Price control lifted on bread, TV sets, apples

Press, 27 February 1981, Page 2

Price control lifted on bread, TV sets, apples

The immediate removal of price controls from bread, apples and pears, colour television sets, and building board was announced yesterday afternoon by the Minister of Trade and Industry (Mr Adams-Schneider). The prices of the different items were unlikely to increase; in some cases they! might decrease, according to spokesmen. Although bread has been removed from price control, bakers will be required to notify the Department of Trade and Industry of any price increases and the prices of new loaves. This will enable a check to be made on how the baking industry performs now that it is free of controls. The removal of restric-; tions on these items was in line - with reports from the Commerce Commission, which recommended that I there was sufficient' com-! petition to warrant their removal from the list of con-; trolled goods and services. “We have also accepted the commission’s recommendation that butter should remain on the positive list,” Mr Adams-Schneider said. '

Similarly, price controls will also remain on ceramic ware and imported oranges and bananas.

The spokesman for the Christchurch members of the Mister Bread Bakers’ Association, Mr M. C. Scott, said that the removal of price controls was unlikely to have any effect in Canterbury and that there would not be any big or rapid increases in nrices.

The main local bakeries were very responsible ana applied for price increases only to cover running and material costs, often holding back price increar:; for several months. Mr Scott said. Bread prices in Christchurch were the cheapest for any of the four main centres in New Zealand because bakers were more efficient than their counterparts in the other cities, he said.

However, the member of i Parliament for Lyttelton

(Mrs. Ann Hercus), a former deputy chairman of the Commerce Commission, predicted that the price of bread would now rise rapidly. She said the decision to remove the controls was “half-baked” and “incredibly stupid.” They would be reimposed by a Labour government because there was insufficient competition to keep prices down. The marketing manager of Fletcher Merchants, Ltd, in Christchurch (Mr J. R. Fountain, said that building board might go down in price as a result of the lifting of price controls.

The price of the board was kept in check by competition, especially in Christchurch where there were about 12 distributors all buying at the same price from the manufacturers. He said that the competition was going to become tougher as distributors tried to move their products more rapidly. The general manager of Sedley Wells' Ltd. Mr D. J. Fuller, said that the removal of controls would not mean any big increase in the cost of colour television sets. As in the past competition, rather than controls, would determine prices.

The Cabinet also considered the Commerce Commission’s report on the question of price control on motorvehicle-, but decided to defer any decision until the Industries Development Commission has reported on the motor-vehicle assembly industry. Copies of the Commerce Commission’s reports on all items except motor-vehjcles are available from either the commission itself or the Department of Trade and Industry. Mr Adams-Schneider said that the motor-vehicles report must be considered s.ub judice until the Industries Development Commission had completed its study.