THE OTAGO DAILY TIMES WEDNESDAY, AUGUST 20, 1947. THE GOVERNING FACTOR

Otago Daily Times, Issue 26544, 20 August 1947, Page 4

THE OTAGO DAILY TIMES WEDNESDAY, AUGUST 20, 1947. THE GOVERNING FACTOR

A review of the opinions expressed on the Arbitration Court’s pronouncement on standard rates of wages bears out the forecast, made in these columns on Saturday, that the court’s findings would not be fully approved by any section of the community. In particular, the spokesmen of organised Labour have been outspoken in their dissatisfaction, and in at least two of the statements by union leaders can be read the hint that certain groups of workers may resort to more forceful means of negotiation to secure a recognition of their claims. It must be admitted that a very large percentage of toe workers in New

Zealand have undoubtedly found the Court’s pronouncement a matter of grave disappointment. Not only have they suffered a setback to their hopes that the claim for an additional pound a week —a sum that would enable them to meet increased living costs and still have a little over—would be granted, but they have learned that the increase decided upon by the Court will be more than offset by substantial advances in the prices of a number of commodities. Yet it must be apparent that had the Court authorised any greater-increases in remuneration to the workers, the prices of commodities produced by those workers would, on the present scale of production, have been forced beyond the reach of the buying public, and the speed of the inflationary spiral towards the eventual collapse of both prices and wages would have been intensified. Union leaders throughout the Dominion to-day bear the responsibility, and it is a grave and onerous one, of convincing their members that the adjustments made by the Court were granted primarily as an incentive to increased production by reinoving anomalies in the scale of remuneration between different classed of workers. The fundamental truth cannot be gainsaid that with- * out increased production, especially of essential goods, wage increases as such must be worthless as an aid to living standards. The Court of Arbitration in its pronouncement devoted considerable attention to a critical analysis of the economy of the country, and it is of interest to refer to its comment on production and living standards: The most important matter for consideration, of course, is production, as this is the one source from which the real remuneration of all sections of the community must come, and which is the only sound foundation upon which our general standard of living can be based. The Court then appends a statistical table which shows the movement of the indices for farm and factory production since the year 1938-39, for which year the base of 100 is given. The volume of production reached its peak in the 1940-41 season, for which the total index figure for all industries was 112. Since then a steady decrease has been apparent, and the estimated index figure for last year was-105. Reduced to its simplest form the lesson to be read from these figures is that production has lagged while wages and prices have soared, and this disproportion spells inflation in any economy. The remedy does not lie in tipping the scale further by more liberal rewards, but in correcting the balance with that extra production that will give wages a greater purchasing power. The remedy lies partly with the Government, partly with industry, and to a very large degree with labour itself. Production can •be stepped up only by harder work or by longer hours of work, and until either of these alternatives is accepted and applied in industry, living standards in New Zealand must continue to be depressed by lack of production.