NEW ZEALAND PRICES

Dominion, Volume 37, Issue 15, 13 October 1943, Page 6

NEW ZEALAND PRICES

Benefit Of Locally-Made Goods

CRITICISM ANSWERED

Dominion Special Service. NAPIER, October 12.

Galling attention to the fact that in the recent election campaign a great deal had been said about the cost of living, the president of the New Zealand Manufacturers’ Federation, Mr. 0. V. .Smith, in addressing the manufacturers’ conference today, answered some criticisms of New Zealand-made goods. “Had it not been for our local industries we would have been without hundreds of things which we eat and wear and use every' day,” he declared. One side in the recent election had stated that the cost of living had risen less than in any of the other countries at war, while the other side had claimed that prices had soared. Both parties, said Mr. Smith, were perfectly correct, (but both parties carefully picked the examples that suited them best. “If you examine the prices of articles made wholly or largely from New Zealand material you will find that there have been no increases in many cases and small increases in others,” he said. “If you examine the prices of articles made from imported materials you will find a very different story. These prices are high, and the reason is the amazingly high prices being charged us from overseas plus high transportation costs and a Customs duty and sales tax paid on these high prices. A 50 per cent, increase over the 1939 export price is today looked on as a small increase. “I could quote you innumerable cases where the increase is well oyer 100 per cent, and up to as much as. -00 per cent, or more. Add to these prices the extra shipping and war risk charges; add the duty on to an inflated price and remember’that most duties are on a percentage basis; add the sales tax (again as a percentage) ; add the retailer s profit (also in many cases a percentage); and then you will see the reason for these high prices. But the Price Tribunal has not been so liberal in granting an increased cost for manufacturing. Price Tribunal Policy.

“We, as manufacturers, have had some hard things to say about the Price Tribunal, but one of our biggest complaints has been the inequitable method of dealing with applications from manufacturers as compared with other sections .or the community. Not only is the unit increase the maximum increase that would be granted, but not even that if another part of the business was capable ot carrying the increased cost. “Had that method always been adopted with retailers and other distributors, prices would not be what they are today. Furthermore, the principle of allowing a percentage increase has been admitted in some trades, and it is. not difficult to understand how prices pyramid if insurance, duty, sales tax, and. profit are all added on a percentage basis. The public should know the source from which these high prices arise. They are certainly not the fault of the New Zealand manufacturer. . “Another criticism that is levelled, is the question of quality,” said Mr, Smitn, “and periodically in Parliament or elsewhere.an article is produced and quoted as a reason why goods should not be made in New Zealand. That type of criticism is just as unfair as if I had quoted a dirt test taken at a dairy factory and then suggested we should do away with the dairy industry. “Many manufacturers today have . a continual headache in striving to maintain quality with inferior raw. materials and with wartime staffs. This problem is not peculiar to New Zealand, of course, because there are very few goods coming in from overseas today with a quality’ of pre-war standard —many, in fact, are marked wartime standard. It would be a strange thing in wartime if it was otherwise. What these critics should not forget is that the high standard of living that we have managed to maintain during these war years is in very large measure due to the part played by New Zealand factories.” Manufacturers’ Dufy. The point was also stressed by Mr. Smith that a business man, whether a retailer, importer, or manufacturer, owed a debt to the community, and it was his duty to discharge that debt by producing the best possible article at the lowest possible price. If a manufacturer exploited the position that had arisen through import control, and later through the war, then he was taking a very short-sighted view, and, moreover, was doing the New Zealand manufacturers as a whole a very grave disservice. Under a high tariff wall, under import control or under any form of prohibition, there was always a grave danger that the security which was offered was a temptation to relax and be content with what had been done.

“Import control and the war have given manufacturers an opportunity that might not have occurred for another 20 years,” Air. Smith said. “They have given us .an opportunity of showing what can be produced. The larger volume of business. offering has enabled us to adopt more economic methods. Firms of world-wide standing have commenced manufacturing in New Zealand. AVe have imported the most up-to-date machinery in the world, and will continue to do so as it becomes available after the war. Necessity has again proved to be the mother of invention, aud we have learned a great deal that is of immense value. In these last few years we have emerged from our period of adolescence and reached the strength of maturity.

“If New Zealand is to rehabilitate her men successfully, if she is to develop economically, if she is to carry a population commensurate with her size, it is in the expansion of industry that our main hope lies.”