CASH ORDER TRADING

Nelson Evening Mail, Volume LXIII, 3 August 1929, Page 11

CASH ORDER TRADING

TO BE STRICTLY CONTROLLED “LIMITATION OF CHARGES AND DISCOUNTS (By Telegraph) (From “The Mail’s” Parliamentary Reporter) WELLINGTON, 31st July. The cash order trading system is to be subjected to. strict control and limitation of. charges and discounts in New Zealand. This is the recommendation of the Hon, J. G. Cobbe, Minister for Industries and Commerce, and Mr J. W. Cillons (Secretary of the Department), who conducted an investigation of the system. The Prime Minister, in an interview, stated that unless cash order companies and individuals conducting the system indicated their willingness to conform .to eight recommendations of the Commission legislation would be introduced this session to enforce these proposals by Statute. “We believe,”, states the Commission, “that control by the State is necessary, and we are further of opinion that rn the public interest legislation is necessary as proper .control can only, be made fully effective by • law. Unfortunately, the system has burst the narrow limits wliero little . or no harm . could have been done to the general public, and it is now necessary to discipline it in such a way as to put it on a fair basis. With this end in view we have to recommend that the Government shall favourably consider the following proposals (1) That the charge to clients should not exceed 6d in the pound; (2) that trade and cash discounts allowed by retailers accepting the orders should not exceed 10 per cent.; (3).that canvassing for orders should bo prohibitcd; (4) that no mail, order propaganda be allowed; (5) that cash orders be open to any firm willing to accept theln, and not limited to one firm or individual;. (6) that all orders should bo issuable from a registered office only; (7) that Jio orders shall be issued to persons under the age of 21 or to married women without the con-

sent in writing of their husbands; (8) that no order be issued to any person who lias not completed payment of any previous order. Commenting briefly upon these recommendations, it is suggested that three months’ notice be given to the cash order companies and individuals to express their willingness or otherwise to conform to the preceding proposals. If acquiescence is shown, then it should be stated that the Government will not proceed with the legislation. Such notifications should be made to the Department of Industries and Commerce within three months of publication of the report. Failuro to send a notification will bo taken as an indication of refusal to plyIt is further suggested that the Secretary of the department should report to the Government before the session concludes. The evidence collected by the Commission showed that the cash order system is conducted by about 20 concerns in New Zealand, with an annual turnover of £289,000. There is a variation in tiro charges, but in Auckland, where the system is most prevalent, 2s in the £ is charged borrowers, while the retailers have to give the cash order company 10 to 15 per cent, discount, while some traders' in jewellery, or opticians, allow up to 33 1-3 per cent, discount. The Commission comments unfavourably on the neglect of traders toi give greater advantages to cash purchasers while giving the cash order company a heavy discount and allowing none to cash purchasers. It is of opinion that if the cash order system has reached the proportion of 10 per cent., of the total trading there would need to be a general revision of prices upwards. The business methods of cash order canvassers in making surreptitious agreements with women are criticised, and cases are quoted of threatened disclosure to the husbands being used as a means of enforcing weekly payments.