COMMISSION’S REPORT

Otago Daily Times, Issue 25466, 22 February 1944, Page 4

COMMISSION’S REPORT

DOMINION MILK SUPPLY CENTRAL AUTHORITY PROPOSED (Special) WELLINGTON, Feb. 21. A summary of the Milk Commission’s report states, inter alia: In Wellington the organisation of processing and distribution has reached a very high peak of efficiency in the activities of the Municipal Milk' Department on the one hand, and of the Wellington Dairy Farmers’ Association on the other, but due to the lack of co-ordination or singleness of responsibility for organising adequate supplies, the full purpose of planned organisation has not been achieved. Consequently, in the opinion of the Commission, the first essential is the reorganisation of methods of control and direction of the industry. In this regard, the Commission recommends the creation of — 1. A central authority with wide powers to guide and control the conduct and development of the liquid milk industry. 2. Metropolitan Milk Councils in the areas of Christchurch and Dunedin and the special area of the Hutt Valley, with powers similar to the Auckland Metropolitan Milk Council. The general purpose of such milk councils would bs to apply the policy of the central authority on all matters of standards, prices, and margins. 3. Dairy farmers’ Co-operative Milk supply associations in each of the four metropolitan areas to form a co-operative organisation of suppliers of liquid milk. Price Structure The second essential to the achievement of satisfactory milk production and supply is that prices and margins shall be fainy and reasonably determined, and be sufficient to attract the requisite supplies, in this connection the commission has recommended that the price payable to producers be computed on a method applying uniformly to all areas, and that-such price be based on the guaranteed Price, with an allowance for extra cost involved In producing city milk. 1 On the standards adopted by the commission, the price so computed is 13d per gallon for milk testing 4.3 per cent, butterfat of accredited standard. , 2. The commission recommends that the full annual quota price of 13d per gallon be divided into three quota periods computed as follows —(a) For the summer period, at 2d to 2Jd per gallon more than the butter-fat value of the milk; (b) for the autumn period, at 2d to 3d per gallon more than the summer quota rate; (c) for the winter period, at the summer qubta rate increased by approximately 80 per 3. The commission recommends that all suppliers whose herds and sheds are not of the accredited standard shall be paid Id per gallon less than the full quota price. Unearned Margins

The commission recommends: —(a) That vendors distributing raw milk or loose milk pay to the Supply Association in addition to the prescribed producers’ price an amount equal to the margins allowed for pasteurising and/or bottling; also, that producer-vendors pay to the Supply Association as an unearned margin such amount as may be assessed by the central authority. (b) That all moneys received by the Supply Association as unearned margins be paid into a special fund to be applied as directed by the central authority. One price should be charged to consumers for all milk retailed, whether raw or pasteurised, loose or bottled. Producer-vendors whose farms are situated within five miles of any boundary of a metropolitan area should be permitted to sell all the milk they produce or an amount not exceeding 40 gallons, whichever is the higher, and that the herds of producer-vendors be T.B. tested and of accredited standards. The collection and delivery of all milk and cream to a vendor for town supply should be undertaken by the Co-opera-tive Supply Association. ■ Quality Safeguards .

1. The commission recommends that the full price shall be payable to a supplier of city milk only if the conditions of milk production conform to the standards decided upon as those necessary for “ accredited ” herds. 2. The commission considers that the accredited herd standards should be finally determined by the central authority in consultation with the Departments of Health and Agriculture and the Dairy Research Institute. 3. The commission is convinced from the evidence placed before it that pasteurisation of all milk distributed is desirable as a national policy. It is also recommended that all milk shall be sampled for quality daily and tested for butter-fat content on a composite 10-day sample. 4. The distribution of loose milk, either pasteurised or raw. Js condemned by the commission, and. In',-its opinion the present Sale Food and Drugs Act should be "blade to apply so as to require all pasteurised milk to be bottled and not left open to recontamination during the process of distribution. In the interests of economy, the commission recommends that the consumers should pay for bottles in which the milk is distributed. The commission further recommends that, as soon as possible, the central authority should see that pro-ducer-vendors have their herds tested for T.B. and brought up to the approved or accredited standard, and that all milk be distributed in sealed containers. All other vendors should be required to purchase their milk from treating houses and to distribute it in sealed containers. Costs of Processing Pending further investigation by the central authority, the following margins should be recognised for Dunedin as appropriate to costs for processing and distributing houses (costs stated in pence per gallon):—Pasteurising, lid; bottling, 2d; distributing, 81d; profit margin, id. The commission recommends that in all cases forward estimates should be made of armed forces milk requirements and that there should be a general tightening up of supply supervision and administration. The commission recommends that the equivalent of the farm cost allowance of 0.767 d per lb butter-fat applied this season to the dairy industry should be applicable to the liquid milk producers in the four main centres.

In view of the fact that the recommendations already summarised relate to a permanent policy, the commission has recommended, in view of the urgency of the need for changes in Dunedin, Christchurch, and Auckland, that the following adjustment be made:—That the quota prices to producers be raised in Dunedin, Christchurch, and Auckland. At the present time the average annual quota payment in Dunedin is 10.3 d per gallon. The commission recommends that it be increased to 12.2 d per gallon for a 4 per cent. test. In Christchurch the average annual quota payment at present is 11.17 d per gallon: the commission recommends an increase to 12.2 d. In- Auckland the average is 12.25 d per gallon. The commission recommends an increase to 12.5 d per gallon for a 4.3 per cent, test compared with 4 per cent, in Christchurch and Dunedin. In Wellington the commission is satisfied that the average payout for the past two seasons has been approximately 12.5 d per gallon for a 4.3 per cent. test. Minority Report

The minority report is in full agreement with all the recommendations of the majority report except in respect of the functions and powers of the metropolitan milk councils. The minority report in this regard recommends that the respective milk councils in Dunedin, Christchurch, and Auckland should undertake the responsibility for all pasteurising and vendincr of milk in those areas. As a corollary to this recommendation, the minority report is in further disagreement with the majority report with regard to the payment of unearned margins. In this respect the minority report recommends that the unearned margins should be paid in directly to the metropolitan milk councils, who in turn would use those funds in effect to buy out private vendors, and, where necessary, producer-vendors.