UNDERTAKING NOT HONOURED

Press, Volume CXV, Issue 33934, 29 August 1975, Page 6

UNDERTAKING NOT HONOURED

Allegations were made at a meeting o f the electoral committee of the Wool Board last week that the Minister of Agriculture. Mr Moyle, had not honoured an undertaking to increase the Government’s financial contribution to the work of the International Wool Secretariat in a period of low wool prices.

The meeting approved a resolution expressing extreme concern at the position and another urging the Wool Board to press the Government to increase its contribution for the I.W.S.

The chairman of the Wool Board, Mr J. Clarke, said that in the last year with growers paying a levy of 3 per cent on the gross proceeds of their wool they had contributed an extra $4 million to board funds, but at the same time the Government’s contribution had gone down from 54.8 million to S2 million, and Mr Moyle had advised the board last year that the Government had approved grants of S2 million annually for an initial period of four years. Mr Clarke said that the change in the basis of the levy from per kilogram to a percentage of returns had been made on the understanding that an agreement would be reached for the writing off of deficits after a period of four or five years.

They had found the Gov. ernment understanding, but only so far It was stated that the assistance the board was seeking could not be treated separately from other forms of assist-

ance to the pastoral industry. The Minister had advised that the Government reserved its position until “the future structure and financial organisation of the wool industry is determined.”

“This is' something that makes me angry,” said the chairman of the committee. Mr T. J. Atchison. “The Government grant to the I.W.S. has been cut from $4.8 million to S2 million in the same year as the growers have dug another $3.8 million out of their pockets.” In proposing that the Wool Board should again press for the Government to increase its contribution, he said he did not think it right that the Government should be dropping its contribution when woolgrowers had been going through difficult times. “The whole deal stinks.”

Noting that the Wool Board had to pay 5-1 per cent on overdraft from the Reserve Bank, he said he could remember when the board had been able to borrow from the old Wool Commission in a similar situation and there had been times when they had been able to pick up millions of dollars.

It was ridiculous that it should have to borrow from the Reserve Bank when the corporation had some SlO million in reserve.

“I think that the Minister is trying to drive us into a debt position so that he can bat us over the head later.” Mr Clarke said he agreeed with these sentiments, but he would not care to see the deficit taken out of the Wool Corporation’s funds as these were earning interest at better than 6 per cent, so that on balance they were making a net gain.

The board had urged that it should have credit from the Reserve Bank at one per cent. They thought that they were receiving a hard deal in being charged 5-1 per cent on Reserve Bank funds. Several speakers said that .they had the impression that the Minister had given an undertaking that if the growers accepted a percentage levy system the Government would make up any shortfall in grower contibutions. Mr M. R. Barnett, (Canterbury-Westland) said he believed that the Minister had given a firm understanding that the Government would put up more money in times of low prices and that nothing further would be expected from growers. The Government had not come to the growers’ assistance in this way and he felt that members of the committee would be justified in feeling annoyed, said Mr Clarke.