STATE IN BUSINESS

Hokitika Guardian, 12 July 1928, Page 4

STATE IN BUSINESS

LOCAL BODIES’ SHARE. UNFAIR COMPETITION. (N ino teen-Twe u ty-Eigh t Com mi 11 c-e.) The passage of the Board of Trade Amendment Bill through Parliament provides a striking example of the rapidity with which important and farreaching legislation may lie placed upon the Statute Book. This Bill was introduced in the Legislative Council six days before the conclusion of the short and crowded session of 1823, read a first time, a second time, committed, read a third time, passed, and sent on to tlie House of Representatives aU within an hour. It was given its first reading in the House the same evening. Four days later it was read a second time, committed, read a third time and passed only thirty-six hours before the close of the session. In moving the second reading of the Bill in the Council, the leader of that branch of the Legislature explained that the passage of the measure was urgent because business firms declined to produce their books, or to allow anybody to look into their private affairs, or to answer any question which the Board of Trade alone had the authority to require an answer. The then Minister of Industries and Commerce stated that from his point of view the main purpose of the Bill was to substitute an inexpensive Min ister for an expensive board. Should that arrangement prove unsatisfactory it could he reviewed at the end of theyear! If there was any serious opposition to the measure it would be dropped. That the Government, for the most' part, has administered the Act with propriety and discretion there is no question; but the presence of such an enactment upon the Statute Book js a. menace to the whole community and might be turned at any time to most undesirable purposes. Hence the crying need for its repeal or its drastic revision.

1.0 AI >KD EN TER PRISE. Grave as is the retention of such a ■ measure as the Board <>t ’trade Act on the Statute Book in its present lorni, still graver is the entrance of tho State into tile spheres of trade and commerce in competition with private enterprise. The Board of ’! rade Act, at least, may be reviewed at any time while Parliament is in session ; but once State trading in any direction is established it seems able to bid defiance to all the constituted authorities, including the Government itself, for an indefinite time. There are, of course, great undertakings, sqch as Railways and Post and Telegraph services which by common consent have been accepted as national responsibilities on account of their universal nse and tbb part they play in tho development, of the country. It is not contended that the. railways arc as efficiently or as profitably operated by" the State as | they would .lie by private enterprises ;’ but State control has been established and is likely to remain. Then there is a large class of undertakings, such as life insurance, fire insurance, accident insurance, State Trust office, moneylending, saw-milling, house-building, and y:> forth, all of which are in competition and often in unfair competition, with private enterprise, withoutconferring any tangible benefit upon the general public and in many cases involving the State in heavy losses which the taxpayers in due course must cover. Again there are State activities of a similar kind, too numerous to be set out just now, which are frankly bolstered up from tho Consolidated Fund. SQUEEZING TRADERS OUT. Though necessarily on a much smaller scale, and in a more confined area, the interference of local bodies with private enterprise is even more pernicious than in State interference. At the moment it will be sufficient ta indicate one or two cases of gross injustice in this respect. When the Electric Power Board Act was placed on the Statuto Book in 1918 tiio Board’s authority in certain circumstances, to assist in the distribuI tion and use of electric current, it was never contemplated by Parliament or the public that this authority would be employed in driving the established traders out of business. But that is actually wliat lias happened in a number of case?, pinny of the boards employing public capital in cutting prices and financing purchasers.’ pf the thirty-five power boards in operation at the present time, fifteen carry on full trading operations,-' supplying machinery, appliances, apparatus, and material as well as undertaking tho general work of bouse wiring. In addition to these fifteen boards, there are eleven others, selling ranges, motors, water-heaters, and sinubv articles. Practically the whole of tlies; sales mean the (liversion of business from the private traders, who, having to pay rates and taxes and interest - capital they employ, cannot afford to sell their goods and appliances on generous terms and at cost price. Then there is the case of the privately owned gas companies in competition with the municipally owned electric systems. During the last six yeais the Wellington Gas Company lias paid £101,997 in State taxes, Municipal., taxes, royalties and so forth, and the Auckland Gas Company no jess than £202.158, while the municipal concerns and power boards Reaped these charges altogether. " Simply there is a gross misjustice here obvious to everyone.