PURSUING THE PROFITEER

Dominion, Volume 12, Issue 287, 30 August 1919, Page 6

PURSUING THE PROFITEER

.■The -Prime Minister has - been commcndably prompt ifi giving heed, to the complaints that are rife in regard to profiteering, and in seeking 'a remedy.' His instruetion to the Board of Trade to obtain any 'reliable evidence it can of profiteering and initiate prosecutions may serve a double purpose. It may lead to a demonstration that profiteering in its true meaning is much less widespread than'many people imagine. On the other hand, the conviction and punishment of any persons who have overstepped •the bounds of fair trading would produce salutary results. " Mr. Massby himself observes that there are many factors, bearing on the price of goods which cannot be dealt with in the Dominion, and that people are apt to overlook the unavoidable inflation of the currency which has been going on during the war years. - "But," he adds, "1 am afraid there is 110 doubt -that profiteering is going cm." Probably this fairly sums u'p the facts. Many of the complaints about profiteering that arc to be heard daily care certainly based on imperfect know;ind 'a failure to appreciate the factors which make a great increase on pre-war prices inevitable.' Some people' apparently estimate the morality of present day trading by comparing pre-war and, current pricey but this, of course, is quite irrational. In order to get at the facts, it is necessary to make full allowance for a heavy increase in practically all the items that enter ■into cost of production, including the wages of labour nere and abroad and "transport Charges over long, and short distances. Making duo allowances, however, some instances of increases in' price are cited from time to. time'which,: to'say the least, call for, investigation. The Board of Trade has full power to cam out the necessary inquiries, and the Act under which.the Prime Minister recommends that legal proceedings should be ttfkcn provides for a fine not exceeding £200 in the case' of an individual offender, arid not exceeding £1000 ,in the case 'of a company. The Act in question—it was brought down by the NationalGovernment last year—is one--of those that may call for attention this session. Apart from the fact that it is an item in war legislation which may need to Jie extended, the sections dealing wtth profiteering seem to be needlessly cumbrous an J involved. It provides, for instance, that: Every person commits an offence against tl\is section, who, either as principal or agent, sells or supplies, or offers for sale or supply, in New Zealand any goods at a price .which is unreasonably high if the opportunity of obtaining sueir price ill Mew Zealand arises by reason of the existence; present or. past, of a. war in which . His Majesty is engaged or by reason of a scarcity of. such goods in New Zealand caused by war conditions present or past. If profiteering is established it does not seem to matter much what the circumstances arc in which it has been practised, and there seem to be strong arguments for deleting the last and qualifying portion of the subsection' which has been quoted. A later subsection provides that the standard of a fair and reasonable rate of commercial profit shall be a rate that would have been fair and reasonable prior to the outbreak of war. This provision again is complicated by the authorisation of "a fair and reason- | able addition for war conditions of I freight charges and business expenses." ■. These charges, of course, enter into cost of production, and have, or should have, nothing to do with the rate of profit.' No doubt .it-would be. an easy matter to simplify and'improve this legislation, but as it stands it ought to" - "suffice, with the powers exercised by the Board of Trade, for a definite test oE the extent to which profiteering is now, carried on in the Dominion.