OUTLOOK FOR TRADE.

Manawatu Times, Volume XLII, Issue 1737, 12 February 1921, Page 9

OUTLOOK FOR TRADE.

CONDITIONS IN ENGLAND. TAXATION A HEAVY BURDEN. LIMIT OF HIGH PRICES. Commercial and industrial conditions in England were discussed in an interview by Mr R. A. Laidlaw, general manager of the Auckland Farmers Union Trading Company, who returned by the Marafna after a nine months’ business visit to Great Britain and America. “I found England groaning under a burden of taxation,’’ said Mr Laidlaw, "and thoughtful men everywhere crying out against extravagant Government expenditure. The budget of £200,000,000 in 1914 had risen in 1920 to £1,282,000,000, while the revenue from the taxation, heavy and all as it was, was expected to fall short of this figure by £166,000,000. The real position was hidden from the public in Mr Chamberlain’s early estimates by the inclusion of £302,000,000 as revenue which was really obtained from the sale of old war stock still on hand. Although the armistice was signed more than two years ago, the Government siTll lias 91,000 more employees in its departments than before the war —the relative figures being 277,945 in 1914, and 368,910 in 1920.

Mr Laidlaw remarked that not only was the Government taxation heavy, but municipal rates (had reached un-hcard-6f figures. Leyton, a suburb of London, has a property tax of 28/2 in the £. Think what it would mean to the rents in Auckland,” he said, “if our rate of about 3/8 were raised to 28/2, which would result in a house worth £1 a week rent having to pay another £1 8/2 a week in rates. High rating is not confined to London, for Pontypridd, in Glamorganshire, fixed a rate this year of 25/ in the £, so that even allowing that the ratcable values are low in England, the position is becoming serious. Just before I left, the London Municipal had called a conference at. which were to be representatives of the London municipal authorities, ratepayers, Chambers of Commerce, and industrial and business organisations, when it was hoped to formulate some scheme of rating reform or in some way find relief from this heavy taxation.” A LOT OF PROFITEERING. Coming to Industrial matters, Mr Laidlaw said that Labour was not helping to mend matters, for it was steadily demanding higher wages for less work. He heard employers everywhere complaining about what New Zealanders call the reduction of output, but what they described as the “ca’ canny” policy of Labour. “But,” he proceeded, “all the blame for high prices is not attachable to the Government or Labour, for no doubt there has been a lot of profiteering and many companies have paid large dividends during the last 'few years. The Government increases the taxation; the manufacturers increase their prices to meet it; the : workers demand higher wages to compensate for the higher cost of living; again the manufacturers’ prices go up to pay the higher wages and so it goes on within this vicious circle until one asks, When will it stop? As a matter of fact, while I was there, there were evident signs that the limit had already been reached, if not exceeded. British manufacturing is so overburdened that it is not in a position to produce goods at prices that the public is willing to pay. “During September and October, Before the coah strike, unemployment was increasing rapidly; factories were working short time, and some were even proposing to close -*own for a fortnight until orders had acctlmulated sufficiently to justify reopening. The month I left, the Government Labour Exchange figures showed 332,330 on their books as unemployed, an increase of 18,000 on the previous month. The Ministry of Labour had, in addition, issued a statemeit that the next figures would show a much greater increase. Money was becoming dearer and was somewhat hard to obtain, except by the most substantial business concerns." NO OCCASION FOR PESSIMISM. In regard to the future ,Mr Laidlaw said: “Personally, I feel there is no need for pessimism, for while it may go hard with manufacturing countries for a time, a, partial depression will lead to stability in the end by helping us to get down to the real and away from the fictitious values created by our clamorous demands for anything a manufacturer could produce at any price he cared to charge. We all knew that prices could not keep on rising indefinitely, as they had been doing, and if the trade depression setting in in Europe and America results in stabilising prices and putting commerce on a firmer basis, it will be a blessing in disguise. “I do not believe a prolonged slump in trade is likely, as the world is still short of essential products. The position is vastly different from anything that has been known before. In the past slumps have been caused by over-production, with the result that they have lasted some time till the surplus was absorbed, but to day the market is bare. Buyers are simply holding off till they believe values •have reached a fair post-war level on which business can be transacted with a reasonable degree of safety.” NEW ZEALAND’S FORTUNATE POSITION. The prospects for New Zealand are regarded by Mr Laidlaw as very favourable. “Being a producing and not a manufacturing country,” ho said, “we find ourselves in a particularly fortunate position, and having for years sold our products to the Imperial Government at well below their open-market values, with a trade depression we arc likely to gain as much from a fall in the price of our imports as wc lose from a fall in our export values. Our dairy farmers, for instance, are in a particularly happy position. When I left England, New Zealand butter, under Government control, was selling at 3/4 per lb, while English and Irish butter, which was uncontrolled, was bringing from 4/6 to 5/ per lb, so that with a free market we still have a fair margin to come and go on before a "all in prices should affect us seriously.”