SOUTHLAND DAIRY FARM COSTS

Southland Times, Issue 25690, 5 June 1945, Page 3

SOUTHLAND DAIRY FARM COSTS

Sir,— Might I draw attention to a rather grave error by Mr John Johnston in regard to the work of the dairy farm costs committee? At the meeting of the Gore Sub-Executive of the Farmers’ Union, as reported in today’s Times (and we must always allow for the possibility of mis-reporting), Mr Johnston stated that “when the Dairy Committee submitted its costs, it had been considered that a watertight case had been drawn up. When Professor Tocker had examined the schedule it was found to be incorrect. It was no use leaving loopholes in the case.” This is totally incorrect. Our costing committee, afte r .J e ~ ceiving the varying conditions, decided that “the variations from farm to jarm and district to district were so widely divergent that it was thought that a more correct statement could be made by creating a reasonably average proportion as a basis and framing its expenditure and revenue on a budget basis.” We then proceeded with our work and, in order to leave no loophole, we based our estimated revenue at a fairly high level and our costs on a conservative basis. The final figure of this proposition gave a net balance available for the farmer’s reward of £39/9/11. Professor Tocker had been engaged by the Dairy Board to carry out similar work to make up a case for the submission to the 1938 advisory committee. Arrangements were made to submit our statement to Professor Tocker. Professor Tocker did not find any error in our work, but claimed that a statement built up on a budgetry basis could not be accepted as evidence to present to the advisory corrimittee. Arrangements were then made to collect actual balance-sheets from typical Southland dairy farms—which work was done by Mr G. M. Smith, with the assistance of other qualified farm accountants. Government valuations were taken, actual revenue and costs were collected, insurance, depreciation, taxes and other charges were dealt with and the group of farm balance-sheets were averaged out and, to our definite faction (as a committee), the final balance for farmer’s reward was found, to be £2l/1/9. I could go further, but I do not think it is necessary. The actual balance-sheet clearly vindicated the work of the committee with our estimates so near the actual that they could have been accepted as they stood. I deeply appreciate the work being done by Mr Johnston and I would have let this mistake pass but for the fact that such statements are accepted by our opponents and used against us when we try to put forward our claims for fairer treatment foi' our fellow dairy farmers. I am quite sure that my fellow committeemen, Mr T. F. Paul and Mr G. M. Smith, will bear me out in what I have written. B. CLEARWATER, Member Southland Dairy Farm Costing Committee, 1937-38. June 2, 1945.