WAGES AND PRICES

Hokitika Guardian, 28 April 1922, Page 4

WAGES AND PRICES

NEED FOR READJUSTMENT. argument beeore arbitration COURT.

WELLINGTON, April 2G. The pronouncement of the Arbitiation Court, last month, on the cost of living bonus under the legislation of last “session, was discussed by representatives of employees and employers before the Court to-day. His Honour Mr Justice Frazer held that, as he understood that the employers were seeking a further reduction of wages, the onus of proof was on them, and they were to commence the proceedings. Air AY. T. Young asked for the exclusion of the seamen from the general order and for special treatment, as the Seamen’s Union had never applied for a bonus and had never received

one. , Air AY. G. Smith said that the seamen’s award was registered under the

Court. . . The Court promised to give consideration to the point. Mr J. Roberts urged that the case of casually-employed, watersiders also needed special treatment. The President: The question might he considered of making a new award, [t is open to both sides to, apply. Special treatment was also asked for the hoot trade and for carpenters. Mr T. O. Bishop, the employers representative, urged that it was mandatory on the Court to consider economic and financial conditions affecting trade and industry, as well as the cost of living. He submitted that the lowered income of the country, and readjustment in other countries, rendered it impossible to carry on New Zcalauu industries at the present rate of wages. He presented a report from dillerent centres showing shrinkages in employment and industry. The remedy was reduced wages, lessening the cost ot production and the price of articles Now Zealand was now living beyond .its income and trying to maintain a standard of living that it could not pay for, holding the wages level above wli-t its industries could support, l’ub'uworks undertaken at the present high cost of wages and material never would be reproductive, hut always would We a burden on the taxpayer. An example was the Government’s workers’ d,veilinjrs. 'The Arbitration Court was like a surgeon operating on the sick body of New Zealand iudustiy. Attempts to adjust wages to the cost ol living, itgardless of output, had failed everywhere. lie estimated the increase m family earnings for the period at 100 per cent., against a 00 per cent rise in the cost of living. Savings Bairn deposits were triple those of 1911. That showed prosperity. The Court’s order of a reduction of 5s a week was absolutely inadequate. Ti.o employers sought a reduction of Us a week, covering the whole bonus granted. | Air Bishop summarised his arguments . as follows: — |

(1) There is undoubtedly, most urg,nt need to-day for a readjustment of wages and prices. The need is not restricted to New Zealand hub is worldwide, and w' o cannot blind ourselves to the experience of other countries. ,Apm-t from the effect we must feel from the world situation, the position of our primary industries to-day is such a. s to call for an immediate remedy, and the reaction upon our secondary industries Ims already become most senOils. ? , (2) It bas been abundantly proved that we can no longer adjust wages to the cost of living regardless ol the economic situation, and I’m Lament h. s recognised this fact by making it mandatory that in any adjustment. ol w..g. s economic and financial conditions sh Ml he iveil due consideration. (3) Tire worker is not being asked to bear an undue share of the sacrifice.. Employers have been losing for the last year, are losing to-day, and are prepared to continue to lose by passing on to the public Die beiv at () f wage reductions if by so doing they arc re-establishing their business and increasing the volume, of their trade.

(|) The effect of an adequate wage reduction will he increased employment and an Increase in the total wages hill, and therefore the pun basing power in circulation. '1 lie eflect of an^inadequate reduction will he a prolongation of the period of lialf-timc employment, a continuation of stagnation in all development, work, and a maintenance o! high pi id s.

(5) Ultimately the situation will bring its own cure. Competition from foreign countries will force down out prices of manufactured goods, and the prices of our primary products must fall lower than tiny are to-day. The result will he unemployment to such an extent that the nveiage wages of tin* community will he reduced perfnue, and the whole arbitration system will fail. Is it not heller and w is: r to lace the situation boldly today, undergo the operation, and suffer the initial pain followed by a speedy recovery, rather than wa.it lor the sickness to develop stdl further, and suffer a very long, drawn-out rr.nvaloscence ?

(fi) New Zealand workers are the best off in the world to-day, and liv making a brief sacrifice they can maintain that position. Is the Court going to call upon them to face the situation. or is it going to permit them to drift into the jeonditions prevailing in other countries ? AA’liat is Llie position in Australia to-day? Copper mines are idle in nearly all the States, the Broken Hill mines arc practically all idle, and the iron and steel works at Lithgow and Newcastle are closed down. Hear what the senior British Trade Commissioner for Australia says on the subject: “The” most serious feature in the economic situation is the refusal of the leaders of organised .'Labour to permit any wage reductions to meet the situation caused by the lowering cost of production in other countries. The result is creeping paralysis in the manufacturing industries, which, although protected hv a high tariff, are subject to overseas competition.” That is only one . aspect of the case, and to adapt it to Now Zealand, we must go further, and say that we cannot protect the secondary industries by a high tariff, because if wo do we are only increasing

the burden of taxation of our primary producers. (7) I wish also to emphasise this point more strongly. If the Court makes a. substantial general order, it hits 'everyone alike at the sum.' moment, and produces the maximum benefit in return, but if 'the Court makes a quite inadequate general order, the effect will be that the workers in some trades will be fully employed, will enjoy the continuance of high wages but small actual wages, because they will have only part-time employment. The difficulties of the poorly paid man will be aggravated, becauso lie will have to pay high prices for the products of his better-paid fellow worker. Their cost of living will be kept up because in the woollen trade, owing to the absence of com petit ion, prices a.ud wages have not been reduced.

(8) There are two ways in which the present situation may be faced, and only two. One is to ignore a,II the necessities of the case and the lessons that others have learned by hitter experience, to endeavour to maintain a false standard or wages and prices, and as a. result to suffer creeping para; lysis in all our industries; and the other is to grasp our nettle, to join hands in the necessary initial sa-rilice, awl so get back to a sound economic basis in our businesses and hnslcn the return of prosperity. The question for this Court to decide is which of the two courses we are to adopt. Evidence is being taken.