THE DUTY ON FLOUR.

Gisborne Times, Volume XXV, Issue 2184, 13 September 1907, Page 1

THE DUTY ON FLOUR.

DISCUSSED IN THE. HOUSE uF REPRESENTATIVES. • • ■■ ' . u. L,*’ MOTION" TO PLACE- ON FREE LIST DEFEATED. . Press‘A^sooiatjtßn*. I ,' • \V EI jLIN Qufcpisiu SPP V'i 1 1 ~,. AY hen the House resumed ,at ey p m. tho item iri the. Tariff- Bill, and pulse, every kind when, ground, or ill any way. lminufactured, n. 0.0., including wheat and flour, was coukhISTATEMENT , BY- THE ■ PREMIER, The Premier said ho know sonic members were desirous of reducing tho duty on flour By LL por- ton, thus making it free. llnr, houcrti agreed to a duty on wheat,- because oho could not bo on the tree list without the other, except to-the greatdetriment of bread consumers. if the flour duty was, removed theie would be no chance of flour-milhn o being carried on in Now Zoaland, with the door loft open- to tho flow producers of Australia to send flour in free. hie was with those who wished to see bread cheapened. It should bo free from possibility of any combination to keep it at a fictitious price. The quantity of wheat exported from Now Zealand in IJUo was 967,151 bushels and exported in 1906 61,199 bushels. Tho quantity of wheat grown in the colony for the season 19U5-6 was 6,798,934 bushels, and in 1906-7 5,605,252 bushels. In 1905 5,300,000 bushels were consigned in New Zealand, and in IJO6 500,000 bushols wero consumed, only 01,199 bushels being exported, lheso figures must make clear that in tho event of the duty being taken off flour it would ultimately come off wheat. Farmers growing wheat would have to send a greater proportion of wheat out of New Zealand and depend on the markets of the Old World. It was frequently stated that the puce of wheat in this country-was governed by tho price in- London.,, . lo a hu-gt/extent this was so, but it was also within the knowledge oh any- PtH son who knew anything at all about the exportation of wheat m years none by from New Zealand to Liigland, that wo were never able to compete on even terms so far as the conditions were concerned with Australian wheat, and wheat grown in America and Russia. If they .took the duty off wlieat what were-they go ng to do in regard to wheat- or flour. We would have to depend on Australian 1 wheat or flour exporters or upon other wheat exporters. If tlioytno"oins to attain the object ceitain members wero honestly advocating of having cheap flour or bread he thought there was a deal to be said for that, but ho thought that would be "oing out- of the frying-pan into the fire If they took certain action and then were in the position, of being in the hands of a combination of flour-millers not in this country, hut in other countries, they would find that bakers in this country would not be in the hands of local peoplo, over whose actions Parliament, would have some control, but would bo in the hands of people outside this country over whom Parliament would havo no control whatever. b or that reason lie was persuaded it would bo a lnuxe mistake as a matter or policy under the belief that we were going to cheapen the-price of bread. -Ihat should follow the taking the duty off flour or wheat. AYhat effect would that have upon the industry? At tho end of 1906 there were 540 weoiile employed in tho flour-nulling industry. Tho amount of vested in the industry was £411,608. Consequently they required to look into the question a littlo deeper. It not only affected tho men oinployed in towns but thoso employed in mills. It also affected those engaged in carting wheat from tho farms to the railway stations, and those employed loading steamers. Ho had no hesitation in saying that if they were to dislocate the whole of this industry they would cause a cessation of employment- directly and indirectly of several thousands of people. Ho was sure he was within the mark in saving they would affect the employment of 4000 or 5000, and that was a very 1 serious matter. Tho duty on flour into Australia was 50s per ton during the year of the drought that occurred in Australia. From time to time that duty has never boon removed. . A\ T heu flour -was at tho abnormally high price of £25 per ton tho Australian Government never altered, their, import duty. If Parliament decided to remove the duty from flour and wheat they might depend on it that thoso farmers who were working in _tho production of wheat would abandon it altogether. Tho export last year was under 50,000 bushels of wheat and 5,000,000 bushels, wero used in our local consumption!. It would bo a very serious tiling if wo removed the duty. He thought it was the duty of Parliament to ensure what ought to bo tho goal of those who were urging the removal of tho duty—to ensure a fair price .being obtained by flourmillers and a fair price being obtained 1 by bakers in proportion to tho price they were paying for wheat. He thought the proper course for Parliament to follow was not to attempt to deal with- the question on the Customs tariff, but they should let the Government bring down independent legislation to fix the price at which, when flour attains a certain figure, tha Governor-in-Council should, have power to remove the duty upon flour. They would also necessarily h.ayo to make provision for the removal of the dutyupon flour proportionate with the price at wliich wheat was being sold at local, towns in New Zealand. For instance, to-day milling wheat ol the, best, quality,, was selling in Christchurch at about 4s 9d a bushel, i The amountr. of duty would obviously have to be on a sliding scale proportionate to the price of ' wheat, and he was persuaded they would have to go a step further. The matter of the price of wheat passed beyond the grower and miller to the baker’s shop. They would have to make provision for the whole three if they were to ensure a fail - price of bread to the consumer. He proposed this session,to submit legislation dealing with tho three aspects he had put before members. He had now a good deal of information, although not all that was required to enable a complete proposal covering this matter to be placed before members. Ho took it that tkoy would require to have a maximum price fixed so that when flour rose to ten guineas or £ll a ton or thereabouts then v iinless wheat were riding at an abnormally high price the Governor-in-Coun-cil should at that price be empowered to remove the duty while those high prices lasted. They would also require to have a price maximum and minimum fixed, in all parts of Now Zealand for both tho two lb and four lb loaf, for unless the principle was carried from the wheat-growers

to the miller ami tho baker, no benefit would bo conferred upon tho masses. Ho iwas having information collected iis -to what tho price of tho two -and Four pound loaf should be, together with the,: price- at which millers coilid legitimately, afford to sell flour at the ruling ..prices of wheat, anil also as to the basis of. a..fair selling prido.,for wheat qt ( thq,.p<?rts of Now 'Zealand. Ho thought,that any, men wliq viewed the matter dispassionately- would agree,.'that that was a 'fairj wav, of .dealing.with tho ,matter. That ■ the, -people -wore entitled to got 'bread.-at as low a price ns it was possible for the baker to supply it was beyond all question. He wished also to say a, word about the representations that had been - made that the; Government should erect State flour-mills. It the State wore to go in for. flour-mills of their own they would require to own all tho flourlnilip of the colony, even though they did !not carry them all on. In addition !to that they would require to own; all lands on which wheat was grown in order to control the. supply of Wheat to tho Government mills. That, in his opinion, was too large a contract considering the l'Gsponsibilities tho Government had on their shoulders. Some lion. members might say that the Government could obtain wheat from, the farmers' in the ordinary way. Ho did not think the : warmest advocate of State-own-ed flour-mills would say that tho Government should carry on those mills at a loss in order to ensure bread being supplied at a- low price, but what would be the result if the Government were largo buyers of wheat from thoso who owned or leased land on which the wheat was raised. The position would be that the growers would only require to hold back their supplies” iong enough, or in other words to corner the supply, and the price would have to be raised and that would operato against Stateowned mills. The only way would be l'ov the Government to own tho lauds on which the wheat was grown anil to produce sufficient for the food supply of the people. lie was persuaded in his own mind that it would bo a mistake and it was not nearly m good a proposal as that which he had submitted. Ho intended in the same mcausurc to submit proposals for the regulation of the price' of potatoes. He did not desire to be bound literally to either tho maximum or the minimum he was suggesting, But! hig 'idea was that when potatoes reached £5 10s per ton the Govern-or-ih-Oouncil should be given power to' reduce the duty on potatoes until they came back to that price. It must be "remembered that the potato-grow-ers of New Zealand were mostly small men and that the average acerage under potatoes would not he more than 20 acres, but they had to remember that every class'in tho country must be afforded reasonable facility for getting a fair return from their investment, and‘whether a man was in a large or a small way it was due: to him as a matter of ordinary - fairness to see that he had a chance of earning a reasonable return from the investment of his "labor to produce the commodity. He merely wished at this stage to indicate what the Government’s intentions were on this important matter, and to inform members on this earliest opportunity that it would be an undesirable thing for this country to take up the, line of. destroying the capital invested in great undertakings or to throw a largo number of people out of employment in order to get a remedy. If they did it to-day in re.gard to tho milling industry they might do it to some other industry at a future time and create a bad impression in tho Old Country ._ AVhere they had an important industry established thero was a responsibility on the colony to see that nothing was done to injure or ruin it and throw out of employment a largo number of people. This country, happily for its people, was in the position of owning its own railways and so controlling tho matter ol transports. There was no discrimination, no differentiation, in favor of the large user of tho railways as against tho small user of the railways. He referred to that matter for tho purpose, of saying that as long as tho Government controlled the important business of transport the peoplo were to a large extent protected against tho huge octopus-like trusts that existed in America and which the people there had to fight against. They could largely protect tlio people against the trusts which through their action affected the price of the foods of tho peoplo, and he believed that the; country would endorse any sensible proposal to prevent trusts from making an Inroad in divers ways into matters that affected the prosperity of the people in older countries. The matter was one of tho greatest importance, and required to he approached with caution and judgment and those lion, members who were

trying to remove tho duty on flour, and necessarily in its train the duty on jwheat, would see, ho thought, that it would be an unwise thing to do in view of the statement he bad made. He hoped members would agree later to raise the Customs tariff as the Government proposed, and this session there would be legislation submitted to provide a remedy on the lines he had indicated. THE DISCUSSION.

Mr Fisher said the proposition .submitted by the Premier contained an element of danger, 'as the Governor-in-Counci'l now really meant the Ministry. He urged that , a Tariff Board should be constituted on the lines of tliol Industrial Boards, and which should he free from every commercial interest. It was true, he added, that the: Premier had undertaken to bring down legislation, but would he pass

Mr. Hogg thanked the Premier for his verv gonerons . offer, and rather •inclined to accept it, hut for reasons which lie would outline lie would stand to liits guns. It was easy to understand the arguments which had been brought forward on behhlf of vested interests. Since the proposal to remove the duty was first made he had been deluged with telegrams and requests to drop the subject. They had miller and capitalist on one side and the bread-winners on the other. Some of the leading men of the colony were with him in this campaign. Air. T. Mackenzie defended the farmers’ interests. He said Mr. Fisher had east a reflection on tho Premier. If the Premier said he would do a thing he (Air. AlcKenzie) believed he would carry it out. Air. Flatman asked whait benefit would accrue to the consumer if the duty were taken off flour. He contended that it would go into the bakers’ pockets. It would be a dangerous tiling to remove the duty on wheat and flour.

Air. Massey said ho agreed with the Premier," but he contended that the Premier’s proposals were really the proposals of Air. Okoy, junior member of the Opnosition. lie believed that if flour"came in duty free

wheat wont. Iso have to come in free of duti , otherwise the floumwllers of the colony would have to pay duty on imported wheat, and the conseqmuico would bo that the millers would havo to close up. Some members appeared to, think, the abolition of tho duty would benefit the consumer, but" as an exporting country this was not so, as the price of wheat was governed by the price in the London market. He did not believe in the proposals regarding the Governor-] n-Uonnoil, but urged that sliding scales should be adopted. However, lie welcomed the Premier’s proposal to bring down a Dill. Then ■ the House could adjust it. Air. Alilllir explained that tho Premier bail already intimated that tlio Bill, would contain a clause providing for power to bo exercised by' the Go-vcrnor-in-Counoil when tlio commodity reached a certain price. Air. Laurenson said he did not believe in taking off the duty. ft would seriously affect the farming ' interests in this country. He quoted figures to show that the abolition of the duty in England had no adverse effect on the farming • industry, as that industry progressed until 1876, or 36 .wars alitor the abolition of the duty. He contended that tho price the colony’s surplus wheat could be placed it tin the London market would always govern the price, hero. All". Buddo approved the Premier’s proposals. It would, he said, be a serious tiling for the farmers if tho duty were taken off wheat and flour. Alii HOGG MOVES TO PLACE ON FREE LIST.

Air. Ilogg said lie felt it his duty to move that flour be placed on the free list, as he felt that the people should be relieved from a harsh tax. He contended, that the flourmlllers lmd exacted great profits from the people of the colony. During tho past four years they had extracted £400,000 in profits. In 1900 the colony’s mills had produced about 83,00!) tons of flour, valued at £683,000, and in 1905 abut 95,000 tons. Air. Graham said the greatest credit was due to Air. Hogg for the manner in which lie had proceeded with his campaign, and it was doubit-liw-due to his efforts that they had tlio Premier’s statement. He urged tiiat under the circumstances Air. Ilogg should bo satisfied. Air. Hogan said he intended to support the amendment; Aliich had been said of the hardships of farmers, and that they should be assisted, but lie ’.asked what assistance did- the farming community give to local industries when the question ,of granting protection to agricultural implements was considered. He considered that the State could take over the mills without growing their own wheat. Half a million would purchase the whole of the milling industi— and the State could still employ the workers now engaged in the industry. Air. Gray said lip was pleased with the Premier’s statement, but considered that if any good came out of it the:credit would be due to Air. Hogg.

Air. Hornsby said the Premier was finding a way out of n difficulty, as if the duty was taken off flour then the people of this colony would be at the mercy of outside wheat-growers. Air. AlcKenzie said that members who desired to abolish the duty should have suggested some means whereby they thought the benefit of tho removal of the duty would go to the consumer. It did not follow that if they took the duty off bread would be any cheaper. THE AAIENDAIENT LOST. THE DIAMiSION LIST.

On a division the amendment was negatived by 49 to 18. Following is the division list: —Ayes (18) : Arnold, Barber, Colvin, Davey, Eil, Fislior, Gray, Guinness, Hogan, Hogg, Izard, Laurenson Alalcolm, Poland, Ross, Scddon, Sidey, Tanner. Noes (49): A'iitken, Alison, E. G. Alien, Bennett, Bollard, Buddo, Carroll, Dillon, Duncan. Field, Flaitman Fowicls, A. L. D. Fraser, AY. Fraser", Graham, Greehslade, Ball, Hnnan, Hardy, Heke, Hurries, Hornsby, Houston, Jennings, Kidd, Lang, Lawr.v, Lewis, Lethbridge, McGowan, T. Mackenzie, AlcLaelilan, McNab. Alacpherson, ■Major, Marnier, Massey, Alillnr, NVata. Okov, Boole, Reiil, Rutherford. Fitallwortliy, Stewart, Thomson, Ward, Witty, "Wood. Pairs: Aves— AVilforil, Remington; Noes—Barclay, Paiata.