FIFTH PERIOD SCHEDULE

Southland Times, Issue 24240, 25 September 1940, Page 6

FIFTH PERIOD SCHEDULE

BASIS OF ISSUE OUTLINED

LICENCES TO COVER FULL YEAR

(Special to The Times)

WELLINGTON, September 24.

The basis on which licences covering imports during the fifth period are to be issued was the subject of an announcement today by the Minister of Customs (the Hon. W. Nash). “With the exception of one or two items noted in the schedule, licences are to cover the full year 1941 instead of a half-yearly period as hitherto,” said the Minister. “Careful consideration has been given to this question and while there are certain factors which raise doubts whether the'six-monthly period should be maintained it is thought that the advantages to be gained by adopting the yearly procedure justify that course. I am convinced from the representations which have been made that this step will be welcomed by importers who will now have a longer time in which to exercise their licences.

“It is necessary, however, to warn importers that the allocations granted to them are intended to provide for requirements for the full year. They are determined within the limits of the funds available and cannot be increased. Importers would be well advised, therefore, to arrange their imports or the distribution thereof so that they will cover the full period, otherwise they might find themselves during the latter part of the year without any goods to trade with. NO CARRY-OVER “A runner important aspect/of the procedure and one which is doubtless generally understood is the policy being adopted regarding the expiry of third and fourth period licences. When releasing the fourth period schedule in April last,” said Mr Nash, “it was made clear that licences for the third and fourth periods would be valid until December 31 next only, and importers were advised to arrange for importation by that date. “It is recognized that there may be difficulty in bringing the goods in within that period, but it is very important that there should be no carry-over from one period into another. If this procedure were not followed it would be difficult to determine the amount which could be allocated for licences in the subsequent period and would probably result in that amount being reduced to a lower level than ultimately found necessary. “It has therefore been decided not to extend third and fourth period licences beyond December 31 next. Any goods ordered under such licences which arrive after that date will be admitted only as a charge against the importer’s allocation for the fifth period. Importers are accordingly warned that in placing orders against fifth period allocations they should make allowance for any goods ordered under .third and fourth period licences which might arrive after December 31, 1940/*

As a means of exercising control and avoiding any difficulties arising on the part of importers from a misunderstanding of the position the following procedure will be followed in issuing fifth period licences: Where at the time of issue of fifth period licences an importer has balances outstanding on third or fourth period licences his allocation for the fifth period will be reduced by the extent of such balances until such time as the licences for the previous periods have been surrendered. This means that immediately the licences for the previous periods are surrendered either before December 31, should the licences have then been exhausted, or after December 31, licences for the full allocation for the fifth period will be available.

STERLING BALANCES “The impression appears to be fairly widely held,” said Mr Nash, “that since considerable sterling balances are at present held by the Reserve Bank and the trading banks a greater sum is available for imports and restrictions can accordingly be relaxed. Such, however, is not the case. In fact, the conditions obtaining today all point to the necessity for maintaining a close control of imports and avoiding expenditure of overseas funds for non-essential imports which can be dispensed with at the present time. “As I have recently intimated the relatively high level of sterling balances held just now is attributable to the following principal factors: (a) Payment in advance for our main export products shipped to the United Kingdom. (b) Delay in the arrival of goods owing to difficulty experienced by

suppliers overseas in promptly executing orders. To the extent that such is the case the drain on funds has been reduced in the meantime.

(c) The present is generally the time when following our export season balances are at a high level and in the normal course a reduction could be expected between now and the end of the year, but this position might be affected through difficulties referred to above, experienced under existing conditions, in obtaining goods from overseas..

“Apart from the above factors the operations of the import selection scheme has had some effect in reducing imports and in improving the trade balance.” SECONDARY INDUSTRIES Secondary industries had also to be provided for. These had been expended in order to produce goods imports of which had been restricted and also uniforms and other goods required to equip the armed forces. This had necessitated the importation of increased quantities of materials and since, as already mentioned, costs of such materials had generally increased a very considerable portion of the funds available had to be allocated to provide for such requirements. While, therefore, the position of overseas funds had shown some improvement the Government had found it impracticable to make any wide relaxation of the restrictions in so far as imported manufactured goods were concerned, but every endeavour would be made to provide as far as possible for the full requirements of industry in the nature of plant and materials. “Imports in 1938 will again form the basis for the granting of allocations to individual applicants although in the case of industrial materials (which represent the bulk of the expenditure) the allocations are generally related to actual requirements without strict regard to previous imports,” said . the Minister.

“When releasing the schedule for the fourth period, I drew attention to the practice which had been adopted by some importers of arranging for the importation of goods in anticipation of

obtaining a licence, and I issued a warning that apart from making themselves liable to the penalties provided under the law, importers who were guilty of such practice also took the risk of the goods being seized. Despite this warning offences of that nature against the regulations are still being brought to my notice, and I wish it to be understood that more drastic action will be taken in future regarding such cases. NO GROUP LICENCES

“Suggestions have been made that licences should be granted to cover a group of items rather than an individual tariff item. It has been represented that under that procedure an importer would be in a position to exercise his licence to better advantage, that is, by importing those goods for which there was the greatest demand and naturally those which would give him the best return. This question has been very carefully considered, and while the desirability of allowing as much flexibility as possible in the use of licences is recognized, it is not considered practicable at the present time, when a close control over imports is still necessary, to give effect to the suggestion. The procedure adopted during the fourth period in respect of the granting of ‘blanket’ licences to the local representatives of overseas suppliers of certain commodities is being continued during the fifth period.” Mr Nash concluded by saying that it was the desire of the Government that the maximum requirements should be obtained from the United Kingdom and every endeavour would be made to achieve that purpose. Importers generally would, he felt sure, be in full accord with that policy and would cooperate to that end.