WAGES CUTS

Evening Post, Volume CXV, Issue 35, 11 February 1933, Page 11

WAGES CUTS

RESTORATION SOUGHT

COUNTERING THE EXCHANGE

LABOUR DEPUTATION

An indication that the Government would not favourably consider the introduction of legislation to raise wages to offset any increase in the cost of living which might result from the high exchange or sales tax was given by the Prime Minister (the Right Hon. G. W. Forbes) when replying to a deputation from the Wellington Trades and Labour Council and the Alliance of Labour yesterday afternoon. Mr. Forbes did not definitely give the deputation a negative answer to its suggestion that, wages should be increased, but .his remarks made it quite clear as to how the Government viewed the position. The deputation was introduced /by the Leader of tne Opposition (Mr. H. E. Holland). In. addition to representatives of the industrial Labour movement, several Labour members of Parliament were also present. Mr. J. Tucker, president of the Wellington Trades and Labour Council, asked the Government to restore immediately by general order the wages cuts suffered by the workers since 1029; to restore the original functions of the Court of Arbitration, and to extend its powers when fixing wages to cover the range of wages and price level, production and consumption; to provide special statistics for the Court covering the whole field of internal production and consumption, apd wages and prices, so that greater equilibrium might be created between consumption and production within New Zealand. The inflated value,of land was the root cause of the present troubles, he- said, and he Submitted that the value of securities on land should be written down to their proper value. That would give the country s' chance to straighten itself out for industrial action 'and bring the bondholder into-the line of national sacrifice with other sections of the community. , He submitted the following plan upon vhich the Government could work:— (1) That the Government should by enactment reduce the value of all farm lands equal to the price.Teeeived ' for products sold in London; -■ (2) That the amount written off 'during this crisis from the value of land held lay mortgage securities should not lie considered cancelled, but that when prices rose a payment of the debt should be made; '-.:■. (3) that the valuation, of land sbouldbe upon a basis upon which the working farmer could pay and live: it would-be fixed on a pre-war year valuation price level, say, 9d per lb butter-fat, and 5d per lb wool;.'. - (4) a national land board sliould be set up whose duty sliould be to adjust land values to price levels, and to see that the dormant debts to the "mortgagee were paid when prices allowed,; ..-.,.. (5) that a land valuation and adjustment board should be established ■whose duty should be (a) to prevent land speculation and (b) to provide a. working scheme whereby land values should-not exceed the minimum possible prices received from products sold;.. '-. ■. ■ ' ' ■. •,. (6) that a basic price of land should te fixed, and a basic price for pro3uets calculated, which should be the base of calculating the valuation of •land for payment of interest rates; under no circumstances should the value of land exceed the prices received from farm products sold locally or abroad. • The scheme, he said,, was not a repudiation of past debts; it would mean fixing a solid foundation upon which the fanner and the whole country could live.'- '..■',■ ,'• ;' . ACTION NEOESSAEY. - ■ Mr. J. Eoberts, secretary of the Alliance of Labour, stressed the necessity: of the Government doing something in the interests of the workers of New Zealand. Little had been said from"the workers' point, of view. Mr. Holland: That is not correct. ,Mr. Roberts: From the discussions that appeared in the1 Press. . ' It-was true, he said, that the Labour Party had pointed out the effects of tho increased exchange. He protested against the Government compelling one section of the community to pay tribute to -the other section. It had been admitted by the farmers themselves that 80 per cent, of them would not see one penny from the exchange. "When the Court of Arbitration heard the application for a general order reducing wages, continued Mr. Eoberts, he and Mr. J. McCombs, M.P., had stated, that a cut would reduce price levels of primary produce and would create unemployment. Events had shown, that the number of unemployed had jumped from 25,000 to 50,000. Ho contended that as>a result of the raising of the exchange rate there would be 150,000 unemployed. The increasing of the exchange rate had been, in effect, a reduction of wages by 10 or 15 per cent. Previously, New Zealand butter prices were ahead of Australia's, but now they were level. Comparing the New Zealand position with that, of Australia, Mr. Boberts said that, in' Australia the" exchange rat«» iiw^ been pegged down, and wages haa not been reduced till twelve months agp; in Australia to-day the. cost of living -was beginning to rise. He claimed that already in Now Zealand prices of commodities the workers bought had increased from 10 to 12J per cent. Purchasing power would shrink, and there would bo more dismissals. ."I am not imploring you —I would not do that—l am appealing to you to remember that there aTo several sections in New Zealand besides farmers," he said. He agreed that the farmers had been hard hit, but he pointed out that there were 80,000 farmers while the workers numbered 100,000. The town workers were in the unfortunate position that they could not grow their own food. It had been said that the national income would be increased by £7,000,000 to £10,000,000 but who was going to pay it? Tooley Street would not, neither would the banking institutions or the moneylenders in New Zealand. The town dwellers would pay by way of higher prices. If the rate of exchange was tampered with, the effects should apply to every section of the community. Mr. Boberts Baid that he had advised the workers not to sign up industrial agreements because no one knew what was likely to happen. He claimed that the only course the Government could, adopt was to pass an Act or issue an Order in Council increasing workers' wages in accordance with the increases as a result of the high exchange. "We have taken kicks," ho said, "but it seems that the Government does not want to co-operato with the trade union, movement. It seems

that some power greater than yourself is forcing you to administer thess blows all the time—but honestly I don't think you mean to hurt the work-1 ors personally. There is a limit be-1 yond which we cannot go." PRIME MINISTER'S REPLY. Eeplying, Mr. Forbes said he did not want to raise any controversial subjects. What action he had taken, he had_ taken in the belief that it was something that was going to work out for good, otherwise lie wouia not have done it. He did not want to see workers' wages reduced. He -would admit there was a force compelling him to act, but it was the force of economic laws. In three years the income had been reduced £56,000,000, so how could the country carry on at the same level? , Mr. D, G. Sullivan, M.P.: Our case is that your remedy is worse than the disease. ' Mr. Forbes: Evon doctors differ, Mr. Roborts: And the patient dies. Mr. Forbes said that it was a case of ability to pay the men or not. When it was said that, there might be a greater number of unemployed, he would not say that those who said that would be wrong. No system had been found by which the Government could got along -without money. Mr. Holland: Is not the position this; why should people in New Zealand go hungry when there is plenty of food? A. WOBLD PROBLEM. ' Mr. Forbes: That is the problem facing every country in the world. A similar state of affairs had existed in Australia where there had been Labour. Governments. The idea of the high exchange was to give a stimulus to the industry on which all the other_ industries wjere founded. If that industry progressed, all the other industries would benefit, but if production fell, the position would get worse. The matters raised by the deputation, were matters of policy, and ho could assure, the deputation that the question of the effieet of things on the workers had received the. full consideration of the Government. As far as the sales tax was concerned, the Government had endeavoured to exclude food. ' As to criticism regarding the Ottawa Agreement, it had been decided that the same concessions would be given to all Dominions but the feeling was that currency was a 'matter for the people of the Bomiaions, although there had been a feeling favouring stability and equality, with the desire that the whole Empire should work in that direction. He thought that what had been done was" better' than deflation. If exchange. had not been raised, unemployment might have .been doubled or trebled. If there, had been no reduction in wages, the number of unemployed. to-day .would have .been greater. The workers' side of the case had been presented by the Labour representatives in Parliament. • In reply to a question as to whether the Government would increase wages if it were proved that the cost of living increased.as a result of the exchange, Mr. Forbes said that the Government did not intend to legislate in regard to wages. If the cost of living'went up prices would go up, and the position ,would be getting .better because the Dominion's prices were determined by prices overseas. Mr.-Eoberts: Will you amend the I.C. and A. Act so as to give parties to an agreement : permission to make application for an increase in wages if it is proved that the cost of living goes up as a result of the exchange rate? .'•" ■-'"- ;" " ' . Mr. Forbes: Agreements' have no clause stating that if the cost of living drops wages will be reduced.