GUARANTEED PRICES

Hawera Star, Volume LIV, 28 June 1935, Page 8

GUARANTEED PRICES

DAIRY FARMERS’ INCOMES LABOUR PARTY’S ADVOCACY (PROPOSALS CHALLENGED. PALMERSTON N., June 27. Guaranteed prices as a means of giving dairy farmers a payable return for their produce were advocated by the president of the new Zealand Labour Party, Mr W. Nasli, M.P., in an address to the National Dairy Contercnce to-day. When the conference reached a remit from the Parkvale Dairy Company expressing the view that delegates should unite and work wholeheartedly for a guaranteed price to cover the costs of production, the chairman, Mr A. Morton, said that since reviewing tho remit the executive had asked Mr Nash to attend and explain what was meant by a guaranteed, price and how it could be worked.

Following Mr Nash’s address, Mr A. J. Sinclair, secretary-manager of the Te Awamutu Dairy Company, was given at his own request an opportun- [ ity to reply to Mr Nash. Reference was made by Mr Nash to tho destruction in various other parts of the world of goods that people were . in need of. He said what was desired was a stabilised minimum income for dairy farmers. The cost should be the determinant of the price, which was rarely measured in terms of the cost put into production. British producers of milk received a guaranteed price for every gallon produced. An unremunerative price for any primary or secondary commodity invariably burnt itself out and also the producer of that commodity. The Wellington City Corporation, basing its prices on factors overseas, but not necessarily *o, paid a guaranteed price to all dairy farmers within a certain zoned area for supplies of milk for distribution to the citizens of Wellington. Between 1928-29 and 1933-34 production had gone up 40 per cent, and income had fallen by 30 per cent. It was impossible for an industry to carry on for anty length of time and be subject to fluctuations of that, sort. He was of opinion that the maintenance of production depended on the upkeep of tarms and the payment to the farmer and his assistants of a sufficient amount to maintain a standard of living measured by the market production resources of the countrv. That was the first essential a farmer should be paid for. the time, skill, knowledge and labour put into the production of his commodities. That paymentshould be measured by the gam** standard as that used to measure the efforts of those who rendered equal service. Guaranteed prices and orderly marketing were essential to progress, Mr Nash continued. It had been argued that under a policy of guaranteed prices investments would fall avvav. but there could lie no sounder safeguard for investment than guaranteed prices, for they would stabilise the value of land. Mr Nash said the dairy farmer should be paid a positive price for his produce. It might be asked vvliat the price should be, but he did not want to determine the price at- present. The banks would probably pay to dairy factories roughly 80 per cent, of the price realised in London and the balance would be collected in the form of a final pay-out. Instead of paying out 80 per cent, he suggested that uuder a system of guaranteed prices the lull amount should be paid out. Assuming Britain was prepared to take up to 150,000 tons of our butter it should be possible to go to the people at Home and tell them New Zealand was prepared to make an allocation of its credits from the sale of that butter to the manufacturing industries of the Old Country. Butter would be required for our own. people say, 30,000 tons, and it would probably be possible to get smaller contracts with other countries amounting to, say, 20.000 tons. . “We would then go to the Dairy Board,” said Mr Nash, “and say, ‘We will pay you so much for 200,000 tons of butter f.o.b. for ports we want to send it to.’ ” T _ , . At the conclusion of Mr Nash s address, Mr Sinclair rose and asked if he could have five minutes to reply. “I can reply in five minutes to what Mr Nash has taken half an hour to say, said Mr Sinclair. ‘T think the industry must .weigh up the facts very, very carefully before it shows the country it is prepared to commit itself to some form of guaranteed prices.” Continuing, Mr Sinclair said most of the products referred to by Mr Nosh as having been destroyed were produced in the same countries as they were consumed. A country consuming only 16 per cent, of the butter it produced had to depend on its exports and world parity. If prices were to be guaranteed the people of this country vvould have to pay money. It could only be done by direct taxation or some method of adjusting the currency. Mr Nash had refused to mention what Jio considered to be the quaranteed price for tho simple reason that he know that if he gave a figure, there were men at the conference who vvould show him it could not be done. Quoting a statement by Mr F. Langstone. M.P., mentioning the figure of Is 3d as a guaranteed price, Mr Sinclair said Mr Langstone wanted the community to pay Is 3d for a commodity that realised 6d. Mr * Sinclair said the moment a guaranteed price of Is 3d was giv en for butterfat the value of land would go up. A delegate: Hear, hear. Air Sinclair said in the course or

two or three years farmers might do well if they stayed on their farms, but many would want- to do as they did in the past, and sell. The men who came in would have to- pay inflated values and no one would be any better off’. If a higher price were obtained other than by a natural rise in the market, the people of New Zealand would nave to pay that price. Replying, Mr Nash said Mr Sinclair’s argument was that because the world parity was 6d.a pound for butterfat a farm could be run on obs a CW 'l'h e arrival of the adjournment prevented further consideration of the remit, which will be discussed, tomorrow,