STATE TRADING

New Zealand Herald, Volume LXIX, Issue 21326, 29 October 1932, Page 8

STATE TRADING

The Associated Chambers of Commerce very rightly protest against State trading institutions occupying a privileged position to the detriment of private enterprise and, in the ultimate, to the public interest. Obviously the State trading ventures ''should be bound by the same rules and laws as operate between subject and subject." Obviously, also, they should pay income taxation. Unfortunately, however, such expressions of opinion by conferences are usually dismissed without i consideration, being classed with remits described as "hardy annuals." That this should be their fate emphasises the manner in which State operations of the kind are entrenched. The average elector with whom the final decision must rest is oblivious of the extent of the evil because he cannot see how his own interests are involved. He may imagine that the State is fulfilling a useful role as a trader. He may even be encouraged through some vague idea that this enterprise is a protection. Yet the conditions of State trading and State lending are unfair and unreasonable. They are contrary to equity and common sense. The whole system of privilege is an anachronism. It dates back to the days when- the State's property interests were limited to a. military barracks and a few public buildings. Now the State is not only the largest mortgagee in the country, but also carries on insurance business, mines and sells coal, produces timber, supplies electric power, and in many other directions touches the activities of private enterprise. An illustration of the claim for privilege is provided by the Appeal Court action by two Auckland local authorities against the State Advances Department. as to their rights' in respect of water supplies to houses on which water rates were overdue. The judgment of the Court upholds the attitude adopted by the department. While it is expressed in general terms it is of importance primarily as it affects property in which the Crown is concerned as mortgagee. It may be good law, but, nevertheless. its effects will be bad. The system gives a premium to inefficiency and spreads a baneful influence over all private endeavour. In this case it, imposes an unnecessary burden on private property. An amendment of the law is one of the most urgent needs of the time.