PROTEST FROM THE WATERFRONT

Wanganui Chronicle, 16 December 1949, Page 4

PROTEST FROM THE WATERFRONT

«'T 'HE people of New Zealand have been fed a lot of information 1 about the necessity for the quick turn-round of ships with food for Britain,” said the president of the New Zealand Waterside Workers’ Union, Mr. H. Barnes, “but ships are being held there merely for storage purposes when the food could better be given to the people in Britain and the ships turned round again to go back into trade .... Shipping companies are being paid very substantial sums for the use of their ships as warehouses when the food should, in fact, be immediately discharged and made available to the people of Britain to whom we have sent it. We protest vigorously at this ridiculous situation.”

Mr. Barnes expresses the viewpoint of what is probably quite a large number of people in New Zealand today. The general memory is that when the market was allowed to look after itself, when seller and buyer got together and the price mechanism of the market had free play, the United Kingdom had a most efficient organisation for the speedy handling of foodstuffs entering the country. The supply was maintained and when a'surplus accumulated, down went the price, encouraging producers to hold off from dispatching further supplies to the market. The price then gradually recovered. But the evenness of the flow of supplies was the chief advantage, for none of the foodstuffs became store stale. Before that occurred the surplus was jobbed out and people who had to be very careful in their spendings could enjoy a high standard of consumption on a low outlay by confining a part of their purchasing power to goods that were in over-supply. A memorandum prepared for the Colwyn Committee by Dr. TV. H. Coates gave some indication of the percentage of turnover done at up to 4.9 per cent, loss and at under 2 per cent, profit. In the sale of foodstuffs the percentage of turnover sold at under 5 per cent, loss amounted to 10.17 and the percentage sold at under 2 per cent, profit was 15.21. So more than a quarter of the turnover of foodstuffs of the firms sampled by Dr. Coates failed to provide a profit of 2 per cent, at maximum or, taken overall, was probably sold at a loss. In wholesale distribution 9.03 per cent, of turnover was done at under 5 per cent, loss and 32.95 per cent, at under 2 per cent, profit. Over the whole of the survey (including retail distribution), 8 per cent, was sold at from nil loss to under 5 per cent, loss and 18.1 per cent, at no profit to under 2 per cent. Thus a reduction in costs by five per cent, would have lifted foodstuffs to the extent of 10.17 per cent, out of the non-profit category into the profit-producing category. The pressure of business under such conditions is therefore to find ways and means of doing this work of turnover of foodstuffs at a lower cost without increasing prices. Thus do the poorer people receive the benefits of the competitive system. It should be remembered by those who think as does Mr. Barnes that the “racket” to which he refers of having. foodships used as storage warehouses is at the initiative of the Socialist Government of the United Kingdom. Why is this Socialist Government engaging in this “racket”? to use Mr. Barnes’ term. It cannot be imagined that Mr. Attlee and Sir Stafford Cripps are particularly anxious to benefit the shipping companies, nor can it be imagined that the shipping companies prefer Io have their ships stationary as warehouses rather than keeping their whole organisations busy by keeping the ships at their proper function which is ploughing the seas. Where, then, lies the cause of this congestion of foodstuffs m the United Kingdom? It is not assumed that this is the result of a stocking-up process engaged in out of fear oi an impending war. What, then? It is because the Government has engaged in the bulk-purchasing policy in the hope of being able to better the price mechanism of the free market. This bulk-purchasing policy has been pursued by people who have no personal risks involved. Their salaries will go on whether the bulk-purchasing schemes work out well or ill. But they have no interest to reduce the cost of handling the business as have the traders who arc endeavouring to lift unprofitable business into the category of the profitable without raising prices. That, is the kernel of the whole, problem. The Watersiders’ Union is quite entitled to draw attention to the ridiculous situation that has developed in the United Kingdom through this conscious interference with the price mechanism of the market by a Socialist, Government, but instead of being content to refer to the problem as a racket they would be doing much more good if they would probe to the causes of this situation which they denounce and then go on to eliminate the causes which have made the shipping ports of New Zealand bywords for ship operators throughout the world.