WIDE POWERS

Evening Post, Volume CVI, Issue 32, 7 August 1923, Page 7

WIDE POWERS

DAIRY PRODUCE EXPORT

CONTROL BILL

PRODUCERS' RIGHT OF DISPOSAL

SERIOUS POSSIBILITIES.

(Contributed.)

It is refreshing to see from the resolution passed yesterday by the council of Hie Chamber of Commerce that the •trading community is at last becoming alive to the serious menace of the modern legislation of a Farmers' Government ; but from the discussion as reported in "The Post," it is apparent that even yet the extent of that menace, as contained in the Dairy Produce Export Control Bill now before Parliament and in the Meat Export Control Act, 1921-22, is not fully appreciated.

Clause 3 of the Bill proposes to establish a Control Board consisting of eleven members, of whom two are to be appointed by the Government, and nine to be elected by the producers, the manner of the election being left to regulations to be made by the Government later on. A twelfth member of the board may be added as representing persons for tho time being engaged in business as manufacturers of dairy produce, or as sellers of such produce out of New Zealand. Clause 12 empowers that board at its own sweet will at any time to assume control, absolute op limited, according to its unfettered discretion, of all or any of the butter and cheese produced in New Zealand and intended for export. The board may, if it chooses, exercise discrimination by assuming absolute control of tho dairy produce belonging to one or more owners, leaving all other owners to deal with their produce as they think fit in the ordinary course of business. Any produce of which th<* board assumes absolute control "shall be shipped as the board directs and shall be sold and disposed of only by the board, or by direction of the board, at such times and in such manner and on such terms as the board in its discretion determines." That is to say, the owner of the produce of which the board has assumed such control is no longer permitted to dispose of his property' and* has no voice whatever in the manner or terms of its disposal or the price at which it is to be sold. He may have purchased the produce from producers' manufacturing companies, yet, at any rate if the purchaso ,is made after the 31st August, 1924, the right of disposal of his goods is taken away from him and given back, in effect, to the very producers who have sold the produce to him and have absolutely disposed of their interest in it;.because the board is composed almost entirely of representatives of the producers. But that is not all. Clause 18 says that the members of the board are not to be personally liable for any act or default of the board done or omitted to be done in good faith in the course of the operations of the board. It is true that the same clause says that the board in its corporate capacity shall be deemed to be the agent of the owners of all produce of which the'board has assumed control and that the mutual rights, obligations, and liabilities of the board and the several owners shall accordingly be determined in accordance with the law governing the relations between principals and agents; but even that provision is qualified by the following words: "Save that nothing herein shall be construed to limit the power of tho board to exercise without the authority of the owner of any dairy produce, any power with respect to such dairy produce that may expressly or by implication be conferred on the board by or by virtue of this Act." But the end of the tale is not even yet. If clause 18 is to be construed as constituting the board the agent of the owner of the produce and accountable as such to the owner for the proceeds of the sale of the produce, the benefit of the clause is rendered illusory, and may be made nugatory by clause 16, which is as follows :—

All moneys received by the board in respect of the sale of dairy produce or otherwise howsoever shall be paid by the board into a separate account at a bank to be approved, by the Minister of Finance, and shall be applied by the board as follows:— (a) In payment of the expenses, commission, and other charges incurred by the board, or for which the board may become liable in the course of its business. (b) In payment of the salaries and wages of officers and servants of the board. (c) In payment of travelling allowances, fees, or other remuneration to members of the board, or of the London agency (not being persons permanently employed in the service of the Government). (d) In payment of advances made by the board to the owners of any dairy produce on account of the price of tho dairy produce. t (c) In payment into a ■ reserve fund, from time to timo as the board in its discretion determines, of such amounts as the board may consider necessary to enable it to carry on its operations under this Act. (f) In payment of the balance to the owners of dairy produce controlled by the board in proportion to be fixed by the board by reference' to tlie quantity and grade of tho dairy produce bundled by the board in respect of the several producers or

other owners of dairy produce.

It must be assumed that the lang-. uage and effect of the Bill and tlTe extent of the powers confered by it upon the board are understood and intended by the sapient Minister or Ministers responsible for its introduction. I'ake an illustration for the purpose of seeing the extent of those powers: An exporter in good faith after ■ the 31st August, 1924, purchases from producers or their co-operative factories produce to the value of £100,000, which produce he intends to export. For the purpose of enabling him to finance the purchases he borrows, say, £50,000 from his bank or from some other source. The board comes along and chooses to assume absolute control of that particular produce. It then proceeds to sell the produce at such price or in such manner as it thinks fit. The advances (if any) made by the board itself are protected up to a point, but the Bill gives no protection to the person or institution that may have lent the £50,000. One would suppose that the board's duty would be to retain merely the expenses incurred by it in the sale of the particular produce, and then hand over the whole of the balance to the owner as an ordinary agent would be by law required to do. But no—not on your life! The proceeds are to l>o applied in piiymcnt of the whole of the expenses and charges of the board in connection with the carrying-on generally of all its business, salaries, wages, travelling allowances, ttc. etc. Aftev satisfying all these demands put of the eals

of the poor exporter's £100,000 worth of produce, the board is entitled to appropriate so much as it thinks lit of what is left—presumably the whole if it likes—by paying it into a reserve account in order "to enable it to carry on its operations under this Act."

It would therefore appear that the board may in effect, at its own sweet will, confiscate the whole of the produce belonging to any particular person, firm, or company, and not pay one penny piece of the proceeds of sale to the owner of the produce. No doubt the Government will say: " Oh! but the board would never do such a thing." Surely the answer is: " The board has the power to do it, and can exercise that power if it thinks ill, without any right on the part of the Government or anyone else to interfere. Why confer upon such a. board powers which even the Minister or Ministers responsible . for the Bill must admit it would be monstrous to exercise?"

Or the Government may say: " There is the same provision in the Meat Export Control Act. and the power has not been exercised." True, it has not so far been exercised; no attempt has so far been made by the Meat Producers Board to exercise its power of assuming control of meat. But that is not to say that the board may not in future exercise its powers even to the extent of confiscation; nor is' it any guarantee that the Dairy Produce Board will not, if the Bill becomes law, exercise those powers and to the like extent. Is it no!; the duty of the Government and Parliament rather to amend defects in the existing statute than to perpetuate and extend them in new legislation?

Just imagine the invective that would have been hurled by Reformer and farmer in unison if legislation of this character had been introduced by a Government of Labour representatives whom it delights Reformer and farmer alike to howl down as " extremists " and " Boleheviks."