FARMERS’ PROBLEMS

Nelson Evening Mail, Volume LXXIII, 11 May 1939, Page 12

FARMERS’ PROBLEMS

MASS MEETING OF FARMERS | GUARANTEED PRICE FOR MEAT AND WOOL REJECTED ADDRESS BY UNION LEADER I United Piw Aumwiationl FEILDING. 10th May. Evidence of the interest being taken by farmers in the problems they are lacing to-day was provided in Feiiding this afternoon, when 400 persons assembled in the Drill Hall to hear an address by the Dominion president of the New Zealand Farmers’ Union, Mr W. W. Mulholland. on the Government's proposal for guaranteed prices for meat and wool. "The unfortunate position of file farmer to-day is that he has lost the symi pathy of other classes in New Zealand, and it is the farmer’s duty to win back that sympathy.” said Mr Mulholland. That unfortunate position, he thought, was the result of a misunder- j standing of the farmer’s position and j problems. It was for the ultimate good ! of New Zealand that these problems should be understood. Though they ; were primarily concerned, at the mo- ! ment, with the problems of the sheep- j farmers, all other farmers experienced : | difficulties as well. | Though the prices received by sheep j men this season were not disastrously! low—they were about on a par with I M the price fixed by the Court of Review ! i J —the fact that meetings of farmers ! I j were being held all over New Zealand j ! indicated that there was some compel- ■ j ling force of discontent. Farmers who' i depended for their livelihood on an | income from wool and store sheep were ; in a very serious position indeed, and 1 he cou’d assure the meeting that the ; Prime Minister and the Minister of I Agriculture were sympathetic to somo- ! thing being done ; "The position is not confined to sheep--5 farmers,” said Mr Mulholland. “Ad- • vances made by trading banks to dairy companies, which would largely be used in financing dairy-farmers, increased last year by approximately £1.000,000. 1 had no idea the position of the dairy-farmer was as bad as it evidently is.” During the same period advances to stock and station companies increased by more than £1.000.000. The cause or all that, of course, was that, while prices for farm products remained stationary, costs, unfortunately, did not. The reason was that while the economic policy of the Labour Party when first returned to power was a balanced policy—inflation of both export prices and internal costs—the Government. in action, had carried out an unbalanced policy—raising internal costs only. That had created two different pounds. The one with which the exporter. the farmer, was paid was maintained rigidly by regulations, and the other, with which he had to pay his costs, was of unknown value, but certainly purchased very much less in goods and services than the pound with 1 which the farmer was paid. . Mr Nash had only recently‘admitted ■ that there would be further increases in costs which the Government would be unable to prevent. “After three years of all time records in export production and in a time of alleged unparalleled prosperity,” said Mr Mulholland, “the Government is forced to admit that our expenditure as a nation has so far exceeded our income that, in spite of having started 1 that period with a credit balance of £40,000,000 in London, New Zealand people are in danger of not being able to meet overseas comitments in the near future. “That situation has been brought about because the difference in values between the pound internally and overseas has encouraged people to import, because their money is worth more outside New Zealand. That was the major cause in the depletion of overseas funds. Instead of correcting the . errors and omissions of its own policy, the Government made a still greater error in adopting import and exchange cortrol to counteract one effect of its ! policy. Though some manufacturers welcomed ; control of imports, which was a necesj sary accompaniment to exchange control, the more far-sighted ones were not so joyous about it, said Mr Mulholland. They realised that the strangulation of export industries must have severe repercussions on themselves. The manufacturer depended on the primary producer to provide the overseas exchange necessary to enable him to obtain his plant, machinery and raw materials. Manufacturers, therefore, would have difficulty in obtaining materials and equipment to maintain last year’s production. The Government, said Mr Mulholland, should have dealt with the cause and

not with one of the effects. Mr Savage had said that, if the Government found it had made a mistake, it would admit and correct the error. If the Government hod found it impossible to raise export prices, as its policy required it to do, then it should have the courage to admit its mistake and proceed to reduce costs to a level at. which export industries could maintain production. It has been estimated that wages constituted about 60 per cent, of all costs that had to be met in New Zealand, said Mr Mulholland. That estimate took no account of the fact that, since 1914, the average .weekly hours had been reduced by 14£ per cent. When allowance was made for that, the average hourly wage of adult males was estimated to be 106 per cent, higher than in 1914. Out of his receipts from a pioduct which sold on the average at 21 per cent, above the 1914 level, the farmer was called upon to-day to pay general costs which had increased by more than 100 per cent, in the case of the hourly wage and by about 50 per cent, in many other items. The total wages costs to-day represented three shillings for each 48 pound ewe exported and 2s 3d for each 36-pound lamb. Another serious factor of increased costs was Government expenditure in relation to the value of production. Mr Mulholland quoted figures showing the heavy burden of direct Government levies on the farming industry, but it was impossible to estimate, he said, what the indirect burden was “It is certain in the immediate future that this burden will become heavier,” said Mr Mulholland. Mr Nash has already indicated that he needs an extra £2.000,000 for Social Securtiy. With a heavier falling off in revenue, through reduced imports and lessened income and other causes, he will need to raise something like £8.000.000 by new taxation if the 1939-40 budget is to be balanced. “It looks as if the Government demands will crush the farmer out of existance unless Government expenditure is heavily curtailed.” “We have now three years’ experience of the guaranteed price in the dairy industry as a guide,” the speaker said. “By the close- of this season farmers will have delivered between £60.000,000 and £70,000,000 worth of produce to the Marketing Department, and it is understood that the present deficit is not likely to exceed £1.000,000.” In other words, the amount in excess of market value paid to farmers would be less than 1 per cent. That the guaranteed price could not be other than closely related to market realisations was made clear by the Minister’s actions and statements in connection with the fixing of the price for dairy produce for the current season. Mr Lloyd Hammond sa'id the meeting should consider Mr Savage’s offer of guaranteed prices for meat and wool, and ask themselves if guaranteed prices would relieve the present situation. Boiled down, the guaranteed price scheme was designed to commandeer produce. As a sheep man as well as a dairyman, he asked what sort of guarantee that “This is not a political issue, but it is one that affects farmers very vitally,” said Mr Hammond. If the dairy guarantee had broken down, what encouragement was there for the sheep man to embrace it. The Meat Board had done splendid work, and, if any kind of control was coming—and he believed it was—farmers ought to retain that control themselves. He would oppose control

by any Government, whether Labour : or National. He hoped he would never see the day when anything unconstitutional would have to be done, but if the present policy continued the time might arrive when the last straw would break the camel's back. Concluding by paying a tribute to the yeoman work being undertaken by Mr Mulholland. Mr Hammond asked ail those favouring guaranteed prices for meat and wool to raise their hands. There was a response from only one man. A forest of hands was raised when the meeting was asked to express opposition to the proposal. Mr D. G. Gordon, president of the Wellington Central Provincial Executive of the Farmers’ Union, said the position of farmers in “marginal” lands should be brought before the public. Those men were only just making a living in normal times, and any increase in costs aJTected them severely. Mr Ormond Wilson, formerly Labour member for Rangitikei, had admitted to him that the Government, in certain circumstances, would have to raise the exchange and abandon the 40-hour week. The following motion, moved by Mr B. McLeod, and seconded by Mr A. L. Brown, was carried unanimously:— “This mass meeting of farmers urgently draws the attention of the Government and the general public to the steadily deteriorating economic position of the farming industry, which, notwithstanding the increased personal efforts of the farmer, and while not now suffering from over-valuation of land or unduly high rates of interest and while realising for its products average prices which, under normal conditions, should enable farming to be carried on successfully, is unable from proceeds to meet the ever-increasing costs, which are pressing so heavily upon farming as to make the position desperate for a large proportion of primary producers to-day.” The meeting concluded with cheers for Mr Mulholland.