WAR CONTRACTS

Dominion, Volume 12, Issue 146, 15 March 1919, Page 9

WAR CONTRACTS

. e :— MANUFACTURERS' AGENTS IN DIFFICULTIES GOVERNMENT RELIEF ASKED A deputation representing the British Manufacturers and Agents' Association interviewed the Hon. A. M. Myers, Minister of Munitions and Supplies; in consection with contracts entered into with • local bodies in various parts of the Dominion. Tho ■ deputation raised an important point in connection with the dis- . charge of contracts that wore entered into under war conditions. Mr. '< A. D. Riley brought under tho , Minister's notice cases where contracts had been lot to supply borough councils with certain machinery early in the war. The orders were accepted 'by tho firms in England, but the New Zealand agents were advised later that owing to-the war conditions it would not be possible to satisfy the orders, since permission to manufacture oould not be obtained from the British-Ministry of Munitions. About six-months ago tho permission waa-grant-ed, but the manufacturing firms then advised the New Zealand representatives that the prices would have to bo greatly increased, otherwise the orders must bo cancelled. The position now, therefore, was that the New Zealand representatives were called upon'to carry out the contract at the original price, the local bodies holding them to the contract. Mtv Riley stated: thaj;. in sonie cases thero would be a difference of from ,£3OOO to wEoOOO between the original contract price ind the present price, and this placed , the agents in a most unreasonable position. He quite realised that the manu-facturers-could not possibly manufacture the goods at the original price, but tho ( Dnus of the situation was falling upon ' the local agents. The deputation wished ■to suggest that ijj view of these conditions the Government should take some . notion to relieve the agents. The request covered a large number of contracts. Mr./Greenshields cited a case where tho original contract price amounted to i£13,000. The cost of tho goods had increased by about <£5000 owinp to tho conditions described by Mr. Riley, but the borough council' concerned had stated that it was not bound to pay more than the original contract price. Mr. Fleming, for 'Messrs. Turnbull and Jones, mentioned a case in which the original contract price of ,£6700 had been increased to .£13,400. Certain safeguards had been placed in the contracts, but cases of this kind had been quite unforeseen. The agents felt that it was the duty of the Government, under the peculiar conditions, to grant some such protection ,1s had been provided by the Imperial Government in the United Kingdom. Mr. Fleming added that from a legal point of view the agents seemed to have no redress. But he considered that from a moral standpoint somethingshould be done for tliem. He believed thai in Australia arrangements had been mada for both parties to a pre-war oontract to pay their shares of the increased prices,' ' but the local bodies in. New Zealand were demanding their full pound of flesh. The Minister, in reply, eaid that the difficulty presented to him by the deputation (was not easy of solution. He , did , not intend to express any opinion in con. nection with the contracts haying been entered into without adequate safeguards being provided; presumably the agents were prepared to take certain risks, but whether their calculations weire right or' wrong was beside the point, The arrangements had been made during the ' war, however, and the responsibility was 1 on those entering into the contracts to see that they safeguarded themselves. The question was . whether the Government was pre wed to take any action that would assist in bringing about a settlement. He would discuss the matter with the Attorney-General and subsequently place it beforo Cabinet. He could say at once that he foresaw difficulties in the way of taking action in the direction dcsired by the deputation. The Government had considered the question when the legislation of 1917 was framed, but that only affected New Zealand contracts. He would got the opinion of the Attor-ney-General and lot the deputation know what decision was reached. <