FARMERS’ INCOMES

Evening Star, Issue 20612, 11 October 1930, Page 12

FARMERS’ INCOMES

£IOO PER HEAD DEGREASE SERIOUS ECONOMIC CRISIS A CONFERENCE SUGGESTED [Fkou Our Parliamrmtart Rsportsr.l WELLINGTON, October 10. On the introduction of the Imprest Bill into the House to-night for a -total of £2,638,000, Mr Coates (Leadet of tho Opposition) discussed the difficulties of tho primary producers owing to low prices, and requested a statement from the Government i hat action it was prepared to take this session. Ho asked if the cost of production had gone down. “ Not by one penny piece,” he declared, and the House would have to consider this fact and the question of wages, even if it raised a howl from one end of the country to the other.

Mr O’Brien (Westland): You have suggested that often enough. Mr Coates: “What the hon. gentleman says is far removed from the truth.”

He withdrew this expression at the request of Mr Speaker, and went on to say that if the earning power of the farmer was ignored and the volume of costs maintained, it was a situation which must be dealt with. His information regarding the reduced incomes of the farming class proved that the average cut in the farmer’s income was £IOO per head. Mr O’Brien: Then you say he is saving income tax. Mr Speaker warned the member for Westland that he would be named if he persistently interrupted. Mr Coates, continuing, suggested that these facts were being pointed out not in a panicky way. Parliament should face them and decide before tho House rose what could be done to meet the situation. He read a series of figures relating to farmers’ incomes, demonstrating cases where, after allowing for the expenses of farming, and 6 per cent, on tho farmer's capital, the net return to tho producer for his labour was £44 in a year. In one case he was £lO down, and he quoted one instance where the net return for the labour of the farmer and his wife and two sons was £246. COMPLETE INVESTIGATION WANTED. When such a position existed, said Mr Coates, there was need for a thorough and complete investigation, and ho was asking tho Government to realise it. When certain organisations made representations to the Government this was followed by representations from other organisations, which declared that they would not stand for any reduction at all in wages or salaries. “If this country is facing a difficult position, we arc all in it, and the sooner we endeavour to meet the position the leas trouble and misery wo bring upon the community. _ Many people do not realise the position, and think, when it is mention*:], that we are drawing a red herring across the trail, whereas I deem it my duty to draw the Government’s attention to it, and to ask it to give an opinion which I hope may lead to some solution of the difficulties* facing the primary producers What would trade unionists outside, say, if they were faced with an earning power of £44 for a whole year’s wont. We would hear of it im mediately.” Tho reform Party was just as anxious as anyone to keep a high standard, but it recognised tho facts, and wished to meet them before the community was overwhelmed. Tho problem to consider was that tho primary producer was facing a reduction of income amounting to eight millions. Mr Lysnar: A lot more than that. Mr Coates: We know it is going to bo more. Why hide it when we know it amounts to £IOO n year tpr every farmer.

He would bo asked vvliat suggestion he could offer. The time had arrived when the commercial community, bank ing, farming, and industrial interests should be brought together to face the facts and see what they had say and how to meet the position. There were other methods more direct, but ho would like to see these interests working together and get an understanding of the other fellow’s point of view. RELIEF TO PRODUCERS. Mr Veitch (Minister of Railways) remarked that there seemed to be a tendency to draw attention to all that had not been done, and ignore all that had been done to meet the present very difficult situation. If it was apparent that the conference suggested by the Leader of the Opposition would produce results, ho was cofifident the House would approve. Ho contended that the session had produced results which would help the farmer. Additional finance bad been provided to encourage laud settlement. Relief would also be given the producers through economies in the railway service. enabling freights to be reduced. The department had already been reorganised, so that a point would soon be reached making it possible to approach the question of providing relief to the producers. A very great deal had been achieved in financing farmers and workers, and where, during economic difficulty, mortgage payments could not be fully maintained, tbo State Advances Department was meeting the difficulties of its clients. The Minister declared his .firm belief that the economic difficulty would not be solved by reducing the standard of the average wage-earner. Good results would follow the development of inter-Empire trade, and a more general determination to buy New Zealand-made goods.

WHAT OF THE UNEMPLOYED? The Labour Party’s view of the situation was put by Mr Savage (Auckland West), who said Mr Coates had asked what unionists would say if they had to face a loss of £IOO a year, but did not the Opposition Leader realise that there were registered in New Zealand to-day 6,000 unemployed, who, through absence of work, wore losing considerably more than £IOO a year, and many of them, as well, were witnessing the disappearance of their _ life savings through the loss of their homes. No one needed to bo told that the present position in the country was serious, but it had to be remembered that the farmer was not in the boat by himscli. In the spring everybody had expected that matters would improve, but such was not the case, and as the weeks sped by unemployment, instead of diminishing, was rapidly increasing. Mr Savage said ho would not admit that the picture was as black as Mr Coates had painted it. In his opinion the people who painted dark pictures wore not tho best friends of New Zealand. They wero tho reverse. Tho dominion had its natural resources* and Labour

waiting to be employed, but tiiere seemed to bo a lack of organisation in that respect. “I don’t think the House should adjourn until some reasonable provision has been made for those who are in a bad way,’’ added Mr Savage. “Tho present rapid increase in unemployment makes one shudder as to the possibilities of the future. What is next winter going to be like, one may well ask. It is reasonable to suggest that the responsibility rests with Parliament, and if the House adjourns, allowing tho 6,000 men already registered to still remain unemployed, then we will be failing in our duty.” He expressed the hope that an early move would be made to put into operation the machinery of the Unemployment Act. There was not a moment to lose in putting the legislation into effect.

Mr Smith (Minister of Labour): , Immediate steps are being taken to put the Act into operation without delay. Mr Savage, after suggesting that interest rates might be reduced, said it was impossible to solve the farmers’ problems by weakening the farmers’ markets. It was not in the interests of tho farmers that wages should be reduced, causing lowered purchasing power. If the employers and employees in industry i would get together and demonstrate what could be done by industry in New Zealand no Parliament under the sun could resist their advances. He believed that Parliament should encourage those concerned to make such a move. He- agreed that the facts must be faced in endeavours to ascertain what could be done for tho development of local industry.

NOW CUT COSTS? ACTING PREMIER REPLIES CAPITAL MUST MAKE SACRIFICES TOO [Pm tlsnTiD Prxsi Association ] WELLINGTON, October 11. Tho debate on the Imprest Supply Bill (No. 4) was continued in the House of Representatives in tho early hours of this morning. The Minister of Labour assured the House that the Government was in earnest in its efforts to cope with unemployment and other national problems of the day. He gave details of tho men who had been placed in work since April 1 last, and stated that plans had nearly been completed for placing an additional 690 men. The solution of the difficulties would be greatly assisted if the co-operation of all parties were forthcoming. Mr Waite strongly advocated the summoning of Parliament immediately on the return of the Prime Minister from tho Imperial Conference. He said that problem's such as unemployment and the difficulties of the primary producers were too urgent for any consideration of them by Parliament to be delayed till Juno of next year. The prices of the primary products were a low ebb at the present time, and he was afraid the bottom had not yet been reached. The most disturbing feature was the possibility of prices becoming stabilised at low figures. Mr Mason agreed that the subjects to which Mr Waite had referred required urgent attention, and that they should be considered completely apart from the party : point of view. The speech of the Minister of Railways had not held out a great deal of hope, and the Feeling remained that something more was expected of the Government. Mr Mason contended that tho money problem was one of the most serious economic difficulties of the day. It had been stated that there was plenty of work in the country, but insufficient capital to finance it. This, however, was not borne out by the statistics, which showed that the fixed deposits had increased to a record extent, while current accounts were decreasing. The amount of money going into fixed deposits was one of the greatest causes of tho present situation.

Replying to speeches made during the debate, Mr Ransom said the Government had all along realised that every possible care and precaution should be taken with regard to the financial position. Before Parliament had met. the Prime Minister had given the country a fair indication of the situation, and had indicated what steps it was proposed to take to meet it. He was glad that the Leader of the Opposition was now prepared to regard the matter as the Government had regarded it throughout, and he hoped the Reform Party would be prepared to asist in coping with the difficulties. Referring to revenue, the Acting Prime Minister said he agreed that the prospects necessitated serious consideration. _ The Customs figures for the first six months indicated that, unless there was a substantial improve- i meat in the next six months there would be a shortage of at least a quarter of a million in that quarter. The same conditions existed with respect to other sources ot income, Th.e Government had recognised throughout that the drop in the values of primary produce, affecting the farming community as seriously as_ it did, also affected the whole dominion. It apopared, however, that the House was not in sympathy with the Government’s endeavour to cut down expenditure. The adverse vote on the Agricultural Estimates had indicated lack of recognition of an attempt to cut out nonessential services. The House had evidently considered .that expenditure should not bo reduced, but it had not been shown that any essential services were being dispensed with. , Mr Ransom remarked that the re-' venue for the first five months of the year amounted to £7,094,841, compared with £7,631,750 for the corresponding five months of last year—a decrease of £536,909. The expenditure totalled £9,587,882, compared with £10,188,731 —a decrease of £600,847. He observed I that, notwithstanding the fall in re- 1 venue, the expenditure had decreased j to more than a proportionate extent, and came very close to the" position as budgeted. It had been suggested that Parliament should again be summoned immediately upon the return of the Prime Minister from London, apparently regardless of the cost which would bo involved in taking such a course. It must bo known that the expenditure on maintaining the establishment was a : substantial item, and yet it was urged I that this step should be taken instead of giving Cabinet the opportunity of getting down to serious consideration of the plans it already had before it. The speeches of the members of the Reform Party during the debate denoted an attitude quite contrary to that when the Budget had been described as the “ Black Budget.” Continuing, Mr Ransom said there had been repeated references to the necessity for cutting down producers’ costs. The Government did not differ from this view. It realised that costs must be reduced, but so far the only method that had been suggested was to reduce wages. The Government did not regard an iihrnediato reduction in wages as the means of attaining a material decrease in production costs. As far as the farming industry was concerned, | it realised that there must bo co-opera- . tion between Capital and Labour, but when calling on Labour to make sacri- J fioes during a time of stress people I

would ho justified in expecting Capital to make equal sacrifice. He thought that if Capital were as willing to assist as Labour was the country would be nearer a solution of its economic difficulties than it had been for some time. If flic cost of Labour was to be lessened it was only right to expect that the cost of Capital would also fall. Mr Coates said Mr Ransom liad indicated that he believed the lending rate could be reduced. Was the State justified in asking private capital to do this, when it considered that the State Advances Department could not give a lead without involving itself in a loss on its transactions. Mr Coates expressed regret that the Acting Leader of the House had not treated his suggestion to call a conference < of al! parties concerned in the economic situation in a different light. He had not shown how Cabinet itself was going to meet the difficultjes, but if he preferred that the whole responsibility should be with tho Government that was his concern. At the same time, Mr Coates added, lie thought Mr Ransom would be wise to reconsider tho position, and call tho parties together. The Imprest Bill, involving appropriations amounting to £2,638,500, was put through all stages and passed. The House rose at 4.20 a.m. till 2.30 p.m. on Monday..