“TIED” HOUSES

Otago Daily Times, Issue 25801, 23 March 1945, Page 4

“TIED” HOUSES

- i POSSIBILITY OF MONOPOLY EFFECT ON HOTEL PRICES (P.A.) ’ WELLINGTON. Mar. 22. The Licensing Commission was occupied practically all to-day in listening to an examination of the Undersecretary of Justice (Mr B. L. Dallard) on the statement which he had-pre-viously submitted. The examination of the Commissioner of Police, Mr James Cummings, had just started when the proceedings were adjourned until tomorrow. Mr H. F. O’Leary. K.C.. counsel for the New Zealand Licensed Victuallers’ Association, asked Mr Dallard if he thought that local option should be abolished where such an area formed part of a bigger area which was licensed. Witness replied that this was a matter of Government policy which might be influenced by recommendations by the commission. Personally, he thought the local option factor was undesirable. There should be one law for the whole of New Zealand.

To" Mr J. D. Willis (counsel assisting the commission), witness said he held the view that it should be illegal for brewers to own licences.

Mr F. G. Young (a member of the commission): Do you agree that the system of brewers and w'ne and spirit merchants financing hotel transactions makes it possible for men of small capital to enter the hotel business? Mr Dallard: Up to a point, but Because that is'the easy way it does not follow that it is most desirable. The best hotel in Wellington is financed by a company other than a brewery. The chairman (Mr Justice Smith): Do you consider that each brewery with a “tied” house, or each brewery with “ tied ” houses, constitutes a monopoly? Mr Dallard: The beginnings of one. The chairman: With more than one there is competition? Mr Dallard: The experience is that such combinations either fight or come to an arrangement. The chairman: Do you suggest that to-day there is some understanding between competitors? Mr Dallard: Not that I am aware of. His Honor said that either there was monopoly in the sale of beer or there was not. .

The witness replied that the system of “tied” houses had a tendency to raise the price of hotel properties and rents. He had heard licensees say that high rents caused after-hours trading. . His Honor said that in the absence of specific cases it was a question whether the general statements of Licensing Committee chairman, which were attached to the statement of witness, were sufficient to justify the inference that competing breweries had so raised rents that the licensees were breaking the law.

The Commissioner of Police. Mr Cummings, in reply to Mr F. C. Spratt (representing the New Zealand liar.ce) said his main concern was for the enforcement of the law as it now stood, and for the advancement of any recommendations the commission might see fit to make for improvements in the existing law. The normal establishment of the police force was 1600, but it was now 144 men short and there was 25 per cent, more work due to war conditions.

Mr Cummings will continue his evidence to-morrow.