SUBSIDISED SHIPS

New Zealand Herald, Volume LXXII, Issue 22059, 15 March 1935, Page 11

SUBSIDISED SHIPS

UNFAIR COMPETITION GOVERNMENT URGED TO ACT iDOMINION SEAMEN'S REQUEST REPLY BY PRIME MINISTER [BY TELEGRAPH SPECIAL REPORTER] WELLINGTON, Thursday The effect on British shipping of competition from subsidised foreign vessels in the New Zealand and Australian trade was emphasised to the Prime Minister, Mr. Forbes, and the Minister of Marine, Hon. J. G. Cobbe, by a deputation from the Federated Seamen's Union of New Zealand which made particular reference to the Matson vessels. The deputation urged on the Government 'the need for prompt action in dealing with the unfair competition of highly subsidised American vessels in , the islands and intercolonial trades. The unfairness of the present position was conceded by Mr. Forbes, who said it had been difficult to secure agreement on the subject with Australia. Mr. F. P. Walsh, general president of the Seamen's Union, said the withdrawal of the Marama and the threatened withdrawal of the Maheno was extremely serious to all who depended on those vessels for their livelihood. The crews of the vessels totalled over 250 and in addition watersiders, drivers and others were employed in tho loading and discharging of these ships. . Enormous Aid to Competitors It could not be expected that shipowners should continue to run vessels at a loss against the enormous monetary and other assistance given their com? petitors by their Government and if the past inactivity in dealing with the important question continued the Seamen's Union was afraid it would be only a matter of time.'when other vessels 4 would also be withdrawn. " Of the two large American passenger liners competing in the intercolonial trade with local vessels," said Mr. Walsh, " the Mariposa was built with a Government loan of 5,850,000 dollars (representing three-quarters of her cost), at 2 per cent interest, and the Monterey with a loan ,of 5,827,500 dollars, at an interest rate of threeeighths of 1 per cent, a total for the 5 two vessels of 11,667,500 dollars—or at par rate of exchange £2,397,514, on which the interest works out at only 338,853 dollars, or £28,532 a year.

" It is almost ridiculous, to realise that the interest duly paid on the loan of more than £1,000,000 for the Monterey for over two years up to June 30, 1934, amounted to only £9770. Subsidies on an equally magnificent scale have been granted to these vessels, amounting at par to over £200,000 a . year." Subsidies Wages The original pretence that .these subsidies were for all mail purposes had been abandoned, continued Mr. Walsh. It was claimed that the subsidies •granted to the American vessels were a set-off for the higher cost of ship construction in America and higher wages paid to American seamen. The cost of ship construction was largely due to the ship builders being protected by tariffs against outside competition and in any case as regards the two Matson vessels was. more than provided for by their building loans. All the deputation asked, he said, was that the New Zealand Government should give similar protection to shipping companies employing crews at New Zealand rates of wages and conditions of employment. The wages and conditions of American seamen were" considerably lower than those enjoyed by New Zealand seamen.

Due to the displacement of coal burners and the replacement of old vessels by ships with increased cargo carrying capacity, seamen had been displaced in large numbers. For example, the crew in the engine room department of the Makura had been educed from 48 to 19. At the beginning of February the union had had ovo.i 1000 unemployed seamen and, in addition 4 there had been a large number of cooks and stewards, engineers,- officers and wireless operators also unemployed. ThJK crews of the Marama and Maheno * would add a further 250 odd to army of unemployed, and as there wast no possible chance of those men getting employment they would be forced to register and get relief from the Unemployment Board. ''Trying to Get Agreement"

At present the Government was taking steps to assist sections of the community, concluded Mr. Walsh, and it was submitted that the seafaring section was entitled to assistance which could be given without any cost to the country.

Replying, Mr. Forbes said he recognised that the competition that was taking place was unfair, so far as New Zealand's own shipping was concerned, but it would be necessary to get Australia and New Zealand in agreement. "We have been trying very hard to get the agreement of Australia," ha said. "We have been forcing the pace and it is Australia we have to convince in regard to what can be done. „ The subject been discussed with. Australian Ministers and the Governemnt has lost no opportunity in bringing the matter forward, and will continue to do so." Mr. W. E. Parry, M.P.: What is Australia's objection ? Mr. Forbes: That the matter is an

Imperial matter and we ought to come to an agreement 'with Great Britain. Mr. Parry: Have you made representations to England? Mr. Forbes: It was the subject ,of discussion on several occasions. They are considering the question of what v assistance they can give to their own shipping. The shipowners of Great Britain have been pressing the Government to give them protection against subsidised vessels. Possible American Markets Continuing, Mr. Forbes said that the Government was anxious to see New Zealand produce getting into America. It had been discussing the question of tariffs and investigations w6re being made as far as fruit was concernedThere might he a market for meat and they were trying to trade with a very big nation. There had been a passenger boom during the Melbourne Centenary. Mr. P. Fraser, M.P.: Companies can't keep running against a loss of £60,000 or £70,000 ; a year; Mr. Forbes: We hope to get some finality when we meet the Australian Ministers. Mr. Cobbe refuted an allegation of indifference on the part of the Government. He said he had refused to approve of a by-law submitted by a harbour board giving preference tc the Matson Line. Hq had told the chairman of the board, a member and the general manager plainly that he would not approve of a by-law which did not give fair play to British shipping. The by-law was altered and the result was that the advantage to the Matson Line was done away with. The Minister pointed out that the American tourist traffic was of considerable benefit to New Zealand.