Manufacturers ‘used figures selectively’

Press, 28 July 1987, Page 8

Manufacturers ‘used figures selectively’

Manufacturers bad used figures selectively to paint a gloomy picture of their sector, said the Minister of Trade and Industry, Mr Caygill, in Christchurch yesterday.

He discounted manufacturers’ assertions of a 42 per cent drop in manufacturing investment, and of 14,500 jobs being lost in the sector in the three years of Labour Government.

After a iy 4 hour meeting with manufacturers and exporters, convened by the Labour Party’s Fendalton candidate, Dr Neil Cherry, Mr Caygill said he was sure the

figures had been chosen to present the problem “in as startling a light as possible.” The job loss figure was given in the “Manufacturers’ Manifesto” released last week.

But Mr Caygill said: “If you stand back and look at manufacturing employment over a reasonable timespan, it has been relatively stable."

He said the talk of a huge drop in investment came from comparing the last quarter of 1986, with the same quarter in the previous year. But when the whole year’s were compared, the drop was

"nothing like 42 per cent,” he said.

“Manufacturing investment is at a comparable level to what was occurring in 1983-84,” he said. "It has fallen only in relation to the peak of investment in 1985.”

Asked if he was accusing the manufacturers of using figures selectively, Mr Caygill said: “I would have been disappointed if they hadn’t.” He said the group had repeated its concerns that interest rates and the exchange rate were too high for their comfort. He said he believed

manufacturing investment would recover when export profitability returned, which was dependent on a better exchange rate compared with Australia’s. That would happen only when interest rates fell, which depended on inflation being brought down.

He said he saw the June quarter inflation figure, which was 3.3 per cent, as a temporary reversal. Indications given to the Government suggested there would be single-figure inflation by the end of this year, or the March, 1988, quarter.