TARIFF COMMISSION

Timaru Herald, Volume CXXXVII, Issue 19511, 9 June 1933, Page 10

TARIFF COMMISSION

WELLINGTON SITTING CONTINUED. MANUFACTURERS' CASE CONTINUED. Bv Telegraph Press Association WELLINGTON, June 8. Evidence befoie the Tariff Commission was given to-day by the representatives f various importing fi—ns. Manufacturers’ Case. Continuing his evidence, Mr A. E. Mander, general secretary to the New Zealand Manufacturers’ Federation, said New Zealanders needed protection in their own home market for exactly the same reasons that manufacturers in Britain needed protection in their home market, and preference oyer their foreign competitor in ours. British manufacturers are unable, without a tariff, to hold their own against foreign competitors in their market, because of Britain’s higher production costs. In New Zealand they were in precisely the same position. Under the Ottawa Agreement the Government entered into a special undertaking: “To institute an inquiry into the existing protective duties and, where necessary, to reduce them to such a level as will place the United Kingdom producer in the position of a domestic competitor—that is, the protection afforded to the New Zealand producer shall be on a level which will give the United Kingdom producer full opportunity of reasonable competition on the basis of the relative costs of economical and efficient production.” Mr Downie Stewart, the Minister responsible for the last two tariff revisions, had declared, in effect, that the Ottawa Agreement merely bound New Zealand to continue her past tariff policy. When the Commission came to consider separate industries and separate items in the tariff, New Zealand manufacturers and their representatives would be prepared to show the factors which render their production >{ eher in

Mr Mander said that incidental might mention that the farmer is now no longer selling produce in the world market at world prices. He receives for his exports world prices plus 25 per cent. And he receives London parity price plus 25 per cent also for the produce he sells in New Zealand. The New Zealand manufacturer requires a margin above the world prices for manufactured goods to enable him to meet the higher costs of production in the Tominion. Workers’ houses in England can be rented for 6/- to 11/- a week. In New Zealand cities the corresponding rents would be 22/6 j to 32/6. Again, all imported goods ! are loaded in price with freight and insurance, roughly 10 per cent, and now exchange 25 per cent. Household gas, light and fuel are more expensive in New Zealand than in Great Britain. The fac was that our whole financial structure—capital, wages, cost of living, land values, house property values, -finances of the State Advances Department and Public Trust, rents, rates, and taxes worked out in terms of higher “money values.” Money-wages in New Zealand were appreciably higher than money-wages in Great Britain. He had in mind one case where a New Zealand firm employed 22 men and 11 boys in a certain branch of its work, while a corresponding English firm, for exactly similar work, employs 11 men and 27 boys. In such a case the mere stating of the “rates” of wages would be useless. It was possible to get over this difficulty by taking for comparison the acuta] earnings, in each industry, in Britain and New Zealand respectively. In both United Kingdom and New Zealand the figures refer to wage-earners only (not salaried staff). U.K. N.Z. s. d. s. d. Clothing Industry— Average actual earnings: Males (all ages) .... 54 0 79 9 Females 25 3 35 2 Both sexes 31 10 41 0 Woollens and Worsteds— Average actual earnings: Males (all ages) 49 4 80 2 Females . 27 7 39 4 Both sexes 36 9 55 2 Engineering Works— Average actual earnings: Males (all ages) 50 4 71 8 Paint and Varnish— Average actual earnings: Males (all ages) 55 8 71 10 Females* 24 4 Japanese Imports. “Manufacturers are much disturbed by the enormous increase of importations from Japan. The cold fact is that Japan is now pouring into the New Zealand market a flood of manufactured goods, many of which are actually sold at a lower price than the New Zealand manufacturer would have to pay for the raw material alone. The reply may be made that New Zealand manufacturers should go to the* cheapest source for materials. We may be driven to that if our protective tariff is lowered to save our industries from extinction.” Mr Mander then quoted extracts from the 21st Report of the Imperial Economic Committee on Imperial Industrial co-operation, and said that agreements between British and New 7 ?aland industries bring into focus an idea well worth the careful attention of the Commission, and of the Government since they point the way to a reconciliation of British and New Zealand industrial interests. Our New Zealand market was too small to be “shared.” If New Zealand manufacturers, in the lines they manufacture, enjoyed the whole of the Dominion market, it would be only just big enough to afford them full use of their plant and machinery, and full employment for the available labour. “Instead of 'sharing’ this little New Zealand market with outside competitors in all the lines we can produce for ourselves, let us aim, rather, at manufacturing certain classes of goods for which we can be assured of the whole Dominion market, leaving other lines, more highly specialised lines, and also the production of certain partially manufactured materials, to Britain . . . and asuring her of the market for them.” This was what was meant by “Imperial Industrial Co-operation and what was recommended in the report of the Imperial Economic Committee. Currency Difficulties. It was represented that the duties on watchmakers’ tools were excessive. Mr Claude A. Wills, the representative of Messrs John Duthie and Co., asked for the lemoval of the 20 per cent, duty .•? electrically welded fabric ' wire made it* England Mr Pascoe asked whether importers could compete with Australia if the exchange '- as at par Witness: v as. Professor Murphy asked whether if ihe currency were stabilised they would not be content to pay duty. . Tr Willis: Yes Professor Murphy: You are asking for incremental tariff adjustment- to meet currency difficulties? Mr Wills: It has been done. Professor Murphy said he wanted to T et the point clearly, as this might, ho

the basis of the contentions of a number of businessmen coming before the Commission. It would be difficult to have a concertina tariff to meet variations in the value <. J currency. Embarrassme : of this kind were the price the community paid for a variable monetary standard. Mr Willis said the object of the Ottawa Conference was to foster trade with England. Professor Murphy said they would get a nice inter-Empire keitle of fish if they commenceo making preferential tariffs for different parts cf the Empire. Mr Francis Joseph Miller, managing director of Messrs Miller and Ahern, said he was seeking a reduction from 20 per cent to 5 per cent in the duty v. woolien piece goods from the United kingdom. To a question he said there were certain lines not procurable New Zealand. Captain Colbeck, representing the Farmers’ Union, asked whether he should ask a question as to the protective effect of the exchange rate. Professor Murphy said the matter was one of economic theory, and it was not likely that laymen would be able to give a satisfactory answer. While the exchange was depreciating, there was the protective effect, but once it had depreciated internal adjustments took place. Some of these, such as interest rates, took time, but when there was readjustment the effect of the rate was lost. The time it took for adjustments to take place was a question of fact. He asked whether the goods mentioned were high grade, luxury lines, suitable for a revenue tariff Mr Miller: Yes. Professor Murphy: Your real objection is more against the high exchange than high tariff. Mr Miller: Of course, we have to include the exchange rate in the landing charges. Professor Murphy: If the exchange rate were lifted, would you have any objection to the duty being replaced? Mr Miller: No. Professor Murphy: You will realise that the exchange rate is a fugitive phenomenon? If we had a concertina tariff, it would be difficult to administer. Don’t you think one of the essentials in a tariff is its certainty? Mr Miller: Yes. I suppose that is so. British Parchment. Mr Ernest Alfred Little, a director of Joseph Nathan and Go., made representations regarding British vegetable parchment paper. the agency for which was held by his firm. He asked that a tariff be imposed on the foreign article at such rate as to protect British paper from undercutting by foreigners Army’s Official Organ. Representations for reduction of duties on concertinas, and band instruments. were made by James Emery, trade secretary of the Salvation Army. “The concertina is practically the official organ of the Salvation Army,” said Mr Emery. “It is used almost exclusively by our organisation.” Professor Murphy: “I expect they use it in some places of which you do not altogether approve. I refer to jazz dances.” (Laughter. - ' The hearing was adjourned.