MILK SERVICE

Evening Post, Volume CII, Issue 124, 22 November 1921, Page 4

MILK SERVICE

PURITY AND COST

BOTTLES, COUPONS, BUTTER-FAT PRICE DO CONSUMERS PAY TOO MUCH? (Contributed.) The system by which milk passes from the milk-supplier to the City Council, from the council to the milk-vendor, and from the vendor to the consumer is likely .to be amended in several jmportant particulars. That is to say, the relationship of farm to City Council's milkstation, milk-station to distributors, and distributors to consumers is to be radically altered; and ths subject is worthy of public study. Until this coring, ths r.iilk-supplier sold to the City Council,at fixed prices (though the prices were seasonably variable, and also fractionally variable because of a--pßnalising scale oi differential payments, under which seals the milksupplier was paid for summer milk in proportion to the amount of winter milk supplied by him). The fixed prices were 2b per gallon for winter milk, Is 6d per gallon for autumn milk, and Is Ad per gallon for summer milk (though the summer price might sink to Is 2d if the winter supply was lacking). Under the new agreement, now in operation, the j fixed prices (except in. winter) and the penalising scale have disappeared. Except as for winter.supply,,'-the milk-suppliers, under the new agreement, will bo paid not on the basis of a fixed price per gallon of milk, but on the basis of the quantity and value of the butter-fat in the milk. The quantity oi the .butter-fat in each supplier's milk will be ascertained by test at the City Council's milkstation; and tho value of the butter-fat per lb will be fired by the rate paid for butter-fat by the dairy factory that (being situated within seventy miles of Wellington) returns the highest butterfat payment to its suppliers. QUALITY, NOT QUANTITY. The reader 'should try to appreciate the importance of the fact that under the new agreement (except ,in the three winter months from 16th May until 15th August) the milk-supplier will be paid on the basis of butter-fat content instead of bulk of milk—on quality instead- of on quantity. This is a gain for tho high-testing herd as against the lowtesting herd. The adoption of highest dairy factory price means that the milksupplier wiU not' receive complete payment until the end of the season, but in the meantime he will receive from the City Council a monthly advance equal to 90 per cent, of the estimated return. At present it is conjectured that the- price realised for, butter-fat will be in the neighbourhood of Is 9d per lb. The highest dairy factory price for butter-fat is not; the whole payment that the milk-supplier will receive. The supplier of domestic milk is under obligations that the supplier of milk to a dairy factory is not under. In the interests of public healthy the supplier of domestic milk must register his dairy, and must therefore ' attain a certain standard in the safeguards thereof. Also, he must pay freight on milk to Wellington instead of to a near-by factory. - The chairman of the City Council's Milk Committee, Councillor C. J. Norwood, has stated that, in addition to the dairy factory price for butter-fat, each milksupplier will receive a bonus of 2i|d per gallon " as compensation for ,the special work made necessary by the registration of his farm",..and for. the cost of delivery. Compensation for registration is in line with the principle of improving'the milk supply not only in distribution but also on the farm. In addition to highest dairy factory price for butter-fat, and the above-men-tioned bonus, there is a third class of payment to the milk-supplier, taking the form of a 25 per cent, addition to his price for two periods that come between summer and winter. The first period is in the fall of the year, between Ist April and 15th May; the second is in spring, between 16th and 31st August. The fourth class of payment is the winter price per gallon (2s) borrowed from the old agreement. To sum up, the prices payable under the new agreement are: — Summer price (Ist September, 1921, to 31st March, 1922)— Highest dairy factory price for butter-fat, plus 2id- per gallon, minus freight (ranging from, id to IJd per gallon). .Autumn and spring price (Ist April to 15th May, and 16th August to 31st August)— Same as above, plus 25 per cent. ( Winter price (16th May to 15th August)— Old agreement price of 2a per gallon,Mninu3 freight. VENDING REFORMS. gWhile a new agreement has. been entered on between the milk-suppliers, and the City Council, the ' agreement - between the City Counoil and milk-ven-dors is drawing to a close. Councillor No-wood states that present contracts with the vendors expire, next July. New contracts for vending*1 are being invited under a new specification. And two far-reaching alterations in the system of distribution and sale are authorised — the placing of domestic milk ill glasscontainers, and the issuing of coupons resembling in principle tramway concession tickets. The argument for the coupon is mainly economic. The argument for the glass-container is partly protective of health and "full measure," and partly economic; but under the latter head a good deal of disputation arises. First, as to the coupon eyslem. The economic advantages claimed are: (1) That there will be an end of credit and of bad debts, which stand for thousands of pounds in the books of the City Council's milk business; (2) that the system will permit a large saving, estimated at several thousands annually, in the book-keeping expenses; (3) that, as the coupons will be sold in quantities, it will be possible to promptly and equitably pass on to the. consumer variations in the cost price of milk. Some consumers may not regard this third factor as an economic gain, but it ranks as an economic gain to consumers in their capacity as citizens and as shareholders in the municipal milk undertaking. In this connection, Councillor Norwood has been reported as sayiiig: "At present it is impossible to work on smaller change of price than a farthing a quart, but under the coupon system a small change in the price of a .week's coupons will enable the price o* milk to be adjusted to a very small fraction of a penny. The importance of this can be seen from the fact that id per quart represents a difference in the revenue of tho depot of £7000 per annum. With the coupons, £1000 per annum can be passed on." With regard to the advocacy of the glass-container or milk bottle as a guarantee of full measure to the consumer, it may bo recalled that, under the present "clipping" system of measuring out milk, there has been a great volume of well-substantiated complaint by consumers on the subject of short measure. It seems that the glass-container will end this; if so, a substantial advance will bo made. Again, the present system involves a great cost, in spillage and wastage, to the City Council. Councillor M'Kcnzic is reported as stating that "the council pays away to the vendors between i/8000 and £9000 n. year to compensate them I from spillage and wastage." Councillor

Norwood is reported as saying that, by using glass-containers, much of that spillage loss will be saved, but there will still be a certain amount of spillage of milk through breakage of the containers. CONTAINERS OR "DIPPING"? That leads up to the question of the cost of breakages, which is a leading card of the opponepts of the. glass-con-tainer system.- For breakage of containers while in tho consumer's hands, the consumer will be liable; he will have to replace the container, or go without his milk. Councillor Norwood states that statistics of the working of the system elsewhere show that 78 per cent, of the breakage is consumers' breakage. That leaves 22 per cent, to be found by the City Council, assuming that the council dispenses with vendors and undertakes its own distributing. In the Evening Post of 27th October, Councillor Norwood quoted figures to show that the cost of a five-gallon delivery can, allowing it a life of five years, is, sufficient to replace containers, of equivalent capacity, six times in tho five years. These figures look favourable. They seem to indicate a big margin of saved cost, out of which to meet unascertained breakages. But ths figures, until amplified by additional statistical experience, can hardly be regarded as. conclusive. A definite judgment on the economic merits of the glass-container would also have to take account of the factor of weight. Does the putting of milk into containers double the weight of the load that has to be distributed from the City Council's milk-station? Even if the container, only adds. SO per cent, to the weight of the milk, that addition is a big factor in the cost of transport. The glass-container finds its best argument under the head of milk-purity and public health. To put sterilised milk into a container at the milk-station, in which, container it is protected from, all the contaminations of the present transport, and "dipping" system, sndi^ in which container it remains until it is uncapped; by the consumer, is to greatly raise the standard of insurance! against impurity. The "dipping" system means, possibly, contact with (human hands; on wet" days, the falling of the drippings from the clothes of the distributor into , the milk;, the blowing of grit.and' dust into the can of the distributor or of the consumer. Against these ills the container protects. And Councillor Norwood further claims that the milk in each container will be "» true average sample of the supply, not subject to the separation of cream which always takes place in can dtelive'ry, owing to the impossibility of keeping the milk cojitinuously agitatedl."'. ■ THE PRICE 8 OF PURITY. On the economic side of the glass container question, the facts available do not. seem to warrant a definite conclusion. The faot has been stressedi that the capital cost of establishing the glass container system—variously estimated at from £7500 to over £10,000 —can be met by tb& Oity Cbuncil's milk undertaking out of revenue, or, at any rate, out of "the funds of the department."_ The capacity of this young1 undertaking to find so large a sum of money for tho establishment of a new system, and the fact that the last year's woi-king shows on the balance-sheet a: surplus, of £14,000 and a net profit of £3075 0s 10d, are evidence of a strong financial position. But neither the< balance-sheet nor the availability of funds—though satisfactory elements in themselves—are necessarily a, justification of the proposed expenditure oil glass containers. What is expected! of the Oity Council is to provide the. best and also the cheapest service as between the milk-supplier and tho consumer. An ideal service from the purity point of view would not do if -it coot too ni'iichi; that is, if it created' too big a disparity' between1 what the milk-supplier receives and what the consumer pays. The real issue is whether the advantages of the glass-container jjara, or are not, likely to be bought at too high a price. If the City Council Is to meet the criticism that' its present service costs too much/ it will have to snow the actual cost per gallon of its service, andl ■each branch thereof; not merely show a surplus and a net profit. It couldi meet the critics of the glass-container proposal by showing that the cost of its present service is reasonable, and that the glass-containers will assure the comsunier a full measure of pure milk at no increased: cost. A great deal of opposition would' be removed if the council could show that the cost of its existing service has not prevented, and) that tha glass-container proposal is not likely to prevent, a reduction in the price of milk to the consumer.

These contentions, pro and con, liava beeri marshalled in the hope that some writer with a closer knowledge—one who seea the problem as a. whole, and not merely sectionally or selfishly—will take the subject up. A summary of the issues should, at any rate, clear the way'-for discussion.