The Southland Times. SATURDAY, NOVEMBER 26, 1938. The Government And Production

Southland Times, Issue 23676, 26 November 1938, Page 6

The Southland Times. SATURDAY, NOVEMBER 26, 1938. The Government And Production

The note of caution which could be detected in the Prime Minister’s statements after the Labour caucus was sounded once again at the quarterly meeting of the ’National Council of the New Zealand Federation of Labour. Mr Savage emphasized the need for co-operation between the Government and the workers, and assured his audience that wage-earners would not be asked to work for less than they are receiving today. ‘‘We can’t decrease expenditure unless we reduce wages or reduce the number of people receiving wages, and we are not going to do that.” But he went on to stress the importance of a wider development of secondary industries. “If we can increase the number of people in productive employment in New Zealand our success is assured.” This is a truth that critics of the Government have repeated many times in the past three years. It has been pointed out that higher taxation accompanied by rising costs and a rapid increase in the number of State employees has made it difficult for industry to provide the amount of employment that should be a normal feature of prosperous times. An expanded public works programme has absorbed thousands of workers, of whom only a small proportion could be said to be engaged in really productive work. These men are wanted on the farms and in skilled and semiskilled trades. They would be wanted increasingly in the country’s secondary industries if it were not for the Labour policy that restricts the expansion of productive enterprise in order to provide employment that adds little or nothing to the real wealth of the country. Fortunately there are signs that the Government has at last realized the threat of an unbalanced economy that comes from a declining production and an internal credit inflation. It is not too late to achieve more normal relations between production and expenditure, and the Prime Minister has already given hints of possible action in the future. Whether or not these measures will touch more than the fringe of the problem is a question that will be answered quickly enough in the next few months. An attempt is being made to satisfy the seasonal demand for skilled workers on the farms, but the shortage of farm labour is now too serious to be overcoirie by temporary measures. In the summer months the situation becomes acute: the threat to production needs no emphasizing if there is difficulty in gathering in the harvests and the wool clip. But it is during the remainder of the year, when more, and more land should be placed under cultivation, when special attention should be given to the improvement of stock and crops, that the lack of rural workers insidiously undermines the productive capacity of an agricultural country. The same danger of superficial action can be found in the Government’s attitude to industry. Something can be gained from a nation-wide publicity campaign for the purchase of goods made in New Zealand, and there will be no lack of co-operation from those who have any share in the task of influencing public opinion, But if there is to be a wider demand for local consumer goods the secondary industries that now strive, among many difficulties, to compete with cheaper goods from overseas, must be protected from further rises in working costs. Most reasonable people will realize that a situation created by a policy that is to receive the continued support of the Government cannot be changed overnight. They will realize, also, that retrenchment at this stage would simply substitute one set of difficulties for another. The essential need is to stimulate production; but (he Government should understand clearly that a situation for which its own policy is largely responsible cannot be improved by appealing for cooperation unless it first provides the conditions under which cooperation can most quickly become effective.