CASE FOR TARIFF

Dominion, Volume 27, Issue 37, 7 November 1933, Page 11

CASE FOR TARIFF

Final Submissions EVIDENCE CRITICISED Manufacturers’ Arguments BEQUESTS TO COMMISSION His final submissions to the Tariff Commission, in reply to requests of representatives of the fanning interests of the Dominion that the present tariff as applied to importations from the United Kingdom should be abolished or materially reduced, were made by Mr. A. E. Mander, general secretary of the New Zealand Manufacturers’ Federation, yesterday. During the course of evidence, Mr. Mander was subjected to criticism from members of the commission as to a statement in regard to the effect of the tariff on wag-e levels. . _ „ The Comptroller, of Customs, Dr. G. Craig, presided, and associated with him were Professor B. E. Murphy, Mr. J. B. Gow, and Mr. G. A. Pascoe. “It is necessary for me to refer to a matter which has given manufacturers a great deal of concern as a result of their appearances, in public and "in camera,’ before the' commission,” Mr. "Mander said. ' “It is obvious that the tariff has the effect of maintaining a particular wage level. Indeed, our higher level of money-wages is one of the main elements in the higher costs of ‘efficient and economical production’ in New Zealand as compared with the United Kingdom. The protective tariff is thus, largely, a protection of the standard of living of the people. As the British Chancellor of the Exchequer, Mr. Neville Chamberlain, expressed it, ‘We cannot go back to free trade, not even if all the world adopted it, because we should inevitably destroy the standard of, living which we have slowly and painfully built up, and which htis now become a necessity to us.’ . . ■ . , , .‘.‘This applies equally to New Zealand,” he continued. “A further lowering of wages could be forced upon manufacturers by a lowering of the .protective tariff. * This is not the place for me to state the attitude of organised manufacturers toward the question of' further wage reductions or future tv age increases. But I am bound to say, deliberately, on behalf of my organisation, that if it is the intention to compel manufacturers to make further reduction of wages, or if it is assumed that they ought to have made greater reductions, then this should be declared openly by the commission,- or by the Government as a matter of national policy, and not forced upon us by the method of tariff-reduction.” Function of Commission. Professor Murphy: Whoso intention are you .referring to? Mr. •Mander .* The intention of the State. . , Professor Murphy: You are not referring to the intention of the commission, because obviously it cannot have, any intention, any voice, or any opinion on the matter. We are concerned only with facts, not with what the rates of wages should be. I personally do not regard this question as being .within my scope. . Our. ~ concern ~is; noth what wages should be. Mr. Gow: I cannot agree with the statement that “this should be declared openly by the commission.” It is not the business of the commission. I must take strong exception to that statement. . Dr. Craig:.Our duty is to report on the Customs duties. That is ail we are concerned with. ‘ Professor Murphy: We have no right or jurisdiction to consider what the wages level should be, and we are not going to. 1 Mr. Gow': Why should we have placed before us reflections on the Government, assumptions that they might harbour sinister motives? Mr. Mander: It is not a question of sinister motives. Mr. Gow: Is it not a sinister motive that it is the Government’s intention to compel manufacturers to make further reductions in wages? Mr. Mander: I say if it is the intention of the Government . . . Mr. Gow:-Why make that suggestion unless it is something you see looming ahead? Why bring it into the story when we have nothing whatever ■to do with it?.... Uhable to Accept Onus. Professor Murphy: It looks like, and I think it .is, an endeavour to. throw some of the .onus of this problem on to the commission.' That is an onus I personally cannot bear. To suggest that we are in any way responsible for what the wage level should be is to 'place an onus on us that we cannot accept. We have enough troubles on pur shoulders without worrying About what the wage level should be. Mr. Gow said it was not right to mrike assumptions and bring them before the commission in the guise of evidence. He thought it was quite out of order. Mr. Mander said he was put in an extremely difficult position because he could not'answer the commission without referring to what had taken place in camera. He suggested the commission must take into-account rates of wages that were economic, if the commission felt they were too high to be economic. Professor Murphy: What of it? Mr. Mander: Then you have to base the tariff arrangement on an assumed xate of -wages that will be economic. Professor' Murphy: It should be clearly understood that no responsibility for future wage levels in New Zealand can rest on the commission. There is no implication of that kind? Mr. Mander: No. Mr. Gow said he thought it highly Improper to make such assumptions and bring them in when they had no bearing on the business. Professor Murphy: I think we might proceed to the next point. I do not think we can usefully discuss this further. Comparative Wage Levels. Continuing, Mr. Mander submitted that the Ottawa Agreement should not be interpreted as requiring Dominion Industries, in order to qualify for protection, to get down to the same level of money wages as manufacturers in the United Kingdom. He thought it had been proved that a considerably higher level of money wages was necessary here, even to equal the same level of “real” wages in Great Britain, and further reductions in New Zealand, unless house rents and the cost of imported goods could also be reduced to the same level as in Britain, would probably bring the New Zealand workers “reai” wages definitely below the British level. It was admitted, however, that industrial workers in the Dominion enjoyed higher wages than farm workers In tha Dominion. Farm wages were d«-

plorably low. But he denied the suggestion which had been made that industrial workers enjoyed their higher wages at the expense of the miserably under-paid rural workers. When it was recalled that 33 per cent, of farm expenditure goes in interest, it was easy to understand why farm workers must be under-paid. High land values and excessive capital charges must be blamed for this; and it was wrong for the Farmers’ Union, the Dairy Board, and the Meat Board to attack our protective tariff as a means of diverting attention from the real cause of the farmers’ and farm workers’ most unfortunate plight. ' Summary of Arguments. In conclusion, summarising his arguments, Mr. Mander said he thought it had been proved: (a) That protected manufacturing Industries were of considerable social and economic value to the Dominion; (b) that the amount of protection required was, in general, a(j least as much as that afforded by the existing tariff, while in certain cases an increase of protection was justifiable; (c) that the existence of New Zealand industries had had the effect of limiting the prices which, could be charged for competing Imports, so that, taking this into account, it was very doubtful whether the protective tariff had, on balance, resulted in any increase in the cost of living or the costs of farm production; (<1) that the amount of protection enjoyed to-day was well below the limit imposed by the Ottawa Agreement; (e) that primage should be removed from all duty-free imports from the United Kingdom; (f) that the duty should in all cases be charged on imported goods on their value converted into terms of New Zealand currency; (g) that more effective machinery was needed to counteract dumping; (h) that special safeguards were required to enable New Zealand to meet the conditions of Northern Hemisphere “end-of-season” jobbing; and (I) that the “Empire-content” qualification for preference should be raised to at least 75 per cent.