GUARANTEED PRICE

Dominion, Volume 30, Issue 143, 13 March 1937, Page 17

GUARANTEED PRICE

Minister of Agriculture Replies to Criticism

HIGHER COSTS QUESTION Dominion Special. Service. Auckland, March 12. A comprehensive survey of the criticism of the guaranteed price voiced by advocates of a compensatory price, together with a reply to allegations of high manufacturing costs which he maintained were offset by considerable savings, was given by the Minister of Agriculture, Hou. W. Lee Martin, in au interview to-night. He said the Government was not going to be stampeded by small sections of impatient farmers into embarking on a course which would be detrimental to the majority of those engaged in the industry. Mr. Lee Martin said he still considered the guaranteed price paid was a generous interpretation of the promise made by the Prime Minister. Not only was the average over the last 10 years generously interpreted, but a further sum of £580,000 was provided to meet in some measure the increase in costs which the Government recognised was inevitable. As a result of the Government’s policy the sum of approximately £20,000,000 had been put into circulation through increased wages and other avenues, and one could quite recognise that some of these costs must be cast on the farmer. The price of 1/- 9-16 d. was perhaps not fully understood by many farmers, who calculated their returns ou a butterfat basis, on which the equivalent was 1/3.1, said Mr. Lev Martin. This is not the last word, and the position has been made very clear by the Prime Minister, the Minister of Marketing, and, in fact, all Ministers, that the whole position is to be reviewed in the light of increased costs which have resulted from the Government's legislation. To arrive at the basis of next years pay-out, a committee had been appointed whose business it would be to go into the various factors involved and report to the Government. Several meetings had been held, and it uas anticipated an announcement in regard to next year's prices would be made much earlier than was the case lust season.

Referring to the question of costs, Mr. Lee Martin said the Government bad been seeking to get a statement from farmers concerning the increase. He himself was milking 90 cows, and a careful estimate of the increase as far as his farming operations were concerned revealed an increase of 5-Bd., which represented practically £7O. However, that was more than offset by increased production, and his returns this year would be approximately £3OO higher than they were last year. Discussing factory costs, Mr. Lee Martin said the returns which be had received from various factories indicated that the extra costs would be more than offset by substantial savings as a result of the Government’s policy.