FLAT FREIGHT RATE

Hokitika Guardian, 24 July 1929, Page 2

FLAT FREIGHT RATE

DOMINION SHIPPING PROBLEM. ENGLISH JOURNAL’S VIEW. In the 'London ‘“Shipping World” of June 5 appears an interesting article on a New Zealand shipping problem that has been the subject of considerable discussion during the last two or three years.

After quoting the resolution passed some months ago by the Wellington Harbour Board that the present system of overseas freights is wrong in principle and most unjust to the users of the main ports, the writer remarks that for several years past the board has protested against the fiat rate system under which, by agreement between certain exponung boards in New Zealand and the shipping companies, the latter agree to lift exports from any and every port, whether large or small, at a uniform rate of freight. The Harbour Board do not criticise the attitude of the shipowners, admitting that they were asked to agree to perform a certain service, that they put in a contract which was accepted, and that they have loyally carried it out. They maintain, however, that a flat rate is wrong in principle and that it is a handicap to the development of ports such as Wellington, which at considerable, cost, have built and maintained port works where ocean-going vessels can lie in perfect safety in any weather.

The Article then quotes'. a,, speech made during the last discussion of the question by the board by the “chief critic of the present regime,” Mr G. Mitchell, “who has claimed that he is animated by no local feeling, but desires only what will benefit the whole Dominion, suggesting that an economy of a million pounds a year could be effected.” The case for the shipowners, as presented by Air C. M. a' member .of the board, is alsq given.' “What is the position writes the writer of the article, who goes on to say: .“In New, Zealand the shipowner is aslced to contract.for the performance of a particular service which is to lift ; the produce of the Dominion and-carry it to these islands. He is perfectly well aware of the percenbf cargo he will lift both from the large and the small ports; he knows' equally well the - facilities provided ' at the • former ports and the handicaps he will meet with at the latter, and bases his contract price accordingly. Were it .not- for tlie efficiency of the port works provided at the major ports, the flat rate lie quotes would of necessity be higher than it is. He knows his business and' averages the cost. The efficiency of the port works at Wellington and at the other major ports reduces the cost of ocean freight to all the producers of the Dominion. These ports are thus performing work of national servicei to 1: New Zealand with ah eye obviously to their own' advantage and. the advantage of tlie users of the port. •

. THE SITUATION IN NEW COUNTRIES. “In all the new countries of the world and in some of the oldest—such as India and China—the provision of the ports may make or mar their destiny. It might even yet become acute in these islands, if an ill-ad-vised scheme of national development were evolved to solve the unemployment problem. Nature intended some places to be ports for ooean-going traffic just as she intended others to be ports for local services. Australia and New Zealand, and to a lesser extent the United States and Canada, and in the British Dominions in particular, the Governments seem perfectly ready to support and finance port schemes. These schemes are often open to criticism, hut these countries are in a transitionary stage. They havq entered a world where civilisation itself depends, in the last analysis,, on free and unhampered ocean transportation. They make experiments in order to attract oceangoing tonnage to their coasts. Some of these experiments will fail; others will succeed. Australia and Now Zealand especially must be prepared to make sacrifices, if necessary, because they are at the end of a blind alley on the ocean roads of the world. The problem is in such cases a national one, and the taxpayers must decide on the broad issues.”

Commenting editorially on the subject in the course of a discussion of port problems generally, the “Shipping World” says:—“Our contributor suggests that the Wellington Harbour Board, in criticising this policy (the flat rate of freight), ignores its effects, foremost among which is the undoubted advantage that all producers desiring to reach European markets are, so far as • shipping charges are concerned, upon the same footing. There is, on the other hand, something to be said for the arguments which have been advanced by the Wellington Harbour Board, anxious to reap the benefits flowing from the completeness and efficiency of its equipment.”