STATE IN BUSINESS

Hokitika Guardian, 21 July 1928, Page 1

STATE IN BUSINESS

ITS TWIN SISTERHOW THEY HAVE FARED. (Taxpayer.) During the last few months a good (leal of attention has centred around what is popularly' termed “Government in business ” the intrusion that is, of State departments and local bodies upon "fields of productive and distributive activity which up to a comparatively few years ago were regarded as the preserves of private, enterprise. Insurance „ companies, gas companies, sawmillers,' dairy exporters, timbci growers, master printers, architects, milk-vendors, steamship companies, fruit exporters, retail book-sellers and the representatives of many other trades, occupation's and professions have joined in protesting against the unfair competition of the State with its own taxpayers and its own workers. Many cases*'of the'kind“that have been examined have been proved beyond refutation, and now, it is understood, are receiving the serious attention of the Government.

The difficulty with all these State enterprises, however, is to ascertain with any' measure of precision how much they are costing’ the country. Six or seven years ago, at the instigation of tho Taxpayers’ Federation, the late Mr Massey gave instructions that every department of State should furnish each year a commercial balance sheet showing clearly the amount' and tho nature of its receipts and of its expenditure. The instructions were repeated each y r ear up to the time of his death and have been reiterated by his successor in office. Some of' the departments have satisfied tho requirements of tho Controller and AuditorGeneral, hut a larger number have not made themselves intelligible to the average accountant. Mr Coates is as insistent as Mr Massey was in this respect and in due course doubtless will obtain what lie and the public require.

OF MANY EXAMPLES. Meanwhile there are quito a largo number of State enterprises which have shown themselves to he wholly unjustified charges upon the taxpayers. The State sawmills, which seem at the moment to be in a process of “ compulsory liquidation,” are a case in point. The State requiring a. large quantity of timber of a certain class, proceeded to erect sawmills for itself, to use such of tho product as suited its purposes and to throw tho .rest on the open market at job prices to the inevitable embarrassment of the private millers and to the ultimate loss of public. Tt is obvious now that this excursion into business involved the State in a heavy loss which will not be fully ascertained until the mills have been actually sold. Then there is the State venture in housebuilding. For this undertaking it may he said that the houses were necessary. So far, however, they have cost the taxpayers from 1170,000 to £BO,OOO a year, and it is a fair assumption that they could have been erected by private enterprise without any charge at all upon the State. Cases of the kind, some of little consequence and others of great importance, could be multiplied almost indefinitely, hut the ground has been so recently covered there is no need to traverse it again just now. If it were necessary to allot the blame for the institution and multiplication of these State encroachments upon private enterprise it.would have to be home in mind that many of them are the growth ot years and that, the present Government, so far,, is no moro responsible for their existence than is any of its predecessors since the day on which the State first embarked upon the troubled and perilous waters of “business”. BLOT ON STATUTE BOOK.

The Hoard of Trade'Act of 1919 and its amending Act of 1923 have'been so frequently mentioned in connection with the State’s excursions into the domain of private enterprise that some allusion to these measures may be permissible here. The original Act, as every ono must know by this time, was a post-war measure intended to help the Dominion over some of the grave difficulties occasioned by the great world upheaval. Many of its provisions were drastic beyond all previous parallels. It empowered tbe Government, on the recommendation of a board of its own creation, to do practically, what it pleased with the trade and commerce and professions of the country. It might fix the price of butter at sixpence a. pound when in the open market tbe value of ibis commodity was two shillings a pound, or it might reduce a doctor’s visiting fee from a guinea to half a crown. Tlie amendment Act simply brushed away the protection afforded by the nominated board and left tbe Ministei of Industries and Commerce practically untrammelled by any other authority than bis own sweet will. It is scarcely necessary to say that the present Minister of Finance, who introduced the Amending Act, and tbe Minister of Industries and Commerce, who now administers the measure, have borne themselves with the utmost propriety, but surely with the war ten years away in the distance it is bordering on the outrageous to retain on the Statute Books laws which might some day fall into the hands of less punctilious administrators and be turned to the undoing of tbe whole community. Wellington, July IStli. 1928.