OTAGO LABOUR COUNCIL.

Otago Daily Times, Issue 21148, 4 October 1930, Page 19

OTAGO LABOUR COUNCIL.

Tie monthly meeting of the Otago labour Council (incorporating the Local District Council of the New Zealand Alliance of Labour) was held in the Trades Hall on Thursday evening, the president (Mr W. 6. Baird) presiding over an attendance of 33 delegates. Much adverse criticism was levelled at the representatives of the primary and secondary industries and financial interests who waited upon the Acting Prime Minister and the Minister of Labour to request that legislation be enacted empowering the Court of Arbitration to amend awards during their currency, so that wages could be reduced in sympathy with falling prices. In the opinion of the council such legislation would exercise a demoralising effect upon the economic situation, in that there would be no stability in wages, and even those in steady employment would have no stable purchasing power. It was emphasised that the wages rates fixed from time to time by the Court of Arbitration from 1914 to the present were not responsible in any way for increased prices. Between 1914 and 1915 the cost of living index figure moved from 1000 to 1072, but it was not until 1916 that any increase in wages was granted by the court, and the .increase that was then granted was about Id per hour less than the rate necessary to give to wages in 1916 the purchasing power they had in 1914. From then on to 1925 the index figure fluctuated rapidly, but although wages were increased and reduced in sympathy with the fluctuations, they never were increased sufficiently to reach the rise in prices, and they always were reduced below the level to which prices £ell. For instance, in 1921, when the index figure stood at 1774, wages were increased from Is lOd per hour to :Is 10i)d per hour, when, if the full increase in prices, as indicated by the index figure, had been given in, wages, the wages rate would have been' fixed at 2s Id per hour. In 1922 the index figure fell to 1597, and minimum wages were reduced from Is 10|d per hour to Is 9id per hour, when, in order to make wages correspond with prices, the reduction should have stopped at Is 10£d per hour. In 1925 the court attempted to stabilise wages on the basis of a 60 per cent, increase over the 1914 standard. But in doing so the court adopted as a 1914 basis an artificially reduced rate.. The 1914 rate for general labourers in all the centres was la 2d per hour. The .Court of Arbitration, under the presidency of the late Sir W. A. Sim, fixed that' as the standard for general labourers in awards governing Auckland, Wellington, Canterbury, and Otago and Southland, and in the memorandum attached to each award it was stated that the court had made the rate uniform throughout New Zealand. Mr Justice Frazer, however, stated that two rates —Is lAd and Is 2d—prevailed in 1914, and he weighted these two rates to give him the artificial basis of Is l|d per hour, which he called the 1914 rate—id per hour less than the actual rate fixed in the awards which were made in 1913. To this artificially-reduced rate he added GO per cent, of itself, which gave him the 1925 rate of Is lOd per Hour instead of Is" 10Jd per hour, which should have been given if the actual 1914 rate had been taken as a basis. Moreover, when he estimated that the cost of living had increased only 60 per cent, above the 1914 standard he was again understating the facts. Between August, 1925, ana July, 1927, the cost of living had never fallen as low as 60 per. cent, above tbat of 1914. It rose as nigh as 64 per cent., but it never fell to the 60 per cent. level until August, 1929, and it then maintained an average level of 6l| per cent, above that of 1911 nntil April of this year, when it dropped to 58.8 per cent., which level has since been maintained. . The council did not agree that wages should be based upon cost of living figures, bufl even if such a principle could be accepted it was clear that wages were not responsible for the prices, and that wages were never permitted to'draw level with increases in prices. Bight through the boom years the employers had successfully resisted 'the reasonable demand of the workers for increased wages, with the result that to-day the workers had much less purchasing power than they had in .1914, and now, because the official figures had dropped a couple .of points in a few months, they (the employers) rushed to the Government to ask that they be assisted in reducing still further a standard of living that was already far too low. It was said that the workers had suffered great hardship from the practice of the Court of Arbitration in fixing their wages upon the percentage system, and that this system was only remotely related to the reasonable requirements of a family. Under the percentage system a labourer, if he were fortunate enough to secure a full week’s work, waa allowed 16s IJd for rent. This, allowance was arrived at from the Government Statistician’s estimate that 26.45 per cent, of weekly wages was spent in rent. The court said that a labourer’s weekly wages were £4 0s Sd. Therefore, 26.45 per cent, of ££4 0s 8d indicated the rent allowance of 16s IJd per week. But everybody knew that the actual average rental, even in this district, amounted to £1 10s per week. In order to have made a fair allowance for rent the court should have reversed its method of calculation by first discovering the actual average rental, which was £1 10a per week, and then deciding that £1 10s per week represented 26.45 per cent, of wages. Had this obviously fair method of calculation been adopted _ in fixing a cost-of-living wage, the basic wage to-day would be £5 14s 74d per week instead of £4 0s Bd. The council was of opinion that the employers were asking the Government to'give the Court of Arbitration power to do what it had already done itself without the intervention of the court. The court, in its awards, fixed a minimum rate of wages only. This rate, os the court had frequently stated, waa not intended to be the remuneration to be paid to a capable worker. It was intended only to be the lowest rate which an employer could pay to a very indifferent worker. To-day, however, workers who had been receiving more than the minimum rate had been reduced to that rate, and many others were working short time, by which their earnings were reduced. The council could not understand how business was to. be assisted by reducing the purchasing power of the people. Such a method would only deepen the depression. It was seen that in .countries in which wages were very low unemployment waa more acute than it was in this country. Delegates expressed the opinion that wages should be increased rather than reduced, and that if the Government wished to accelerate business it' should attempt to reduce the large incomes and make a “ raid ’’ on the banks. If those things were done something useful might be achieved, but if the employers' wish was granted it would only have the effect of making a bad position much worse. The following resolution was carried unanimously, and the secretary was instructed to forward same to the Acting Prime Minister:—“ That this meeting of the Otago District Council of the New Zealand Alliance of Labour protests against the action of a deputation representing ■ the employers and financial interests that waited upon the Acting Prime Minister urging that the Industrial Conciliation and Arbitration Act be amended to empower the Court of Arbitration to amend awards during their currency with the object of having wages reduced. This council is of opinion that the workers _ of this country have never received- living wages in the minimum rates fixed from time to time by the Court of Arbitration; that wages have actually been reduced without the intervention of the court at all; that the reduction of wages means the reduction of spending power; that a reduction of wages is not a remedy for over-produc-tion and under-consumption; that, considered ethically and economically, wages should be increased and large incomes taxed. The council hopes that the Government will not be unwise enough to allow itself to he stampeded into committing a folly fraught with such serious consequences both to itself and to the country generally.”