Auction System Condemned

Press, Volume CI, Issue 29994, 1 December 1962, Page 12

Auction System Condemned

(Parliamentary Reporter) WELLINGTON, Nov. 30. The Parliamentary committee which has spent a year inquiring into the fishing industry wants the Trade Practices and Prices Commission to investigate the effect of the auction system of fish in Christchurch.

.The committee, in its report to Parliament today, said the fishing industry board, which it proposes should be set up, should endeavour to increase sales in New Zealand at prices reduced “through competitive selling at all levels.** It also recommended that

competition be retained by the continuance of direct sales of fresh fish from boats Reviewing the evidence It heard on the Christchurch fish market, the committee found that in Canterbury—unlike other areas—the auction price of the day was charged by other wholesalers in the area for fish which had never been near the auction. Otago and Southland, unable to obtain all their supplies locally, had to buy additional supplies from Christchurch from time to time and pay auction prices substantially above their local prices. “Instances were quoted of fishermen in these areas sending their catches to Canterbury during periods of shortage in order to obtain the higher prices resulting from auction." said the committee. It noted that the Consumer Council alleged that retail prices in New Zealand appeared to be determined on

the principle of "what the traffic will bear.” Consumer resistance developed at prices above 3s 6d per lb and the council considered that the trade was not interested in making “cheap” fish available at prices to under-cut competing products. The committee concluded that the auction system in Christchurch “has been a disturbing influence on the industry over much of the South Island.” It found that “the Christchurch auction created conditions favourable to sueh restrictive marketing practices as diverting the cheap fish to export and the dear fish to the local market** The committee was not convinced that the auction system in Christchurch benefited the consumer, either through stimulating better quality or cheeper prices as compared with systems applicable elsewhere.