Wages and Internal Prices

Manawatu Times, Volume 66, Issue 290, 6 December 1941, Page 6

Wages and Internal Prices

STABILISATION POLICY Per Press Association. WELLINGTON, Dec. 5. In the wages increase application before the Arbitration Court, Mr. W. J. Mountjoy, for the Employers’ Federation, to-day replied to Mr. McLagan, who is presenting the case for the New Zealand Engine Drivers’ and Firemen’s Union. He submitted that nowhere had Mr. McLagan proved ail increase could be granted without adverse effects on the economic life of the community, nor had he proved an increase was absolutely necessary if wage-earners were to be enabled to maintain their present standard of consumption. Further, it had not been proved that the present standard of living could be maintained even with an increase of wages. Wages, he said, constituted the most important element in internal prices, and clearly the most important contribution towards internal stabilisation must be stabilisation of wages. It had been clearly shown that the war could be paid for and the war effort sustained only by real sacrifices. In view of the magnitude of the sacrifice required the conclusion was inescapable that up to the present the sacrifice made by wage-earners in New Zealand was very moderate indeed, probably much lower than other sections of the community, whose incomes had not been increased, and many of whom had to bear very heavy taxation. Under present conditions, continued Mr. Mountjoy, any rise in wages would represent an attempt to iolico the workers’ sacrifice at ‘he expense of the rest of the community. It would be a direct blow at the stabilisation policy of the Government, and could result only in an upward trend of prices and in increasing the difficulties )f the Government’s finances and dangers of inflation.