TRADE RECOVERY

New Zealand Herald, Volume LXXII, Issue 22045, 27 February 1935, Page 14

TRADE RECOVERY

(PROGRESS IN DOMINION

CLAIMS BY MINISTER

NEW ECONOMIC PROBLEMS

GOVERNMENT ACTION DEFENDED

[by telegraph—own correspondent] "WELLINGTON, Tuesday

A vigorous reply to criticism that the Government was increasingly interfering in business was made by the Minister of Industries and Commerce, the Hon. R. Masters, in an address at the 71st annual meeting of the Wellington Chamber of Commerce to-night. The Minister took the opportunity to speak of returning prosperity as indicated in expanding trade, and referred to the success which, ho claimed, had attended the Government's policy of rehabilitation. Mr. Masters, who based his remarks on points made by the president of the chamber, Mr. D. J. McGowan, in his presidential address, referred to the necessity of Government intervention in modern world trade, a tendency which was becoming more pronounced and inevitable, whether it was liked or not. (Comparison with Australia In mentioning Australia's apparent return to prosperity, Mr. Masters emphasised that if New Zealand thought to follow the Commonwealth policy of borrowing and of heavy'subsidising of industry with loan money, unemployment could be abolished to-morrow. He expressed the opinion that the more conservative programme followed in this country was on sounder lines. The Government here was dealing with the situation without adding one penny to the national indebtedness.

Taking first the unemployment prob- ( lem, the Minister said it was pleasing to realise that the position was very much easier. In October, 1933, the peak period, New Zealand had 15,246 registered unemployed. The figure had gone

down to 52,086 at the end of December, 1934, a drop of 23,000. On No. 5 i scheme the peak total was 44,743 and at the end of January, 1935, the aggregate working under the scheme was 32,911, a fall of 12,000. A large proportion had been reabsorbed into industry -and 23,000 were no longer a chargo on the fund, and were contributing to the maintenance of their less fortunate fellows. A good deal had been made of the return of Australia to prosperity to New Zealand's disadvantage, but the position in regard to unemployment over then; and in the Dominion were , totally dissimilar.

Large Commonwealth Subsidies | Mr. Masters cited figures showing that Australia had resorted to a subsidy of £5,000,000 for the sugar industry, £5,300,000 for butter, £4,000,000 for wheat, £BOO,OOO for rice and dried / fruits and £600;000 for other primary industries. These subsidies devolved as * a direct cost to the consumer to maintain prices above world parity. The total annual subsidy on primary products was therefore £16,000,000. If New Zealand wished to pursue the same policy, then the Government could give it to the country if it was considered a sound way in which to meet. the position. •* w Evidence >of the active condition hotli. of New Zealand's export and import trade was disclosed by the fact that last. year's exports were valued • at ;347,000,000, a figure higher than in any year since 1929. Imports totalled £31,281,000, a volume also higher than in any year since 1930 The balance of • • trade in favour of the Dominion was £16,000,000, a figure higher than at any period in the last decade. Improvement in Revenue

Men of commerce would agree that the improvement had been very great. The finances of the. country similarly refte eted a return to more prosperous conditions. The customs revenue • for nine months ended December 31, 1934, had increased- by £BOO,OOO, beer dntv had shown a rise of £17,000. and sales • tax, which was a clear indication of the spending power of the community, had increased by £300,000 in the period under review. Voices: What about reducing it? The Minister: Nothing would give the Government greater pleasure than to be lible to reduce the whole lot. Continuing, Mr. Masters said the film tax, also a sure indication of freer public spending, had risen by £IO,OOO for nine months. Income tax returns had grown from £511,131 for- the corresponding nine niontbs of 1933, to £956,046 for nine months to December 31, 1934, an increase of nearly 100 per ceni. . Competition "by Railways The Minister said he had realised that if he had started a policy of price fixation he would not have been able to stop. Up to the present time he had beea successful in not having fixed any prices. The chamber had complained against competition from the railways, but he would point out that selected businessmen were running the railways. The Government was not doing it. Voices: Let us appoint the Railways Board. ~ Mr. Masters: I dare say that it we let you appoint the Government, you would appoint one to suit yourselves. Officially speaking, the Minister went on, he desired to say that the Government had no wish to see governments competing in private business, but the whole position of governments and their relation to business had changed during the last few years and governments, in spile of themselves, were being forced into trading under the conditions that were obtaining. Politics and trade were becoming more intertwined month by month. He predicted that governments would be tali ing a larger part in trade and commerce in the future. As business men, members of the Chamber had one duty to perform, and it was their duty to see that men were put into Parliament who were competent to deal with the new problems of trade, politics and commerce as these arose. It was iv>t a question of interference, but of co-operation.