RADIO SPEECHES

New Zealand Herald, Volume LXXIII, Issue 22413, 8 May 1936, Page 13

RADIO SPEECHES

DAIKY LEGISLATION MR. FORBES' CRITICISM " TREMENDOUS EXPERIMENT " BRITISH RESENTMENT FEARED Special arrangements were made by the Government for speeches on the Primary Products Marketing Bill by the Leader of the Opposition, the Rt. Hon. G. W. Forbes, and the Minister of Finance, the Hon. W. Nash, to be broadcast from Wellington last night. The original intention was to broadcast these speeches from the House of representatives on Wednesday night, but the prolonging of the debate on the bill made this impossible. To meet the altered circumstances these two representative leaders, speaking from 2YA studio, were heard over all the national stations last night.

Speaking first, Mr. Forbes said the bill was designed to give effect to what the Labour Party had termed at the last election guaranteed prices. It had been correctly described by the present Minister of Agriculture, the Hon. W. Lee Martin, as a tremendous experiment. That would not be such a serious matter if it were not experimenting in the means of livelihood of thousands of men and women carrying on the dairy industry of the Dominion. The failure of the experiment would be a national disaster. Risk of Huge Deficit They were told the purpose of the bill was to provide a 'payable price to tho dairy farmer for his produce, irrespective of whether the produce realised this price on the market or not. The whole scheme was based upon the finance for providing that payable price.

Provision would have to be made for a possible lengthy period of low prices and, therefore, for a deficit running into many millions, to be carried by the .Reserve Bank. The Government had brought in a new system in using the Reserve Bank to provide finance for its undertaking. That was another tremendous experiment, and it was not surprising that the dairy farmer felt a little doubtful when his future was subject to two such large experiments. Questioning the necessity for the. bill, Mr. Forbes said that when one looked at the industry one could not help feeling that it was a monument to the business ability, the initiative and the foresight of the men who had been its leaders. They could show a very fine record of successful achievement in overcoming difficulties, and had built up a trade that had been of the greatest assistance to the country. It could not be fairly said that there was a need to take away from them the handling of their own produce. Marketing by men who were directed by those who owned the produce would be much keener than it would be when ordered by men in Government employ. Peeling in Britain

One of the most serious matters about the bill was the effect it might have on New Zealand's standing and the good feeling that had always been shown toward New Zealand on the British market. When the British dairy farmers knew, as they soon would, that the New Zealand producer was being subsidised against low prices, they would become more determined than ever to get increased protection in what they justifiably held to be their own market. The present Government had said repeatedly that it would endeavour to obtain by agreement an increased market for New Zealand produce. The British- Government was certain fco say in reply, as it had said already, that the dairy produce market was being glutted by New Zealand a.ud Australia that they were sending too much already. Between 1933 and 1935 New Zealand's yearly . export of butter to Britain had increased by 10,000 tons and Australia's by 20,500 tons. In the latter year the total import had been 80,000 tons above what, it was estimated, the market could profitably absorb in 1933. It was easy to see that, the whole problem was becoming more and more difficult. Australia's keen competition also, had to be reckoned with. _ _ , Two Conflicting Policies

A great deal had been made of the possibility of increasing imports from Britain, said Mr. Forbes, but the position did not seem to be fully understood. Fifty-two per cent of* British goods were admitted duty-free and the remainder had the advantage of 20 to 30 per cent preference. The Government's policy of encouraging British trade was in conflict .with its very definite policy of stimulating local industries —to which, he believed, a section of the farmers was strongly antagonistic. The late Government had been aware of this conflict, but had done all it reasonably could for sound local industries. If it was now to be "full steam ahead," he wondered how the two purposes would be accomplished. Mr. Nash had told the dairy conference that he would £ee what could be done about bi-latcral agreements. However, the British Government had repeatedly declared that it would not agree to any differentiation in its treatment of the Dominions, although it had been pointed out at the Ottawa Conference that New Zealand's tariff on British goods was 50 per cent lower than Australia's. He believed that this settled the question of bi-lateral agreements for the provision of speciallyfavoured markets. Inflationary Finance Summing up his argument, Mr. Forbes said the scheme was a great experiment, requiring the utmost caution and the fullest consultation with the dairy industry. It should not have been brought into operation without a vote of the farmers. The scheme was based on experimental finance which, in the opinion of competent economists, involved inflation. It provided fGr subsidies to the dairy farmer, but assumed that his subsidised produce would be given free entry into Britain. As a preliminary, an effort should have been made to ascertain whether such a plan would be resented in Britain. The present successful system of co-operative marketing was to be scrapped and an inexperienced Government was empowered to fix export prices from which there was no appeal. It was a backward step, although conceived with the best of intentions.

The Opposition, said Mr. Forbes in conclusion, had made an unsuccessful fight against the bill and had done its best to point out its weaknesses. However, when the measure became the law of the land, as it would within a few days, the duty of every good citizen would be to do all he could to make the scheme a success.