Govt Refuses Grant To Wool Board

Press, Volume CVIII, Issue 31769, 28 August 1968, Page 1

Govt Refuses Grant To Wool Board

(New Zealand Press Association)

WELLINGTON, August 27.

The Government has decided that it would be inappropriate to make a grant to the Wool Board’s share of the International Wool Secretariat’s budget.

The Wool Board has been told, however, that the Government will continue to make available to the Wool Commission, Reserve Bank finance at low interest rates to enable the board to bridge the expected gap of about 54.5 m between the money available to the board from other sources and its obligation to the I.W.S. for the 1969-70 year.

Announcing this today, the Minister of Finance (Mr Muldoon) said that the Government had carefully considered the board’s request for Government assistance in meeting its contribution to the I.W.S. budget. “The Government agrees that there is a need for continued research into new woollen products and processes and for intensive market research and promotion,” he said.

“In considering the board’s request, however, the Government must recognise the needs of all sectors of New Zealand's export industries. “The Government has had to have regard to the fact that the wool-producing industry still has substantial assets in the form of stocks, and that these will be liquidated over a period. “Furthermore, both prices and productio" are high in the meat industp’, and many sheepfarmers will have the low wool prices partly offset by returns from-meat. “As there could be no arrangement made for repay-

ment of a direct contribution, the Government has accordingly concluded that it would be inappropriate to make a grant to the Wool Board’s share of the I W.S. budget," Mr Muldoon said. The Cabinet’s decision to lend, rather than grant, $4.5m to the Wool Board has not been well received by Federated Farmers, and other alternatives are to be sought “I don’t agree that we should find this money out of our own capital,” the chairman of the meat and wool section of Federated Farmers’ (Mr F. G. Spackman) said tonight. “The original proposition was much better. The New Zealand taxpayer is being asked not to subsidise, but

to support the promotion of a commodity which has contributed greatly to New Zealand’s welfare,” he said. “I.W.S. promotion is our one bulwark against competition.”

Mr Spackman said that other avenues would have to be explored, but he was not prepared to name them.