£2,500,000 DEFICIT

New Zealand Herald, Volume LXXVI, Issue 23488, 27 October 1939, Page 8

£2,500,000 DEFICIT

THE DAIRY GUARANTEE PAST SEASON'S LOSS PRICE FOR COMMANDEER QUESTION NOT ;YET SETTLED [nr TELEGRAPH —SPECIAL REPORTER] WELLINGTON, Thursday "We have never received an offer from the United Kingdom equal to the price we are paving the dairy farmer for his produce," said the Minister of Marketing, the Hon. W. Nash, in a broadcast address to-night. The Minister outlined the various stages in the negotiations with the dairy industry over fixing the guaranteed price for the current season, and also described aspects of the negotiations with the United Kingdom Government concerning the purchase of the Dominion s surplus, dairy produce. Mr. N.ish began by refuting rumours which he said were current. A journal, be said, had mentioned that the British Government had fixed a maximum price of 145s for butter, but that had nothing to do with the New Zealand Government,.which was not getting that price. The figure mentioned was the price fixed by the United Kingdom Government for all the butter imported into the United Kingdom. It was a price fixed when supplies were short and when the Dominion's major supply had not reached there in large quantities.

Position of Account "I do want the dairy farmers to understand that the price we are paying to them to-day represents 130s for butter and 77s 6d for cheese," Mr. Nash continued, after explaining that the figures represented sterling. For last season's butter sold to date, New Zealand had recovered 114s 4d per cwt. sterling and had paid out 124s sterling. For cheese it had paid out 73s 9d sterling and had recovered 59s lid. The present deficit in the Dairy Industry Account for butter was £1,349,807 and for cheese £1,182.829. Against this there was the surplus from the previous season of about £500,000. "All our butter was requisitioned by the United Kingdom Government on September 22 and the price we are to receive for it lias not yet been determined." . Mr. Nash continued. Cheese was not requisitioned, but it was being sold at 66s and the Government was paying out 73s 6d for it.

Negotiations With Industry Some statements had suggested that the Government had been making millions of pounds as a result of its dealing in dairy produce, the Minister said. Actually it had not been making a penny, but had been giving the dairy farmer more than it had been receiving. Mr. Nash described in 'detail the negotiations between himself and the dairy industry concerning the guaranteed price. He said that he had discussed the price with the chairman of the Dairy Board on February 15, and later had stated that he considered that the past season's price should be continued. His views had been communicated to a conference of interested organisations, and they had suggested that the Government should accept the standard recommended by last year's committee.

1 Britain's Offer

At this stage of his address the Minister followed very closely the terms of a statement which accompanied his recent announcement of the guaranteed prices for butter and cheese for the present season. He described negotiations that occurred before and after his recent trip to England, and mentioned that shortly after his return the Dairy Board had conveyed to him a resolution offering the Government full co-operation in the present crisis. The United Kingdom Government had suggested on September 5 that the price it should pay should be based on that of last year, Mr. Nash said. The New Zealand Government was not satisfied that this was sufficient, and since then it had been in negotiation continuously with the United Kingdom. Every offer received, however, had been below the price now being paid to the dairy farmers. An Increase Urged

The New Zealand Government had urged the United increase its offer, pointing out the effect the price offered would have on the economy of the Dominion. A further cablegram was sent only yesterday urging the United Kingdom to carry to the logical conclusion the evidence that Jiad been placed before it.

"The Government wants to encourage production and to pay a decent price to the farmer to enable him to have a decent home," Mr. Nash said. "I believe that the price is a fair price, and we have endeavoured to get a price from the United Kingdom that is justifiable from the point of view of national economy as well as from that of the dairy farmer. We will do everything we can."

THIS SEASON'S PRICE

INDUSTRY'S RESENTMENT CONFERENCE URGED REPORTS TO FEDERATION [nT TEI.EGRAriT PRESS ASSOCIATION] WELLINGTON. Thursday Widespread resentment in every dairying district over the 1039-'lO guaranteed price was reported by the directors of the National Dairy Federation, drawn from all parts of the North Island for their quarterly mooting in Wellington to-day. After a full discussion the meeting unanimously decided to urge the Dairy Industry Council to call together representatives of every dairying company in the Dominion with tiie object of taking steps to deal with the position. "The situation is very serious and there is widespread resentment at the action of the Government in every dairying district in New Zealand," said Mr. Arthur Morton, president of the Federation. "Our organisation has been inundated with requests from dairy companies to take immediate steps to deal with a situation that is flagrantly unfair to farmers, who are being asked to increase production and are given no protection whatever against constantly rising costs."