The Gisborne Herald IN WHICH IS INCORPORATED "THE PRESS." GISBORNE, SATURDAY, DECEMBER 18, 1948. £1 GOING NO FURTHER THIS CHRISTMAS

Gisborne Herald, Volume LXXV, Issue 22823, 18 December 1948, Page 4

The Gisborne Herald IN WHICH IS INCORPORATED "THE PRESS." GISBORNE, SATURDAY, DECEMBER 18, 1948. £1 GOING NO FURTHER THIS CHRISTMAS

gHOPPING for this Christmas the £1 seems to be going no further than it did last year, and that was not tar. This would appear to be the consensus of opinion among shoppers today. It is no exaggeration to say that the majority of people are disappointed that the Government’s promises of relief through exchange parity have not borne more tangible results.

Following Mr. Nash’s dramatic announcement on August 3!) of the exchange decision, be hastened to assure the public of New Zealand that "people in every walk of life” would benefit. lie said: “It simply means the removal of the exchange loading on all imported goods, which will mean that imported consumer goods and goods used by the farmer will be greatly reduced in price.” That was a confident prediction. llow far has it materialised? Mr. Nash said: “A wide range of New Zealand manufactures will become cheaper because of the lower cost of imported raw materials and capital equipment.” To what extent has the ordinary citizen benefited so far?

Despite those assertions it is claimed four months later, now at a time when people shop more freely than at any other time of the year, that they are little, if anything, better off. The reasons are not far to seek. Business men state that the rapid rise in overseas prices, over which New Zealand has no control, is offsetting the advantage which it was hoped exchange parity would give. Coupled with this are increased shipping charges and, in addition, some overseas firms have announced a reduction in discounts. Tn New Zealand there is little evidence of a considerable fall in the prices of locally manufactured goods. In many lines the proportion of imported raw materials is not large and, therefore, exchange parity does not make itself greatly felt. In any event, the prices of imported materials are also rising. In most New Zealandmade goods labour and selling costs are the main charges and these, too, are increasing. Practically every award in the past year has provided for wage or overtime increases. Some workers are striving for shorter hours as well. AVe have all had personal experience of the results.

There is also the problem of inflation, the constant pressure from which is accentuating our difficulties. Nobody knows better than Mr. Nash the causes and dangers of inflation, and nobody is in a better position to decree more resolute measures to check it. He has repeatedly emphasised the importance of increased production and more savings, but '.ins failed to provide adequate incentives —taxation relief and a higher rate of interest. The existing heavy, wartime taxation and low interest rate arc the greatest obstacles to what he seeks to encourage and the objectives he urges citizens to reach. Besides those remedies, controls and stabilisation are palliatives.

In the meantime, people may rightly ask where is the “considerable reduction in the cost of living” that has been promised, and how long will they have to wait? They want more concrete evidence than statistics of an increase in purchasing power.