Mr. Coates Critical

Hawke's Bay Herald-Tribune, Volume 81, Issue 52, 24 November 1937, Page 3

Mr. Coates Critical

■Press Asaociation »

GUARANTEED PRICE ©

Industry Account Method Examined LOWER INSURANCE

(By Telpgraph—

WELLINGTON, Last Night. Strong criticism of the Government 's guaranteed price scheme for dairy exports was expressed by the Bt. Hon. J. G. Coates (Opposition, Kaipara) during the second reading _ debate on the Finance Bill in the JEtouse of Represem tatives to-night. Mr. Coates also criticised the method of keeping the dairy industry account and stated that in his view thern should be only a very small actual deficit on® last season'S operations. In various directions, Mr. Coates said, the xeport of the Marketing Department, presented by the Minister of Marketing, Hon. W. Nash, had proved misleading. The Minister had quoted the present rates for marine insurance and had compared them with the rates ruling in 1923-24. Thore had been a ste.ady decline in these rates during tho last 12 years and actually the rates in 1935-36 were slightly lower than those ruling to-day. "lt has not been the Government '8 action which has brought down insurance rates," Mr. Coates said. "The rates were brought down long before the Marketing Department came into being. The present rates are part of a three-year cbntract arr.anged before , the Marketing Department was established and adjusted to cover st'orage. To imply that the department has brought down the rates is nothing more nor less than an attempt to hoodwink the public." The Government had set up a committee to assist in determining the guaranteed price, but it had taken care to control the committee by means of legislation. The committee certainly did not h,ave a free hand in the mattor^ It was required to take as a basis for its recommendations the standard of a really efficient producer, but in such a variable occupation as dairy-farming it was impossible for such a standard to be properly deflned. The whole position concerning tho guaranteed price was a negation of the Government 's declared - prineiples. The Labour Party had always set its face against the laying down of maximum payments in wages, butsthe guaranteed price was not a maximum; it was a maximum above which the farmer could not hope to earn. "In the case of farmers who have to pay for their labour, the position to-day is not a scrap better than it was in 1935," Mr. Coates declared. "It is not only a questioa of labour costs. All costs have advanced to such an extent that in the case of 75-per cent. of dairyfarmers they have overtaken the increase in price. "Since this hopelessly involved system has been introdueed, the Government has confiscated all the impr.ovements made by the man who has had all sorts of difficulties to overcome. The average butterfat yield per cow in 1919-20 was 152.041b. In. 1933-34 the yield had increased to 220.801b. And now we find that the Minister in his passion for figures "has based his price on a yield per cow of 2581b. of butterfat. "I wonder if the Minister could tell us what proportion of dairy-farmers are obtaining that average of produc; tion. I know numbers of farms where men cannot hope to obtain a yield of 2001b. of butterfat per cow. What chanee has a man who cannot reach the standard adopted in fixing the price?" The position of the dairy industry account was examined by Mr. Coates, who said that considerable confusion would arise from the f act that the Minister had included in the aecounts the whole season's production and not just the season's experts. In fixing priees for a season, the Aet stated that only actual shipments between August 1 of one year and July 31 of the next year should be taken, but the Minister was including in his first season's aecounts butter which had been exported after the end of the season. In respect of actual shipments, the balance shown in the accounts were as follows: Creamery butter, deficit of £481,150; cheese, surplus of £298,583; whey butter, £4503. That gave an estimated deficit on the season's shipmenls of £187,070. The Minister of Marketing, Hon. W. Nash: That is not correct. You know that there was not a surplus of £298,583 on cheese. ' Mr. Coates: I am taking the figures from the accounts. Administrative expenses were glven as £174,266, Mr. Coates continued, and that inade a total estimated deficit of £361,336, not including the extra payment to .cheese producers. His belief was that on the year's working there would be a credit of about £133,000, without taking into consideration a deduction for administrative expenses^