FARMERS INDIGNANT

Southland Times, Issue 23988, 1 December 1939, Page 8

FARMERS INDIGNANT

THREE REPLIES BY MINISTER

GUARANTEED PRICE FOR SEASON r EMPHATIC PROTEST BY CONFERENCE SUBSIDIES NOT WANTED BY INDUSTRY (United Press Association) WELLINGTON, November 30. Intense disappointment and indignation at the reply by the Minister of Marketing (the Hon. W. Nash) to the three questions put to him was expressed by the Dominion conference of the Dairy Board today. The questions related to the alteration of the standards and prices recommended by the 1938 Guaranteed Prices Advisory Committee, the covering of the extra costs incurred for the current season, and whether it was still a principle of the scheme that farmers should receive a price which would cover the cost of production. The conference urged that the Minister give further consideration to an increased price to be paid for this season’s output. An emphatic protest against any form of subsidy as a means of meeting the increased costs, which, it held, should as a matter of right, be added to the price paid by the Government was also made by the conference. The conference this afternoon received the following written reply from Mr Nash to the questions put to him yesterday: ALTERED STANDARDS Question 1: As the 1938 Advisory Committee unanimously recommended standards and prices to the Minister, this conference respectively inquires on what data the Minister altered both the standards and the prices. Answer: The basis of the alteration was set out in the statement made announcing the prices for butter and cheese for the 1938-39 season. This state- ( ment was quoted in full in the annual report of the Marketing Department for the year ended July 31, 1938. The Government realized that the report of the committee was entitled to be given very careful consideration and this was done. In my statement announcing the prices for the 1938-39 season I drew attention to the fact that the recommendation of the committee was a qualified re- , commendation because in the report reference was made to certain relevant factors which had not been fully assessed by the committee, but which, in its opinion, should be considered by the Government in determination of the prices. These factors were duly considered with the whole of the evidence on standards and prices as given to the 1937-38 and the 1938-39 committees. I '- "In dealing with the standards the 1937-38 committee reported that 62501 b of butterfat was the production an adult male unit of labour. The 1938-9 committee took 67501bs as its standard. The Government, after careful inquiry and examination of the evidence, considered that a fair standard was 60001bs and the price was determined accordingly. PRODUCTION COSTS Question 2: If the price for the 1938-39 season as fixed by yourself was reasonable to cover the costs of production in your judgment, will you indicate how the farmer’s increased costs incurred for the 1939-40 season are to be provided for. Answer: During my address to the conference in April last and at subsequent conferences I announced that the Government would, as circumstances warranted, fully examine the effects of major rises in costs. As stated yesterday the Government has already been considering the costs of fertilizer with a view to covering added costs and in particular to meet the request of the United Kingdom for maximum production. When this examination is concluded I will be pleased to convey to you the procedure the Government proposes to follow in general. The major items of increased cost should be covered in the price but in present war conditions it is hot possible to pass on all additions to costs. The Government will, however, use every possible endeavour to ensure that the effect of increased prices shall be equally shared by all section of the community. It should be noted that for the 1938-39 season the average payout of butter factories was .319 d per lb butterfat in excess of the basic pay-out. The cheese factory pay-out was ,18d per lb butterfat in excess of the basic pay-out. Costs, as you are aware, depend to a certain extent on output and during last season exceptional weather caused lower production and consequent higher costs on fanns and in factories. PRINCIPLE OF SCHEME Question 3: The conference desires to ask if it is still an essential principle of the guaranteed price scheme that farmers shall receive a price which will cover the cost of production. Answer: With the essential qualification that all forms of our social and economic life may be affected by the war, there is no intention to alter the principle of Section 20 of the Marketing Act. I will bring the remaining subjects raised in the various speeches before the Government for its consideration at the earliest possible moment. Speaking- as a member of the 1938 Advisory Committee on prices, Mr C. P. Agar (Southern Ward) called attention to the Minister’s statement that the report of the committee carried qualifications. The qualifications were not those affecting standards and prices but factors involved in a position that would arise if the market went down, in which case the scheme might cost the Government some millions of money, he said. “PLAIN TWISTING” “It was plain twisting to turn that statement round,” Mr Agar said. “There was no evidence of a standard above 57801bs as recommended unanimously by the committee so there was no evidence in the report on which the Minister could have reached his standard of 60001bs. The thing was determined by expediency and by what the Government thought it could get away with.” Mr Agar said the Ministers reply was nothing but verbiage, .There was

not one straight attempt to answer the questions put to him. There was only one answer to it. He felt so incensed by the reply the Minister had sent that he thought the conference should say to the Government it had no confidence in its administration of the Marketing Act “I support 100 per cent, the attitude taken up by Mr Agar ” said Mr A J. Sinclair (Te Awamutu). His remarks though strong were absolutely justified. The Government has failed miserably and we are justified in saying that the guaranteed price scheme has broken down under its own weight.’ Mr Sinclair asked what attitude the delegates could advise the fanners to adopt. He thought they could take it for granted that there would be no review of the price. His opinion was that the Government did not realize the position among the rank and file of the industry. There was not one man in the Cabinet who had firsthand knowledge of the problems .facing primary producers. “WE HAVE DONE OUR BEST”

“I have never advocated anything unconstitutiopal,” Mr Sinclair added. “We must go back and tell our people that they have to take the count for the time being. We have done our best and we have got nowhere. We cannot advocate strikes or direct action especially as there is a war on We have to produce to the limit while this war is on to help Great Britain wm out. We will have to tell our people that this Government is unreasonable, that it will give us no concessions of any kind and that we are finished. Mr F. O. R. Phillips (New Zealand Co-operative Dairy Company) said that if the price to be paid was based on realizations the Minister should tell them so. , _ , , “We do not want to be puffed up and think we have the problem all on our own,” said Mr E. R. Bird (Northern Ward). “The wheat growers have gone on strike in Australia, the dairy farmers of Denmark have threatened to go on strike, and there is the same problem in America.” Mr Bird asked how long they were going to co-operate in a policy that impoverished their industry and ultimately the country. He did not think the industry was entitled to continue with that offer of unqualified co-operation. If the Government wanted goods it would have to pay for them. The period for which they could produce below cost had its definite limit. SHARE NOT ADEQUATE

“If we are the basic industry we should not be related to others,” Mr Bird continued. “They should be related to us. People who have created the production have not received an adequate share of it. It is in the country’s interest to put our industry first. Mr W. Marshall (New Zealand Cooperative Dairy Company) said the Minister’s answer to the second question brought into clear relief the fact that the principle on which the guaranteed price plan was based had proved to be entirely unworkable and had broken down on the basis on which the promise was made to the industry. “It (appears from investigation that the men and women who farm in the Auckland province have made up their minds that they are not prepared to carry on on the present basis,” Mr Marshall continued. “They are incensed at what they see going on. I feel that we have failed in our job if we have not brought the Government and the Minister 1 to realize that there is a very serious undercurrent of discontent on the farms and that unless something can be done to change that it is going to be impossible to increase production or at least to maintain it. I think we should again go to the Minister and ask him whether there is yet any ray of hope. The issues are serious and I suggest that we should not come to a hurried decision today.” GOVERNMENT’S ERROR Mr J. Fisher (Southern Ward) said they had got into an impasse because the Government had made a fundamental mistake in the economic structure of the country. A gigantic error had been made by the Government when it raised the wages of the ordinary worker and at the same time cut down the hours of work. The Government was not a scrap concerned about the increase in costs. “You are disappointed and disgusted with the reply you have received,” said the chairman of the board (Mr W. E. Hale). “If the resignation of the Dairy Board would bring about the solution I have no objection to that.” Voices: That wouldn’t do. Mr Hale: As far as I am concerned I am prepared to do that. We are trying to do a job but we are not satisfied with the progress we are making. We are getting nowhere. I would like the conference to express its opinion about subsidies. I hope it will pass a resolution that it does not want any subsidies. (Hear, hear.) Subsidies are inequitable. Another delegate said he did not think the Minister had altogether closed the door. They should ask the Government to face some reduction of costs in the industry. Mr R. J. Glasgow (New Zealand Cooperative Dairy Company) suggested that the conference express regret and indignation at the evasive nature of the Minister’s replies. CONFERENCE MOTIONS The following motions were carried: That this Dominion dairy conference wishes to express its intense disappointment and indignation at the unsatisfactory reply by the Minister to the questions asked of him, the position being that payment of the price announced will constitute a substantial cut in the dairy farmer’s net return and will leave no possibility of his recovering the full costs of production. However, in view bf the concluding paragraphs of the Minister’s letter this conference urges that the Minister give further consideration to the increased price to be paid for this season’s output. That this conference emphatically protests against any form of subsidy as a means of meeting increased costs which should, as a matter of right, be added to the price paid by the Government, and that the conference convey to the Minister the viewpoint of the industry on this matter in an appropriate statement. — ■ ,