DAIRY CONTROL.

Southland Times, Issue 20016, 2 November 1926, Page 8

DAIRY CONTROL.

Beard’s Recent Meeting.

INTERESTING DISCLOSURES.

Texts of London Cables Revealed.

Interesting details of the iccem meeting of the Dairy Control Eea:d, including the texts of cables from members of the London Agency and from Mr Coates have been supplied by Mr T. M. Timpany, the Southland member of the Board.

PRICE FIXING SCHEME. TRADE IN LONDON ANTAGONISED. RECENT DECISION IS NO CHANGE. It has been obvious for some time that behind the meagre official news issued by the Dairy Control Board some events oi major importance had been moving and when Mr T. M. Timpany, the Southland member of the board, arrived back from the meeting of the board he was asked if he could throw light on the subject. Mr Timpany' to a representative of the Southland Times said that he desired to speak on the recent events because the suppliers should know what was happening. “I feel that the supplier should know what is be- ; hind all this business,” said Mr Timpany. “I want him to know, and he cannot get the I information from the New Zealand Ex- • porter, the board's official organ. I decline to shoulder the responsibility of remaining silent.” TROUBLE IN LONDON. Going back over the events since his election to the board, Mr Timpany went on to say that at the first meeting it was obvious that things were not running smoothly at the London end. Mr Grounds had gone to London and about the time of his arrival a cable message from Mr lorns, of the London Agency, showed that the price fixing policy determined on by the board before the election was the cause of the trouble. Those price fixing instructions were sent to London on the motion of Mr John Fisher and it is clear that the majority of the London Agency members the men on the spot, oppose that policy. After the board meeting a statement appeared referring to cables from Mr lorns and Mr Grounds, but nothing was said of a message from Mr Stronach Paterson, and other members of the London agency on this vital subject. LONDON AGENCY’S OPINION. The cables speak for themselves. Mr lorns cabled on October 4: Fixing minimum price and retaining present management has already resulted in some boycotting of New Zealand produce. If persisted in will in my opinion result in disaster. If this is board’s policy, I request board’s cabled consent to my returning New Zealand immediately. If board adopts Australian price control system, accepts Wright’s resignation and replaces him with better man, who easily obtainable. I am confident position can still be retrieved and control policy successfully applied for benefit of producers, and I am willing to remain here and work to this end. Please reply' promptly. (Signed) W. A. lorns. On the following day, October 5, came thia opinion from Mr Grounds: Most practical course present difficulty recall Mr lorns, make Mr Motion chairman London Agency. Leave London Agency reconstruction until Hunt returns and Grainger and myself report. Mr lorns indicated opinion by cable. Mr lorns is heartily in support of compulsory' control, but he will have none of this price fixing. Mr lorns proposed Mr Wright’s recall; Mr Grounds suggests that Mr lorns should be got rid of. The other message from Mr Paterson was not made public. Mr Paterson is the Government re presentative and a member of the London Agency. Mr Motion, the other member, has remained silent throughout. Mr Grounds, of course, is not a member of the Agency. Mr Paterson’s message was: In case board w’ould like my views on the position they are as follows. I concur in Mr lorns’ views first necessity in re-establishing confidence is change of manager and abandonment of minimum price fixing in favour of the Australian system of price control. I concur in Mr Grounds’ view reorganisation London Agency' desirable but do not agree his immediate proposals to that end, feeling they would identify' board's control policy even more closely than hitherto with the past policy of the New Zealand Cooperative Dairy Company. These methods would result in accentuating present acute hostility throughout the whole trade. (Signed) Paterson. These telegrams should be read carefully because they show that the majority of the London Agency opposed the board’s policy and they throw light on the subsequent events. MR CORRIGAN’S MOTION. “At the meeting’*of the board early in October,” said Mr Timpany, “I said verylittle, and nothing definite was done in connection with these cables. Mr Corrigan gave notice of a motion which proposed to put the issue to the test, and in the meantime the London Agency had no reply from the board. When we met again last week Mr Corrigan had put in an amended notice of motion. These proposals were drafted after a conference between two members of the board and the Minister of Agriculture, and they were spoken of as a compromise. This meant that the business was fixed up before the board met. I protested against the adoption of these proposals which carried on the game with price fixation under another name and did this in the face of the known opposition in London. I Mr Corrigan’s motion was adopted with ' slight alterations and the addition of a I fifth clause, but not unanimously as the | Press report stated. The proposals set out | the policy: That the existing policy of board be altered as follows: (1) That the London Agency be instructed to arrange a meeting of all importers of New Zealand butter and cheese for the purpose of electing a committee of three. (3) If both producer members of London manager present confer with i such committee of importers from time | to rime for the purpose of naming prices ' which shall be rhe selling prices of butter ! and cheese for the time being. (3) If the both producer members oi the London Agency fail to agree to the price so named then in such case the London Agency may itself name prices which shall be the minimum price for all butter and cheese.

(4) The New Zealand Dairy Produce Board at all times reserves to itself the right to over ride all decisions of such joint committee or of the London Agency if in its opinion such action is not in the best interests of the producers.

(5) A meeting shall be convened by the London manager from time to time or when required to do so or by any two members of the joint committee. PRIME MINISTER’S MESSAGE. “It must remembered,” said Mr Timpany, “that before this there had appeared in t the newspapers a message from London r saying that Mr Coates was cabling to the f board, and members must have known it 1 was on the way. The message actually' 1 arrived on the morning of the board’s meetl ing, and was hurried over from the office f of the Acting Prime Minister. It reached • the meeting just after Mr Corrigan’s proposal was dealt with and was laid on the t table until after the luncheon adjournment, j When we resumed I asked what was to be [ done in the face of the Prime Minister’s message, which was couched in strong terms [ and showed (hat he was exercised about . the matter. The message speaks for itself, . it is dated London, October 27 ‘ Dairy Control Board.—lnfluential depu- > tat ion representative importers, blenders, multiple shops, wholesale provision merchants and retailers has made very' strong . representations to me. Firstly, objecting t to control. Secondly, protesting against . price-fixing. Thirdly, objecting to the , present manager, London Agency. Rei garding firstly I told them that control , policy definitely settled and would continue. They recognised this position and state they desire to continue work in interests of New Zealand dairy trade at this ; end and accepted my statements. Re--1 garding secondly, lam convinced strongly J it would be a great mistake to attempt | anything in nature of minimum price- ; fixing and in view of serious position any' method at this juncture likely to engender antagonism should be avoided. Regarding thirdly very strong objection expressed to Wright in whom trade apparenty have no confidence, and this attitude very' detrimental interests of New Zealand producers. Matter has been discussed with Grounds, who is meeting same people to-day. Paterson’s telegram to board in my opinion correctly represents feeling majority of trade here. Give copy this telegram to Hawken. Matter most urgent. Board meets October 27, Wellington. (Signed) COATES. When I asked the board that it proposed to do, the chairman said that all the points mentioned in Mr Coates’s message had been met in the motion adopted by the board, and it was no use going into it again. I protested against this slight treatment of the message from the Prime Minister and asked to have it recorded, saying that I would not acquiesce in such a procedure in the face of the Prime Minister’s warning. MR PATERSON’S CABLE. “At the time I did not know that Mr Paterson had sent another cable. This one actually reached the board on the day after the meeting. It was dated October 23, from London, and said— Cannot urge too strongly that to avoid disaster board should abandon minimum price-fixing, and adopt Australian system price control. All allottees, with exception only of Lovells and Wilson Sears have this week officially in writing strongly represented to Agency that owing to keen hostility of all branches trade throughout country price-fixation would be detrimental best interests producers. Strongly urge also board should dispense with present manager, who completely lacks confidence trade and, in my opinion, can never secure trade’s goodwill and cooperation. Wright has repeatedly stated Australian system price control both useless and unworkable. If, therefore, board adopts this system all the more essential change manager. Eminently suitable man of great experience and highest standing in trade is prepared negotiate for position if and when it becomes vacant, but declines allow his name disclosed unless and until board creates vacancy. In any case anticipate no difficulty replacing Wright with more suitable man. Think reorganisation London Agency not urgent and can wait Grounds’ return, and that meantime if board by adoption course above suggested lays foundation essential for reestablishing goodwill and confidence present Agency with suitable new manager can get business working smoothly. Believe that firstly in view provisions section six sub section two of Act it is at least very doubtful whether Wright has an enforceable contract against board. Secondly, if he has such contract and board decided dispense with services measure damages would be salary balance period less what he might reasonably be expected earn during same period, but on these points board will doubtless take legal advice before final decision. In event deciding dispense Wright’s services, suggest board should authorise Agency at discretion arrange amicably best terms or alternatively notify Wright on board’s behalf of termination services, and if board decides advisable, make any payment in lieu notice such should be made with denial liability. Whatever the cost believe change manager essential. Above message is sent with cognisance Prime Minister, who requests you hand copy immediately to Acting Prime Minister. (Signed) STRONACH PATERSON. Although this cable was sent from London on October 23, it only reached the board on October 28, after the message sent by i Mr Coates and dated October 27. This mes--1 sage deals with the whole situation, and I shows that the trade is antagonised. UnI derstand, too, that while the London Agency was meeting the trade, the board in New Zealand was making its decisions ignoring the information of the Prime Minister’s cable, and not waiting on Mr Paterson’s, which some of the board knew was on the way. ANTAGONISING THE TRADE. “The antagonising of the trade is a vital matter, and these cable messages show that the reply is a boycott of New Zealand produce. In addition the advances are reduced. I asked the board to secure an increase in the advance on cheese, which is justified by the market, but I was told that this was out of the board’s control, the advances being fixed by the merchants handling the produce, a position disclosing their power, and the danger at this stage of antagonising them. I was told that the board would consider the request, but in the face of that assurance it does not look as if much can be expected. If cheese were selling in the open it would bring 8d per lb, f.0.b., to-day, but the advance is only s|d, and that is not enough for the dairy farmer : to-day. The position in regard to butter is different—cheese and butter .cannot bp com-W