‘Need for tough inflation action’

Press, 22 October 1981, Page 27

‘Need for tough inflation action’

PA Wellington The rise in the rate of inflation to 15.4 per cent is most disturbing and indicates the need for tough, corrective Government action, says Mr R. E. Taylor, acting executive director of the Employers' Federation. “High inflation is extremely bad for employers as they struggle to contain costs yet' maintain productivity," he said. “Where they cannot, jobs are lost, and often export income is lost as well.

“We need an expanding economy but with the present rate of inflation this is made very difficult indeed, particularly when the inflation rates of our main trading partners are considerably lower. "The present wage round

has settled down reasonably well, and will help take some of the pressure off the economy from this quarter. "While the cumulative effect of the high wage round last year and the 5 per cent general wage order in June is obviously showing through in the present inflation rate, employers and unions have made a real contribution to the anti-inflationary battle this year by keeping wage settlements down. “But wage restraint is only part of what is needed. What is of concern is the present monetary and fiscal stance of the Government. It all indicates that there will need to be some severe belt-tight-ening over the next few months to prevent inflation soaring even higher." Mr Tavlor said.