MR LYSNAR’S CHARGES

Hokitika Guardian, 20 March 1925, Page 4

MR LYSNAR’S CHARGES

CU.M MISSION OPENED. THE CASE OUTLINED.. WELLINGTON, -March 17. The Royal. Commission appointed u> inquire into the administration of the Government in connection with meat export control, and particularly the charges made in the House of Representatives by Mr W. D. Lysnar, member for Gisborne, against the action of the -Minister of Agriculture and the .Meat Export Control Hoard in connection with the sale of certain freezing works and other property of the Poverty Bay Earmers’ Meat Company Ltd., to Vcstey Bros., was commenced at Parliament Buildings this morning. At the outset Sir John Findlay (for the Government) urged that Mr l.ysnar should he joined as a party. It was a question, he said, as to whether he should not he ordered to pay the costs of the Commission. Mr Lysnar opposed this. The Commission, he said, was set up by the Government, mid ho was present to assist in the inquiry and make explanations on behalf of the company. He referred the Commissioners to a letter forwarded by him to the Prime Minister in December last regarding the scope of the inquiry. He contended it was perfectly plain that the Commission was set up by the Government, and that bis remarks in the House were made purely as a member in condemning trusts. The Commission was not set up at his suggestion, and lie submitted that there was no justification for his citation as a party. It was mainly an inquiry bv the Government into the conduct of the Minister of Agriculture. Sir John Findlay asked whether, in the event of the charges made not being proved, the person responsible

for the inquiry was to escape consequent costs. In a sense, Air Lysnar

came before the Commission as prosecutor, enjoying all the advantages of a prosecutor, and yet lie wished to avoid costs if the case went against him.

The Commissioners reserved decision on the point. Another question arose as to the admissibility of general evidence as to the disadvantages of trusts and combines generally which Mr Lysnar proposed to call. 'flic chairman questioned whether it was competent for M.r Lysnar to perambulate all over the world in search of evidence concerning trusts. Outlining the case, Mr Lysnar reiterated that the Commission was not set no at his request, but as a result of an official statement by the Government. The facts, when they came out, would show it was not the Ooveriiliiciil. lint the Hon. \\ . Nqsworthy that was the resoniisible party. "If the Government choose to push their lingers into tin" lire and get them burnt, they must take the consequences. I am not hero to delend thorn.” said Mr Lysnar. Dealing with his objections to the personnel ol the ( ommissioii Mr Lysnar said he considered it necessary that persons of judicial oxnorieuce should have been appointed. The inquiry embraced questions of the utmost importance to,the country and to the Empire. It dealt with the general adiiiinistatioii, and then wiLli three particular instances ol ad mi n istn tion --( I) Working ol the existing laws relating to slaughtering meat, export control and commercial trusts; (2) dealings .surrounding the Poverty Bay Fanners’ Meat Company’s affairs and the sale ol those works to Vcstey Bros., acknowledged to he the biggest combine in the world; (3i the action of the chairman of the Meal Board in relation to the iioii-incliisiiin of the 1 1 i| • \ • 1 11 >) l: i i ( o.li iim.lon in freighl contrails and acquiescence in llie sale of the company's premises lo Vcstey Bros. The latter questions were minor as compared with tlie lirst, which

was of Empire importance. tie anti.cipated that the hoard ami Air NosworLhy would attempt to magnilv the difficulties in particular eases in order to veil the fact that they had failed to observe the greater principle they had failed to maintain. They would fasten oil a possible priniae lacie justification of their particular acts in order to whitewash their general lailure to carry out the policy of the country. Il was significant that a Royal Commission was investigating the dangers ol trusts in the meat industry in England and lie hoped the finding would he available before llie New Zealand Coinmis-

sion reported. Mr Lysnar said his main evidence would lie directed to the first question, the light against trusts and combines, whose plan was to work on the brutal cornering of markets by sheer weight of capital. From an economical standpoint there was as much to fear Imm trusts as there had been from the Germans. The trusts were seeking to dominate the world hv finance .just as the Germans were trying to do by brute force. The simple issue was: Were trusts and combines to dominate, or the Government for the people? Apart from the local importance of his two latter questions, there was a great underlying principle involved which seriously affected morality. It the Commission did not properly solve it. it would deal a death blow to the .Meat. .Dairy and Fruit Control Hoards, for it would he impossible for those hoards to retain public confidence

( [ without which they could not exist. It t , would he averred that the Minister and the hoard were justified in consenting ,f to the sale to Vesteys, because \ es.leys i> had another works in the district and ,] agreed to close them up. I he pios diners ul Poverty Pay should not he ._ penalised because Vesteys had works already there. It might he said that there had been some negotiations with ~ A rumors’ representatives lor a sale. This lie wholly denied, hut ho admitted ] that an effort was made to obtain e money from Armours by way of mortgage, subject to the Government’s and j, the hoard’s consent. It was surely the lessor of two evils to mortgage to 1 Armours "rather than sell to \ esteys; r but tlie extraordinary position would i. be shown that the Meat Hoard objected to the company mortgaging to Arincurs, while it consented to the sale y to VcsteysC The Tvaikohu County t Council’s consent to the transfer ol 1 slaughtering licenses was a mere per--1 funetory one. lie anticipated that it . would he said that the hank wished Lo - sell to Vesteys, as the latter were the - only known buyers. The hank’s desire i to sell to Vesteys, he argued, was no , justification for the Minister to set aside the legislative safeguards provided in the Slaughtering Act of 190 S. The Commission adjourned, till the evening. Mr Lysnar intimating that lie so far had merely touched the fringe of his case. 'When the Commission resumed Mr Lysnar said that lie put the whole responsibility for the sale to Vesteys on the Minister of Agriculture, not on the Prime Minister and his Government. Sir John Findlay: Well, the Government accepts the whole responsibility. It is not going to make a -scapegoat of anybody. As against the allegation that the Poverty Pay Farmers’ Meat Company , was, “ Hopelessly insolvent.” Mr Lysnar read a letter from Mr E. Plumer S Mountfort, of Gisborne, giving it as his > opinion ns a banker of forty-four years’ «

experience that “had the company been given time it could have extricated itself from the somewhat embarrnsed position in which 1923 found it. and the hank in my opinion would have incurred no undue risk in carrying it over as was done with a similar company by another institution some little time previously. 1 ’ That fact showed < the company was capable of_ making : profits and that the hank would have been amply protected by the offer of shareholders of the company to taka up a further £‘loo,ooo of shares and apply the calls in reduction of the overdraft. Air Skerrctt: They might just as well have offered the moon. (Laughter). Af.r Lysnar argued at considerable length that the general question of trusts and combines came within scope of the order of reference. At 10 p.m. the Commission adjourned till to-morrow morning. W ELLINGTON. Alarcif 18. The Commission enquiring into Mi W\ D. Lysnar''s charges continued its sittings to-day. Resuming the presentation of his case. Air Lysnar said that owing to slumps the Poverty Bay Farmers’ .Meat Company, when formed, lost money. Sufficient data were put before the bank to justifv the bank authorising the company to hold its hand. After tho capital of the company had. been fully called tip in 1922. no direct intimation was received from the bank that extreme steps would he taken against the company, or that any attempt would he made to force the sale ol the works. The first definite intimation was a telegram from the Gisborne branch ol the hank- that Vesfoys were about to make an offer of £22.1.(100 for the works, and that the company should accept it. Following that, the directors were advised that if they did not accept the olfer extreme steps would be taken. 1 The directors did everything to avoid ) selling the works, and made an oiler t„ the bank in writing to find another C 100,000 worth ol’ shares, ami place them nil certain definite terms, but tlint nro position was turned down. ■ There was talk about Armours making

■ a better olfer. \flcr referring to Vcstey Brotbeis - business methods. Mr Lysnar said; [ "W e know the operations of I rusts amt i that they are unscrupulous in every t wav. W’e know that the ‘Big KIVL '’ had a secret fund that was unaudited, i and which they used to bribe officials ami everybody associated with the - trade.” i The chairman pointed out that the - Commission was not dealing with Urn - “Big Five.” THE "BIG FIVE." t Air Lysnar referred to unauthorised - negotiations between individual dircoi tors of the Company with \ esteys representative, and stated that lie was - afterwards invited to see Air Rowlands, t Vestevs’ manager at Auckland. with t them, and did so. Later, on August - *>oth, he wrote to Mi* Row In mm , offering to buy Vestevs’ Ta .alien. - works. Imt Air Rowlands replied that y Vestevs were not sellers. Six da\s f Inter the company got an oiler Iron 1 , r Nelson Bros., Ltd., ready Vestevs. n their “one and filial oiler. Air Lou- •- fi,„ds called it. for their works. He .1 alleged that Vestevs were introducing li various trust methods at their works, e and, remarking on the unscrupulous I- character of the trusts said Hint they I- all knew the " Big Five” had a secret >- fund which was used to bribe i.egis- -- latinos, eU\

The chairman remarked that the only information the Commission had about tic "Big Five” was that negotiations had taken glare between U>e Poverty Bnv Meat Com,pane ami one ol the ■■ Bio Five ” about borrowing some more on terms under which they would virtually become owners. Air Lysnar, he said, was getting nowhere, but simply blackguarding trusts. A MATTER OF PRESSURE. Mr Lysnar contended that the power of preventing irusts holding works in New Zealand was too great to he vested in lie Mini; ter I’rc -ore. lie did not sa v improper, hut iiilluenl ial, pressure, was brought to hear on Ministers, wlio could not stand it. lit* urged that Parliament itself should lake the responsibility ol dealing definitely with Lbe matter. As showing the pressure to which the directors of-his company had been subject, lie quoted the following telegram from the general manager of the National Bank of New Zealand. Wellington, to the Gisborne manager: Inform Witters, Coop and Williams that W. D. Lysnar having admitted to me lie had made the consent of the Government a political issue between him and the Government, I informed him that the hank’s oiler of SenU'inlicr 13th regarding a .settlement between the guarantors and the hank no longer held good, and that our consequent' action will he governed by the attitude ol directors and shareholders to-day (Signed) Jolly. Air A fivers: The hank was not prepared to lie Air Lysoar's political foothall. Air Lysnar: “Air Jolly wanted mo to be the hank’s political football.” lie added that the offer of September 13th contained a concession of £22,000 to the guarantors, ami that was to lie withdrawn. j THE POLITICAL ISSUE.

Mr Myers said that the political is-! sue was introduced bv Mr Lysnar, not, by Air Jolly, the former having told Mr Jolly that he proposed to make the stopping ot the sale ol works to \ es- , levs a political issue, thus causing the, hank to lose its only opportunity of, Mr Lysnar declared that his hanker j had no right to endeavour to interfere as regards his political action. 1 Sir John Findlay: I should think lie, could say that you have no light lo threaten political action to serve vour, private interests. The chairman : Don’t you put your- , self into the position that bankets would say members of Parliament should not go into commerce or borrow large sums of money? i Mr Myers: And then threaten to use their political influence. Proceeding. Air Lysnar strongly; maintained that the Meat Hoard did , wrong in sanctioning the sale to Vos- 1 teys. especially before the Hoard had heard fully the case of the Poverty Hav Farmers’ Meat Company. i