THE COST OF LIVING

Dominion, Volume 15, Issue 182, 29 April 1922, Page 7

THE COST OF LIVING

WHAT SHOULD BE THE BASIC WAGE? * ARBITRATION COURT HEARS EVIDENCE i FOOD, CLOTHES, AND RENT UN IO NS PRESS FOR COMMISSION OF INQUIRY The Court of Arbitration continued yesterday the ! •hearing of evidence and argument on the question of wages adjustment, provision for which was made in p the amending Act of last session of Parliament. It ” was not until the afternoon that the hearing of evi-' ' dence offered on behalf of the Labour unions was commenced. . . '

On file bench were the President of the Court (Mr. Justice Frazer), Mr. W.. Scott (employers representative), and Mr. M. J. Reardon (workers’ representative). For the employers Mr. -T. 0. Bishop, supported by Mr.'A. S. Cookson, appeared, but he took but little part in the proceedings of the day. Most of the day taken up in the hearing of addresses from Mr. M. J. Alack, representing the A.S.R.S., Mr. L. F. Evans (Dunedin), Mr. A. Armstrong (Christchurch), and Air. AV. Maddison (representing Nelson). THE RAILWAYMEN. Mr Al. J. Alack addressed the Court. He said that first of all he Would earnestly support the request for.an inquiry into the cost of living. Previous commissions on the subject had proved that statisticians’ figures were very far astray, and to. the detriment of the workers. Obviously, the Government Statistician had now no reliable data on which to base his figures. He would protest, with the others, against any reduction in the wages of the workers. He represented "the A.S.R.S., composed of men in regular employment, getting houses at less rentals than other workers, getting, sometimes, a portion of their t clothing, and yet he would produce one hundred weekly budgets from railwaymen to show that it was impossible for them to subsist decently on the wages they now received. He was not himself much concerned' about the Statistician’s figures. What lie was concerned about was. . that the workers should have sufficient wages to live a full human life. He traversed critically the argument of Air. Bishop that the trade and commerce of the country could be rehabilitated by the reduction of wages. He did not agree that reduced wages would reduce prices. On the contrary, the reduction of wages might, by reducing the buy in power of itlie people, actually so diminish business as to force traders to increase prices. He proposed to put in one hundred weekly budgets for a period of four weeks. His Honour said that budgets were of no •value for such a short period. They should be for a pe.ripd of at least three months, or preferably six months, because so many purchases were nonrecurring. Such an item as a scrub-bing-brush might last for six months. Air. Alack asked on what the average family was based by the StatisticHis Honour said that the average for two families wns five adults and four children. The extra adult in most cases would be a young person above sisteen, years of age,, wholly or partly sclf-supportin<7. ' Air ' Alack said that if the wages were to be based on a family of two children, “then you arc going to let loose the Afalthusian tiger to devour the nation, because Taniuies of two will not regenerate the race.” His. Honour: That mny be so; but wo must take the facts as we find them. His Honour went on to explain that the big report in Australia on which the basic wage of £5 16s. per week was based was fallacious. because it presumed the existence of a million or more non-existent wives and children. On this ground the report was attacked. ,

A FAIR LIVING WAGE. Mr. Mack said that the average number in the families for which ne was putting in budgets was four, children. It would be seen that in no case did the rental, of departmental ( houses exceed one-sixth of a Meek s ■wages, or one day s pay. and yet the average cost of tho budgets was £4 19« 7d. He urged that first of all the dutv of the Court should be fo assure to "the workers a fair living wage. It was not the desire of the ture—and he quoted Sir Francis Bell in support of this statement—that industries should be carried on at the expense of the workers If an industry could not be carried on profitably, paving to the workers a wage, sufii cient tn allow them to live in fair and reasonable comfort. wrnkl have to cease. Sir Francis Bell had said in the Legislative Counffil mi the Industrial Conciliation . Amendment Bill No. 2: , J x “We can trust the Court to decide according tn their ability what is a fair standard of living. For some, veafo roanv of those who have noted as agents for unions have pointed out that"the workers now being represented and now seeking increases of wages, have not had a fair living wage, and it has been pointed out by Judge after Judge that the Court has no power to talfo into consideration what is a fair living wage. That was iin . to the passing of legislation m 1918. AU that the Court had to deal with was the effect of the alteration .in wanes on the industry under consideration. Now we have in ‘his amending legislation a provision whereby the Court has to take into consideration the question of what is a fair standard of livinc as well as the cost of. living. Again, the same gentleman had said-. “Ono modern condition of industry is that that industry shall be able to pay to its workers such wages as will enable those workers to live according to a fair standard of living, as it is called, and in reasonable comfort. If not, the industry must fail. The old high mid dry political economy is that to" which mv honourable friend lias given utterance. It is not possible to meet half-wav the conditions we have to meet in tlie ever-increasing surge of Labour towards what it conceives to bo its rights. The logical conclusion to my honourable friend’s words is that the industry must be kept on, and maintained, so as to produce a profit, whatever may be the necessary wage paid to the workers. That is not the position. If the industry cannot be carried on without profit it must cease. If it is carried on with a profit, a fair share of that profit belongs to the worker, and that fair,.share is. a sum., which will keep the workers in a fair and reasonably comfortable condition.’ THE CAUSES OF HICH PRICES. Mr. L. F. Evans, addressing the Court, discussed the claims of fanners and manufacturers and their de-

mauds of the Court for reduction of the workers’ wages. He said, in cficct that the farmers could get .relief only by free trade. On the other hand, the manufacturers, while they had secured an important' measure of protection agaiust countries where prices were low and wages correspondingly, were now comparing wages in protectionist New Zealand! with wages in free-trade England, arid were demanding heavy reductions in wages here. He would submit that one result of protective duties here was to enable some factories to keep running on a minimum of efficiency ’ with obsolete machines, and inedioore ■managemont. v DROP WHICH DID NOT COME. Mr. Evans said that a general revival of international trading was anticipated, and this would have important results to' New Zealand. When the Court stabilised, wages a year ago. it did so in of a “big drop” in prices. That had been only partly realised. Had the workers received the bonus of ss. to which they were then entitled, he claimed that they would to-day have been in a better position by. 3 per cent, than they had been under the stabilisation arrangement. He supported the view that no reduction should take place until a commission was set up for the purpose of definitely finding what a reasonable standard of living should’ be. He pointed to .the fact that with regard ' to primary products the position of November, 1920, was entirely reversed, and indications pointed to a stabilisation of prices of these products on a higher level than then appeared possible. He referred to the decline in the bank ratis'' in England and fo the improvernent 'of credit, as shown b.y the rapid, fall in interest rates for colonial municipal and Government securities. Inanswer to Air. Bishop’s citation of the metal industries in support of his plea for. reduced, wages. Mr. Evans cited the woollen industry, which, he said, was a much bigger and more important industry than tho metal ' industry. This industry had made profits during the war. owing to the much enhanced price of English woollens, and it was anticipated by some of the leaders in the industry here .' that prices would eventuallv settle in Britain on a higher plane than before the war, and that in future New Zealand mills would not feel the competition from England so keenly -as before the war. The National Mortgage anil Agency Company had declared a dividend on last year’s operations of 10 per cent, free pf income tax. in spite of alleged had times. The'(Price of wool also was recovering, arid crossbred wool was no lenoer unsaleable at any price. The evidence tendered bv the employer* nt the November srttmg. made most dismal reading, and if tl*nr prophecies had materialised New Zealand would have been in a bankrupt state lon„ ago. ‘ THE WORKERS’ BURDENS. : He spoke of the heaw indirect taxatfon' borne by the workers, and the workers had no' opportunity of nassinrr on the taxes to other shoulders. If the Court decided to reduce wages, an additional injustice would be done J xl Wrt-rlrnr It tllP* during the first nine months. J" Arising Pn-s the workers were not in anv nor were roduoed the debt owin« S 1 workers the Court before a decmo f to interfere v)th p ommcn d to the remuneration, would rocom was a fair standard of living. .

THE 19U STANDARD NOT SATISTHE 191“ FACT ORY. ■nr a said that he was on the supposition that, the 1914 stana a rd of living was satisfactory to the workers That was not so. He haa S™. „„nort«a will. th. Lrttur more discontent and unrest among Jhe Sers on account of thestandard of living allowed to them.. Tor tl . p sent 5 thev were flghtmg to get ilm 1914 standard back: Uiey certainly W not got it now. He would suggest to the Court that there had been no real reduction in the cost of living. had been a reduction in the prices, qf some goods, but there Y as that the reduction would be onh tern porarv. There was evidence for a concerted movement on the part of tp employers to bring about a temporary fall in prices and in the cost ot ming, to make good the claim now be< ing made to the Court for reduction of the workers’ wages. He said th|t on the present wages allowed it was not possible - for many workers, employed. all the year round and guiltv of no such extravagances as alcohol, to maintain their families in decency and comfort. The fact was that many such people lived in poverty all the roar round, and this should not be. in one of the most productive countries in the world. Always the worker had been getting a less and less share in the wealth he produced. Dealing with rents, he said that the allowance made for rent by the Government Statistician was quite inadequate. The rent of a five-roomed house for Christchurch, was set, down as, 16s. M That was a ridiriuloils figpW. No liobse of five rooms could be secured at such a rental. In consideration of rents, the Court ought fo coiisidcfothat many workers had lately been compelled to purchase houses. They would never own the houses, but they had. paid, a small deposit and were (.paying in-

■«' teresb. They were still, in reality, rentpayers; they' were paying higher rents for the privilege of paying the rates themselves. THE INFLUENCE OF THE COURT. - The employers would like the Arbi-’ tration Court to stop working altogether just now. The employers found the Court very useful during the war, when the workers held the stronger position, when there were more jobs than there were men to fill them. The employers came to the Court to retard the increases in wages which the workers asked, but now the employers did licit'- ?want the Court to retard the reductions in wages for which the employers were clamouring. In actual fact the unions which had refused -to come to the Court had done better for themselves than those who had come to the Court. He asked the Court not to accept the employers’ proposition that a reduction of ..wages would increase the prosperity of the country. FOOD RATIONS, DIET, AND EFFICIENCY. Mr. W. Maddison addressed the Court at some length on the question of food rations and dietetics m relation to working efficiency. He quoted some authorities on ibe necessary number of calories for the support of the human body in undiminished vitality, and the food supply necessary to give these calories. |On the matter of substitution he said it was impossible to find substitutes far such things as milk and butter and eggs. He suggested that the worker, in order to live on his pay, had been compelled to practise substitutions which had been harmful to his own and Ills family’s health, and had been compelled to make the substitutions because he was unable to pay far the foods required for a properly balanced ration. He urged the Court in effect to lay down a proper diet, to discover the cost of it, and then to fix a wage sufficient to enable the workers to purchase it. MEDICAL OPINION. Dr. Alexander Robertson' (called by - Mr- Maddison) was asked questions about the authorities quoted by Mr. Maddison. Generally, witness supported the authorities, and gave his own opinions as to the requirements of .a man engaged in hard physical or mental toil. He said that under-feed-ing would lead to loss of vigour, reduced efficiency, and reduced resistance to disease. To His Honour: More digestive ailments were caused by improperly balanced feeding than by deficient feeding. To Mr. Maddison: Ho met many eases .of malnutrition, especially among people of intermittent or casual workDr. IL 0. Whyte similarly supported the authorities quoted, and supported tho opinions expressed by them. He said. that he could not see, fronl his experience, how a man could keep a wife and family, supplied with' proper food and clothing, on a wage of £4 os. a week. The medical profession could not approve housing conditions which were brought about by several families living in a house—a family in a room. Dietetics was becoming more and more an exact science, and it was right that the determination of a living wage should be approached by an investigation of the requirements of the body, and. then a calculation of their cost. ■ . To Mr. Scott: Margarine was not a suitable substitute far butter. Vegetable oil margarine contained no vltaniines at all? -He understood that there were other margarines made from animal fats, and he thought they might be better. His Honour: We have never considered margarine as a substitute for butter in this country. Witness (to Mr. Bishop): He found the working classes were generally in better state here than in Scotland, where he had practised, but there was still a Eoo'd deal of sickness among them. Generally there was more sickness in tho towns than in the country. To Mr. Maddison: This was probably due to housing. - LABOUR , UNIONS’ EVIDENCE

FINDING A BASIC WAGE Mr. McCombs then proceeded to call evidence. Andrew Parlane, secretary of the New Zealand Drivers’ Federation, submitted a list of articles determined by the Commonwealth Commission on the Basic Wage ns necessary for a man, wife, and three dependent children under 14 years of age, and he submitted with the goods, clothing, and services the Wellington prices for these. The total weekly cost worked out at £5 Is. BJd., made up as follows : —Food, £2 Is. 3d.; clothing, £1 13s. 7d. ; miscellaneous, £1 6s. IOJd. . On the present minimum wage in New Zealand, the allowance for food was £1 95., and he did' not see how a proper 1 diet could be maintained. When the German prisoners were interned on Somes Island, the cost of rations alone was 7s. 193 d. per head per week. That was Th 1916, and at present prices the cost would be about 9s. 3d. He pointed out also that in the list he provided there was no allowance, for fire insurance, for renewals or depreciation of furniture, or for life insurance. He thought also that something should be allowed for cultural education. If a working man had a daughter who had an aptitude for music, he ought to bo able to nay for music lessons for her. The statistician set down 17s. 3d. as. the rent of a five-roomed house in' Wellington. Witness knew several people who were paying more than that for one room. If he added to- the schedule £1 us. per week for rent the weekly outgoings would be £6 6s. B}d. Mr. McCombs: That is 50 per cent. ■ above the present minimum wage. CLOTHING AND DRAPERY. Andrew Croskery, secretary of the Shop Assistants’ Union, said that he . had had 20 years’ experience of the drapery trade. He had taken out the landed costs of certain household lines, in 1913 as against the prices to-day. He thought the retail prices would be about 75 per cent, more than landed costs. He did not know that retailers were to-day adding higher rates of profit than before the war, but as the, prices were higher the actual profits were higher. His Honour: Our list Shows that the increase in clothing is still 113 per cent, above pre-war prices. Mr. Scott said that Mr. Croskery’s prices appeared to be absolutely right, put the list of goods chosen was not indicative of a household' budget. Witness said that he had gone through Mr. Parlane’s list of cirapcry as allowed by the Basic Wage Commission. Ho did not see that it would bo possible to reduce the clothing scale, seeing that New Zealand was a colder country than Australia. Ho had carefully Examined the articles and the costs, and considered that they were fair, erring on tho conservative side. The weekly requirement for drapery was therefore £1 13s. 7d. ; certainly not less than that sum. If \,tlio family were cut down to two children, the reduction would be about ss. a week. —- HOUSES and rents/ ' 1 " I ■{ i:-- Frederick Joseph Manning, land agent in Wellington, said that ho was not in any way connected with the Liibour movement or any other political organisation. Ho said that rents

in Wellington had increased at least 50 per cent, since 1914. It was impossible to got in any pgrt of Now Zealand a fivo-roomed house for 16s. Bd. The rental would not be less than 80s. anywhere. It might be possible by buying the house for a person to reduce the weekly cost to 265. per week. To His Honour: He thought there must bo a shortage of 7000 houses in New Zealand. He thought that in Wellington about 20 to 22 per cent, of the workers were buying their houses on time payment. There were more rented houses in Christchurch and some other towns. No man would build houses for rent as a business proposition. A rental of £2 a week for a five-roomed house would not give an owner a return of more than 5 per cent, when allowances wore made for rates insurance, and repairs. To Mr. McCombs: He did not see any prospect of rents coming down. Even by buying a house a man could not get a house far a weekly charge of 16s. 8d ' To Mr. Bishop: Very few tenants had been able to hold houses at prewar rents. Houses had been sold, and the people had to get out to pay more rent or to buy elsewhere. . To Mr. McCombs; Tho rent restriction legislation had been generally evaded. Also, owners had quitted their houses. 1 , . CHARITABLE AID RATIONS. Charles Henry Chapman, member of tho Wellington Hospital ’and Chantable Aid Board, and of the Wellington City Council, said that the allowance given to destitute persons far food was at the rate of ss. per week, making the same allowance for a child as for an adult. It had been found that the average family consisted of five persons father, mother, and three children. The cost per week was 295. Id. The allowance included nothing for luxuries or anything of the kind. . ~ Mr. McCombs said that the allowance proposed of 38 per cent, on a weekly wage of £4 ss. would give £1 8s 4d. a week, or 9d. a week loss than allowed by the Charitable Aid Board for rations. To Mr. Bishop: There was a..great deal of unemployment in M elhngton to-day. The ration scale was .the same at this time as it had been tor several years, past. To Mr. McCombs: There had been cases of men in receipt of full award wages who had to apply to the boaid for aid. They could not carry on with their wages. This concluded the evidence. THE 13s. REDUCTION. Mr? McCombs submitted To the Court some figures in reply to part "t Mr. Bishop’s opening speech. ne Sa in the employers’ case put forward by Mr. Bishop there is a somewhat involved statement regarding increases in wages and bonuses, on the strength of which the employers claim a 13s. reduction in wages. At first I did not think that the statement called for a reply because I realised that the Court was thoroughly familiar with the various computations, and would readily see the fallacies in the employers’ calculations. But to clarity the matter I have prepared a table which I wish to submit. The second column shows wages as at 1913-14. The third column shows wages as at March, 1919. The fourth and fifth columns show that up to March, IJIV, the workers had only received increases in wages ranging from 21 per cent, to 29 per cent., or an average of 24 per cent, to meet an average increase in the cost of living, “all groups, of 4b per cent. The sixth column shows wages as at March, 1920, while the seventh and eighth columns show- that at March, 1920, with all bonuses added, the workers were only receiving an average of 53 .per cent, increase in wan-es to meet an average increase of 63 °per cent, in the cost of living. This covers the period of the computations on which the employers base their claim of a reduction of 13s. in wages'. , . The correct computation shows that the workers were entitled to receive more, not less, wages for the period named, and'in equity should now be compensated by the Court pursuing the same go-slow' policy on the down grade which it pursued on the up grade. The table shows exactly what -happened when prices were on the up grade. In the early days of the war prices rose verv rapidly; but it was not until March. 1919, that there was any substantial increase in wages, and then it was only a 24 per cent, increase to meet an ascertained average increase of 46 per cent, in the cost of living. And ’now, while wage increases are still below price increases, it is proposed to immediately reduce because there is a slight fall in the cost of living. But in addition to all these disadvantages the employers actually suggested the adoption of the monthly index number on the down grade instead of the six-monthly moving average, which was adopted on the up grade. It is not surprising that even Mr. Bishop should realise how unfair the employers’ proposals are. In his opening, statement ho said: “Now I am" quite aware that the employers are going to be accused of adopting one figure going up and wanting to adopt another figure coming down.” Following is the table referred to by Mr. McCombs: —

Wages columns include all bonuses to date. Wo have no “all groups” figures for March, 1919, but the “all groups” figure- for July, 1918, was 40 per cent.; and for July, 1919, 49 per cent., which would make March, 1919, approximately 46 per cent. The price increases for March, 1920, are the Government Statistician’s figures for the average of “all groups” for that period. Monthly Abstract of Statistics. Vol. 7, 'Nos. 4 and 9. Tlic Court adjourned until to-day, when the case should conclude.

Wages Wages Mar., 1913-14. 1919. Wages Price Incr’se/Incr'se p.c. P.O. 8. d. Unskilled .. . 1 2 1 6 29 46 Semi-skilled It 39 )1 4J 1 7 1 9 21 to 24 46 Skilled )1 5 )1 6 1 11 22 46