THE OTTAWA AGREEMENT

Waipa Post, Volume 48, Issue 3482, 21 June 1934, Page 8

THE OTTAWA AGREEMENT

THE GOVERNMENT'S VIBW-

POINT.

TERMS NOT IGNORED.

HON. C. E. MACMILLAN'S

REPLY.

In.>.reply. to the resolutions going jGorwaiirid to the Government from the meetings of citizens held in various centres , recently, including Te Awa-iriutu'-lsist Wednesday evening, urging that the terms of the Ottawa Agreement.be properly observed and carried out and that tariffs be lowered against British goods, three replies have .been made/ These are from the Prime Minister, Hon. J. G. Coates andvHon. C. E. Macmillan. The first two briefly state that the representatives from the meeting will be given due consideration.

The Hon. C. E. Macmillan, however, has gone to considerable length in his reply and sets out the case of the Government in the face of such Criticism!. -He state:—

HONOURING THE AGREEMENT. Regarding the first part of the resolution) "that the Government should promptly cai-ry out the terms of the Ottawa Agreement," I propose to set out the exact terms of the obligations undertaken by New Zealand and to describe the action taken in fulfilment thereof. Article 6: That the New Zealand Government will invite Parliament to pass the legislation necessary to substitute for the duties of Customs now leviable on the United Kingdom goods specified in Schedule D the duties shown in that Schedule, and to exempt all United Kingdom goods from the application of the surtax of nmefourtieths or .onev-twentieth of the Customs duty, as the case may be. These duties were brought into force by Section 3 of the Customs Act Amendment Act of 1932. The surtax was abolished from United Kingdom goods by Section 6 oi the Custom's Acts Amendment Act, 1932 . Article 7: That the Government undertake that protection by tariffs shall be afforded against United Kingdom products only to those industries which are reasonably assured of sound opportunities for sucArticle 8: That the Government undertake to institute an inquiry into the existing protective duties, and, where necessary, to reduce them as speedily as possible to such a level as will place the United Kingdom producer in the position of a domestic competitor—that is, that the protection afforded to the New Zealand producer shall be on a level which will give the United Kingdom producer full opportunity cf reasonable competition on the basis of the relative. cost of (economical and efficient production. Thejse matters were included in the Order of Reference of the Tariff Commission, whose report will be presented to Parliament shortly. 'Article .9: Thai: the Government undertake that United Kingdom producers shall have an opportunity cf putting forward their views in connection with the inquiry referred to in Article 8 hereof. -It was in order to give this opportunity that the opening of the inquiry was delayed at the expressed wish of the Home Government. The opportunity was duly afforded and availed of.

/Article 11: That the Government undertake that the existing primage duty of 3 per cent ad valorem now levied' on United Kingdom goods which are otherwise duty-free shall not:he increased, and shall be abol-ished-as scon as financial conditions permit. .The Government has.observed its undertaking not to increase this duty, andv. will likewise carry out its obligations to abolish it as ;scon as financial conditions permit. Article 12: That the Government undertake to accord to the non-self-governing colonies and protectorates ami -the-. Mandated territories of Tanganyka, the Cameroons under British Mandate, and Togoland under British Mandate preferences on the Commodities and at the rates shown in Schedule E, and also any preference, for the time being accorded to the: United Kingdom: Provided that His MajeVsty's Government in New Zealand shall not be bound to continue to accord any preferences to any colony or protectorate which, not beprecluded by international obligations from according preferences or.; (ii) according to some other part of the Empire (in the case of Northem Rhodesia, excepting the Union of South Africa, Southern Rhcdeseia, and the Territories of the. South African High Commission) preferences not acceded to New Zealand.

This preference has been brought into effect by Section 4 of the Customs Aielis Amendment Act 1932, and the surtax was abolished by Section G of that Act.

THE GOVERNMENT'S ATTITUDE. "From the foregoing it will be seen that, so far as has lain in its power, New Zealand has promptly carried out the terms of the Ottawa Agreement. Full performance was of course, impossible until the Tariff* Comjmission had reported, and you may be assured that the undertaking given in Article 7 will be honoured by the Government when. .Parliament meets.

- As regards the second part of your telegram, I, take this to miean that the Government-should allow its members . to vt>te against the Government proposals if they feel inclined to do so. .-3Vl(ay : I: remind you that the Government has been placed in power in "order that it may govern the country according to the principles that it believes flo be right; that the Ottawa Agreement was negotiated by the Government; that the Government intends to carry out the spirit and the-letter of the Agreement; and that deliberately to weaken its chances of pasteing the necessary legislation wlould constitute a grave evasion of •responsibility. •-, I cannot help feel-ing-that" in passing this resolution the (meeting of which you were chairman has acted "without full appreciation of- what its resolution implies. THE TAEIFF QUESTION. A 3 the meeting resolved that the Government should drastically lower the tariffs against British goods, it r is .evident that the impression preI vailed; .that .these duties are. at preThat this is hot the case .is-shown by the fact that while the

totjal value of goods imported from United Kingdom in the calendar year 1933 was £10,839,803, this figure included goods free of duty (except primage) to the value of £5,875,582. The total duty was £1,851,000, of which £906,706 was paid on alcoholic beverage, cigarettes and tobacco. Therefore the average rate of duty paid on United Kingdom goods (excluding spirits and tobacco) works ovit at just ovier 9 per cent. DUTY-FREE GOODS.

Among the goods from, the United Kingdom free of duty are certain items free even of primage, and the following list will be cf interest to farjrners: „ Value oi Imports.

Seeds, grass, clover, turnip, etc 48,183 Cheese bandages 36,550 Meat wraps 96,867 Wire ■ 195,159 Sheep dip G 8.670 Manures 58,8b4 It will therefore be seen that there is not such great scope for reduction of tariff as might be imagined, especially when it is remembered that such duties a s aire imposed were designed either for the protection of local industries believed to be worthy of encouragement, or, in the case of spirits, cigarettes, tobacco and luxuries, for revenue. In passing it may be remarked that the Australian tariff has been reduced to comply with the terms of Article 8 above, but is still twice as high as ours.