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CHAMBER OF COMMERCE

MEETING WITH MEMBERS OF PARLIAMENT. IMPORTANT QUESTIONS DISCUSSED. About 70 members of the Chamber of Commerce met local members of the Legislative Council and House of Representatives in the University Club room on Friday afternoon. The members of the Legislature present were Sir James Allen, Mr G. M. Thomson, and Sir John Sinclair. M.L.C.’s, Messrs W. Downie Stewart, A. E. Ansell, F. Waite, and J. W. Munro, M.P.’s. Apologies for absence were received from Messrs W. B. Taverner, J. A. Macpherson, and W. A. Bodkin. In Welcoming the members of Parliament, the president (Mr A. C. Cameron) stated that they were pleased to know that the No. 5 unemployment scheme was being continued. There were many matters ■which could have been placed before members, but the chamber had selected those which it considered to be of first importance to the province and to the commercial community. The opinions that would be expressed would be those of the chamber as a whole, and were arrived at after careful consideration. The membership of the chamber was 475. GOVERNMENT ECONOMIES. Mr T. C. Ross drew attention to the large increase in the number of Govern ment departments during recent years and to the expense incurred in the frequent transfer of members of the public service. Mr N. Oram said that to ensure that taxation should be kept down to a minimum it was essential that Government ex penditure should be very closely watched. GIFT COUPON TRADING. Mr A. H. Allen stressed the harm that was being done to legitimate traders by the gift coupon system. There was no objection to the giving of such goods as Were sold, but hardware firms, jewellers, and fancy goods businesses were being seriously affected by the system. He urged members to use their endeavours for the introduction of legislation to deal with the matter. UNEMPLOYMENT. The subject of unemployment was dealt with by Mr C. B. Barrowclough, who said that the chamber would give its wholehearted support to the solving of the problem, but felt that there was an urgent need for a reconsideration of the works undertaken in providing unemployment relief. Among the productive works that could be undertaken were such as the Deep Stream deviation, the new Post Office, Leith flood protection works, a promenade from Lawyer’s Head to St. Clair, HAAST PASS. “ Advice has just come to hand that this work is to be discontinued,” said Mr J. R. Fairbairn, who pointed out that the discharging of about 200 men from this work would result in their crowding into the city, where they would have to be given relief work. The value of the road to the province was beyond question, but the chamber would offer no objection to the cessation of the work in the meantime if more urgent works of a productive nature were to be gone on with. If, however, the economic position improved it was trusted that members would keep the Haast Pass road in view. DEEP STREAM DEVIATION.

Mr P O. Smellie urged the claims of the Deep Stream deviation as a work upon which unemployment funds might reasonably be spent. The road was the main highway to an important part of the province, and was dangerous in its present state. The expenditure of £6OOO would reduce the grade of the hill from 1 in 4J to 1 in 9, and of this £6OOO the Main Highways Board was quite prepared to find £4OOO. This road was certainly more important than many of the works up which unemployed funds were being spent. NEW POST OFFICE. Mr J. M. White gave reasons why the new post office should be gone on with. The site was valued at £75,000, and, with the amount (£20,000) already spent on the foundations, the loss per annum in interest was £5700. To proceed with the construction would assist very considerably in alleviating the unemployment problem.' The amount which would be spent in wages would be about two-thirds of the total, while various trades at present working short time would benefit. At the conclusion of Mr White’s remarks the chairman read a telegram from Mr Taverner announcing the Cabinet’s decision to call for tenders. This was greeted with applause. BOARD OF TRADE ACT. Mr A. H. Allen gave a brief resume of the way in which the Board of Trade Act was hampering business men, and urged the members present to press for its repeal. LOCAL BODY ADMINISTRATION. Mr C am eron stated that some time ago the Prime Minister had announced that the Government was considering the setting up of a commission to inquire into the local body administration. The members of the chamber took this opportunity of strongly urging the necessity for this commission to be set up without delay. They also urged that an endeavour be made to ; get their order of reference to include:—(a) The advisability of reducing the number of counties; (b) the advisability of eliminating certain borough councils, tramway boards, etc., and amalgamating other boards where amalgamation would lead to efficiency. and economy; (c) the advisability of establishing some system where a constant check can be kept on local body expenditure and administration. Mr .Cameron said that the value of the work of the Local Government Loans’ Board •was abundantly evident. Unfortunately, much of New Zealand’s local body indebtedness which now amounted to £70,670,000, was incurred prior to the check which the Loans Board exercised upon borrowing. ■■ In regard to reducing the number of counties, there were in Otago.. 10 counties and he submitted some particulars of the smallest of them.

Square miles. Population. . Clutha 946 7240 Bruce ...... 503 4770 Maniototo .. .. 1239 2592 Waihemo .... 336 1417 Waikouaiti .. 318 4179 Ft should be possible to reduce these to five or six counties. With regard to establishing a system by which a check could be kept on local body expenditure, they had only to consider the value of the investigation of their own local Power Board affairs to show how necessary it was for the spotlight to be shown upon the administration of some of our local bodies. Some of the power boards in other part of New Zealand were in an equally parlous state. The affairs of many of the smaller hospital boards, river boards, and drainage might well repay investigation. When they remembered that there were 520 local bodies in New Zealand, most of them with paid secretaries, offices, engineers, plant, they realised the room there was for elimination and amalgamation with a view to economy and the possible employment of better paid officials. OTAGO’S DETERIORATED LANDS. Proceeding, Mr Cameron said: One of the matters of paramount importance to all who have the welfare of the province at heart is the problem of Otago’s secondclass lands. We have more second-class land in Otago than in any other province. Over 6,000,000 acres of occupied land in Otago are unimproved and of this over 1,000,000 acres are covered with manuka, gorse, broom, fern, or similar secondary growth. The pity is that much of these million acres is first-class country and is rendered partially or completely unproductive by the secondary growth referred to. Of the other 5,000,000 acres, much of it is internal pastoral country which might be helped and the carrying capacity considerably increased by irrigation, keeping down rabbits, or .topdressing. It is the position of ' the 1,000,000 acres we wish to deal with. It is estimated that between Glenore and Beaumont the spread of manuka is increasing at the rate of 1000 acres per annum. Manuka is spreading rapidly over the hill country of West Taieri, the coastal lands east of the railway line from Henley to Milton and also north of Dunedin. It is getting a hold of such splended sheep country as the Hukerere at the back of Wilden. Ragwort is spreading with alarming rapidity, especially in South Otago and the Owaka district and in Southland. Sheep are able to control it to some extent, but dairy farming tends to increase the growth, and it is a serious menace to the health of stock. There have been serious cattle losses, and the productivity of the country is suffering. Much could also be said of the spread of fern, tutu, St. John’s wort, broom, and secondary bush growth! The gorse position is very bad. In the good old days when labour was cheap the early settlers could trim their hedges and control it. They have no chance of doing this to-day—the farmer cannot afford to keep his land cleared. Irrigation races and natural streams running through broom and gorse country help to spread the seeds.

So much for the position which 1 can assure you is serious. lam sure that it is obvious to you all that the con tinned and unchecked spread of this growth must seriously and adversely affect the productive capacity of Otago, and that any cystem of control or plan of clearing tlie best of the affected land woul i lead to an enormous increase in our prv ductivity. This city and the Dominion would be the wealthier. I need not stress this. At the present time noxious wee 1 inspectors are doing their best with gorse and such growth which is termed “ noxi ous weeds,” but they are powerless trcheck the steady encroachment of manuka fern. etc.

Under the Deteriorated Lands Act, 1923, provision is made for the occupants of Crown land to apply for an inspection by a special Revaluation Committee with a view to having the land classed as “ deteriorated land,” and either having their rent remitted or getting a loan on first mortgage at 54 per cent, to enable them to do something to the land. l'hw is good so far as it goes but in practice a farmer or runholder will have hxs land classed as deteriorated land oniv as a last resource. It affects his credit. The Deteriorated Lands Act does not help the freehold farmer, or stop the menace of one man’s property being affected by the spread of secondary growth from his neighbour’s property. The Department of Agriculture is doing a fine work in carrying out experiments in control and methods and elimination, methods of clearing manuka, etc. There is no Government department or board or organisation whose job it is tft classify this second ary growth and draw “ our ” attention to it. By “us” we mean those who have a stake in the province. Anything which is being done is being done by the Department of Agriculture or by individ uals who are, as it were, voices crying in the ■wilderness. Next comes the problem of the Unem ployment Board which may want to find work for the unemployed on such jobs as-the reclamation of waste land. Whc is in a position to advise the board what work in the province is of first importance, what manuka-infested land would pay to clear where it should be checked to prevent further spread, how to go about it. whether ragwort spraying is more important at the moment than the grubbing of gorse or broom? The commissioner of Crown lands and the Land Board have their hands more than full, and, apart from the fact that they deal only with Crown lands, they do not work closely with the Department l of Agriculture. The Department of Agriculture has also many problems to contend with, and it is unfair to put such a work on to it The Otago Provincial Council of the New Zealand. Farmers’ Union recently set up a committee to go into this question, and the committee brought down a unanimous report to the effect that the matter so far ns Otago is concerned was of such urgency that steps should be taken immediately at least to check the spread of this secondary growth. In the opinion of the committee the first step to be, taken was to set up in Otago a “ Deteriorated Lands Committee ’’ to consist of, say —The commissioner of Crown lands, the field superintendent of the Department of Agriculture, two experienced farmers, one representative of the Otago Provincial Council, New Zea- ’ land Farmers’ Union, one representative

of the executive of the Sheepowners’ Federation, one representative of the executive of the Otago A. and P. Society, and one representative of the stock and station farms.

This Deteriorated Lands Committee could go into the whole question of deteriorated lands in Otago and report on the spread and control of manuka, control of ragwort, gorse, question of draining land, etc., with the idea of making strong recommendations for utilisation of unemployed labour upon the reclamation of farm lands. The committee was also of opinion that if the Government was not prepared to pay the expenses that the suggested committee should be set up and the expenses paid by the bodies concerned, as the matter is of such vita] importance It is almost unnecessary tor me to say that if the committee is to do any good it must have status, and this could only be brought about by the Government seeking its opinion and asking lor recommendations whenever any matters affecting waste or deteriorated lands are under consideration. Thie committee would also require to have some say should the question of putting unemployed on to the reclamation of land be considered. This committee would have to have niore power than, say, the Amenities Society. Its real value would lie in keeping the province alive to the true position of its deteriorated lands, and by working in conjunction with the Department of Agriculture and Lands Department, it could put forward constructive proposals which, by reason of the personnel of the committee, would carry more weight than if such proposals were submitted by, say, the Department of Agriculture alone or by this chamber, the Farmers Union, or any other body. In conclusion, I may say that the coun?C.the Dunedin Chamber favours the establishment of a committee such as outlined above., to be set up and maintained at no additional expense to the Government other than, perhaps, the provision of bare travelling expenses should such committee be asked to make a special survey and report for the Government. We believe that a similar committee might "Rh Uidi’antage be set up in each provincial district, and we urge you to place our suggestions before the Government.

’ IRRIGATION. The subject of irrigation was also introduced by Mr Cameron, who said the chamber had very mixed ideas about the advisability or, otherwise of the Government commencing further costly irrigation schemes at the present juncture. Many of the existing schemes, Mr Cameron said, have proved costly undertakings, and the question naturally arises, Can we justify further expenditure unless we can show some definite return for the money expended? Mr Cameron continued:

As business men we must frankly admit that the land when irrigated cannot pay a water rate which will return even 4 per cent, interest upon the cost of construction. We must, therefore, look at the question of irrigation from another angle, viz., that of its value as a means of permanently increasing the productivity of the country for all time, increasing the carrying capacity of all the surrounding country, making closer settlement possible, increasing the business of such services as railways, post and telegraph, and so on. We have often .been taunted with the statement that we have not taken the interest we should in our Central Otago country. Furthermore, while we may hesitate to recommend the construction of further irrigation schemes, we cannot fail to note that huge sums are being spent elsewhere on works which show considerably less chance of being productive. Money has been spent like water in the Auckland province, and pressure is still being maintained to have more spent. , We understand that the Government is looking round for large schemes for unemployment purposes, and, while we believe that expenditure upon irrigation can well stand over until economic conditions improve, we conceive it to be the duty of om Otago members to press the claim of Otago arid leave it to the Cabinet, and their advisers to decide upon the relative merits of the claims of each province. Such being the case, we put forward the following facts for your consideration: —

There are three extensive areas in Otago which could be watered by large irrigation schemes — 1. The Upper Manuherikia scheme, which would irrigate from Clyde to Lauder and embrace such country as Matakanui, Omakau, and Becks. (The dam would be at St'. Bathans.) 2. The Hawea, scheme which would be a hydro electric pumping scheme and irrigate Hawea Flat.

3. The Maniototo scheme. A reticulation scheme which would water the Maniototo. (The dam would be at Paerau). In our opinion the Upper Manuherikia scheme should be gone on with first, as it lias the greatest possibilities for gradual development and a natural dam site exists at St. Bathans which necessitates no engineering difficulties. The land which would be inundated by the actual dam is poor. This scheme is favoured by the Public Works Department, who have made a complete survey and. have taken out the estimates. The Hawea scheme also presents possibilities. The Maniototo scheme (in our opinion) need not be con sidered meantime. If there is any doubt regarding the respective merits of the Upper Manuherikia and the Hawea scheme we suggest that the Public Works Department, Department of Agriculture, and commissioner of Crown lands, make a report and that their recommendation be taken as final.

With this proviso, we briefly submit the claims of the Upper Manuherikia scheme. The scheme could be developed to irrigate 150,000 acres of first-class irrigable land. Apart from making closer settlement pos sible its greatest value would be in increasing the carrying capacity of the sur rounding pastoral hill country. The carrying capacity of pastoral country in Cen tral Otago is solely regulated by its ability to winter sheep. . The provision of even 200 acres of irrigated land for each ■ run would double the carrying cap acity of the surrounding country The recommendation of the Public Works De partment is to erect a dam at St. Bathans with foundations on a scale which would allow for extension, and to commence with a 14,000 acre scheme, the idea being to increase the height of the dam and irrigable area later, after the other

scheme became established. There are many difficulties in the way of the successful establishment of this scheme, but not more so than in any other district. The estimated cost of the initial dam with foundations strong enough to allow for extensions is £267,000. As an indication of the value of irrigation, we refer you to the Government farm of 89 acres at Galloway. Before irrigation its maximum carrying capacity was nine sheep. Last year the farm carried: 91 head of full-grown stock, including 56 milking cows, and it produced 14,0001 b butter-fat. and the returns from pigs totalled £l5O. The railway returns from the irrigated districts speak for themselves. In conclusion, we would emphasise the following points:—(a) Before deciding upon any one scheme seek the advice of experts: do not be influenced bv any interested party. (b) Emphasise the necessity for productive expenditure. but if it is a question of money being spent anyway, put forward the claims of Otago as a field for the expenditure of money for irrigation purposes. IMPORTATION OF CEREALS AND PRODUCE. Mr J. B. Waters said that during the years since the war period it had been very noticeable that the North Island had adopted a growing practice of procuring its supplies of cereals and produce from outside countries. While remunerative prices were being obtained by South Island growers these importations were not felt to any extent. With the exceptionally low prices ruling for all farming products these importations, however, had in recent years had a very detrimental effect on South Island growers. The position had been further accentuated by the removal within the last two years of the duty payable on lines such as barley for stock feed, kibbled maize, etc. The adverse rates of exchange had also helped to cheapen these importations, especially from Australia. The direct effect of these importations had been a lowering of value to below the cost of production. A continuation of the present position would inevitably cause growers considerably to reduce the area sown in cereals, such as oats, barley, chaff, etc., as it was impossible for the New Zealand farmer, who was handicapped by climatic and other conditions, to produce as cheaply as the Australian grower. The direct result of this would be: (1) Increased unemployment amongst farm labourer and other industries dependent on agricultural work; (2) adverse effect on trade balance against New Zealand; (3) loss of purchasing power of growers interested in these lines. It was interesting to note, added Mr Waters, that the only line of produce—namely, potatoes—which could be grown in competition with the Australian grower was prohibited from landing in that country. SOUTH ISLAND SHIPPING SERVICE. This matter was introduced by Mr Allen, who asked if those present were aware that with the exception of the visits of the Maui Pomare, which sometimes brought about a dozen passengers, no overseas passenger steamers were coming direct to the South Island. Even the Maheno service was suspended. Although the population of the South Island had increased considerably we were worse off than we were years ago in three aspects, viz.,—overseas shipping, intercolonial shipping, island (South Sea) shipping. Our overseas shipments arrived in vessels making Dunedin and South Island ports the last ports of call. Mr Allen went on to enumerate the loss to the southern portion of the South Island from the point of view of the tourist traffic and the victualling trade. He referred to the subsidies which were still being paid for the San Francisco and Vancouver lines, despite a regular Panama service, and also stressed the necessity of members, urging that the South Island should get a passenger service with Melbourne. GOVERNMENT RATE OF INTEREST.

Dealing with the Government rate of interest, Mr C. B. Barrowclough said: The Dunedin Chamber of Commerce asks for the most serious consideration of a reduction in the rate of interest paid by the Government. It is fully cognisant of the difficulties which lie in the way of any such reduction, but feels that the urgency of the need for the reduction is ample justification for the request. It is realised that the law of supply and demand must necessarily be a prominent factor in determining the interest rate, and stresses the necessity for the strictest national economy and the necessity for the balancing of the national Budget so that the demands of the Government on the money market will be reduced to a minimum

It is unnecessary to labour the need for a general reduction of the interest rate. Wages have been reduced. Capital, the other factor in production costs, must make its contribution and reduce interest rates. It is not considered possible to reduce interest by Act of Parliament. One of the determining factors in fixing current rates of interest is the rate paid by the Government. We are convinced that, if the Government’s rate can be reduced, the general rate of interest will fall. The high Government rate is affecting the country prejudicially in many ways. 1. .It is keeping up the general rate of interest and increasing production costs. 2. It ds taking away capital which could profitably be employed in industry. 3. The high rate of interest on mortgages is unfairly penalising those who have suffered reductions in wages and indirectly is operating against a reduction in rents. 4. The high rate of interest paid by the Government is, at the present time, so attractive to Dominion investors that it is practically impossible to arrange first mortgages on city or county securi ties, more particularly in view of the interference with the rights of private investors brought about by the Mortgagors Relief Act. 1931, however neces sary such legislation may have been.

It would seem that the time is now opportune for a reduction in interest rates. There need be no fear that such a reduction would result in capital leaving the country. The possibility of a flow of money to Australia is ruled out by present conditions thefe. The existing exchange rate would effectually prevent a

flow of capital to England even if interest rates there were sufficiently attractive It is admitted that the difficulty m floating the last Government loan suggests that the rate offered could not be reduced. On the other hand, there is always the possibility of borrowing within the Dominion. The business community realises that its success is bound up with the solvency of the country, and it is submitted that, if necessary, the money would be found within New Zealand even at a reduced rate. The success attending the flotation of War Loans shows what can be done when the country realises the necessity.

It must be conceded that borrowing within the Dominion at a reduced rate would, to a certain extent, negative the desired result of increasing the money available for production and mortgage investment. But it would lead to a general reduction of interest rates with the attendant advantages. And, as already indicated, the Government needs would have to be reduced to a bare minimum by rigid economy. I realise that the matter requires far greater consideration than the time at my disposal or my knowledge of national finance can allow. But this chamber is so firmly convinced of the necessity for a general reduction of interest rates, and is so firmly convinced that this can be achieved only by a reduction in the Government’s rate, that it commends the matter for the most serious consideration of those who are competent to devise ways and means of achieving the desired result. REPLIES BY MEMBERS.

Sir James Allen thanked the chamber for inviting members of the Legislative Council to be present, and congratulated the chamber upon the matter presented to them. He then dealt with some of the difficulties in connection with Government borrowing and reducing the rates offered in New Zealand for money. Mr G. M. Thomson said that members of the Upper House could do little as compared with members of the Lower House, but they certainly could organise and act in unison upon such matters as had been placed before them, Mr Downie Stewart congratulated the speakers upon the lucidity of the matter placed before them. It was clear that much thought had been given to the subjects dealt with. He was particularly interested in the statement made by Mr A. C. Cameron upon Otago deteriorated lands, and he thought there was value in the suggestion made. He went on to refer to the working of the Deteriorated Lands Act, and confirmed Mr Cameron’s statement that no farmer cared to have his land classed as deteriorated land. He suggested that it might be as well to alter the name of the suggested Deteriorated Lands Committee to “ Otago Lands Committee.” He could support the statements made upon the question of local body administration, and gave several illustrations of the difficulties in persuading local bodies to amalgamate. Mr Stewart also referred to various other matters such as Government economies, borrowing, rate-of interest, import of cereals, and Board of Trade Act. If business men were not wanted in Parliament it was good to have their opinions at meetings of that kind, he concluded. Mr Munro said it had to be remembered that the unemployed themselves should have some say as to how they should be employed. Messrs Waite and Ansell had to leave before the conclusion of the business. CONCLUSION.

Mr Cameron thanked those present for their attendance, and said that the chamber realised -the difficulties they had to face during the coming session.

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https://paperspast.natlib.govt.nz/newspapers/OW19310623.2.72

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Ngā taipitopito pukapuka

Otago Witness, Issue 4032, 23 June 1931, Page 21

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4,645

CHAMBER OF COMMERCE Otago Witness, Issue 4032, 23 June 1931, Page 21

CHAMBER OF COMMERCE Otago Witness, Issue 4032, 23 June 1931, Page 21

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