MINIMUM WAGE AND PROFITSHARING.

Pelorus Guardian and Miners' Advocate., Volume 29, Issue 43, 5 June 1917, Page 8

MINIMUM WAGE AND PROFITSHARING.

In moving cue remit under the above hcuuing at tne recent runners' wunrerenee in iiavelocK., nir it. JJ. ieil (,I'eiorus bounds Uruncii j read tne rolio wing interesting paper;

The great vvona struggle that is now going on nas oeca manted not only oy terrioie suitenngs and sacrifices, but by certain compensating gains wfiich, one hopes and believes, will prove of lasting benefit to humanity. Not the least of these compensating gains is that we have been given a wider and clearer outlook upon life. These trials and sufferings, snared by all classes alike, have awakened the national conscience, and have educated us in the matter of each man and woman’s personal obligations to the State, ana as to their share in the national life in a way which the existing system of education had completely failed to do.

X has been truly' said that national life is fundamentally a matter of human relationships; and those relationships, to be on a sound basis, must be regulated by conscience. This truth has been brought more prominently to the front in England than it has out here in regard to the relationship of Capital and Labour. Before the war, these two were ranging themselves into two hostile camps, and a conflict seemed unavoidable. The trials of war have, however, emancipated both sides from many prejudices and antagonisms, and their relationship has become more of a partnership of equals, mutually dependant upon one another, than that of master and servant as of old.

Mr G. H. Roberts, one of the chief spokesmen of Labour in England, declares that the time is ripe for a bettor understanding between Labour and Capital. The British Chancellor of the Exchequer (who before the war was the leader of the Conservative Party), speaking at Glasgow on January iSlth last, said, amongst other things:—“ln consequence of the war, old machinery and old customs were being swept away. The greatest social problem of the Empire is to secure a fair distribution of wealth without drying up the springs of ■wealth. The greatness of the nation depends upon the conditions under which men do their work, “I am convinced,” he says, “that the whole future of the Empire will depend upon the establishment of good relations between the representatives of Labour and Capital who were more or. less antagonistic in .the old times. The gulf between the classes has been lessened by the war. Every section of society, particularly the great Trades Unions, has sent its best to serve the ■country. ’ ’ What wo have to aim at is the es* tablishment of good relations between the representatives of Labour and Capital in New Zealand. No one can regard the existing relationship between the two as in the least degree satisfactory, and the unpatriotic action of some of the miners and watersiders cannot be too strongly condemned, and unless something is done in the near future to check the go-slow and other tendencies of Labour policy in New Zealand, the situation will in time become intolerable. Some of the chief causes of this unfortunate state of affairs are, I think,(l) The narrow outlook of the leabers of Labour who regard the interests of labour as independent of the interests of the other members of the community. (2) The failure of the Trades Unions, while raising the standard of wages, to keep up tho standard of v/ork. In fact the tendency has been, rather to encourage the lowering of the standard of work. (3) The failure of the State to educate children in the matter of their obligations as citizens. (4) The mistake of representatives of Capital and Labour in treating capital and labour as two separate units, instead of as two halves of one whole. All these evils? are quite capable of being rectified in time if people will allow themselves to bo guided by. commonsense, patriotism, and conscience. On the other hand it is quite evident that the present state of things cannot go on indefinitely. Tho question, therefore, is what eventually is to be the outcome. Are we to adopt the ‘wait and see' policy, and allow things to drift, knowing that by doing so we, as a commur.’ty, are bound to go on the

rocks; or should wo not rather try to install some motive power that will enable us to steer a straight course to a well-ordered and contented state in which everyone receives the full fruit of his labours, where it would be everyone ’s interest, instead of restricting the output, to increase it to its utmost limit?

It is because one believes in the commonsense, patriotism and conscientiousness of tne very large majority of New Zealanders that one is hopeful of the present state of things being remedied. And it is with the view of helping in this direction that this motion is brought forward. An immediate improvement in the relationship of Labour and Capital might be looked for if the system of payment by results, that is, that everyone who contributes to the success of an enterprise shall share the profits in proportion to what he has contributed in labour, brains, or capital, were generally adopted. This principle of profit-sharing is already being applied largely at Home to industrial undertakings, and one cannot see why it should not also be successfully applied to the farming industry. It seems only fair that everyone employed on the land should have, of right, a direct interest, not only in increasing the output, but in the results of good seasons. That the system of profit-sharing is being so applied in England is proved by the formation, last year, of the British Manufacturers ’ Association, representing 700 firms employing one million men, the chairman stating:— ‘"ihis Association’s proposal for the adoption of a minimum wage and a system of profit-sharing showed practical desire on their part for a better understanding with their employees. The Association was prepared to discuss means for securing just and generous terms for the remuneration of their employees." Again, the Empire Resources Development Committee set up in London this year under the auspices of the Rhodes Trustees, for developing, with the assistance of the Imperial Government, the resources of the Empire, in putting forward its scheme, points out that it is the first of its kind in two respects — that it aims at a worldembracing purview of industrial resources, and sets down the intention to share the profits of Imperial resources with the workers . For instance, in devloping the State Fisheries, the idea is that all on board the fishing vessels, from the captain to the lowest man, should participate in the proceeds of the catches. When it comes to the question as to how this principle of profit-sharing is to be applied to the land, we must, I think, begin by correcting the mistake before referred to as one of the contributing causes of the feeling of hostility between Capital and Labour, that is, the treating of Capital and Labour as two separate units instead of as the two halves of one whole. We are all apt to look upon gold as itself capital or wealth instead of merely a convenient medium of exchange of capital or wealth. Real wealth is that which contributes directly to the physical and moral needs and enjoyments of mankind. As the production of the greater part of such wealth is the result of labour of some kind, either bodily or mental, labour itself is an inseparable part of wealth or capital. Consequently the former who calculates that his land, implements, and stock are his capital, should also take into consideration the capital value of the muscle of the labourer who contributes to producing the harvest as entitled, pro rata, to the same interest and profit-earning capacity as his other capital. It is obvious that farming must be run on lines to yield a fair minimum living wage to all engaged in it; and in fixing this minimum wage due regard should be had to the fact that the capital value of a man’s muscle is a wasting asset and has only so many years to. run at full strength. As regards profits and profit-sharing, the chief point would be to arrive at the capital value of each man, and this might be deduced from his wage. Such capital values would then be added to the general capital value of the concern, and after allowing for the payment of wages, rent, management and other working expenses, the profit would be divided in proportion. It would be necessary to form some kind of reserve fund to provide for the payment of the minimum living wage in bad seasons. To give an example of how the system would apply, take the following, which with modifications would also apply to other cases: The figures are merely to illustrate. A farmer, the capital value of whose farm and stock is say, £3,500, makes a gross return of £650. The farmer works himself and employs one man. The man gets say £2 per week—£loo per annum in round numbers. The farmer who works and also supervises is worth say £3 per week—£lso per annum. Other working expenses come to say, £IOOO. A net profit is shown of £3OO. The capital value of the farm is £3,500. The farmer takes 5 per cent, on the value of the farm, also on his own capital value, and the man gets 5 per cent, on his own capital value of £IOOO, and say 10 per cent, is carried to a reserve fund against bad seasons. The system should, I think, be a voluntary one. Its best chance of success would be that it received the sanction of both the farmer and the farm labourer as an honest settlement of the first claims of each. The system would not bo applicable to casual labour, although in the case of shearers, mustorers, etc., there might be a sliding scale of payment according to the price of wool. Nor would the system be applicable to new farms which have not yet come into profit. But as the greater part of the work on such farms, such as bush-felling, sowing grass- seed, fencing, etc., is contract work, this should be no argument against the profit-sharing system. The difficulty of getting the right men together to discuss this matter is, in view of the present attitude of a part of Official Labour, is a real one. There is, however, another section of labour which is perfectly approachable, and which has honourable representatives in the present House. It is to such men wo must look for progress. It is a proved maxim that men will treat you as you treat them (I except Germans and other moral decadents). If you treat them as rogues they will