What Stale Subsidy Is Paid On Wool For N.Z. Mills?

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

What Stale Subsidy Is Paid On Wool For N.Z. Mills?

(P.A.) CHRISTCHURCH. Dec. 18. A reply to statements by the New Zealand Woollen Mill Owners , Association and the president of the association, Mr. W. R. Carey, on his comments on the first

Christchurch wool sale was made last evening by the Leader of the Opposition, Mr. S. G. Holland.

“I cannot find much in the two statements that is in conflict with anything I said on Wednesday night,” said Mr. Holland. “The mill owners say that the overseas buyers set the prices at Wednesday’s sale. The overseas buyers claim that the New Zealand buyers set the standard. “This could easily become another case of which came first —the chicken or the egg. so it may be best to divide the responsibility equally. No Control Over Rules. “The facts of the situation are, however, interesting and beyond argument. The Government has laid down the rules under which the New Zealand mills must operate, but over which the mill owners have no control. “Under this arrangement the Government will refund out of taxation levied on the people a considerable part of the high prices which the local buyers have to bid at auction sales. “It is inevitable that such an arrangement must result in increasing prices- We are surely not being asked to believe that the local mills do not know how much of the purchase price of wool they buy will be found by the Government and how much of the price will come out of their own pockets. those in a position to provide the information can assist in this interesting and important discussion if they will answer the following specific question: ‘How much of the 81d per lb. which was bid by a New Zealand buyer for wool at Wednesday’s sale will be provided by the Government out of taxation?’ Taxpayers Entitled to Know. “I have no criticism whatever to offer concerning the New Zealand woollen mills. They make a firstrate product, but I am interested in informing the taxpaying public of the system under which the mills are obliged to operate, but over which they have no control.

“The taxpayers have to find these huge subsidies and they are surely entitled to know how their money is spent, and it does appear to be a matter worthy of pertinent comment that a record price of 81d per lb. for wool should include a substantial subsidy from the taxpayers’ funds. That no stock and station agent or trading bank or Government department would dream of financing clients on the basis of today’s wool prices is convincing proof that the current prices are at false levels and it is proper that all factors that might lead to that false level of prices should be properly examined.”