Price freeze catches all

Press, 20 August 1976, Page 1

Price freeze catches all

There is still some confusion in Christchurch about the interpretation of the price-freeze regulations introduced by the Government on Tuesday night. The Government Printer’s office in Christchurch had not received its copies of the new regulations yesterday, and did not expect them until today at the earliest. Officials at the Department of Trade and Industry in Christchurch said that they were still waiting for their copies too, and in the meantime had been seeking advice from Wellington on questions asked by manufacturers and wholesalers during the last few days. One grocery wholesaler said that there were at least several lines for which price rises had 1 been approved under earlier regulations. However, these had not been put into effect because the items—cotton, bottle tops,

fly-killer and cigars—were not fast sellers. However, the executive pricing officer for the department (Mr P. J. McDermott) has a comprehensive list of all Category A goods—those most affected by the new price freeze.

Category A goods included most foods, building materials, chemicals and drugs, fertilisers / and petroleum products, some items of hardware, vehicles, and various miscellaneous items, including colour television sets, and services like egg distribution, and gas supply, he said. Category B goods—on which a mandatory sixmonth interval between price rises has been in force for several years—included washing machines, refrigerators, black-and-white television sets, furniture, floor-coverings, light bulbs and books. Under previous legisla-

tion, the method of recovering costs varied according to the firm's turnover.

Firms producing category A goods had only to seek the approval of the Price Tribunal, for a price increase, while for Category B goods, firms with a turnover of less than $l.$M had to wait six months before completing the necessary calculations to justify—and obtain—the rise. Firms with a turnover of more than SI.SM had to notify’ the department of their intention to seek an increase, while those with a turnover of more than SSM had to notify the department, then wait 28 days before increasing prices. Even those firms which had only a day to wait before their application would have been granted would now be subject to the freeze, said Mr Mc-

Dermott. However, they would have to add only the mandatory 136 days to the one day left to complete the period. Although the freeze was intended to remain in force until December 31, it would continue for whatever subsequent period sellers would have had to wait under the former regulations. Manufacturers who had to import raw materials would have to absorb any increased price of these raw materials, said Mr McDermott. Although there was provision under the new legislation for exceptions, under a “hardship” provision, it was not likely to be exercised much, he said. Under previous regulations it had been hardly used. A firm would probably have to be at break-even point or worse before such aid would be considered, he said.