The Dominion SATURDAY, JUNE 17, 1944. STABILIZATION POLICY

Dominion, Volume 37, Issue 223, 17 June 1944, Page 6

The Dominion SATURDAY, JUNE 17, 1944. STABILIZATION POLICY

When the Government’s belatedly-introduced stabilization policy was announced it was stated that it would do two things, “each of which will depend for its success on the other.” The first was the stabilizing of prices of a large group of the essentials of living, and the second was the stabilizing of individual rates, of pay. When making the announcement the Prime Minister said that he wished to stress the fact that it would not be possible to hold down prices unless “rents and incomes of all kinds, including wages, are held down, too.” Ministers were very firm and positive on this point. Now the Government has decided, according to the Acting-Prime Minister, “to restore flexibility to the wages structure within the limits of the stabilization policy.” What exactly does that mean? The wages structure, as the Minister said, may be a delicate affair, but, as things are, it is a wing of a much larger structure, the national economic edifice, and if the wing is to be jacked up to meet one set of conditions then the balance will be thrown farther out of plumb and fresh “stresses and strains” become unavoidable. It was impossible to prevent certain anomalies being created when a national attempt was made to make things static, and it was probably recognized that, sooner or later, some adjustments would be necessary to meet the position of those in the lower-paid grades of employment. But it is. a little late in the day for the Government to assert that it “did not assume, when the original regulations were promulgated, that they would bear with equal fairness on everyone.” As a matter of fact no little stress was laid, by the Government spokesman, on the equality of sacrifice aimed at. That: was why wages and prices were to be “tied together.” To the extent that the flexibility now authorized will enable clearly established cases of hardship, to be remedied there will be no objection. They were inescapable in any case, and the community would not desire any proved injustice to be perpetuated.. But the elasticity which it is proposed to provide will, just as inevitably, have ascertainable effects, and the position will not He righted by introducing a measure of flexibility on the one hand and giving another turn to the screw on the other. What can now be asked for, with even greater weight than formerly, is that the system by which the Government Statistician prepares the special wartime price index should be fully explained. Apparently inquiries as to the methods used have proved abortive and, of course, the change has effectively prevented any comparisons being made with pre-stabilization figures. The official statement on the matter reads: “The wartime price index will’ not permit of comparisons between the current level of prices and the level ruling at any period prior to December 15, .1942. The publication of the ordinary retail price index has been discontinued by ministerial direction, and the customary figure of. percentage increase in retail prices since the outbreak of the war will no longer be available.” That was about as unsatisfactory as it could be, more especially because the suspension of the ordinary retail price index was not "due to any inability on the part of the Statistics Office to conpile it but Jo ministerial direction. . It now becomes essential, with power given to. the Arbitration Court to vary wages and conditions without taking into account anj fluctuation in the cost of living, that the methods whereby the wartime price index is prepared should be made available, so that it and the various factors may be made subject to careful examination. Many sections of the community will be more desirous than ever to ascertain as definitely as possible the effects of this “flexibility’ on the claim made for the stabilization scheme, that it would “prevent our economic structure being disrupted . . . through prices, wages and costs being progressively forced up by the pressure of an expanding puichasing power on a decreasing volume of consumers goods.