A SLIDING SCALE

Evening Post, Volume CXIII, Issue 127, 2 June 1927, Page 8

A SLIDING SCALE

On first appearances a sliding Boale of duties may be judged a better method of protecting the local market for a commodity -which is subject to great price fluctuations. Fixed duties do not give the same protection. Indeed, from the viewpoint of the protected industry they may in some circumstances prove a delusion. The sliding scale certainly affords more enduring protection. Wheat-growers and flour-millora may bo expected, therefore, to welcome the Government's decision, if they are satisfied with the scale itself. If the governing domestic price is set at £13, the duty is based upon £3 10s per ton, ana thia means that the domestic price must rise to £16 10s a ton before flour can be admitted duty free. Removal of the duty in shilling steps, however, will permit imported flour to come in as a governing factor when the price rises above £13. To all intents and purposes, however, £13 is the minimum price of flour unless domostie competition and sales force a reduction. Consumers cannot obtain the benefit of a bountiful . production, in Australia unless the harvest in New Zealand is even more bountiful, because each fall of a shilling in the domestic price will be compensated by a shilling addition to the duty. If wheat-growers and flour-millers begin to compete with each other the Government generously offers to keep the ring aiid prevent Australian exporters from intervening. In a measure, therefore, tho sliding scale system is more favourable to the producer and flour-miller than to the consumer. Tho full effect of the proposed change cannot, however, be judged until the new scale of wheat duties is announced. Nor can it be assumed that the Government plan will close the door to agitation for increased protection. There is still scopo for much argument as to what should bo the governing price, and Parliament, which is to be asked to fix that price, can be asked also to alter it.