TARIFF COMMISSION

Evening Star, Issue 21509, 6 September 1933, Page 7

TARIFF COMMISSION

SITTING OPENED IN DUNEDIN EVIDENCE OF IMPORTERS Goods as diversified as pianos, dried milk, men’s hats, and imported timber were to come before the notice of the Tariff Commission to-day, when it opened its Dunedin sittings to hear evidence from importing interests. The commission comprises Dr G. Craig (chairman), Professor B. E. Murphy, Mr J. B. Gow, and Mr G. A. Paseoo. ORDER OF REFERENCE. The Chairman, at the outset, explained the procedure to be followed. Ho said the order of reference was to inquire into tbo Customs tariff of New Zealand, and to recommend for consideration by the Government any alterations therein, having regard to existing trade agreements to which New Zealand is a party, and particularly to the agreement concluded at Ottawa in 1932, between His Majesty’s Government in the United Kingdom and in Now Zealand; to the financial, economic, and industrial conditions in. the dominion; to the reasonable requirements of local industries which were being conducted in an efficient manner and were economically justifiable; and to all other revelant considerations.

This order of reference w T as regarded as relating to all questions concerning the tariff, including the following:—(a) The rates of duty to be charged or the exemptions from duty to be allowed on goods produced or manufactured in British or foreign countries; (b) the basis of the valuation of goods liable to ad valorem duty; (c) the basis of preference of or tariff concessions to any country; (d) the basis upon which dumping duty should be levied; (e) the relation of tho tariff to the rates of exchange ruling in Now Zealand and in other countries.

The Chairman explained that as a general rule the evidence would bo heard in public sittings, but the commission Avas willing to receive evidence in confidence if the circumstances so warranted.

The Chairman said the commission had given consideration to the question of the representation of persons or organisations by counsel or other agents. The object of the commission in its sittings was to obtain facts upon which its findings could be based. It was considered to be important that every reasonable facility should be afforded to those interested to adduce the facts as fully and clearly as possible. Hence the commission had decided that any person or organisation tendering evidence might, subject to the approval of the commission, be represented by counsel or other agent, and that such agent would have the right to examine or cross-examine witnesses upon evidence given by them, provided that, in the opinion of the commission, the questioning would result m the elucidation of facts or the obtaining of information useful to the investigation. Mr A. E, Mander, general secretary of the New Zealand Manufacturers’ Association, appeared on behalf of that body, and Mr P. Waite appeared for the New Zealand Farmers’ Union. POPULARITY OF THE PIANO. Thomas llitchie, general manager of Chas. Begg and Co., asked that the Customs duty on pin nos manufactured in Great Britain should be removed. He pointed out that no pianos were manufactured in New Zealand and that no New Zealand industry was protected by it. He pointed out that owing the high cost of pianos imported from Great Britain it was practically impossible to sell new pianos in New Zealand. The Government received practically no revenue from the Customs Department through the importation of pianos. Were the duty removed the sale of pianos would be stimulated, and those firms engaged in their sale would bo able to make profits and to pay income tax to the Government. He stressed the point that the learning of piano playing by young people was very valuable, as it tended to keep them in their homes, where they came under proper influences, a thing that was particularly desirable at the present time. The removal of the duty would also strengthen the Government’s position in regard to its export to Great Britain. Were the duty removed, he gave the assurance that firms selling pianos would embark on an advertising, campaign and push the sale of pianos. Employment would be given for hundreds of people* in the way of salcsnien, tuners, teachers, carriers, etc. With the removal of the duty and with a normal exchange rate pianos could be sold at from £4B to £52, whereas the present price was in the vicinity of £7t>. The British Pianoforte Manufacturing Association supported the request, said Mr llitchie, and it pointed out that the importation of pianos by New Zealand had practically ceased. Mr Pascoe said he took it that owing to tho advent of the radio, there would not again ho the same volume of piano selling that there was previously, even if tho duty were removed. Mr Ritchie said it would take time to stimulate the sale of pianos, but there "'as a definite change in the attitude of the public towards radio. While entertainment by radio was still a factor, there was a tendency, especially in Great Britain, to look to the radio for education and news rather than for entertainment. . He considered, too, that when, piano playing came into its own again the standard of playing would bo higher because of the educational value of the radio. To Professor Murphy, Mr Ritchie admitted that even if the duty were removed, there would not bo an immediate benefit to the sellers, but the demand for pianos would bo stimulated and tho effect would bo felt in a little time. The economic depression was also to be considered because people could not buy pianos as the price was so high. There was definite evidence, however, that there was now a greater interest in piano playing and there was a constant inquiry for cheap second-hand pianos. That led him to believe that if the price of new pianos wore lower, more would be sold. Mr Pascoe asked if it was borne out by the annual competitions that were held in various parts of New Zealand that tho number of entrants in the contests was increasing.

Mr Ritchie replied that greater interest was being taken in the piano playing sections. Mr Pascoe: Wo can take it that in a number of homes of people in poorer circumstances there were children who would learn piano playing if facilities were offering P Mr Ritchie; Definitely that is so. DUTY ON BAGPIPES. Professor Murphy asked if bagpipes came under the beading m “ other musical instruments.’' Dr Craig: Yes. Mr Ritchie then submitted a petition from James Robertson and Co., an Edinburgh firm, asking for the cancellation of the duty on bagpipes, Mr Ritchie said that no bagpipes wore, manufactured in New; Zealand, If the

duty of 22J per cent, were reduced there would be a greater demand, for bagpipes than under existing conditions. Canada had abolished the duty on bagpipes following tho Ottawa Conference. It was desired that tho duty on bagpipes, component parts, and accessories should bo abolished or reduced. Bagpipes played a definite part in the life of the community. The playing of bagpipes made for physical development. Professor Murphy: Whose physical development—the player or the listener ? Mr Ritchie: Both.

Mr Gow: You haven’t mentioned that the skirl of the pipes has sometimes saved tlm Empire in times of stress. Professor Murphy; They frighten the enemy away—is that the idea? Mr Waite said the Farmers’ Union supported the request with regard to bagpipes. DUTY ON TIMBER. Mr Carl Ruben, manager of the Maorilaml Importing Company, urged a reduction in the duty on imported timber. Ho said the New Zealand sawmillers have been well catered for in tho way of protection, which, as far as sawn am. dressed timbers were concorned, amounted to a total prohibition of importation. The witness suggested that there-'was little chance of building costs being reduced while the Government practically stopped competition by prohibitive tariffs. Mr Ruhon quoted figures taken from a statement by the British Columbia Lumber and Sbinglc Manufacturers Association. That shelved tho landed cost of 10,000 ft of rough sawn Canadian Douglas fir, including freight, insurance, exchange, duty, and surtax, to be £147 10s Bd. The freight amounted to 132.43 per cent, of the f.o.b. value; the exchange, which was collected on the freight and tho f.o.b. value, to 60.78 per cent.; and tl*e duty and surtax to 150.45 per cent. The landed cost of 10,000 ft of Canadian sawn, dressed Douglas fir was £206 13s 4d, the freight being 108.52 per cent., and exchange £>4.51 per cent., and duty and surtax 246.60 per cent. Mr Ruhen said tho climatic conditions of Central Otago were such that it was almost impossible to keep our native timber straight tliere, and until we varied our manufacturing methods and felled our logs while the sap was down we would not succeed iu supplying skantling which would not be affected by every change in the weather. The imported sawn dressed timber, being kiln dried, was free from that defect. Although prior to the last increase in duty—from 11s 6d per 100 ft super, to 19s per 100 super, feet, tho importations were not so large as when the duty was 4s per 100 super, feet, importations were still taking place, showing that in spite of the increased price, which brought the cost to the consumer a long way above the rest of tbo native article, this material was necessary, and supplied n felt want. Tho question was whether we could afford to increase the cost of building to our producers by artificial means such as 150 per cent, and 246 per cent, ad valorem duties and surtax. DRIED MILK PRODUCTS. Mr W. S. Wunsch, manager of the Now Zealand Sugar of Milk and Casein Co., of Edendale, appeared in connection with dried milk products. Ho said the present duty was nominally 10 per cent, on dried milk products from British countries, and 25 per cent, fx’om foreign countries. He asked that the duty on foreign goods, be maintained, but had no objection to the free entry of goods from Empire countries. Ho continued: “Lactose is manufactured from whey. As this has a very low value per ton it cannot bear high transport costs before treatment. Therefore the maximum size of any factory depends on the production of whey per acre, which is higher in New Zealand than in any other country. The manufacture entails very high overhead charges so that a small factory is uneconomical. For these reasons the industry is one particularly suited to New Zealand conditions. It transforms an industrial waste (often a nuisance) into valuable products. In addition to the production of lactose, the process in use hero also gives a very valuable stock food, sold as Milkiwey Paste, so that all tho contents of the whey are utilised. Tho industry is at present dealing with some four and a-half million gallons of whey per annum, transforming this into some 400 tons of lactose and 800 tons of Milkiwey Paste, and finding a market for 5,000 tons of coal in the process. If it can overcome its present difficulties it will bo in a position, with but slight modifications of its processes, to produce other valuable foodstuffs from whey, and will undoubtedly extend to other districts. It will then convert more than 200 million or so gallons of whey at present wasted, into saleable products, largely suitable for export—in addition to lactose, it has exported in the last three years 100, 500, and 1,000 tons of Milkiwey Paste. There is no need to emphasise the effect of this on employ-

ment, both directly _ and through the fuel and transport industries. “ Tinder normal conditions the industry is so eminently suited to New Zealand that it should need but little protection, in spite of the fact that it is working in a protected market with its labour and material costs heavily inflated. The European producers, who are its only real competitors, have, of course, far lower labour and fuel costs, but the greater production of whey per acre here and the greater efficiency of the New Zealand process go some way to counterbalance these. Conditions, however, are not normal. In Europe they have lessened the outlets for skim milk, and so forced an increase in the casein production therefrom. This in turn has left the producers witty the problem of whey disposal acute in a closely settled country. One solution of this is the manufacture of lactose. This manufacture has glutted the market, and at present lactose _is being sold below its cost of production. This has forced some of the Continental factories out of business, but the adjustment is slow, and the difficulty of getting rid of the whey still maintains too many. In New Zealand the problem of whey disposal is not yet sufficiently acute to give us appreciable help, and indeed we pay the dairy factories for our supplies, thus increasing their payout. Moreover, we have reason to 'believe that the Continental manufacturers, who are in a loose combine, are mailing deliberate efforts to force both us and the Australian makers out of the business. The naked value of lactose in gold is therefore only about one-third of pre-war, and many of our costs are far higher than pre-war. “ The present retail price of lactose in New Zealand is from lid to Is 3d per pound—we believe tlie lowest in the world. The imposition of a duty will not result in any raising of this price, at least under present conditions, but it will ensure us the whole of the local market at a price which will enable us to survive. If we fail to do so, it is hardly likely that any other firm will essay the manufacture of a difficult material such as lactose, and New Zealand will again he dependent solely on foreign supplies. It is almost certain that the price will then sooner or later be forced up, and customers here may well have to pay nearer the 2s 6d per pound which obtained in 1905. Moreover, the approaching problem of whey disposal will remain unsolved. Massey College has reported that our methods are those most likely to provide this solution. ■lt is perhaps not too much to claim that the industry, already a valuable one to the country, has promise of becoming an important factor in its further commercial development. M'ilkiwey paste is a substitute for whole milk in the feeding of calves, pigs, and poultry. Its principal sale to date has been as a calf food. It is now definitely proved for this purpose, and the quantities used rose from sixty tons last season to 169 this. Several large poultry keepers are regular customers. The suggestion is that in the event of closer settlement of the country being necessary Milkiwey Paste might play a not unimportant part. For these reasons we maintain that an import duty should be imposed on lactose at least equal to that in force on dried and condensed milks. Its manufacture is far more complicated and costly than that of those products. It needs more expensive plant and more highly skilled technical control. It is probably the only “ fine chemical ” manufactured in New Zealand, and these costs are of course much higher in the fine chemical than in any other industry. We do not ask for any tariff at all against lactose manufactured elsewhere in the Empire. Fair competition cannot hurt us, and we should gladly see Empire Freetrade in our products.” The Chairman: You are asking for 25 per cent, against foreign products—both sugar of milk and the paste. Mr Wunsch: Not on the paste, which I think must stand on its own merits.

After hearing further evidence in committee the commission adjourned till the afternoon.

MANUFACTURERS' INTERESTS

MR MANDEII WELCOMED BY LOCAL ASSOCIATION.

At a special meeting of the executive of the Dunedin Manufacturers’ Association on Monday evening, the President (Mr James Hogg) extended a welcome to Mr A. E. Mandor, general secretary of the Manufacturers’ Federation of New Zealand. Mr Hander was later introduced to a large and representative gathering of local manufacturers.

Mr Hogg referred to the efficient and effective work being accomplished by Mr Mander on behalf of the manufacturers of the dominion, and added that his services were available to any member of the association in giving direction on tariff matters while he was in Dunedin. -‘i ;As manufacturers,” said

Mr Hogg, “we are satisfied that dominion organisation is essential to promote the welfare of industry, to present the claims of industry for recognition, and, by keeping our plants running full time, to reduce unemployment and provide work for the thousands of boys leaving school.” Mr Mander then addressed the meeting and outlined the procedure required in presenting tariff cases, after which he was accorded a hearty vote of thanks.