Bill Will Set New Basis For Wool Commission Payments

Press, Volume CVIII, Issue 31830, 7 November 1968, Page 22

Bill Will Set New Basis For Wool Commission Payments

(New Zealand Press Association)

WELLINGTON, November 6.

The present wool market was so crudely organised that it was incapable of recognising the great amount of work farmers put into their clip, the Minister of Agriculture (Mr Taiboys) said in Parliament today.

This situation was not in the longterm interest of the wool industry, he said during the second-reading debate of the Wool Commission Amendment Bill.

Supporting the recommendations of the wool marketing study group report, prepared for the Wool Board and the Wool Commission in 1967, the Minister said that at present very wideranging studies were being made of the total marketing operation from wool shed to ship’s side.

The bill sets a new basis for determining the amounts which the Wool Commission is required to pay to the Wool Board as payments supplementary to the wool producers’ levy.

Under the new provision the commission, with the consent of the Minister of Finance, will be authorised to make such supplementary payments out of the Wool Commission account as may be agreed upon by the commission and the board. Under the act the commission need only supplement the board’s grower levy to meet the board’s requirements in each year. Previously the commission was required to make a supplementary grant to the board equal to the amount collected by the levy. Last year, because of the commission’s buying-in policy the obligation to make the suppleemntary payments was suspended for one year. Mr Taiboys described the provision of the bill as a more flexible technique. Third Amendment The Opposition’s agriculture spokesman, Mr W. E. Rowling (Buller) said the fact that this was the third amendment to the commission’s supplementary payment system since 1964 underlined the uncertain financial circumstances of current marketing conditions, but he welcomed the more flexible approach the bill would provide.

He said it was the Labour Party’s view that if the commission could not in the short-term restore its financial position sufficiently to meet its obligations to sustain New Zealand’s contribution to the International Wool Secretariat a Government guarantee should be given that would enable the industry to give the necessary assurances to the I.W.S. New Zealand's contribution to the LW S. was tremendously important to the industry and the nation, he said. “The industry should not

be in danger of jeopardising its promotion efforts in the 1.W.5.,” he said.

Direct Assistance

“As I understand it,” said Mr Rowling, “The Wool Board is required by the end of the month to indicate where it stands in its ability to fulfil its requirements to the I.W.S. “This has precipitated approaches from the Wool Board to the Government for some direct assistance towards promotion costs, which have thus far been unsuccessful.

“It i« worth noting that in the case of two other member nations of the LW.S.—Australia and South Africa— Governments make direct grants,” he said. Mr Taiboys replied that the Government had offered the Wool Board Reserve Bank credit at 1 per cent to meet its obligations to the LW.S. He said further discussions between the Government and the industry on the question of LW.S. support would be held in the near future. Study Group “There is no doubt whatever <rf the availability of support to the industry to continue its contribution to the LW.S.,” said the Minister. Referring to the wool marketing study group report,

Mr Rowling said there was now a better atmosphere in which to re-appraise the selling needs of the industry. Matters which the Government should be considering included:

The provision of market intelligence and The need to re-examine the powers and duties of both the Wool Board and the Wool Commission with a view to the possibility of welding the two into a single authority. Such a new authority should consider the right’ to sell by auction or direct sale to the end user, and with Government assistance by bi-lateral agreement. The introduction of a qualityreduced system of seasonal average prices. This would ensure that at all times an efficient producer would have a reasonably stable and adequate income. “Wait And See” Mr Rowling said there was little room for an attitude of wait and see.

“The industrial giants involved in the synthetic field will give no quarter—already they are devoting 8 to 10 per cent of their annual turn-over to advertising and related activities.

“This bill merely gives the necessary degree of flexibility, to the commission to meet present circumstances but it does nothing to control the circumstances,” he said. Mr Taiboys said it was the

view of the Government that the wool industry itself should determine its attitude to the wool marketing study group report. Dairy Industry “Any recommendations from the industry would receive the closest and most sympathetic consideration from the Government,” he said. The Minister said that if the commission and the board were combined into one organisation a separate price-fix-ing authority would have to be established, as happened in the dairy industry.