DAIRY BOARD DISPUTE.

New Zealand Herald, Volume LXV, Issue 19957, 28 May 1928, Page 11

DAIRY BOARD DISPUTE.

RESIGNATION OF MEMBER. STATEMENT BY MR. GROUNDS REPLY TO MR. GOODFELLOW. POWER OF WAIKATO INTERESTS. "Having resigned from the Dairy Froduce Board, we now know where Mr. Goodfellow is. As a merchant he should not be on a producers' board." With this comment Mr. W. Grounds, chairman of tho Dairy Produce Board, concluded a review yesterday of the events which preceded the tendering of his resignation as a member of the board by Mr. W. Goodfellow, managing director of the New Zealand Co-operative Dairy Company. "Since the establishment of Amalgamated Dairies, Limited, our difficulties have been greatly increased," Mr. Grounds said. "The suspicious attaching to the power of the Waikato have been multiplied. Mr. Goodfellow, even yet, does not appear to realise that the main objection within the industry to the establishment of an electoral system, based upon a dairy council, was due to the suspicion of Waikato power, which the establishment of Amalgamated Dairies, Limited, has not diminished. Added to that suspicion, mercantile interests have had grave misgivings at Mr. Goodfellow's continuing membership on the Dairy Produce Board, for they see in him a representative of a rival selling organisation." Antithesis of Co-operation. Quoting a clause from the articles of Amalgamated Dairies, Limited, Mr. Grounds said the provision for private operations by the directors of a company in the business they directed on behalf of ,» co-operative association was the antithesis of the co-operative ideal. "The two conceptions cannot exist side by side," said Mr. Grounds, quoting from his monthly review in the Exporter for May. "We make no reflections regarding the use of these opportunities. We are concerned alone with the fact that the S revisions for them would assuredly create istrust and suspicion, in which atmosphere the spirit of co-operation cannot exist." Mr. Goodfellow's reference to pooling aiid price fixation was, Mr. Grounds contended, at variance with facts. "No one, as far as 1 am aware, is suggesting either pooling or price-fixation at this juncture," he said. "Members of the board will recall, however, that when Mr. Goodfellow returned from England a year ago I drew specific attention to the ultimate result of his suggestion regarding a withdrawal of pooling. Efficient control is qtiite impossible without a system of pooling." All companies which had signed the agreement to supply particulars required under the export licence regulations were morally bound to execute their undertaking, Mr. Grounds declared. The New Zealand Co-operative Dairy Company had signed its acceptance in the name of the chairman, Mr. Dynes Fulton, and the secretary, Mr. T. L. Hames, on September 26, 1927. Mr. Goodfellow claimed that that guarantee had been given in his absence, but he had been in the Dominion between his return from England a year ago, and his visit a few weeks ago to Australia, and was presumably constantly in touch with his business. It was not, until November 24 that Mr. Goodfellow ard his solicitor had waited on the speak?r in connection with the position. Meinwhile the export of the company's produce had been proceeded with in accordance with the written undertaking to supply the export particulars required under the regulations. Regulations Suspended. The board's suspension of further action until the July meeting meant that the reflations, although in existence, would be non-operative for the present season's produce, said Mr. Grounds. As a result of the board allowing the New Zealand Co-operative Dairy Company to hold out against the supplying of the required particulars, several other companies had indicated their intention of adopting a similar course. The policy to include all factories had been adopted by the board by eight votes to two, said Mr. Grounds. "Mr. Goodfellow has been calling it my policy," commentjd the chairman, "but the resolutions passed by the board show conclusively whose policy it was. My speciac proposition, which Mr. Goodfellow has been confusing with the board's policy, was submitted to the National Dairy Association conference at Rotorua last year, and was approved with almost complete acclamation. It was that the board should undertake the marketing of dairy produce for any company which desired the hoard to do so, thus removing entirely the compulsory method. This would have relieved factories from the possibility of the re-imposition of the one-half per cent, commission, which was imposed by the merchants immediately upon the withdrawal of the board's control policy at the commencement ox the present season. Mr. Goodfellow's opposition on the board was responsible for the rejection of that scheme " Dairy Council Scheme. References by Mr. Goodfellow to the effort to set up a dairy council drew from Mr. Grounds a denial that he had worked to prevent the establishment of that body. "I attended the first conference in Wellington in 1922 to deal with that question, the idea then being to form a company with a board of directors," explained Mr. 1 Grounds. "At that conference two difficulties arose. The first had reference to the proportion of representation as between the North Island and the South Island. But more particularly there was a difficulty in respect to the voting powers of dairy companies. A deadlock was reached, which appeared to be insuperable. A small committee, of which I was a member, was set up, and on the following day we were able to report to the conference that a solution to the difficulties had been found. This occasioned such surprise to the conference that they received the news with extreme jubilation. As a matter of fact, those present rose and sang 'God Save the King.' " "A small committee, of which I was sgain a member, was set up to continue the negotiations toward the establishment of the scheme. Later difficulties again developed in the South Island with reference to representation, and negotiations were again suspended. Still later the South Island reconsidered the position and asked that negotiations should be reopened. This being done, a national conference was held in Wellington, at which a decision was made to establish a dairy council, which was forthwith elected by those present. On the following day I was approached regarding my willingness to accept tho chairmanship of the council, and I was elected, as Mr. Goodfellow says, by a large majority. It will thus bo seen that I was closely associated with each step in the development of the scheme to establish the council." Recalling the difficulties that subsequently arose with regard to the system of election to the Dairy Produce Board, Mr. Grounds said tho Leader of the Labour Party, Mr. H. E. Holland, promised he would not oppose the system of election of the board by the council unless the point was raised by Mr. T. M. Wilford, then Leader of the Opposition. But Mr. Wilford had opposed that particular clause in the Act establishing the board, in which case Mr. Holland had said he would be bound to support the Opposition. The Government, rather than risk the defeat of th 6 whole measure, had therefore agreed to alter the-system of election to the so-called democratic method, whereby the producers by individual vote elected the numbers of the board. "I affirmed and hay*) never deviated from the conviction of he soundness of the council system of Election as originally planned," concluded Mr. Grounds.