PLAN CONDEMNED

New Zealand Herald, Volume LXXIII, Issue 22543, 7 October 1936, Page 15

PLAN CONDEMNED

POWERS FAR TOO WIDE ANALYSIS BY MR. COATES HIGHER COSTS AND PRICES "NO NEED FOR THE BILL" [BY TELEGRAM —SPECIAL REPORTER] WELLINGTON, Tuesday Ihe principle of wholesale Government interference in industry was strongly attacked by the Rt. Hon. J. G. Coates (Opposition—Kaipara) during the debate on the Industrial Efficiency Bill in the House to-day. Mr. Coates said the powers contained in the bill were altogether too sweeping. All that was required was power to intervene in the affairs of an individual industry if the need for that intervention could be clearly demonstrated. Nobody knew how far the bill might go, said Mr. Coates, nor had they any idea how it was going to operate. It provided for the regimentation of industry, and that would not work. The bill would mean increased costs and less efficiency, and the public would not be served as well as it was being served at present. Rise in Price of Bread Mr. Coates said the Minister of Industries and Commerce, the Hon. D. G. Sullivan, had taken credit to himself for an improvement in the wheat and bread industries. However, the result of the Minister's intervention had been an increase of from a penny to twopence a loaf. Mr. Sullivan: The authorised increase in the price of bread is a halfpenny a two-pound loaf. "Well, how is it that the price has gone up more than that?" asked Mr. Coates. "In the country districts, where most of the people use the four-pound loaf, the price is up by twopence. That is the*result of Government control or regulation." The Minister: There has been an increase of a penny per four-pound loaf. Mr. Coates: It is up twopence in many cases, and yet the Minister quotes the bread and wheat industries in support of the introduction of the bill. Minister and Manufacturers

Manufacturers, said Mr. Coates, were entitled to risk for what they wanted, but at the same time one was justified in inquiring if they were satisfied with the bill. ,

L . The Minister: Licensing has their conr currence, co-ordination has their concurrence, and the Bureau of Industry has their concurrence, but they want to have a larger say in the question as to whether any plan should or should o not bo adopted. y Mr. Coates said he had been informed that the Minister had told the a manufacturers that if they did not. agree with the proposals in the bill he ~ would socialise every industry in the , country. The Minister: I hope the honourable 3 gentleman will accept my word when r 1 say that I said nothing of the kind. What I did say was that if they did '' not want the bill that was all right. Mr. Coates explained at length the " proposals for assistance to industry de--3 veloped by the last Government. 3 The establishment of the so-called > bureau under the present bill, Mr. ' Coates continued, meant the operation > of a tariff board. The policy of the Government, which industry had to • stand meant a definite rise in prices. Tariff Considerations The Minister of Internal Affairs, the Hon. W. E. Parry: A slight rise, perhaps. Mr. Coates: A big rise. I think. But even if it is a slight rise slow strangulation can be just as effective as sudden decapitation. With both costs and prices rising, Mr. Coates said tariff considerations had to enter into the matter. Manufacturers operating under the Government's labour legislation would be asked to compete with imports from countries where the hours of work were 44 to 48 a week, where there were lower wages bills and where, in many cases, more efficient machinery was available. It was obvious that tariffs would have to be brought into the picture. Mr. Sullivan: We know how each industry in the country will be affected by this legislation and only a handful will be seriously affected. Mr. Coates: How can the Government tell until the legislation is in operation. Mr. H. M. Christie (Government—• Waipawa): The manufacturers will have the benefit of increased turnover. Mr. Coates: The increased turnover is more than overtaken by increased

costs. Costs and Exchange Rate The whole trend of affairs, Mr. Coatcs continued, meant either a rise in tariffs or an embargo on certain classes of imports. Tf those alternatives were ignored the Prime Minister might find himself in the position of having to raise the rate of exchange still further. Increased costs would inevitably bring the local manufacturer into keener competition with the importer. "I do not like this backdoor method of getting control of industry," Mr. Coatcs concluded. "The bureau may do this and the bureau may do that, but it is all to one end. We want a definite statement of Government policy concerning the use of this legislation. lint in the final analysis there is no need for the bill at all. Special sets of circumstances should be dealt with individually in a careful and considered way."