefiting. * “I don’t know who was responsible for the idea, but it certainly wasn’t anybody who understood the dairy industry or they would have known it was ■practically impossible to administer from a dairy company’s point of view.” Mr Linton said the industry knew its prices would be cut. But the Government’s proposals were a “complete negation of the whole idea that there should be a cushioning of prices over a period of years.” “All, the industry wants —and it hoped to achieve this in the promised negotiations—is for the Government to make better provision on a loan basis to tide the industry through what it believes are temporary difficulties,” said Mr Linton.