Expert Witnesses On Effect Of Wage Order

Press, Volume XCVIII, Issue 28936, 2 July 1959, Page 18

Expert Witnesses On Effect Of Wage Order

(New Zealana Press Association) WELLINGTON, July 1. New Zealanders would pay one shilling more in the pound to transport their goods—and possibly themselves—by road transport, and at least two shillings in the pound extra for dry-cleaning their suits, if the application for a general wage order went through, two expert witnesses told the Court of Arbitration today. The witnesses, one representing the transport industry, the other the dry-cleaning and laundering industry, were giving evidence in support of argument by the New Zealand Employers’ Federation that the increases proposed are against consumer interest and would tend only to push up the cost of living.

The application is for an Increase of 13.7 per cent on the first £2O of all award wages and for the inclusion of the previous general order, of an 18 per cent, increase, into the first £2O of award wages. The latter charge would increase overtime rates, the current general order not being applied to overtime by all the awards.

The increase is being supported by the Federation of Labour, the case being led by Mr F. P. Walsh as advocate. The Employers’ Federation (Mr P. J. i_,uxford) opposes both the general wage order application and the writing into awards of the 18 per cent, order regarding penal rates. The first witness called today was H. C. Campbell, general secretary of the New Zealand Road Transport Alliance, who was also representing other major private transport interests. Whereas the number of trucks operated by the public carriers increased from 13,000 to 16,000 in the 10 years to 1958, ancillary user trucks increased from 27,000 to 55,000. General wage increases partly accounted for this. With one exception, a general wage increase had always led to an increase in public carriers charges. Each time that threatened, public carriers were told by customers, “If you’re going to increase your charges again, we’ll put on our own trucks.” “More Worried”

The New Zealand Carriers' Federation, the Passenger Services’ Federation and other public carrying organisations were more worried about the present application than in the case of previous applications for general orders. He doubted whether any employee of a public carrier finished the week with the basic award payment for 40 hours. That would apply in both city and country areas, he said.

The witness said that last year’s Budget increases in petrol end sales tax had forced public transport costs up, but more private transport was being used, particularly with groups of all wage levels banding together to use cars for getting to work. Customer resistance would become worse if the application were granted, he said. Farmers were most resistant to increased charges because they could not pass it on. The more serious effect, however, was where the ancillary user put on more trucks. One of the reasons for higher charges was "an attempt to keep trade on the railways,” the witness said in reply to a question by Mr Justice Tyndall. He added that local bodies also

were able to gain advantages over public carriers. The witness said that an order granted in terms of the application would involve a 7i per cent, increase in public carriers’ charges, accentuating the customer resistance. Wider Effects

A wider effect would be on overseas funds, because haulage to f.o.b. ports of timber for export to Japan was already economically marginal and a new wage order could make a difference between profit and loss on the whole transaction. Another direction in which higher charges would be felt was in road and bridge construction, because much of the haulage of materials was private contract, including week-end work at penal rates.

Quoting the labour contents involved, witness said that a 10 per cent, increase in wages would mean a 4.7 per cent, increase in goods services and 4.4 per cent, in passenger services directly, irrespective of secondary effects of a general wage rise. To Mr A. P. O’Shea (Federated Farmers), the witness said the farmers definitely had cause for apprehension about an increase in carrying charges. The use of private transport for either passengers or goods helped to depress overseas funds and was uneconomic for the county, though it might be economic for the individual, such as a farmer. To Mr J. Turnbull (Public Service Association), the witness said that in 10 years to 1958 the gross average payload in commercial trucks has risen from four tons, exclusive of trailers, to six tons, an increase that would apply to both privately operated public vehicles, ancilliary users’ vehicles, though perhaps not to the same extent in the latter.

Trailers were used more now than both sections of transporters. To Mr Walsh the witness said that public carriers had had an increase in actual work over the last 10 years, but had not retained their former share of the total work being done. Second Witness * The second witness, J. A. Higgs, called as a representative of the dry-cleaning and laundering industry, said his industry as a whole opposed a general increase in wages. His industry had to pay high warges and provide lots of overtime to get workers. In his own case ,his firm paid an incentive bonus, which had proved of benefit to the consumer and to the firm. The industry’s costs had risen greatly since the war, yet wages had risen much greater by comparison A meeting of representatives of the industry in Wellington a few days ago had conservatively estimated that if a general wage order and overtime rates in accordance with the application were granted, the industry would have to pass on costs to the public to keep its head above water. It had been suggested that the only way out would be to charge lOs for dry-cleaning a suit instead of the present 9s (in some cases 8s 6d). It has been decided it was better to load the extra on to suits rather than make a general increase for all apparel, because the suit was the article on which there was the least margin of profit The Court adjourned till tomorrow morning, when Mr Walsh will continue cross-exam-mation of the witness.