Farmers’ Case For Court

Press, Volume CI, Issue 29831, 25 May 1962, Page 10

Farmers’ Case For Court

The Sheepowners’ Union was applying for a decrease in award minimums to emphasise the difficult economic plight of the country, Mr O'Shea told the Court. Factors in the case, he said, were falling incomes of farmers hit by the recent drought, and that much of the burden of the cost of industrialisation was falling on the farmer. The wageearner should also bear his fair share.

’’Everyone must realise that the country has got to stop paying itself more than it earns. Some people, however. may dislike admitting it.” said Mr O'Shea. “Let me state right at the outset that the main objective of making the application is to emphasise the difficult financial and economic situa-

tion which the country is facing, to endeavour to influence the Court to ensure that in the judgment it delivers, the seriousness of the situation will be brought home to the people of New Zealand.” This would help to check the retreat from economic stability that had been the rule for so long. Costs, including wages, had been climbing steadily.

“Sheepfarmers consider that something more than simple opposition to wage increases is required if the serious situation of their industry is to be recognised, and a wage policy directed toward promoting the economic stability of New Zealand brought into operation,” said Mr O’Shea. “It is not suggested that wage policy alone is the cure for the financial crisis which the applicant for a wage increase had admitted is merely postponed.’ « “It is suggested, however, that wise action by this Court could have a very valuable influence on the whole country in this present time of difficulty.” Mr O’Shea said the application was based on two main grounds—that it was impossible to establish new industries in New Zealand, except by granting concessions to them which would impose a heavy burden on the community, and that it was impossible to bring virgin land into production at a price at which it could be sold. “Rising Deficit” Mr O’Shee said that in the 10 years since 1952 New Zealand had built up a net deficit of £72 million. Present overseas balances were less than £6O million, a position which the Government Statistician described as “dangerous.” “The root cause of the drain on our overseas funds is demand in New Zealand. When wages are increased, demand increases. The relation between movements in nominal wage rates and drains on overseas funds, is fairly obvious,” he said. •'The question the Court

must face is whether or not it should, in the interests of economic stability in New Zealand, play its part in assisting to regain stability in our overseas funds. Mr O’Shea referred to 10 new manufacturing companies whioh, he said, were to be started by overseas interests by agreement with the Government, and on which he said he hoped to subpoena the Secretary of Industries and Commerce Department (Dr. W. B. Sutch) to give evidence. Mr O'Shea said that the cost of these industries to the country would be very great. They would use a labour force of about 6000, but could only be established with massive protection.

“In other words, our cost structure in New Zealand is so much out of hand that these industries are not considered able to be established and run on a self-supporting basis. This burden must eventually come to rest on farming.” "Tied to Market”

The farmer, however, could not pass on his increased costs. He must accept the market price, said Mr O'Shea.

“It appears that if we are going to insist on industrialisation with the avowed intention of providing jobs, such provision must be paid for. The whole community should pay this cost, and the wage-earners who, by and large, have supported the policy, should bear their fair share,” he said. Referring to the recent drought. Mr O’Shea said the income of New Zealand’s wheat growers would be reduced and IJlew Zealand would have to spend more money on wheat imports. Falls in income were also anticipated for dairy and sheepfarmers—in fact, the latter might not have sufficient income to “plough-back” investment in the land. Mr O’Shea was sjill making his submissions when the Court adjourned till tomorrow