The Daily News THURSDAY, AUGUST 31, 1933. STATE “ENTERPRISES.”

Taranaki Daily News, 31 August 1933, Page 4

The Daily News

THURSDAY, AUGUST 31, 1933. STATE “ENTERPRISES.”

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Supporters of State adventures in the manufacturing and commercial realms are wont to reply to criticism that it is because State enterprise has been limited that it has failed. Such reasoning finds little support in the facts that have become known in regard to State trading efforts in New South Wales. Such efforts there seemed to have every chance of success. They were instituted to serve a large population living within a comparatively small radius, with ample transport facilities, equally ample supplies of raw material, and employing labour avowedly in favour of State control of industry and therefore, presumably, willing to give the most loyal and efficient service. The State Government of New South Wales made a bold effort to show that by the elimination of private profit better service could be obtained by the community at smaller cost. In the building trade it was at least consistent in its efforts to cover the supply of the principal raw materials required. The State possessed its own forests, felled the timber, milled it, sent it to its own joinery works, and lost money on every process. This was not the only comprehensive scheme. The State opened quarries for the supply of road metal and stone for concrete work, established brick and lime works and an electric power station to supply cheap power, and again lost money on every undertaking without reducing the cost of building or of manufacture. To the efforts already enumerated may be added the State trawling enterprise, which is admitted to have lost over £300,000 before it was shut down. By June, 1932, the accumulated losses on the various industries referred to had reached £800,500, but had each enterprise been subject to the same rates and taxes as those controlled by private enterprise the losses would have been considerably greater. It is little wonder that a non-Socialist Ministry closed most of the State undertakings. The brickworks, quarries, fruit canning works, dockyard and engineering works, and a State coalmine were given a further trial, and a pipemaking plant that has shown a profit has also been kept in operation. With the exception of that plant all the other undertakings have shown further losses for the financial year 1932-33. The coalmine headed the list with a loss of £112,000, the dockyard and engineering works had a deficit of £70,000, the cannery lost £17,000, and the quarries and brickworks lost £7OOO and £BOOO respectively. It is not surprising to hear that the Government has decided to dispose of all its commercial undertakings with the least possible delay. The experiment has been thorough. It has covered a wide number of industries. It has been carried out when prosperity obtained and when the menace of unemployment should have stimulated every State employee to give of his best. The anxieties of the private manufacturer in regard to obtaining the necessary capital for a new enterprise or for extending one already established did not apply to the State undertakings, and they also carried a far. lighter burden of direct and indirect taxation than their competitors, as well as receiving most favoured treatment where State requirements of supplies were concerned, yet the result has been almost total failure. In this Dominion the voice of the Socialist is still to be heard. He proclaims as fervidly as ever his belief in State control of industry, of finance, and of transport. The hard facts of another State’s experiences are of more value than doctrinaire reasonings. Those experiences were obtained in a land where social conditions and the industrial outlook are closely akin to those of the Dominion. New Zealand will have herself to blame if she does not profit by the example set before her.