RINGS AND CONTRACTS

Evening Post, Volume CXIII, Issue 125, 31 May 1927, Page 11

RINGS AND CONTRACTS

WHY BUSINESS PASSES

BKITAIF

AN ELECTRIC TRANSACTION

"Evening Post," 31st May. The policy of the Government and local authorities in New Zealand is to place all possible business with British, manufacturers. Preference, even to considerable increases on foreign quotations, has been given on several occasions, for it is recognised that Great Britain, being New Zealand's best customer, and giving a duty-free market to its products, some preference of the sort should be Bhown by this Dominion. Much.is said by producers of venturing, into new markets, and rightly so; but in almost every instance those new markets that are worth trying are surrounded by high tariff -walls, and, incidentally, Australian dairy farmers want their walls raised a course or bo higher by raising the duty on butter from New Zealand from 2d to 6d per pound. Britain, then, remains not only the biggest but the freest market for New Zealand main exports, and the best for reasons of sentiment and business. New Zealand then looks to Britain to be loyal to itself in this respect. But at this distance it will be difficult to understand why a great British railway company should place an order, for £120,000 worth of electrical plant with, a Continental firm when the plant could have been obtained in the United Kingdom. WORKING ARRANGEMENTS. "The Times" Trade Supplement takes the same view. >It went further, and elicited the fact that th« railway company tried to place, the work in Great Britain, but discovered evidence that led' to the belief of the existence of a price agreement among British manufacturers and a quota arrangement restricting the output of individual firms. Aa a result the company reluctantly turned to a Continental firm for the supply of the whole of the plant. But it gave no explanation of the fact that only three British firms were asked to tender. A full knowledge, not only of the circumstances of the present negotiations, but also of those connected with similar occurrences in the past, states "The Times," is necessary before it is possible to judge -the case as between the railway company and the British, tenderers who have aroused its antagonism. It Jim been apparent for a long time that some kind of a working, agreement exists between the electrical 1 manufacturers of Great Britain. Municipal engineers have on more than one occasion pointed to the close similarity between the offers they have received from different iirms, and have-, suspected mutual arrangements for sharing contracts. It has been admitted that a system exists under which a successful tenderer will divide amongst his unsuccessful colleagues, a percentage which has been added to the tender price for that purpose. In justification the manufacturers draw attention to the intricate calculations, elaborate designs, and frequent visits to site which are often entailed in a bid for a comprehensive contract. . .