RISING PRICES

Te Awamutu Courier, Volume 78, Issue 7017, 9 February 1949, Page 4

RISING PRICES

POSITION IN AUSTRALIA MANY REGRET VOTE IN REFERENDUM Many Australians now regret the “no” vote in last August’s referendum which denied the Federal Government permanent control of prices. Since then control has been in the hands of individual States. With inadequate administrative machinery to cope with the work of investigation. expert assessment and policing which were essential to the smooth operation of controls, the States have had to narrow down by thousands the list of goods and iterps over which they exercise control. Once controls were lifted the prices for most of the “freed” commodities bounced up and State authority, more accessible than remote Canberra, was forced to give immediate consideration to demands by interests for revision of prices still held in check. In most cases increases were granted. Living costs have risen, so sharply that in spite of basic wage increases the consumer’s purse is being severely strained and many people sigh for the days of centralised price control when they knew exactly what they would have to pay .for goods. No item lias caused greater controversy and heart-burning than clothing. For years retail prices of clothing have been kept at reasonable level by Federal Government subsidies on woollen and cotton textiles supplied to manufacturers. Increasing costs of primary products forced subsidies up to £30,000,000 a year, but when price control passed to the States the Federal . Government announced that it would withdraw the subsidies. Protests from the States were unavailing. The Federal Government refused to allow the use of revenue for purposes over which it had no control. Moreover, with the elections due at the end of 1949, it hoped that its swollen Treasury cofers would permit substantial tax reductions for vote-catching. Prices are expected to rise by at least 20 per cent, from February 7, when supplies of subsidised softgoods are expected to be exhausted. So far the State price-fixing authorities have been able to suggest only one means of tempering the blow to the public—a 7J per cent, cut in retailers’ margins on softgoods. Big department stores and business organisations have unavailing!y fought the decision. The scheme was threatened last week by the announcement of the Victorian Premier (Mr Thomas Hollway) that he would not be forced into a decision by the other States, but he backed down when he discovered that the move had originated with His own officials. The various State Governments had agreed to consult each other on price-fixing policy to obtain uniformity, but the decision to cut retail marginal prices was taken while Mr Hollway was in London.