STABILISATION PROBLEM.

Marlborough Express, Volume LXXVI, Issue 249, 22 October 1942, Page 4

STABILISATION PROBLEM.

In the course of the debate ln the House of Representatives on the non-payment to wool-growers of the 15 per cent.' increase in the price of wool, the Minister for Supply, Mr Sullivan, emphasised the seriousness of the inflationary situation with which the country is now faced. In the last three years, he said, the national income has increased by £44,000,000. In the same period the value of goods available for consumption in the Dominion has decr eased by £55,000,000. Thus the gap between income and the value of goods hafs been widened to the extent of £100,000,000 in round figures. This enormous gap between income and the goods it will buy is fraught with great danger to price levels. The latest figures, quoted by Mr Sullivan, accentuate the warning he uttered three months ago, when he deplored the "stiff resistance"

being offered to the stabilisation of wages and prices, and declared that "without stabilisation the country would be faced with disaster." The Prime Minister, Mr Fraser, spoke in the same strain in the debate on the Fair Rents Bill, and emphasised the urgent need for a bold and general anti-inflation policy. Such things have been said repeatedly sinee the receipt of the recommendations made by the Economic Stabilisation Committee set up by the Government two years ago. The remark made by the Minister for Supply that the whole question of Stability has a close relationship to what was done with the wool money suggests that this may be regarded as a starting point for a general policy of stabilisation. Otherwise, indeed, there would be little justification for the special treatment of the wool money. The amount which will be placedi in reserve to assist "economic security," if the Sheepowners' Federation accedes to the representations that are being made to it, is an insignificant fr action of the gap between the national income and the value of the consumable goods in the Dominion.