HELP FOR THE WOOL GROWER AGAINST LOWER PRICES

Wanganui Chronicle, 15 September 1948, Page 4

HELP FOR THE WOOL GROWER AGAINST LOWER PRICES

Mr. Nash Reads Letters To The House Regarding J.O. Funds

(Press Association) PARLIAMENT BLDGS.. Sept. 14 In his reply to the debate on the Budget, which he started in the House of Representatives this afternoon and finished this evening, the Minister of Finance (Mr. Nash) dealt with the effect the adjustment of the exchange rate to parity with sterling would have upon the wool-grower.

Mr. Nash read letters ex-1 changed between himself and the chairman of the Wool Board dealing with use of the funds accruing to the Joint Organisation, set up to sell accumulated wool i stocks. The letter in reply to Mr. ! Nash from the chairman of the Wool Board indicated that body’s approval of the Minister’s suggestions. . The Minister declared that woolgrowers were at present doing; best of all. with the exception of a small minority in certain types of high country whose return, although incomparably better than in former years, might still fall short of what it ought to be. These particular woolgrowers might be affected by the exchange move, but the Government had had many discussions with the Wool Board and the Wool Disposals Commission with a view to giving woolgrowers some kind of background of stable prices, as was already enjoyed by other producers. Members of the Wool Board and the Wool Disposals Commission had co-operated fully, said Mr. Nash, and he had been at all times able to discuss the country’s economy frankly with them. However, they chose to revert to the auction system after the war. although he personally thought it was a mistaken decision. About the end of the war, too, a Joint Organisation was set u.p to sell accumulated wool stocks. Under this arrangement the wool became the property of the British and New Zealand Governments, which were to bear any losses and were clearly entitled to share any profits. Contrary to earlier expectations those profits were now likely to be substantial. Despite its clear title to one-half of these profits, the New Zealand Government had never intended its share to go wholly into public funds, and had proposed to the woolgrowers that if they set aside a surplus from the growers’ contributory fund the Government would also make available profits from the Joint Organisation for the future benefit of the industry. Mr. Nash then read the following letters written on August 27 (after the Budget debate in the House had started). The first letter, written by Mr. Nash to Mr. N. R. Jameson, chairman of the Wool Board, stated: “Following the policy decision of the Government on the use to be made of the final balance of profit accruing to New Zealand from the operations of the New Zealand Wool Disposal Commission and the Joint Disposals Organisation, in terms of the financial plan (section 111 of the schedule to the Wool Disposal Act, 1945), conveyed to you in my letter

of 25th. instant, and subsequent discussions in regard to this matter, and also in regard to any balance remaining in the growers’ contributorych.":-, .ecount when the Joint Orp ition is wound up, an agreeme. s follows is acceptable to the Govs. ament: “(1) The Wool Board undertakes that any balance remaining in the contributory charge account kept by the New Zealand Wool Disposal Commission when the Joint Organisation is wound up will be used as the nucleus of a fund for the establishment of a post-joint Organisation marketing plan for wool, but if the intended Post-Joint Marketing plan does not eventuate, will, in any case, be used in conformity with section 17 (6) of the Wool Disposal Act, 1945. “(2) The Government agrees that any ultimate or final balance of profit arising from the transactions of the Joint Organisation will similarly be used in the establishment of a PostJoint Marketing Plan for wool, but it the intended post-joint Marketing Plan does not eventuate, this balance of profits will be reserved for expenditure for purposes beneficial to the wool industry as may be mutuallyagreed upon between the Wool Board and the Government. “(3) It is agreed that any contemplated post-J.O. marketing plan shall in its form and details, be acceptable both to the Government and the Wool Board, that its policy shall be determined by mutual agreement, and that its administration shall be jointly by the Government and the industry through equal representation on any board or controlling authority that may be established for the purpose. "If these proposals are acceptable to your board and you advise me to that effect, the exchange of letters could be accepted as a record of agreement between the Government and the industry.” Mr. Jamieson replied to Mr. Nash the same day, stating: “The terms of this agreement between the Government and the Wool Board (on behalf of the wool industry) as set out in your letter are completely acceptable to the Wool Board, and I am happy to say were very well received when announced to the electoral committee of the industry. On behalf of the board I wish to convey our appreciation of the very fair attitude of the Government in these matters, and our thanks to you personally for your contribution to the conclusion of this mutually satisfactory agreement. This exchange of letters can, as you say, be accepted as a record of this agreement between the Government and the industry." Mr. Nash said the agreement reached would provide a safety background. In the event of any bad collapse in prices the funds would remain at the disposal of the industry, whether or not a projected marketing plan was agreed on.