RELIEF FOR PRODUCER

Poverty Bay Herald, Volume LIX, Issue 17954, 5 December 1932, Page 5

RELIEF FOR PRODUCER

READJUSTING VALUES BUSINESS MEN’S SUGGESTIONS NATURAL PROCESS PREFERRED Proposals for the relief of the primary producer are dealt with in a statement presented by Mr. Edwin Salmond, president of the New Zealand Importers’ Federation, and approved at a meeting held in Wellington of representatives of various interested bodies. The meeting was attended by representatives of the Associated Chambers of Commerce, the New Zealand Importers’ Federation, the United Kingdom Manufacturers’ Association, the New Zealand Harbor Boards’ Association, the Canadiau-British Manufacturers’ Association of New Zealand and the Commercial Travellers and Warehousemen’s Association. The principal point of the statement was set out as follows: After carefully considering the various proposals ivnieh. have been advanced for relieving the position of the primary producer, it seems to us that the principal trouble i’es in the high land values and over-capitalisation which is common throughout New Zealand. With little probability of substantial improvements in the prices for primary products, it seems that costs of production have to be reduced still further.

It is questionable, however, whether this is not being retarded by the various restrictive Acts that have been passed, such as the various Mortgagors’ Relief Acts. If the readjustment of values were left to the natural operation of economic law, unfettered and unrestricted, a quick v.h efficient readjustment of costs would eventuate, but it does not seem that <his necessary readjustment will be brought about by postponing payments of both interest and principal on mortgages, which merely postpone the day of reckoning and maintain the high values of the lioom period.

LOCAL BODY EXTRAVAGANCE A great deal of the over-capitalisation of the farming industry has been caused by the extravagance of local bodies, which have provided facilities far in excess of requirements. It is difficult to see how this matter can be efficiently tackled, but the Bank of New Zealand’s proposal shows how nuch it means to and weighs down the Farmer. The same position is true also, of course, to the citi is. where the weight of rates is excessively heavy and crushing to trade and industry. We believe that this particular phase of the problem should be dealt with by tile Local Bodies Commission which the Government proposes appontTho proposal of the Bank of New 7e ~ land that the Government should pay farmers’ rates for one year docs not ap pear to us to otter any real relief, cxcepL to the local bodies. The bank’s proposal in reality only relieves those who can afford to pay and gives no relief to those who cannot pay. It seems to us inequitable and unsatisfactory, while the remission >f land tax will only benefit the farmer to the extent of ,£515.000, the amount which it is estimated will he collected from this source during the current financial year. SUGGESTION OF BONUS

Although there are grave objections to a bounty, it is to be preferred to an increase in the exchange rate, and if a natural process, unfettered by restrictive legislation, of reducing all values could be put into operation, it might be found necessary, ana advisable, for a bonus to be paid to hardship cases only. In that event, the oorms should bo for specified objects and for a limited' period. On no account should it be indiscriminately administer, and it should be confined to those who really 'require it. It should not be possible, moreover, for the bonus to be taken by creditors in payment of some debt already existing; the bonus would have to be used exclusively for farm improvement and the increasing of production. We realise that a stringent process of devaluation is certain to inflict a certain amount of hardship and to affect adversely the Government’s finances, principally through its advances to settlers and others, but after taking into account the heavy losses which would result we think that ... natural readjustment is preferable and in the long ran will give the greatest benefits to the Dominion.