A GUARANTEED PRICE.

Matamata Record, Volume XVI, Issue 1442, 17 July 1933, Page 7

A GUARANTEED PRICE.

FOR FARM PRODUCE.

Labour Party’s Proposals.

“ The Labour Party’s statement of policy to meet the immediate difficulties,” was the way Mr. J. Thom, National Secretary of the Labour Party, described the address he gave to an audience of about 60 at the Empire Hall, Morrinsville, on Wednesday evening. The Mayor (Mr. W. T. Osborne) presided. The Labour Party’s recent annual conference had recognised the fact that although there were in New Zealand commodities enough to satisfy all the needs of the people, yet there was the vaste unemployment problem demoralising the people, while thousands of primary producers were faced with insolvency.

Fixing Internal Price Level.

The only remedy for the troubles of the primary producers was the fixation of an internal price level in New Zealand. Critics would say this was not practicable, but he wished to point out that here in New Zealand- we have already an internal price level which had no connection with the London price level. Evidence of this was the fact that dairy companies reckoned on getting at least a penny a pound more for their butter in New Zealand than for the butter sold in England. In the same way £IOO worth of goods in London, when retailed in New Zealand, were worth, say, £l9O to the importer after paying freight, taxes and traders’ profits! One Dunedin tea merchant labled his packets of tea which was sold at 2s 6d per pound with the information that the sales tax of 5 per cent., the exchange of 25 per cent., and the duty of 3d per pound represented Is of that 2s 6d. This meant that London parity for that tea I must be less than Is 6d, but by these methods an internal price level of 2s 6d was fixed in New Zealand.

Views on. Currency.

Thus it appeared that the internal price level in New Zealand was already fixed. The only question was whether it was to be fixed “ higgledy piggledy ” or by sound economic means. The Labour Party would pay a fixed, guaranteed price to the farmer, so as to enable the farmer

to meet his commitments and to farm profitably. There would have to be fixed guaranteed wages and salaries for Uie reason that unless the workers, who constituted the major part of the market of the primary producers, were getting adequate wages they could not buy from the farmer at fixed guaranteed

prices. } “We would not base our credit ' upon gold, but on goods and ser--1 vices,” added Mr. Thorn. If credit were related to production we would I have a means of stabilising prices I and of saving the people from the ! effects of fluctuations of prices. Banking, finance and currency were functions much too important to remain in the hands of people who were actuated merely by the desire for profit.

Example of Wheat Growers.

Minimum prices were already guaranteed to the wheat and apple growers by the Government, and these industries were comparatively prosperous. The Labour Party wanted to apply this policy to all primary industries. In this, the Labour Party was not alone. Farmers themselves were demanding fixed prices for their produce. The recent National Dairy Association conference at Hamilton had declared itself in favour of a fixed guaranteed price for butter consumed in New Zealand, and had supported Mr. A. J. Sinclair's butter stabilisation scheme. This scheme entailed the setting up of a stabilisation board to be created by legislation and to have the power to fix the internal price of butter in New Zealand.

Nominated Imports.

“If we pay a fixed guaranteed price to farmers that gives the Government control of that part of the farmers’ produce that is exported. That gives the Government control over the exchange.” The Government would use the proceeds from the sale of produce abroad to meet the interest bill of £10,000,000, and spend the rest on importing goods which would not enter into competition with an industry that could be carried on economically. That would automatically give a tariff to every industry that ' was worth while, at the same time bringing about free trade in those articles which could not be produced economically. Imports would thus be restricted to goods nominated by the Government.