The Southland Times. PUBLISHED EVERY MORNING. Luceo Non Uro. FRIDAY, JANUARY 23, 1925. BRITISH FOOD PROBLEM.

Southland Times, Issue 19458, 23 January 1925, Page 4

The Southland Times. PUBLISHED EVERY MORNING. Luceo Non Uro. FRIDAY, JANUARY 23, 1925. BRITISH FOOD PROBLEM.

The evidence given before the British Royal Commission on Food Prices by Lord Vestey is of special interest to us here in New Zealand, because, as it happens, it deals with the meat supplies derived from the Commonwealth and from our own Dominion. The head of the great meat firm surveys the position from the owners’ point of view in a comprehensive manner, which only serves to demonstrate the magnitude of the problem which the Commission is investigating. It has to investigate the broad and fundamental causes of the big increase—averaged at about 80 per cent. —of food prices in the Old Country over those that ruled before the war. In contemplation of the setting up of the Commission these were being discussed in the English Press shortly before our last mail left London. The broad facts, it was then argued, can scarcely be in dispute, though they are often ignored. In the five years between 1914 and 1919 enormous sums of borrowed money were spent. Every kind of material, capital and labour, men and machines, were thrown, regardless of expense, into the task of saving the country from a terrible danger. The reward came in the form of the inestimable benefit of freedom and security. But the country has to pay the price and will not for very many years have finished paying it. The process of paying it burdens industry with an immense incubus of taxation. In order to find the means to pay these taxes it has often to seek to charge higher prices for its goods. And that is not all. The maintenance and development of industry depend very largely on capital, which has to be raised or borrowed. Owing to the war, which has depleted capital, and to high taxation, which has tended to prevent accumulation, there is now much less of it than there used to be in proportion to the amount required. Consequently capital, exactly like wool or wheat, being scarce, costs more: not so much as it did four years ago, but more than it did twelve years ago, and enormously more than it did twenty-five years ago. The extra interest paid for capital has, again, to go on to the price, and to be paid for by all the consumers. Besides the various special reasons for high prices—mainly, as has been said, attributable to the effects of the war—there remains always the fundamental factor of the laws of supply and demand. Under their compelling force conditions may at any moment arise over which a British Government can by no possiblity exercise any control. For example, the recent increase in the price of Australian frozen lamb and mutton is due to a shortness of output, which itself is caused by the drought from which the Commonwealth suffered last year. On the other hand, the rise in the prices of South American beef has been brought about by a sudden increase of purchases by European nations, and, in the same way, one of the reasons for the higher cost of bread is the growing taste for wheat flour in the Far Eastern markets. In the case of both these staple articles of food, either seasonal variations, such as excessive droughts or rains, or any considerable addition to the normal number of consumers, are bound to affect prices. In other words, irrespective of the influence on the market of such disturbing elements as combines, the tactics of unscrupulous speculators, and excessive retail profiteering, the root cause of the difficulty is the too narrow margin between the world supply and the world demand. The public will be particularly interested in the Commission’s conclusion as to the extent to which advances in wholesale prices are passed on and possibly increased in the charges made by the retailers to the consumers. But, as The Times, in its anticipatory discussion of the Commission puts it—

The one great object to which their attention, taking the long view, must be addressed will be to suggest means by which this country and the Empire, with all its vast resources, may be made self-supporting in the supply of their essential food.