ARBITRATION COURT

Hokitika Guardian, 13 May 1931, Page 5

ARBITRATION COURT

SPECIAL SITTING. THE WAGE QUESTION. (By Telegraph—Pei Press Association) WELLING TON, .May 12. Mr Bishop said lie had arranged lor •J. Fawcett of the Department of Agriculture to give evidence purely as :iii expert witness. -Mr Fawcett said he had been asked to maky u statement covering the economic position of the dairy industry. It was contended the conditions governing the dairy industry wire applicable to all primary activities, to a greater or lesser degree. The payout love] for butteiTjit in the present season represented a reduction approximately of « per cent, compared with the average of the previous eight seasons. He dealt at length with the effect of the lowered price level upon the economic structure of the dairy industry as at present constituted. Fawcett stated under a fixed maintenance stud labour bill, every movement of one penny in the payment for bnttei'fat .represented a movement hi the interest surplus Of LT,322,000 or (•quill to six per edit, on a capital of 622.200,000. Had the pftyUdt fob 1930-31 sufashu beef) equal to I. In. 1 average u\vt‘ previous yours and production remained at 1929-30 .standard, the gross income to farmers would have been approximately 22 and a half millions and would have been used roughly as follows.—Maintenance s(x millions, interest on borrowed money and farmers equity nine millions, wages ami labour reward seven and a half millions.

As it was, however, farmers gross income would be approximately fifteen millions. If it was assumed that six millions must be earmarked as the minimum required to maintain production, then nine millions was available for Jill interest and labour, or if it was assumed that farmers equity was fifty per cent, of the total capital, then wages and labour was being maintained on the interest on that equity. As tile Court was on the point of adjourning for lunch. Justice Frazer asked Mr Bishop how long he thought his ease would take.

Mr Bishop said a great deal depends upon the extent to which the witness was cross-examined. However, allowing a reasonable time for crossexamination, be .expected to conclude his case to-morrow night. He would he calling AY. i). Hunt, H. D. Acland and .possibly Mr Jessup of the Meat Board.

Mr Roberts indicated that would require at least a. two day adjournment for an adequate preparation ol his reply. Justice Frazer said ii‘ Mr Ijlsliop’s case concluded to-morrow night, the Court would then adjourn till Monday, ]t is likely the hearing will ho concluded by the end of next week or on the following Monday. WELLINGTON, May 12.

Tn the Arbitration Court this afternoon, Mr Bi s hop called W. T). Hunt, who said that, in giving evidence, he was acting for the New Zealand Meat Board and for the Dairy Export Control Board. After dealing at length with the fall in the prices of primary produce, lie said that, in his view, there werp only two alternatives. One was an immediate and drastic reduction in costs, involving the reduction of wages. If the country failed to do this, the other alternative would be forced upon it. That was the depreciation of its currency, which would follow a probable Inilure to meet New Zealand's overseas obligations. The denreeiation of the currency would involve a reduction in the purchasing power of a]l salaries and wages, and also a reduction in the value of nil savings. An immediate reduction in costs, including wages, would have the effect of reducing costs to everybody, including the wage-earners, and, in the end. the wage-earners might not he ativ worge off. On the other hard, the history of depreciated currencies, which had been numerous since the war, showed that, while everyone had suffered by a universal dislocation, the wage-earners had suffered the most, and the Farming community had suffered the least. The Court, adjourned till to-morrow,

HEARING- continued. WELLINGTON. May 13. The cross examination of AY. D. Hunt wn s continued at the Arbitration Court this morning when the hearing of evidence on the question whether a general order should be issued in respect of wages, was resumed. Replying to Mr Young. Mr Hunt said he was not in favour of a fixed wanes fund. He considered a wages fund must he dependent upon the extent of production. It* was just about as certain that the cost of living would fall following a reduction ol wages, as it was that, the sun would Gse to-morrow morning. Mr Young There may lie a cloud over the sun and you won’t be able to s ee it. Air Hunt—But it will be there just the same. Mr Chapman Would you suggest that, industries which even now in adverse times, are able to pay good dividends, say eight, per cent., should participate in the general wage reductions. Air Hunt—T don't sot 1 how you conhl different into. Any industry consists of a large number if units, and while some units are making good profits, others are on the border line. .The benefit of wage reductions in any industry will be passed on to the pro-

dueing community in the form of reduced costs.

Replying to Justice Frazer, Air Hunt said lie expected to s ee the first signs of economic improvement in Europe and United States. He did not expect any substantal improvement here before there had been improvement in those countries.

Air Blood worth asked witness whether lie was aware that wage., mid approximately four years ago been paid at something like ten per cent, above the award rates.

Witness—That would depend upon the supply and demand.

Justice Frazer remarked that in some trades, particularly building, rates were above the award minimum that had to he paid. He would not like to take the responsibility of estimating what had been the general rate. Mr Bloodworth asked witness whether he recognised that workers had already suffered a reduction of wages by being brought down to the award niininiums. Air Hunt—Wages have not yet been brought down sufficiently to meet, the tremendous reduction in prices for our primary products. Further questioned by Air Bloodworth, Mr Hunt stated that New Zealand butter was more than holding its own in the markets in the Old Country. It would lie possible to get a higher price for it, but it would not be possible to get anything like the necessary volume eutisumed at the highofi pfiee. The same principle applied to iiibouk, H wins necessary to fix a rate at which the industry could afford to employ labour, If rates wore higher, the industry could not afford to employ all the country’s labour.

Air Bloodworth: —I think you wil( agree with me that the home market is valuable and we want more people in New Zealand in order to increase the home market. Air Hunt:—Yes. Air Bloodworth We don’t want to have to depend upon outside markets. Mr Hunt:—We can’t do without them. Mr Bloodworth: —If we hope to induce people to come to New Zealand to increase our home market will it help us to reduce the standard of living. Air Hunt:—No. Mr Hunt went on to say that if wages were fixed at a lower level, and costs were brought down so that everyone could lie employed, it would follow that the purchasing power would he widened and the standard of living would he improved

Cross-examined by Air Roberts, Mr Hunt expressed the opinion that as soon as produce prices improved, wages would also improve. Air Roberts.—Did employers agree to tlte raising of wages when produce values were very high a few years

ago, Air Hunt. AVagcs rose, Air Robn’tH.-• Ye?, with h’jidrtl weights, and following two. throe and four years behind the increased values. Air Hunt Many employers were paying more than the award rate. Air McCombs asked whether Air Hunt would he satisfied if wages were reduced and interest rates left alone. Air Hunt.—Both will have to come down.

Air McCombs.—Then you agree with me that the Government should have passed legislation to reduce interest rates.

Air Hunt.—Government could reduce interest i-ate without lesris'ntion. Legislation would have unsatisfactory effects.

Air Hunt’s evidence having been concluded the Court ,adjourned for lunch.