Not Passing On All Wage Increases

Chronicle (Levin), 7 May 1949, Page 2

Not Passing On All Wage Increases

Press AssocicotionJ

(Per

WELLINGTON, May 6. "It is obviously desirable t&at tlie wages increases arising from the raview of awards should he reserved as far as possibie to the workers concerned. To enBure that wage and salary earners and their families as consumers enjoy to the fullest possibie extent the real increase in purchasing pdwer, it will be the responsibility of the Tribunal to see that as far as possibie price increases are avoided," says a statement issued by the Price Tribunal today. A preliminary survey of tlie effect* of the wage increase reveals that i price increase in sonxe industriea is inevitable. This will particularly be the case where the wage bill represents a eonsiderable proportion of the total costs. Where, in the view of the Tribunal, an increase is inevitable, every ei . t'ort "will be made to keep this increase down to the minimum. In no case wilJ* extra-prolit be allowed as a direct result of the wage adjustinent. ,"Jt is not considered that any appreciable increase in the prices of food' duffs will result through the increase in wages, partly because the wage content in certain foodstuifs is relatively small .ind partly because the consumer price of niany foodstuifs is maintained at a low level by means of a subsidy. "While the Tribunal is not yet in a position to determine the matter linally. it appears from the evidence so far available that the margins perinitted in botli the wliolesale and retail fields can in sonie instances be reduced. No fin a I lecision can be arrived at, however, un til the matter has been inore closely examined, possibly after a public hearing. "It will be appreciated that if in certain cases the margins for distribution can .without injustice be reduced, the rises in manufacturing costs due to the mcreased labour award will not neces;arilv mean increased prices to the pubiie. Where tliese inevitable increases to Manufacturers can be olfset againsi iliininished margins for distribution this will naturally be done. It will also be possibie in some cases to avoid >ncreases in price bjr taking aceount of the exehange savings which have not yet been reflected in the price adjustments. "The Tribunal recently decided that consequent upon the increase granted by thc Court of Arbitration to the clothing trade employees, manufacturers' margins should be redu'eed in most of Ihe branehes of the elothing trade. Lf the Court awards a further increase in the wages of elothing trade workers it is intended that tlie manufacturers of women 's and' men's outer wear, of children 's garments and of industrial garments, should be perinitted to iucreasc their faetory prices by adding as a surcharge 011 the end price any further wage increase allowed. "Details of the procedure to be adopted will be discussed with the garmeut manufacturers. "As any substantial wage increase: cannot be absorbed completely by all woollen mills, opportunity will be takeb to rc-price certain items of production. Similarly with footwear. 'It appears that the inost equitable way of meeting the wage increase wiU be for a blanket ceiling increase to be coniputed on an industry basis as an interiin measure, after which individual (Irnis will be required to' prove increases up to the ceiling. "In all the above cases the Tribunal will take the necessary action without application by the industries or firms concerned. Any necessary adjustinent-. will be made by the Tribunal withou! application in respect to the following industries: Tanneries, laundries, manufactureres of plywood, cement, bricks, asbestos and other cement products, lime plaster, iibrous plaster, plasterboard, wallboard and furniture. "It is not anticipated that any .undue delav will occur in dealing with these branehes of industry as in most ckses the Tribunal is in possession of up-to-date information coneerning the trading positions. It should be possibie to make rapid adjustments where these appear to be warranted. ' ' The trading community will no doubt appreciate that the task of the Tribunal and of the Price Control Division will be particularly- onerous dur ing the next few weeks while the above industries, which are regarded as thc ■ most urgent, are being dealt with. Provided manufacturers and others concerned co-operate by furnishing promptly all information required by the Tribunal there should be little delay. "When these more urgent cases have been dealt with attention will be given to other industries where the wage increase is relatively small or where such increase can be borne, at any rate for a time without- injustice. These other cases will ^be dealt with later in their order of urgency. "