POLICY REVERSED

Evening Post, Volume CVI, Issue 121, 28 November 1928, Page 14

POLICY REVERSED

, SAIiE OF FREEZING WORKS PURCHASE BY BORTHWICK'S A transfer of the meat export slaughterhouse license from the Wainoawa Meat Co. to T. Borthwlck and Sons was granted. This was the bald and formal announcement made in the x-ecords of the last meeting of the Wairarapa South County Council. Ordinarily such a statement in . the report of proceedings of a county council would attract little public attention. But this is an announcement of outstanding interest to the freezing industry of the' Dominion, and to those who furnish that industry with finance. It cannot be regarded with indifference by the New Zealand Meat Producers' Board because it represents a complete change in the policy of that body. The policy of, the board was one of New Zealand bwner- . ship of New Zealand freezing works. In its report for the period, 14th March to 30th June, 1923, the board stated:—"Rumours were recently in circulation to the effect that the purchase of- freezing works in the Dominion was contemplated by certain overseas interests, and the board decided that iii the event of any such purchase or erection ,of freezing works by overseas interests without the approval of the board, it would take such action as would prevent such interests controlling the meat going through such freezing works." „'-.' n. The board was actuated by fears ot overseas interests endeavouring to acquire superfluous freezing works at a low capital cost, and that such interests would "soon cause trouble' to the remaining locally-owned works, and might eventually endeavour to acquire them also, or push-them out of business" (to quote a statement made by the chairman of the board,-Mr. David Jones). The board also held that in such an eventuality these overseas interests would then be m a position of dominating the whole of our frozen meat trade." LICENSE REFUSED. Twice the board had been asked to recommend transfers of licenses from locallyowned works to overseas interests. It approved the transfer o£ the Poverty Bay Sheepfanners' Company's works to \ estey's who were already long established in the- locality, and in any case, were about to enlarge their owft Poverty _ay works. Vestey's took over the Poverty Bay Sheepfarmers' works from the liquidators acting for the National Bank ot New Zealand on the board recommending the Minister of Agriculture to grant an export licence in the case of this unBuVwhen the Wellington Meat Export Company had the opportunity to dispose of its undertaking to Borthwiek s for £200,000-and this was fully approved by, - shareholders-the Minister for■ Agriculttire on the recommendation of<Hhe Meat Board, refused to approve the transfer ot the license from the, company to-Borth-wick's. He did so in the following letter to the manager of the Wellington Meat Export Company:— 25th January, 1926. Dear Sir,-With reference to your application for approval of the transfer of your company's license, under the .Slaughtering and Inspection Act, IJOB, and the Slaughtering and Inspection Act 1918, to Messrs. Thomas Borthwiek and' Sons (Aiist.), Ltd., I have to mforrn you that the matter was duly re- ' fermfto the New Zealand Meat^'oducers' Board, which, by statute, is invested with power to control the meat ■export trade of the Dominion The board has advised the Government that, after due consideration, it cannot see its way, on the grounds of public policy, to recommend the:transfer of the license „ question. I may- say that in this re- • commendation I concur, and .therefore am unable to extend my approval to your application for the transfer of the license I desire to make it .clear that this decision is in no way intended to reflect upon the ' conduct of Messrs. Thomas Borthwiek and Sons (Aust.), Ltd. _ operations .in thereat freezmg and exporting business.-Your faithfully, (Signed) O. HAWKEN, " Minister of Agriculture. Borthwick's ■ was then, as now, a very old-established firm'in the New Zealand meat export trade with its own works m three pastoral localities, and it was generally admitted at-the time the transfer was proposed that its relations - with producers were invariably satisfactory. HoweVer, the Minister in concurrence with the board refused the transfer of the license without which, of course, the purchase could not be completed. The sale fell through. The Meat Export Company had to carry on as best it could. EFFECT ON THE BANKS. But there was - one effect the refusal ofthe Government to facilitate the transfer of the licence had, that apparently the Minister and the board either overlooked or regarded with indifference, and that was, the perturbation ot the banks and other financial institutions interested in the financing of freezing There was not then, and there is not now, in sight any purely New Zealand company prepared to purchase what Mr. Jones once described as "derelict or invalid works." This action of the Minister and the board vitiated freezing works as securities For they could not be sold without a licence to export, and no one in. NewZealand wanted to buy.them unless at less than scrap value. Tho Bank^of New Zealand 'was interested in the Waingawa Farmers' Freezing Company, and it, like a number of others the company got mto difficulties. There may or may not have been an offer from outside interests to take over these works, but they had to be taken over by the bank, and by the bank were leased to a company which recently decided not to apply for renewal of the lease, but acquired an interest in the Wellington Meat Export Company • instead. This undertaking has been purchased: from the bank by Borthwiek s, .and the licence, of course, - transferred, to .them with, the works. ' Now the question that producers will be asking is why this change of policy by the board? Why was the Meat Export Company's sale to Borthwiek s stopped, and why was the Wairarapa Company s sale to. the same British, but outside, interest approved?