STATE BUYING

Nelson Evening Mail, Volume 79, 28 September 1944, Page 6

STATE BUYING

MINISTER’S EXPLANATION INDUSTRIES AND COMMERCE ESTIMATES Wellington, Sept. 27. Many questions concerning the administration of the Department of Industries and Commerce were raised in the House when the department’s estimates were being considered. An explanation about the purchase of 1.250.000 yards of shirting, described by Mr Gerard (Opposition. Mid-Canter-bury) as equivalent in quality to a good mosquito netting,” was given by the Minister, Mr Sullivn. He said that the material received from the United States was not in accordance with specifications and sample. The American authorities had agreed that that was so and had taken the material back lor their own use; There had been no cost to New Zealand. Replying to criticism of bulk purchase generally, he said: "We had to use bulk purchase. It was imposed on us by overseas authorities, who couldn't be bothered with small orders. Without it we wouldn’t have got supplies at all.” It was utter nonsense for Opposition members to speak of dispensing with bulk buying by the Government while war conditions prevailed, said Mr Langstone (Government, Waimarino). He said he had been in Washington when the system was instituted. It would be absurd for anyone to put in small orders. The system provided that orders for all British countries had to pass through the British Supply Council in Washington, and once orders were placed with it no one dare approach the manufacturers to influence orders. That was definitely prohibited by the American regulations. Orders were placed by the officers of the lendlease administration with the War Production Board. It was only when larger orders began to be placed by New Zealand that the position became easier. New Zealand had only a small supply mission and Australia's was five times larger, while the huge British mission had acquired innumerable buildings in Washington. PURCHASE OF STEEL The method of purchasing steel was criticised by Mr Macdonald (Opposition. Mataura). who said the cost to the country was excessive through supplies being bought at high prices and then handed over to secondary industries for processing at lower prices and later retailed at prices below manufactured costs. The loss to the Government was about £23 10s a ton. He said he had been informed that £IOO.OOO had been, spent by the Government in duplicating the plant at the Otago iron rolling mills and that it had only been worked for about six months. The Minister said the decision to duplicate the plant had been made by the War Cabinet. That had been done, as had many other things when the country was in danger of invasion, because the Government had to make sure of supplies and had no such assurance through the shipping position. A lot of money had been spent on shelters and in other ways which fortunately had not been required, and the use of the iron plant had not been found necessary when later the shipping position improved. Questions about a machine, purchas ed from the United States through the Ministry of Supply, for approximately £30.000. and subsequently taken over by the Railways Department for £6OOO. were asked by Mr Watts (Opposition, Riccarton). He said he understood a firm requiring the machine had sought to buy it from England at £SOOO or £6OOO. The firm had refused to take delivery of it at the American purchase price, and it had been taken over by the Railways Department. The Minister said that the machine bad been bought from the United States on the specific instructions of the United Kingdom authorities. He believed the price was about £25,000. It was u lend-lease item and had been sold for £6OOO to the Railways Department, which had found good use for it. A denial that any radio firm had been given privileged consideration in the issue of supplies was given by the Minister to Mr Doidge (Opposition, Tauranga). He said a special investigation was conducted when these allegations were originally made and there was no truth whatever in them. The firm was simply using the large stocks it had held in pre-war days. No supplies could be obtained from overseas and there was therefore no question of any preferential treatment. Replying to Mr Macdonald’s inquiry concerning supplies of steel, the Minister said that as we could not get supplies from Australia we were forced to go to the United States. That steel cost about £lO more a ton than the previous Australian price. Now that the Pacific situation was clearing, it looked as though future supplies could be obtained from Australia. There were fairly large quantities of American steel held here at present, but not sufficient for two years’ requirements as asserted by the Opposition.