Trade Competition

Hawke's Bay Herald-Tribune, Issue 144, 6 July 1937, Page 8

Trade Competition

AUSTRALIAN GOODS

Minister Says N.Z. Factories Jfforking at Capacity REDUCE COSTS, NOT WAGES "The Prime Minister as head of - tt« Government, has emphatically ctated that whe-re an industry has heen unduly affected hy legislation to the eztent that it can no longer h« carried on, then steps to protect that industry will be taken; hut I want to say that of the great many industries that we have investigated we have found that in almost •very instance the factories are working right up to their full capacity and cannot keep apace with the orders they are receiving," the Hon. D. G. Sullivan, Minister of Industry and Commerce, last night when replying to a deputation from the Hastings Chamher of Commerce regarding the keen competition Kew Zealand woollen manufacturers are "being called upon to meet from Australia. Mr E. L. Cullen, M.P., introduced Hr Hugh W. C. Baird, president, Mr W. E. Bate, vice-president, and Mr V. Thomson, seeretary, of the Hastings Chamber of Commerce, who comprised the deputation. An epokesman. Mr Balra said that •oncern. was felt because of Australian produce being placed in New Zealand at « price that would beat New Zealand-produced goods. "Our exports to Australia amount to £1,840,000, bui our importe last year aggregated £4,940,000," he said, "and the question Jooms up as to what remedy tnere is. yfe cannot esport more goods to Australia, bnt what about tariff adjustjnents to favour Britain even more, especiaJly as ehfe is our best customer? "We appreciato tbat it is a very difficult problenx inasmuch as itis hard for New Zealand to differentiate between paris of tlie British Ernpire, ' ' he added. "But what is preventing our woollen and clothing manufacturers from cumpeting with the Australian goods f Is it the 40-hour week, or heavy iaxatioh, or bothf Would dt help our woollen manufacturers if an extra tariff wero placed on woollen clothing and blankets containing a percentage of cotton and coming from Australia? Ag&in, are our tariffs against Britain too highf When sales-tax and exchange were added, no adjuetment was made ia tariffs. Progressive Tariff Reduction. *'I£ our manufacturers were advised that the present protective tariff would be redueed, say, 5 per cent. every five years np to 15 per cent., would that not lead to greater efficiency?" he asked. "I do not mean that the Government ahoald interfere with private enterprise in any other way, but this would mean the 'survival of the fittest.' You know that to-day there is a xise iu landing charges. in comparison with those of a few years ago, of about 20 to 40 per cent., and when all landing charges are taken into account appareJ and woollen goods costs, to land in this country, from 70 to 80 per cent. In this protection, or is it a heavy tax on the consuining publie?" Mr Sullivan: Is it to get an improved trade with the United Kingdom or is it the protection of local woollen mi>ia that you wantf Mr Baird: Well, both; but the first thjng is protection of local industry and the second an improved trade witxi Britain. Have there been importations at the experts© of local industry? — "I think aoJ* >- • Are you sure? — "Well, one represcntative told me that his iirm was manufacturlng iess 'in one pafticular line because of the competition from Australia." Mr Sullivan said that he had every ■ympathy with the represenlations i'or protection of local industry, and that it was not the intention of the Governmeht to allow any particular industry to be affected adversely to the exteut of being unable to meet opposition by teason of the recent legislation. More Imports But More Work. " Have we any informatiou regarding this particular industry?" he asked of Mr, 1j. J. Schmidt, secretary of the Industries and Commerce Ucpartinent. Mr Schmidt; We know the factories are .working to full capacity. "My department has investigated a great nUmber of industries because of eoinplainta such as the present, and, though we have found that there has been increased importation, we have iound that there has aiso been increased activity on the part of local manufacturers — so much so, in fact, that they have been unable to keep up with the orders they aro receiving," the Minister added. Mr Baird: Have they employed more meiif c Mr Sullivan: They have to a certain •xtent, but they can' t 17 get all the Bkilled labour they require, Mr Baird said that one important question was whether our manufacturers to-day were putting their houses in prder as rcgarded efficiency. He eonsidered that a tariff reduction of up to 15 per cent. spread over the years as suggested would not only help the manufacturers to increase their efficiency but would. also help trade with Great Britain. '*1 am in sympathy with two points of view expxessed," said Mr Sullivan. "The first is Ihe building-up of our oira industries and the second is that, if there must be importation, then preference should be given the United Kingdom because that is where our best customer is. But our investigations show that there has been inten■Ive activity on the part of our gym

local factories despite the increased importations. "What we want to do is to get down the costs through increased efficiency," he said. "Just as the Minister of Publie Works, the Hon. B. Semple, has been able to'reduce costs in his department by as much as a third through increased efficiency, so must our manufacturers mechanise, standardise, unify and avail themselves of scientific research so that they too can increase the efficiency of the industry and bring down the costs. What has to be done is to get down the costs without redueing wages, because by reducing tlio wages there would be a reduction of the puTchasing power."