OUR ARBITRATION SYSTEM

Dominion, Volume 21, Issue 100, 26 January 1928, Page 8

OUR ARBITRATION SYSTEM

“ABOLITION UNJUSTIFIED”

PROFESSOR A. H. TOCKER’S CRITICISM

REPLY BY DR. H. BELSHAW

Dominion Special Service.

Auckland, January 25.

‘‘lf compulsory arbitration is abolished as a preliminary to an attack on wages, industrial conflict is inevitable. Our arbitration system has its weaknesses, but they do not justify its abolition.” s

These sentiments were expressed by Dr. H. Belshaw, professor in economics of Auckland University College, this morning, when he reviewed the remarks made by Professor A. H. Tocker. of Canterbury College, at Melbourne last week. In his interview Dr. Belshaw necessarily confined his comment to generalities, but he recorded his concise opinion upon the merits of the Arbitration Court as a mediator between employer and worker, and ventured the suggestion that strikes had been reduced since the establishment of the Court.

“Those who would abolish the principle of compulsory industrial arbitration,” he said, “lay two main charges against the Court—first, it is stated that it maintains wages at an undulv high level, and secondly, that it shackles industry and prevents that elasticity which is, desirable for industrial progress. It -is argued that, in consequence of these factors, costs are maintained at a high level, and a marked disparity exists between prices in ‘sheltered’ industries (mainly manufacturing) and ‘unsheltered’ industries (mainly agricultural), prices in the latter .case being determined by conditions overseas. It is suggested that free collective bargaining be substituted for compulsory arbitration. ' “In reply to the contention that the present price disparity is due to the Arbitration Court,” said Dr. Belshaw, “it is sufficient to point out (a) • that the disparity is world-wide in extent and is due to forces which are generally operative and are not purely local in significance. Is the price disparity in the United Kingdom and the United States due to the fact that there is no system of compulsory arbitration? (b) That the disparity can be sufficiently explained by the gross expansion of overhead costs (see Bulletin No. 33 of Canterbury Chamber of Commerce) attributable mainly to post-war pver-capitalisation, the anomalous system of company taxation, the increase in distributing charges due to the inflation of site rents, the increase in the number of retail distributors 'and the increase in the rates charged for loans. In short, the influence of the Arbitration Court is far from being the main factor in the situation.

“In reply to the second criticism, while it is agreed' that the arbitration system is not sufficiently elastic this does not provide adequate grounds, for its abolition. The result of abolition will be either weak trade unionism or strong trade unionism’ in any particular trade. ■

‘The assumption that collective bargaining will necessarily make for a more elastic system and will make easier a system of ‘payment by results’ is completely erroneous.,’’ said Dr. Belshaw. “If compulsory arbitration is abolished as a preliminary to an attack on wages, industrial conflict is inevitable. Can we balance the highly problematical gains against .this? • It is true that there have been strikes. under the Court, but to say that for this reason the Court has. failed in its main object is, I_ think, incorrect. It is clear that the Court has considerably reduced the number of industrial conflicts, and this being true, it has achieved its purpose. Admittedly our arbitration system has. its weaknesses, but these do not justify its • abolition, especially when an alternative has already been tried and found wanting, and when the whole trend of development elsewhere is away from laissez faire. Our aim should be the perfection of the present system, making toward .greater elasticity and variety. It is significant that by far the majority of both employers and trade unionists desire not abolition, but amendment. Can we afford to leap backward into the dark?”