CONTROL OR COMPETE?

Evening Post, Volume CXXXIX, Issue 147, 23 June 1945, Page 6

CONTROL OR COMPETE?

As the question of the licensing of a firm or firms to manufacture motor tyres in New Zealand is to be the subject of investigation by the Bureau of Industry, we do not wish to comment at this stage on specific points raised by tyre-manufacturing companies in Great Britain. In the reply made by the Minister of Supply to statements made by the manufacturers, however, there are points which call for clarification. Mr. Sullivan has endeavoured to cloud the main issue by emphasising the need for the expansion of New Zealand industries in order to provide for full employment and improve the living standards of the people. We have never questioned the desirability of expanding industry in New Zealand, provided it is done on sound economic lines, but what we have questioned is the use of the licensing provisions of the Industrial Efficiency Act for the purpose of creating controlled monopolies. A question that arises from Mr. Sullivan's comment is the extent to which these provisions are to be used for such a purpose. When the element of competition is removed from any enterprise there is a danger that the public interest will be affected detrimentally. New Zealand has already had unfortunate experiences of this both in State industry and in the creation of partial monopolies by licensing. Is the licensing system, combined with import contr.ol, to be further used to grant monopolies in certain industries, thus, removing the element of competition both from within and without? *If so, there is a decided danger that the incentive

which competition provides to develop on modern lines, and to give the public the best possible service, will be lacking. The public, whose interests must be paramount, are entitled to a clear statement of Government policy on this issue, an issue that cannot be avoided by vague references to full employment and living standards. These terms are in danger of becoming catchwords without the real meaning they should possess. Full employment is not praiseworthy just because it is full; it must be fully productive of useful goods and services. It cannot be unless the people employed are working in the industries and under the conditions that will give the best results. Full efficiency, for which free enterprise .is essential, is as necessary as full employment.