Government Has Broken Contract in Guaranteed Price

Manawatu Times, Volume 64, Issue 171, 22 July 1939, Page 12

Government Has Broken Contract in Guaranteed Price

Mr E. B. K. Gordon s Maiden Speech in House

Difficulties of the Farmer Explained

Increased Costs a Big Factor

In his maiden speech in the House during the Addiess-in-Reply dehate this week, Mr. E. B. K. Gordon, Opposition member for Rangitikei, among other things, attacked the Government’s farming policy and :ts methods of land settlement. During his address Mr. Gordon remarked upon the increased costs which had to be shouldered by the farmer and their effect on production. To assist the man on the land Mr. Gordon suggested a reduction in land tax, rural rates, hospital rates, etc., thus placing the burden on the community, where it rightly belonged. Mr. Gordon's speech was as follows:

I was rather disappointed that His Excellency's speech contained very little mention of our basic industries. The mover of the address in reply dealt with those industries only in a few cursory remarks. Surely, when great problems are facing the Government of thia country, the state of agriculture in general is worth a little more notice by the Government. I would like to point out that no Government whieu neglects its primary industries ever prospers for long. Our primary industries are the very lifeblood of our existence and are to be encouraged and built up so that they will strengthen our national life. 1 believe the secondary industries should be encouraged so long as thev can manufacture goods on an economic basis, but the fact remains that, in my opinion, these industries will always' be subservient to, and dependent on, the auccess of our primary industries for their existence. That being the fact—which I think no one will dispute —surely the Government should take more notice of and give more consideration to the farmers' problems. It is the primary producers who supply the London funds, so it is essential that the Government should see that primary production is kept up, otherwise our standard of living must fall in that we s-hall have to do without many of the amenities of life which we enjoy at the present time. I intend to deal now with some of the problems of the man on the land, and in this connection I would be pleased to have an indication from the Government of ita land policy. In listening to the speeches that have taken place in this debate up to the present I have heard several different opinions expressed. The hon. member for Rotorua the other evening appealed to the Minister of Lands to settle 150 more families on one particular estate which is being developed at the present time. I was pleased to hear the hon. member make' that appeal, because 1 can assure the House that farmers ’ sons, farm workers and those who are used to agricultural work, are anxious to take up farming on their own account —men with experience and ability who would make ideal farmers, but who are to-day denied the opportunity of owning their own farms. Iu fact, during the last three and a halt years of Labour administration this country has lost the services of many hundreds of its best young men. They have been enticed away to seek employment on public and other works because there is no opportunity for them to start on their own account. Government members have from time to time asserted that they are the followers of Richard John Seddon. But are theyt It was in the days of Seddon, when Sir John McKenzie was Minister of Lands, that the bulk of the northern part of the Rangitikei electorate, which I have the honour to represent, was settled. Mr Seddon settled men on the land as individual farmer?, with an opportunity to own their own farms as little capitalists in a capitalistic state. The policy was still further extended to workers to enable them to own their own homes. Contrast that policy with the present Government's policy of State-owned houses, and the fundamental difference between Liberalism and Socialism is apparent to all. It is also illuminating to contrast the Liberal land settlement policy with that outlined by the present Minister of Lands. Unfortunately for me, the hon. member for Stratford gave a quotation from a speech delivered by the Minister of Lands which I had intended to give. However, I do not think it will do any harm to repeat it. This is what the Minister of Lands said;

; can be done for the Small Farmers!” And it is important to note that it was written eighteen months after the present Government came into power. The hon. gentleman says:

; ‘ ‘ From the point of view of political strategy it was a great i blunder on the part of the Seddon Liberals to settle thousands of workers on the land as individual i farmers. The settlers placed on tho land by the Liberals were tho s mainstay of Massey's Reform Party. Even if the Labour Party, were mad enough to try, it would be impossible for it to carry out a i clear settlement land policy to-day. Economic and social forces combined have doomed the small farmer to gradual extinction.'' " We get in this article the message of

. the Labour Government to tho landless > wen of this country, to those fanners' sons and working men who are looking forward td a chance of starting as individual farmers on the land. As definitely as it can bo said in the English language, the hon. gentleman tells them, “No, there is no hope of your desire being gratified, for two reasons:— (1) The Labour Government won't attempt it because the Liberal Party tried it and the men who were given the chance deserted the Liberal Party and supported their political opponents. If Labour placed you upon the land as individual farmers, you would, no doubt, desire to become little capitalists in a capitalistic world and would join tho opponents of a Socialist Government. (2) That, iu the opinion of the Labour Party, the day of the small farmer is gone and the future fanning is to bo on the lines of collective farming, us outlined by Mr Langstone at tho Labour Conference. » I should also like to quote what has been said by the Minister of Finance and Marketing. The Standard of August, 1937, as tho following:— “The Soviet system of economic planning," said Mr Nash, “was better than under any other form of Government that he knew of. The Soviet's problems were greatly simplified by the fact that the State owned all the land, of which it had obtained possession by killing off the owners during the revolution. ’' What is the land policy of the Labour

Government? We have statements liko those I have read, and we also have members appealing to Ministers to settle men on the land; and we would like to know what is the land settlement policy this Government is going to adopt. Is it to be community-farm-ing, creating a State peasantry! I am sure the young men of this country who have had experience on farms will not take up farming under such conditions. The one thing that the farmers of this country prize above all else is freedom to farm in their own way, to act on

their own initiative, and manage their own affairs. Under tho Small Farms Scheme, wo are told that 90,000 acres are in course of development; that 394 individual holding?, comprising 27,000 acres, have been allotted; and that the balance is -being developed under the development scheme, which was visualised to give opportunity to married men who were anxious to go on the land. Camps wero to be established to assist in tho development work. Tho Government has ceased to build homes for the married men, and, apparently, prefers to develop farm settlement per medium of single men in fairly large camps—men brought mainly from tho cities. Tho wastage is collossal, and development slow; tho establishment of individual holdings is being displaced by a collective farming system: the creation of an army of State farm employees, instead of individual farmers. There will be no incentive to work, and any man with a spark of ambition who wants to be independent and have a farm of his own will have to leave. There can bo no stability in such a scheme. There can be no stability' because, if a man employed ou such a farm wero to fall out with the overseer or anyone else Iu charge, he would be given the run. You cannot get men to take up farming on those lines. The Fanner’s Difficulties. Now I come to tho man ou tho laud and his difficulties. The farmer’s grievance to-day is that any advantage which may have accrued to him from better prices has been more than cancelled out by the increase in his costs due mainly to Government legislation, and his economic position is worse than it otherwise might have been. I would like to point out that every increase iu taxation, every increase iu wages ou the waterfront, iu tho freezing works, in the dairy factory, in transport, rail or shipping freights, has put up tho farmer’s costs and is reducing his income,

The Hon. F. Lang.-tone elaborated for half-an-hour (at the Labour Conference, 1937) ou the Government’s land policy, and particularly the extension of the State farming principle, referring to the magnificent results from these in the U.S.S.R. He pointed out that in considerably less than ten years, although commencing with a debt running into some six million rubles, the Russian State Farms now showed a credit of over 900 million rubles. He considered that State farming was one of tho solutions of the land problem in New Zealand, and there was no reason why they should not show a similar satisfactory state of affairs here in a very short time. It was also decided, among other things, to recommend tbe setting up of a Btate Co operative Model Farm with a definite aim of proving the feasibility of a five-day 40* hour week in such an enterprise. We are also indebted to the member

for Kaiapoi for drawing attention to the difference between the Liberal land settlement policy and the policy of the present Government, in an article contributed to “Tomorrow" of May 26, 1937. Tho article is entitled, “What

thereby rendering him unable to maintain his production. For years the farmer has had to stand the brunt of all the increases in taxation and costs generally; they have all come home to roost on him, and it has only been by his efforts in increasing production, helped by the natural climatic conditions of the country and the fertility of the soil, that he has been able to carry his load so far. He is the only producing section of the community unable to pass his increased costs on. He lias to accept world prices for his produce while other sections of the community are able to pass their increased costs on by increasing tho price for their goods or services as the case may be. The worker, too, lias his costs taken into consideration by the Arbitration Court, but the farmer has been left to carry his increased burden of costs without any consideration. I will assert that the time has now arrived when tho farmer's burden must be taken into consideration and some redress made if he is to carry on successfully. The fact of so many farmers, especially tho hill country sheepfarmers, finding it difficult to carry on and in some cases even walking off their land, while the price of meat and wool is fairly good, speaks for itself. The position as I sec it is this: The depression caught tho farmers, and their produce falling by about £25,000,000 made them unable to keep their farms in decent order; scrub and second growth began to get away and deterioration set in. With the return of good prices in 1933-36, tho farmer looked forward to being able to put his farm in order again, but he found he could not get tho labour to do the work, there was absolutely no labour offering in 1936-37 to do this class of work. The Government 's public works policy was to blame for this, and tho result is that these lands have now deteriorated to such an extent that tho farmer is quito unable to overtake the work. Men are still not available for back-country work; they prefer to stay near tho towns, and I do not blame them. Tho Government is to blamo for not having the foresight to see that a policy such as theirs would lead to the deterioration of farm lands. Tho question is, what is the Government going to do 7 To my mind, the course to pursue is to relieve the burden on the farmer by reducing his taxation and cost 3 such as land-tax, rural rates, hospital rates and so on, and put the burden on the community where it lightly belongs. Cost Increases. I would like to put on record some of the increases in costs for which this Government is alone to blame. As a matter of fact, tho bulk of the canto have been stationary for a numbei K years, but there was a sharp increase from 1935 to tho present time, and the Government will have to take tho blame for that. In the first place, the Government increased tho land-tax from £458,873 in 1936 to £1,047,877 in 1937—an increase of 128.3 per cent. A great many of tho men who pay this tax aro men who are farming second and third-class country and those men have not as good an income left ou which to work as many of the men ou good class country near tile towns. It is most unfair that this tax should remain. This tax is only justifiable in one respect, to break up largo estates. It was imposed for that purpose in the first place, and cannot bo justified iu respect of4ho bulk of sheepfarming land at tho present time. If the Government desires to retain tho land-tax it should classify tho land and lax only the farms suitable for subdivision. A great many farmers who have to pay £2OO or £3OO in land-tax have a smaller income than the owners of holdings near tho towns who pay little or no land-tax.

39 to £3157 —an increase of 61.8 per ceut. Having in view the hospital rate over tho country as a whole, I maintain that this charge was never warranted as a charge on the land and should have been charged up under the Social Security legislation. Instead of being eliminated, it has been heavily increased. The cost per bed in hospitals throughout New Zealand in 3933-34 was £368, and the cost in 1937-38 was £224 per bed—an increase of £56 per bed or 33 1-3 per cent. Hospital rates collected in hospital districts in 1934-33 amounted to £601,448 and in 1938-39 to £944,071—an increase of £342,623 or 57 per cent. That works out just about the same us in the two counties I have mentioned; the Rangitikei County showed an increase of about 60 per cent., and the Wanganui County just over 61 per cent. These figures are absolutely correct. They have been taken from the Year Book. The land holder is being penalised more heavily. I maintain that the whole of the hospital charges should come from the Consolidated Fund to which everyone would contribute. They should be entirely removed from the land as such. Then, let us remember the increased cost on the land in regard to improvements. If one wishes to get some fencing done or some new implements, one finds tho costs are 100 per cent, greater than in 1935. The expenditure on maintenance, scrub-cutting and fencing lias gone up from 50 to 75 per cent. There have been increased freezing charges. And hero again the sheepfarmers have been hit. These charges have gone up by £585,060, or 44 per cent. The cot of freezing a 361 b. lamb is up 9Jd, or a farthing per pound. Algtoether tho farmers are getting only about 40 per cent, of the selling value of their meat products. The rest is going in costs. If the farmer is to survive, he must have a fair share from the national pool. If these costs are to go on piling up, he will have nothing left in a short space of time. For the sales of his produce in London, although he receives £125 New Zealand currency for £IOO sterling, he is still at a disadvantage eompured with other sections of tho community that are receiving wages ou a still further iuflatod £l. So to-day we have really two currencies operating iu New Zealand—one tho producer's, based on the pegged exchange and currency which has fallen by 20 to 25 per cent. This puts the farmer at a further disadvantage of 20 to 25 per cent, in liis purchasing power. Co-operative Movement Not Socialistic. The Labour Party is constantly claiming that Socialism is co-operation, and that the co-operative movement is only a form of socialism. That claim is quite contrary to fact. The co-opera-tive system as mentioned by the hon; member for the Bay of Islands in relation to the co-operative dairy factories is definitely part of the capitalistic system, and is only to be found in capitalistic countries. Can the hon. member tell me of any co-operative concerns that arc run in countries where tho capitalistic system is not in force! I would point out that the co-operative dairy factories, the co-operative freezing works, and tho farmers' trading companies, wero founded under tho capitalistic system as we know it. They were founded under previous Governments. Tho other night tho hon. member for Onehungn mentioned the huge profits which those companies have made, and the hon. member for Marsden to-night again referred to the profit of tho Farmers’ Trading Company in Auckland. These facts show that those concerns are working for a profit, and are not socialistic at all. If one studies the history of the co-operative movement in Great Britain, one finds that tho whole movement is conducted on strictly business lines for profit. Every cooperative trading concern represents the investment of private capital, and only succeeds where business methods prevail. The co-operative movement iu Great Britain to-day represents one of the strongest units in the capitalistic world, and many of the leaders of the movement are prominent Conservatives who aro bitterly opposed to socialism. Tho co-operative movement lias nothing in common with socialism. We have that exemplified in three of tho Acts passed by the Government—tho Primary Products Marketing Act, 1936, the Industrial Efficiency Act, and the Transport Licensing Amendment Actall giving tho Minister complete control. Where the Minister has the final word there we have the worst form of socialism. There is no appeal past the Minister. Where is our British justice? What has become of the democratic form of Government when we as British subjects are denied the right to take our claims for justice to the highest Court in the land? That right is denied us to-day. We talk about totalitarianism: it is certainly showing its ugly head in New Zea-

Then, wc have to consider the increase in wages of approximately 50 per cent. There have been increases in transport charges, in railway freights (10 per cent.) and in rural rates. This latter js one of the most important in the list of costs.

I have taken out sorno figures dealing with county rates, apart from hospital rates, covering tho Rangitikei and Wanganui Counties in the electorate I have tho honour to represent.

In the Rangitikei County for 1933-30, the total amount of rates collected was £29,687, and in 1938-39 tho figure was £56,000 —an increase of £26,313, or 88.6 per cent.

For the benefit of the honourable member for Marsdcn, I would point out that here we have a definite increase in costs in rates alone, and these figures do cot include hospital rates. In respect to tho Wanganui County the general rate for the year 1934-35 was £12,524. For 1938-09 —£22,394 —an increase of £9870, or 7S.S per cent.

In these two counties new valuations are going on. I do not know why the valuation of land should bo pushed up at tho present time. lit tho Wanganui County new valuations aro approximately 20 per cent, up and mostly on the unimproved value. In the Rangitikei County valuations wore made in 1935-30 and the few ridings that were not revalued then nro now being revalued. In one riding, In tho north end, tho revaluation just released shows an increase for one riding of over £140,000. That covers high sheep country., L should like the Minister to tell us why these values have been increased.

land to-day. The governing of the country is the biggest business 'of the country, and I maintain it should bo conducted along business lines. The question arises today: Has tins Government proved efficient? I say no. A Government cannot spend its w r ay into prosperity any more than a private individual. Can any hon. member on the other side of tho House tell us of any private individuals who have spent themselves into prosperity! I can mention many who have spent themselves out of it. Jf a business man invests additional, capital money, ho expects a larger turnover, otherwise it would be very poor business to invest new capital. The same should apply to the Government. This Government is spending more millions than any other Government has spent. It has enjoyed good years of primary production. There have been tio slumps. The Government was not short of funds until recently. Whdh it came info office, thanks to the good management of previous Governments, it found £40,000,000 or thereabouts in New Zealand currency at its disposal in London, and the Reserve Bank was free from Government overdraft. In addition, the Government collected £10,000,000 in extra taxation. What do we find to-day? Has primary production increased? Primary produc-

The unimproved value of second-class bush land 14 miles from Taihapc is higher to-day ou the new valuation than first-class bush land adjoining tho borough. Is that fair! That is placing settlers in back country areas iu a most unequitable position in that they will bo required to pay higher rates than they would otherwise be required to pay.

Provided the counties are all valued on tho one standard of values, it Hoes not matter whether the valuations are high or low, as a county has so much to find and will strike a rite accordingly. But here we have back-country settlers penalised because their values are being put up at the present time. Hospital Rate Burden.

Let us consider the hospital rates. In the Rangitikei County for 1934-35, tho amount wns £S4OO, and for 1938-39 the amount was £13,400, an increase of £SOOO or just on 60 per ceut. In the Wanganui County the rates for 1934-35 amounted to £1932 and iu 1938-

tion is our main industry, and, if it is not thriving, them the country is being badly managed. The management of this Government over the past few years has been most inefficient; the Government came into power at a time of rising prices and had everything in its favour. Now, what uo we find to-day? We find that our primary industry exports decreased to the extent of 12.5 per cent, last year, and that farming in general has shown a large decrease. I should like to put before the House figures indicating the extent to which tho Dominion has slipped during the past few y’ears. The total fanning area occupied has decreased by 121,404 acres, while land has gone back into scrub and fern—deteriorated—to the extent of 187,562 acres. Barren and unproductive land totalled 162,443 acres.

In face of those facts, we find members on the Government side declaring that much of the decrease in the production of dairy-produce has been due to climatic conditions. Cliinatic conditions will not account for the decrease in the number of dairy cows milked. In the last three years the decrease in dairy cows has totalled 78,710. I repeat that climatic conditions have nothing to do with that decrease. There has also been a decrease of about 52,000 pigs. Wool production has decreased 7,500,0001b5. The latest sheep returns show that sheep have decreased by 500,000. What is the reason for all those decreases? The reason is simply that the farming community has been neglected by this Administration. The farming industry has been killed by the tremendous load it has to carry.

I have endeavoured to show the increased costs that have to be borne on the farm. There is no doubt that the tremendous increase in taxation has come home to roost on the farmer. Despite what the hon. member for Marsden has said about costs having decreased, 1 contend that I have shown that costs have increased. I doubt whether the hon. members ou the other side realise how much New Zealand depends upon primary production. If wo take the fig'ures for 1936, our peak of production, we find that our national income was estimated at £136,000,000. Of that total, primary production accounted for 88.6 millions. Other items were mining, 4.3 millions; fisheries, .5 millions; forestry, 3.6 millions; factories, 26.7 millions and building and miscellaneous, 12.4 millions. Hon. members will observe that primary production accounted for 70 per cent, of our total production. The Guaranteed Price.

I would like to touch on the guaranteed price. In doing so, I wish to state that the marketing scheme, as far as I know, has proved thoroughly satisfactory: that is, as far as I know it. The farmers believe, however, that if this Government had never come into power they would have had a similar marketing scheme. The Dairy Board was working on a marketing scheme before Labour came into office, and if it was not identical with the one now now ii. force, it was at any rate along similur lines—with two differences. Tho Labour Government has commandeered the farmers’ produce and has restricted the number of agents handling the produce overseas. Under tho guaranteed price scheme tho Government guaranteed a price for tho produce and made certain conditions. Tho Minister stated that in fixing the price for dairy produce, certain things were to bo taken into consideration.

The great dispute between the Government and the farmers arises from the fact that the Government lias broken its contract. The Government agreed definitely that it would take into consideration the cost should be given tho right to take their case to a Court of Appeal. The Minister should not have the final say when he decides upon an agreement made by him. Another point is that the dairy-farm-ers have been aalced to accept the same payout for next season as wan fixed for last season—in order to stabilise the industry. On the fact that the price last year was three-farthings per pound less than coats, they are asked to accept that price this year. When the Dairy Conference asked the Minister whether the Government was preparod to stabilise costs for this year, and, if not, whether additional costs would be taken into account in calculating the price for this year, he said, no. That means that the Government was prepared to stabilise the farmers’ income, but not their costs. That is the position to-day, and that in the farmers' grievance to-day—-that the farmers are not getting a fair deal. Dairy Fanners’ Increased Costs. Let mo give the House some figures relating to the dairy-farmers' increase in costa under tho guaranteed price scheme. First, we will take the subsidies paid to the industry over the last three years. The first year, it will be lemembered, showed a deficit of £272,482; the second year showed a surplus of £553,000. The third year—l am using tho figures quoted by tho Minister of Agriculture in the South Island this year—the estimated loss will be £1,827,000. If we add together the first year’s loss and the estimated loss for this year, we get a total of £2,099,452. Deducting the surplus of £555,000, we get a totar of £1,544,482. This means that during the past three years tho dairying industry has received £1,544,482 more than the price the produce realised overseas. Now let us examine the costs which the industry has to bear. Taking the cost of getting the produce from the farm to f.o.b. at one-halfpenny a pound for butterfat, the cost, basod on 160,000 tons for three years, comes to over £2,000,000, and the extra cost on cheese to f.o.b. at three-farthings per pound for butterfat, based on 53,000 tons for threo years, amounts to £714.000. Wo get, then, a total 6£ £2,714.000.

endeavouring to show is the increased costs through the operation of this guaranteed price scheme. Taking the three years in succession, I wish to show the increased wages on the farm. The first year showed a wage increase on dairy-farms of from 30s a week, which was about the average wage before the guaranteed price scheme came into operation, up to £2 2s 6d which was an increase of 12s 6d per week per man. 'Taking 15,000 men, that shows an increase of £487,500. The second year the wage increase was 15a, so that it went up by another 2« 6d per man per week, and for 15,000 men this meant a further increase of £585,000.

One of the Government’s reasons for giving the guaranteed price to the dairy-farmer was that it realised that dairy-farm workers w6re receiving a very low wage; that has always been admitted, and is deplored by most dairy-farmers. Of course, there wero a few exceptions, but it is not even suggested now that the dairy-farm worker is receiving a higher wage than other sections of the community. What I am

This third year there was a wage increase of 22s Od per week per man, which came up to £857,500, or a total for the three years of £1,950,000. If we add these items together, increased costs from the farm to f.0.b., £2,714,000 and the increased wages on the farms of £1,950,000, it gives us a total of £4,664,000. If we deduct the total subsidy of £1,544,482, we find that the dairyfarmer is worse off to-day by £3,199,518 under the Government’s scheme, and that is where the Government has broken its contract, it made a contract with the dairyfarmer to pay him his additional cost in bringing in tbe scheme, but it has not done it, and that is why there is all this discontent in the dairy industry.

I maintain that had the Government upheld ita scheme and fulfilled its obligations, very little would be heard about the guaranteed price. The Government is all along to blame. The Minister of Marketing paid a visit to my electorate before tho election ami did me a great service. Ho was speaking at Kimboltou and was asked why the Government did not pay to tho dairy-farmers the price recommended by the committee. He said it was because, if the Government did so, the dairy-fanner would have a higher standard of living than other sections of tho community. The dairy-farmers recorded their opinion of that at tho last election.

We have had several Government members stating to the House that tho farmer was never better off than he is to-day. I would like to ask those members to look back a little. Although they say that the farming industry was never better off than it is to-day, it seems that they cannot go back past the slump years. I would ask thorn, however, to go back to 1916. If they take from that year to 3930, they will find that the price of dairy produco durin" all those years was higher than it is to-day under the present guaranteed price. I can' quote to members the prices realised by one of the largest factories in the Rangitikei electorate between the years 1916 and 1930, and the lowest price they received in 1930 was Is 4.25 d. In those years the costs of the dairy-farmers were at least £3,119,518 less. When we take into consideration the costs of farm operations to-day as compared with those of other days, we see that the farmer was infinitely better off previously. His rates and taxes have been increased tremendously, but even with the guaranteed price it is folly to say that the farmer is better off. During the years 1922-30, wo were paying better wages than we are paying to-day. I have been a working farmer since 1906. The basic wage in 1925 was £4 ss, and it is £3 16s today. We were paying hotter wages in the years 1925-27 than we are paying to-day because the farmers were receiving better prices, and costs were lower. It is tho increased costs, as 1 have shown, that have placed the farmer in a difficult position. Wo have heard a lot about the proposed guaranteed price for wool. As a small woolgrower—not a wool king—l am satisfied that many questions will have tj be answered by tho Government before the wool-growers agree to a guaranteed price for meat and wool. The sheepfarmer sees that the dairy-farmer has been let down in the matter of costs. Wool-growers wish to retain the control of the marketing of their own product. Increased Marketing Costs.

The wool-grower realises that he cau market his produce at a cheaper cost to himself than if he were to hand it over to the Government. The increased costs of the Primary Products Marketing Department bear that out. The old Dairy Board cost £78,000 a year, but the present organisation is costing £192,000 a year. The sheep-farmer wants to know where the money is to come from. It is of no benefit to him to have a guaranteed price if he cannot obtain the full market price, pins the added costs. The market value mut bo given. The additional amount of money required cannot be taken from other taxpayers, and the farmer will not agree to being taxed in order to pay himself. The secondary industries are dependent on the welfare of tho farmers, not only in buying their goods, but also in supplying their raw materials. Unless tho primary industries of this country are encouraged and built up, to increase overseas credits, this country will not be able in turn to buy raw materials overseas with which to keep industry going. I have a letter before mo from a local storekeeper wherein ho states that a firm from whom he has obtained goods for several years informs him that it cannot supply the goods because a permit cannot be obtained for the importation of raw materials. Surely, when that is the position, the Government just see that, unless the primary industry is built up, it is useless starting secondary industries. It is only by the sale of our primary products—and this applies to the extent of 96 per cent.—that we can get the funds to buy even the machinery for secondary industries, let alone the raw materials for them.

Another question asked by the woolfarmer is whether the Government, in instigating a guaranteed price for meat and wool, is going to build for the future, or whether it is going to mortgage the future by piling up a huge overdraft at the Reserve Bank. When the sheep-farmor lies definite answers to some of these question?, ho will be able to decide on his line of action. I should like at this stage to refer to some of the statements of the hon. member for Marsdcn. That honourable gentleman was quoting numerous balance-sheets of dairy-farmers in his electorate and eventually quoted a suc-

cessful case showing a rise in the farmer's income. I think the hon. gentleman said that tho farmer had about 30 cows and that his income was a little over £390 from the 30 cows—that is. approximately £lO per cow. I should say that the farmer is a most efficient one. If he farmed on those lines in my district he would not be making a do of his farm. Some of the farmers in my district arc making £ls per cow. The hon. gentleman also stated that costs had come down for the farmer. I should like the hon. gentleman some time to tell the House iu what way. Have feneing-wire, posts and battens come down! Tho price of fertilisers has remained practically stationary. Tho price of superphosphates has not altered in my district for some years. 1 do not deal through the dairy company in fertiliser but the price in the Rangitikei district is practically the same as it was some years ago. The hon. member for Marsden also said that there was a swing back to dairying. I wish to contradict that flatly. In niy electorate during the last ton days I have been in tho House there have been four sales within ten miles of my home—sales by people who arc going out of dairying. 'l'he cows owned by these people have been bought by other farmers to replace duds in their respective herds. Dairying is definitely going to show a huge decrease this year. Le me state why people are going out of dairying, because I am suro the Minister is interested. These men are going out this year because they could not get labour last year. One could go to the Placement Officer at Wanganui, but could not secure inen. I myself went to him in January to employ an additional man, and was informed that there were far more applicants than the Placement Officer had a hope of satisfying. Of course, this being tho offseason, labour might bo available now, but I say that during the dairying season no labour was available for the dairy-farmer. Tho policy of the Government in taking men off tho land on lo public works and such liko has put tho farming industry as a whole iu a very awkward position.

Wo had some very scathing remarks from the hon. member for Marsden about our stock-and-station agents. 1 maintain that these agents are rendering a very useful service to the farming community, and I know of a number of men who have got their start with the aid of these agents. lam not suggesting that they' have given 100 per cent, satisfaction in all cases—that they have not taken a little more perhaps than they should have taken; but in the majority of cases they have been a great help to the industry. Speaking generally', if a man is a good farmer, the stock-and-station agent gets very little out of him. Even if a man is tied to a stock-and-station agenev, the agency does not get commission on what he sells to the freezing works. Of course, much depends upon the circumstances. It may be that a man is farming second-class land and has no fat stock. On the other hand, if he is in a good district and his farming is efficient, the fat stock is generally sent to the freezing works, and the stock andstation agent derives a commission only on wool, and things of that sort.