OVER-PROTECTION AND THE PUBLIC INTEREST.

Dominion, Volume 2, Issue 450, 8 March 1909, Page 4

OVER-PROTECTION AND THE PUBLIC INTEREST.

An interesting statement has readied us from the Waikato which serves as an excellent illustration of how Government concessions sometimes operate to the benefit only of the individual instead of serving also the interests of the public, who should be the first consideration of the State. It seems that some years ago. the Government decided to encourage the local manufacture of galvanised iron, and with this object a tariff amendment was made increasing the duty on the imported article to two pounds per ton. It was considered that by raising the duty to this extent the local manufacturers could compete successfully with outside makers. The industry, if it, as conducted, can be called an industry, might or might not have been worth developing. As a matter of fact, the "manufacturing*' seems to consist merely of importing the black sheets of iron and the galvanising materials, and galvanising and corrugating the iron here. How much labour this finds employment for we do not knowprobably not many hands are engaged in the industry. The work of passing the sheets of plain iron through the galvanising bath and of stamping the corrugations it is estimated would cost less than one pound per ton, but even if it costs thirty shillings, a tax of two pounds a ton on the imported article is an altogether unwarranted drain upon the public to protect the industry. But this is not the only protection accorded the locally-galvanised iron. The Seddon Government went a step further and reduced the railway rato for 100 miles in the Waikato to 15s. a ton, as against £l 6s. 8d- a ton charged on imported galvanised iron. It would reasonably be expected that with these substantial advantages, given at the expense of the public, to aid him, the local manufacturer would be able to reduce his price appreciably to at least the country consumer who is reached by the railway. Nothing of the kind appears to have resulted. Despite the very great concessions granted, the consumer has received no benefit. Strong complaint, indeed, is made as to the mode of dealing with Waikato buyers. The hardware trade in Auckland is stated to bo particularly well organised. Possibly it cannot be called a combinc in the strictest sense of the term, but it at least works very harmoniously in a good many directions. The result is that country buyers complain that they find it very difficult to deal direct with the galvanised iron works: They have to buy from the hardware house's in Auckland, who fix the price of the article, which includes their commission, and the fanner in conscience has to pay a good deal more for [the product of thia exccßsively'protcctcd

industry than would otherwise be the case. H'gh rents are ;i general .ind legitimate complaint in practically all parts of New Zealand, so much so that it is questionable whether the taxation of building material is not always prejudicial to the public interest. Be that as it may, however, it is quite apparent from the evidence before us that the excessive protection of the local manufacture of galvanised iron lias imposed a substantial tax upon the community at large, more especially the country consumer, and it is extremely doubtful whether there has been any corresponding gain to the country. We believe that the matter has been brought under the notice of the Minister for Railways, and Cabinet might with advantage give the whole question its careful consideration.