30,000 WITHOUT WORK

Press, Volume LXXI, Issue 21412, 2 March 1935, Page 3

30,000 WITHOUT WORK

* PERMANENT POSITION IN DOMINION REMEDIES SUGGESTED BY MR W. BROMLEY (SPECIAL TO THE PKESS.I TIMARU, March 1. The opinion that unless new industries were established, shorter working hours adopted or a compulsory retiring age fixed New Zealand could never hope to have less than 30,000 men unemployed was expressed ,by Mr W. Bromley, deputy-chairman of the Unemployment Board, when addressing the New Zealand Rotary Conference to-day. Mr Bromley made an exhaustive survey of the factors contributing to the abnormal increase 01 unemployment during the depression, and strongly advocated the development and subsidising of new industries on a planned basis as a means ot absorbing the unemployed. . After stating that unemployment m New Zealand was a problem of good times as well as of bad—the Government found it necessary to appoint a committee of enquiry into the problem in the boom year of 1928—Mr Bromley proceeded: . "It is patent to all to-day, I think, that large scale unemployment in New Zealand is inevitable, not only until better world prices are obtained for our produce, but until we can develop new industries, obtaining a better balance between our primary and secondary industries. Summary of Workers After examining the factors traceable as responsible for an abnormal increase of unemployment in various industries, Mr Bromley quoted the foßowing figures showing a summary of the unemployed in New Zealand at September last: —

Normal .. .. -• 13,500 Public works .. •• 6,000 Public works by local authorities .. • ■ 3,000 Agricultural and pastoral industries .. •• J.OOO Factories .. •• 11.JO" Coal miners .. •• 1. 100 Transport— Waterside workers .. 4,000 Railways .. .. 3,500 Tramways .. .. 500 He was still convinced that New Zealand must depend largely on the production of the soil. It would be folly to neglect the farming industry. The Dominion should take note, however, that the tendency in Great Britain was towards a greater degree of self-sufficiency, a policy forced upon her by the loss of her own export markets (reduced from £525,000,000 in 1913 to £367,000,000 in 1933) which left no option to New Zealand other than the rearranging of a new balance between primary and secondary industries. Two Important Issues "The two questions uppermost in his hearers' minds at this stage must be: (1) Is it not overstating the case to assert that with world recovery New Zealand will be unable to reach normality as far as unemployment is concerned by enlarging her capacity to produce from the soil those commodities for which she is so renowned? (2) Will not new industries spring up in New Zealand if and when they can be carried on at a profit?

Balance in Industries "If we are to reach a better balance between our primary and secondary industries, our secondary industries as well as our primary industries, will have to be the subject of some planning, and the present lais-sez-faire abandoned, not only in new industries, but also in existing industries." Citing the example of the woollen industry, Mr Bromley said that in 1932-33 the output was:— Tweed and worsted (yards) 1,276,144 Flannel (yards) -. .. 865,726 Blankets (pairs) .. 110,668 Rugs and shawls .. 39,201 Yarn (lbs) .. .. 829,476 Hosiery (dozen) .. .. 134,549 He asked his audience whether they would say that New Zealand had had the best results possible from this industry? Last year New Zealand imported something like £500,000 worth of woollen goods into the country, and the Dominion's woollen , mills were employing fewer hands to-day than in 1928-29. "If we cannot develop an export market for some of the woollen goods that we produce, rugs, for instance, it ought to be impossible for any outside manufacturer to win a market here for the same woollen goods. The raw materials have been at bedrock —coupled with customs protection, exchange advantage, freight charges—and it seems inexcusable that

this industry should be adding to the numbers of unemployed," he added. "The 12 woollen mills in the Dominion are for the most part working as separate concerns, each contributing to each item in the list of things produced mentioned earlier. I know that organised as one concern, with rationalisation and specialisation, extension and development would be easier, and probably in that way many of our present unemployed could become absorbed. X'erhaps many are thinking that nothing could be more terrible than to have Government interference with industry, more particularly when the industry has managed for 60 years «,vithout it. Government Interference "When you consider, however, in recent years the Government has been called in to assist industry it seems less terrible. I think then that there is a necessity now for some central body, not the Unemployment Board, to examine and plan for the expansion of our existing industries. It appears just as essential as it is already admitted to be in connexion with our primary industry." New Industries Discussing the development of industries new to the Dominion, Mr Bromley asked whether this could be allowed to drift on the lines of unregulated private enterprise. Recently, assisted by the Unemployment Board from the funds under its care an investigation, by experts had been undertaken to ascertain the economic possibilities of a modern steel works for New Zealand. The report was not yet available. Taking all the wellknown factors into consideration it would not be surprising if the report; when available, confronted them with this problem. There was iron ore in plenty and of good quality, limestone, coal, and labour also. The capital required was said to be about £2,000,000, but having regard to the limited market and the costs entailed in concentrating the units of production, there was little promise of a return for the £2,000,000 of capital for a long time to come, if ever. He asked, however, whether the disclosure of such a position need prevent New Zealand from establishing a steel industry? "With unemployment relief costing in the region of £4,000,000 annually, and likely to cost a similar large sum annually until a growing proportion of our male population can be gainfully employed, we must ask whether it is not wise economics to establish such an industry out of revenue collected for relief of unemployed. What about England buying our. exportable products? Must we not take her manufactured products in return? First, I think we could continue to import to, at least the same extent, even though we manufactured more in New Zealand.. There would be changes of course in the items imported; and sec-

ond, England could be assisted as greatly by exporting some of her surplus population to New Zealand, as by the export of manufactured goods. Reducing Working Hours "Another popular line of attack on our problem would be a reduction of working hours in industry," continued Mr Bromley. "This is not a question without difficulties. It has engaged the attention of the International Labour Office at Geneva much of late. I am not suggesting that it is possible in New Zealand without some international action. What I do say is that to-day, when the wage level is tending to rise again, is the best time to have the question considered by the employers and workers engaged in industry. It seems to be much nearer possibility when wages are increasing than when wages are falling. "Then, finally, is this taxation to last until these years of proposed development have passed? Are we to have the spectacle of thousands of our citizens subjected to such a low standard of living as that experienced by the unemployed to-day? Are scheme 5 and sustenance and all the other schemes to become a permanent part of our social system, and are the unemployed for years to come to be the battle ground of all our political fights?" he asked. "The answer to all those questions will depend upon the people themselves. Insurance Scheme "Personally I think that we shall never return to the position where the genuine worker deprived of income through loss of employment and for no fault of his own is left without support. Periodically we are advised that the present system of unemployment relief should give way to an insurance system such as operates in England. I subscribe to the view expressed by the Special Investigating Committee that an insurance syste:,* on the lines of the English act is inapplicable to present New Zealand industrial conditions. The English act has to the present time excluded agricultural workers and many others corresponding with classes that in the aggregate comprise the larger part of our New Zealand workers. One of the difficulties confronting the Unemployment Board in the work of administering relief is the wide disparity between country and town wages. To fix a relief benefit rate for country workers, not attractive enough to detract labour from the farms, is inadequate for relief in the larger cities. For this reason the board for a long time now has adopted different scale rates of relief as between town and country. This policy, however, has been subjected to much criticism.

"The plea is put forward that seeing the citizen residing in the country is taxed on the same basis as the resident of a city, when unemployed he is surely entitled to the same basic rate of relief. The logic of this plea makes it very hard to deal with, and I am certain that if, as I have suggested, the provision of relief is to be continued for some time, alterations in the legislation will certainly be required. The difficulty just mentioned of establishing a flat relief rate over the whole Dominion would assume greater proportions still if I were to go into the classes of applicants also. New System Suggested "I have often thought that greater justice all round might be achieved by amending the legislation slightly to provide for a more co-operative basis of responsibility as between the Unemployment Board and local governing bodies." Mr Bromley, illustrating his idea, took the Timaru allocation centre. First, the unemployment fund would provide as relief such a rate as could safely be made uniform throughout the Dominion. A local unemployment council in Timaru, representative of the local bodies subject to levy by the Hospital Board and the Unemployment Board, should then decide the basis of relief for the unemployed In this area. The relief would then be administered as now, by the organisation created by the Unemployment Board and the local bodies of the district would be required to contribute

directly into the unemployment fund an amount to cover the difference between the flat rate provided from the national taxation and the rate agreed upon. "Such an arrangement, it appears to me, would offer the following advantages over the present system:— 1. Any advantage in money rates given to the unemployed in any district would require to be paid for by that district. 2. Local body representatives would discuss questions of relief from a different and better angle than at present. Election of a representative has at times been secured by promising that someone else would pay higher relief for unemployment. 3. Under the proposed arrangement the rates of relief could be made as high as the local residents were pre- , pared to pay for. 4. It would not cost more. Any increase in local taxation would be offset by reduction in national taxation and finally the board, under that arrangement, would have more opportunities for directing new employment."