SHIPPING AND FREIGHTS

New Zealand Herald, Volume LVI, Issue 17253, 1 September 1919, Page 9

SHIPPING AND FREIGHTS

GOVERNMENT STEAMERS.

APPROVAL OF MERCHANTS.

COMPANIES IN OPPOSITION. Discussing the Industries Committee's recommendations regarding shipping, Mr. M. M. McCallum, president of the Cham l ber of Commerce, said he knew it was considered to be high treason in Wellington to criticise the Union Steam Ship Company, but his personal opinion was that this company, which had practically a monopoly of the inter-colonial and Island trade, had not given the Dominion, and more particularly the port of Auckland, a "square deal ' New Zealandlg trade with the Pacific Islands was nothing like what it fhould be, and during thd last few years much of it had been lost to America and Australia. A close investigation of the position should certainty be made by the proposed Board of Industries and Commerce. The establishment of a State line of. steamers for both the inter-colonial and overseas trade would be heartily welcomed by the whole commercial community. The proposed conference with the shipping companies was approved by . the president of the Auckland Industrial Association, Mr. Frank M. Hills. Mr. A. J. Entrican, expressing his views as a merchant, said he was inclined to agree with the opinions expressed by the committee with regard to the advisability of New Zealand owning her own ships to take her produce to the markets of the world. If this was not possible, then, in order to have some control the companies carrying goods , should be required to be registered in the Dominion, limiting reserves and dividends, and' granting rebates to shippers from surplus profits. The connection, between, the two islands by ferry was also a question that requires consideration.

Criticism of Present Conditions, "It is recognised that tlwjhipping combine in London is the strongest in the world, and that the New Zealand exporters and importers are absolutely in its hands and are being ruthlessly exploited by its members," said Mr. Robert Burns. He said that the freight charges at present in operation— increases over the pre-war • rates —were not justified by the increased expenditure of the companies. There should be some combative measures adopted, and he thought the proposed conference of producers and importers would be a step in the right direction. If, as a result, satisfactory arrangements were made a State-owned line of steamers would be inadvisable, but a State-owned line would be preferable to the present condition of things. Mr. Burns said the present Island steamer service was a scandal. Only ono obsolete steamer was engaged in the Eastern Pacific service, which was very irregular. Instead of assisting in the development of trade the steamer service to the Pacific had the effect of restricting trade. He considered it was only a matter of time before the ferry service between the North and South Islands and the State'ownership of coal-carrying steamers would be accomplished fact*. .

Shipowners State Their Case. The report of the Industries Committee in reference to shipping was not considered to be of much value by some of the representatives of shipping who were seen on the subject, especially in regard to the suggested State-owned steamers. it was pointed out that large shipping companies were* managed by men who had been connected with shipping practically all their lives, and who knew the business thoroughly. It was asserted that Government control in other ventures had proved that "' red tape " methods had been a bar to the carrying on of work on profitable and satisfactory lines. In support of this contention it was stated that, before the war, wool was canned from Auckland to London at less freight than i the New Zealand Government charged to | •. carry it from Rotorua to Auckland, it was | also pointed out that the recommendation in the report that producers and importers should combine with the Government in establishing a State line of steamers brought the position back to where it was now, as producers and importers were in many cases shareholders in the various steamship lines. Without owning steamers at present the Government had for some time been controlling practically the whole of the oversea shipping and this, in mosit cases, had tied the shipping companies down in such a way that thev could not develop pJong the lines they would like to, and which would prove more beneficial to the public. It was fully expected that, when more ships were released from Government control, and those which were sunk during the war had been replaced, competition among shipping companies would take place. This it was understood would cause a considerable reduction in freights, although they were not expected to reach the pre-war level. Those; well versed in shipping stated that it only required 5 per cent, of shipping to be unemployed to cause a cutting in freight rates.

Comparative Dividend Retains. Figures given with reference to the earning powers of vessels showed that for 10 years prior to the war the average divi- | (lends paid by the principal cargo steamer companies in the United Kingdom was 4.78 per cent, on paid-up capital. Taken for" the same period the dividends paid by 28 of the principal passenger lines with a combined capital of over £47,000,000 was slightly under 6 per cent. Taking in the war period and for 10 years' before, the average dividends paid "by the principal cargo steamer companies at Home was £.85 per cent. The contention was advanced that when all vessels had been handed back to the various companies competition would be so keen that shipowners would not get anything like the returns they did before the war, and the public would benefit aci cording. The shipping question at present solely depended on the conditions brought about by the war. When conditions. returned to normal it was thought that shipowners would, be able to use their vessels to open up trade at a fas - cheaper and more profitable n*te than vessels controlled by the Government.

The chairman of the Auckland Provincial Farmers' Union, Mr. J. Boddie, eaid that unless a change came over the scene i: might bis necessary for self-preservation tor the State to take some definite steps to avoid the producers' present handicap of high freights.