PRICE OF BUTTER.

Taranaki Daily News, 23 October 1916, Page 3

PRICE OF BUTTER.

i KBPRESEXTATIVE MEETfVG AT HAWERA. / •BOARD OF TRADE'S ACTION CEXSURED. There was a very representative gathering of representatives of the dairyine industry in the Taranaki district at Ha~wera on Saturday, practically every factory being represented at a meeting to discuss the limitation of the price of local butter as fixed by the Board of Trade.

Mr. A. Morton (chairman of the Xational ]>airy Association) presided, and stated that the meeting had been called to consider the latest imposition placed by the Government on dairy farmers. At the outset, lie asked whether it wss the opinion of the meeting that it should be open to the press. Members of tiie committee had considered that the press should not be admitted, but that the results should be communicated to the press.

The meeting was practically unani mous that the press should be admit ted.

The chairman gave a lengthy address, describing in detail the negotiations with the 'Board of Trade. They had most probably noticed for some time past that there bad been complaints that among other articles of the necessaries of life toittcr was too dear, and it was represented that if there were any further rise in the price of this article possibly serious consequences would enSue. He was not acquainted with the full details prior to the time that be became connected with the matter, but a fortnight ago he was invited to meet the Minister, of Agriculture in conference to discuss the question of fixing the local price of butter, and also important proposals in connection with the export of butter and cheese. He detailed what took place at the confeernce (as already reported). No steps were taken at the conference to put important proposals in regard to the export of butter and cheese before them, only the question of the price of local butter, whether they were prepared to allow this to remain at the price at which it stood on the local market or whether it should be reduced. oßth the Minister of Agriculture and the Board of Trade were emphatic that they should not discuss nor suggest any increase in price, which at that time was '2d per lb below the f.o.b. value of the produce lor London shipment. What had led to the Board of Trade taking action was that a deputation, comprising Messrs MaeEWan, Paccy, "Nathan, Buchanan, Frouse and Robs'rtson, presented figures on October 3 showing that the local trade was at a disadvantage as compared with ,the export trade, and strongly urged that the local wholesale price should be increased to a parity With the f.o.b. equivalent, and that the BWd of Trade should publish a report giving the evidence of the disparity and justifying the advance. At the same meeting Messrs Harkncss, Pace)' and McEwan urged that the embargo on exportation should be removed. \ Mr. Morton could quite conceive that members of the deputation had good reasons for making the request, because'sincc the commencement of the export season they were confronted with the'question as to whether they bad a permit to export, and were told by the Government that the issue of tills permit depended on the local price of butter not being increased. The Board of Trade said that they had made investigations and made a report to the Minister giving the outline of a scheme for fixing local prices. Though there was no statement to that effect in writing, he felt assured that the Board of Trade was satisfied that since the outbreak of war there had been no exploitation of the local butter market. Indeed, it was admitted that under the pievailing conditions those factories supplying the local trade had done so at a loss of £70,000, compared with the prices paid on the London market. That admission alone, he considered, should have had some influence, and had the industry been accorded fair treatment their reasonable request, now made for the first time, to place, the loal prices on the same basis as those ruling on the London market, would have met with favorable consideration. Nominally, Mr. Morton said, they met in conference to consider the question. Actually, they were called together to discuss a scheme already cut and dried. They endeavored, of course, to protect the industry in eevry way possible, tout no matter in how mild a way they made any suggestions they were met with the statement that an increase could not be allowed, but possibly the price might have to he reduced. He outlined the suggestions of the Board of Trade as follows: —

(1) The Board recognised that factories supplying the local market are at a disadvantage as compared with oxporting factories; (2) it is undesirable that the factories supplying the local market should be at this disadvantage; (3) to meet this disadvantage it is further undesirable that the local price should be increased; (-4) ;•. reasonable price should be fixed for the local trade; (o) the disadvantages thereby accruing should be spread equaibly over the entire dairying industry; (0) to do this a small charge will be imposed on the butter-fat supplied to all registered factories; (7) tlie sum raised by this means will be disbursed pro rata to those supplying tiie local trade; (8) all restrictions on export other than those necessary to give effect to this schecme to be removed.

These outlines they were not asl;ed to consider, but actually to consent to, despite the fact that the conference was a representative one, and that there were present men whose opinions were valued in the industry and should have carried weight. There were also representative, of the exporters and of the grocers. :Mr. Morton thought it was partly owing to representations made previously by the retailers that the producer had to some extent to thank for prices being limited. The retailers had evidently said that if the wholesale price went above Is od they would have to increase the retail price by an additional penny, as -2d profit did not allow sufficient margin. After a discussion, lasting all the afternoon, the Minister of Agriculture and the Board of Trade representatives left, and. asked the dairy representatives to suggest some more practical scheme. Jt was, however, not practicable to draw up any scheme litat did not raising the price on the local market, so a small committee was set up to prepare a report. The report placed on record the entire disapproval of the proposal submitted by the Board ■of Trade to limit the selling price of butter within New Zealand, and to the principle of taxing the whole of the dairy farmers of the Dominion in order to make up the difference in price between the limit fixed and the current London market price, because such a course would be (a) economically ua- j

•sound: (h) a class tax: (c) an interference with the small farmers of tile Dominion, who were at present bearing the enormously increased cost of prodtic" tion, due to the absence of many members of tlicir families in the 'n»hting lines, the high price of labor, and the greatly increased cost, of all farming requisites; (d| the fact that butter for export is to-day worLh Is (i%d to Is 7'/ 3 d f.u.b., the equivalent of which for business in. the Dominion, after meeting distributing and marketing chaws, is Is 8d per lb.wholesale and is Kkfper lb 'retail for best qualities, as compared with the charge to consumers in Britain of about 2s p er ], D) an< j i :eeiU , se of Nv i lio j x an increase on the local market is not only justified but necessary in the general interests of the industry; (e) that if any limitation of the price is deemed ju-ecsary, it is suggested that the cost of such limitation should be a charge against the consolidated revenue, in support of which we instance the precedent of the Imperial Government with respect to the increased rate of wages of the railway workers in Great Britain.

A committee of six was set up to watch over the interests of the producers in respect to the Government's proposals to regulate the local price of butter. This report was unanimously adopted and placed before the Board of Trade and ITons. Allen and Merries. Hon. James Allen was emphatic that Cabinet had already considered the matter, and, was not prepared to consider any suggestion that did not embody fixing the local price at no higher than the then rate. The matter was left at that. It was, however, considered advisable to set up a- committee of six to look after the interests of the producer. This committee comprised: Messrs Marx, Powdrell, Pacey, Fisher, Agar and the speaker. They then saw in the press that the Government had gazetted regulations on the 13th inst., which came into force the next day, prohibiting export except by license on agreeing to contribute %d per lb butter-fat on the previous month's output to a fund which would reimburse factories that had sold locally at.the lower price. Mr. R. Triggs, who had been gazetted with authority to issue, desired to confer with the six committeemen in connection with the working ar-

rnngements. After consultation, the committee decided that in the interests of the producer it was the wisest policy to endeavor to assist as far as possible, yet it was not wise to do so-without making an emphatic protest. Accordingly, a letter was handed to Mr. Triggs when the committee met him, stating: "In responding to the invitation the Advisory Committee wish to make it clear that they in no way depart from the 'resolution passed by the meeting of producers held in Wellington on the 10th inst., and that any assistance rendered or part taken in conjunction with Mr. Triggs must be without prejudice and under protest, and it is only owing to the urgency of the position and the necessity to utilise all shipping space for the benefit of the Home consumer as well as the Now Zealand producer that we associate ourselves with this matter.'' The committee considered it was not advisable to refuse to assist, because, if they did, the industry might be placed in an awkward position. Boats wero noiw ready to load, and there was a lot of produce stored in the grading works that might be held up if there was any hindrance. He had discussed the question of shipping space with the chairman of the Overseas Committee, who informed 'him. that though there was said not to be a great quantity of meat in store, they were still being pressed to take meat away, and the lonic, which was expected to load dairy produce, would be loaded to the hatches with meat at Dunedin, if it was thought the Government would raise any protest against shipping "dairy produce. Mr. Morton stated that, with Mr. Triggs, they had discussed the scheme, the principle of which had been outlined. The tax of on butter-fat to make up any loss to butter factories supplying local trade was based on 3d difference between Is 4d, the local price, and Is 7d, f.o.'b. price for London shipment. This was subject to variation, because the levy would increase one-farthing for every penny that the London value rose, or would decrease accordingly. This basis was adopted as a less complicated method of working. There was a lot of discussion over the issue of licenses. Representations were made that these should he held over until such time as the first shipment was sent away, or until factories had had an opportunity of applying for the licenses. While this was not agreed to, some important modifications had been made. .Meanwhile the secretary of the .National Dairy Association had been instructed to obtain legal opinion as to whether or not such action was within the power of the Government, and, if the report was favorable, to test its validity, because the committee felt that it was their duty to lake every step possible to protect the industry from such an arbitrary and unjust imposition. It was a matter of such importance to the industry that it was worth while using all the means in their power to see if they could avoid the payment of an arbitrary tax. The Minister of Agriculture and* the Board of Trade were particular to impress on them that it was. not a tax, but simply taking from one portion of the industry

to give to another. The committee, however, considered that- it was taxing one class in order that all others, whether they could afford it or not, might obtain cheaper butter. They had deemed it wise to acquaint the Minister and the Hoard of Trade of their opinion, and asked them to suspend its operation until the case had been heard by three judges of the Supreme Court, so as to obviate any appeal. The Board of Trade had m'et them in a reasonable spirit and promised to give thejn every assistance. The Minister of Agriculture was, howover, attending a show in Hawke's Bay, so they could not see him, though one would have expected that when such in important matter was being discussed he would have been there to hear their representations. They had placed the matter before Air. Hemes, who met them in a spirit of candidness witli a desire for a settlement. It had accordingly been arranged to hear the case on Friday next by the Chief Justice and two other Justices, and though they could appeal against the decision it was not desirable to do so, if the opinion was unanimous. If the decision upheld the validity, they had no course but to accept it, and endeavor to work in .such a way as to avoid any friction. They could protest against the principle, but there would be no remedy until Parliament met, when they could 'bring their influence to bear on those to whom Parliament was responsible, If they succeeded and proved its invalidity, they were faced by a determination that the local price must not increase, and no doubt this would be arrived at by other means. He could not say what course would be adopted. They could contest them all, or, if not, protest. The principle enunciated was a departure from anything that had taken place in

-Vw Zealand. It levied upon the small armer an unjust and unfair tax to benefit tile rest of the community, ininy ot whom were better able to pay 'a higher price for their tatter than were the tarmers, who suffered as much as anyone else through the high cost of iving. If ll 1(!y i, a a hcen asl . ccl to , )onc . lit the Imperial Government or patriotic or relief purposes they would have con■sulered it wise to assent. Thev must do ah in their power to protect'the interests of the industry. If thov won they might be confronted by soniothhi" jar worse, but even if so, thev were bound to resist an unjust tax with all tne strength m their powei; and all the j»eans in their power. He pointed out that .Supreme Court actions were expensive, but if it cost £SOO to rid themselves of the arbitrary tax it would be cheap riddance. This expense they must be prepared to bear. They must also hear the matter in mind, not to-day but in the future, and if unsuccessful it was for them to throw the responsibility on others to bring pressure on those in power and convince them of the unjust«ess of the proposals. He then move,! the following resolution: "That this' meeting, representing the entire dairying industry in Taranaki, records its emphatic protest against the principle contained ],, the recommendations of tho Board of Trade's report and the regulations made by the Government fixuV a on the price at which butter may°be solcUocally, and making a levy on the whom dairying industry of the Dominion to contribute the .difference between the amount of such local price so flxec 1 and the f.o.b. value for London shipment,' and that it regards the principle of the regulations as unjust and absolutely unfair m its incidence and a hardship on the dairying community of the Dominion, comprising as they do practically all the small farmers who are suffcrin'" equally with otlier classes of the com", munity, by reason of the increased cost of living, which they are una.ble to collect from the purchasers of their, produce, but are, on the contrary, compelled to accept the current price therefore in open competition without protection." Mr. Murdoch (.Tolls) seconded. It was resolved to endorse the action of the committee in taking steps to test the validity of the action.

The chairman's resolution was then discussed.

Mr. W. .Po'ivdrell (Kaupokonui) considered that it was exceedingly moderate. The chairman, was the calm man of the party. As an amendment he moved that this meeting of Taranaki factories objects to the class tax levied by Cabinet on butter and cheese and without the sanction of Parliament, which amounts to £300,000 per year. This meeting is of opinion that the'price paid for political purposes and city votes is too great, as same entails a yearly tax of £7 per head on 40,000 "sinail dairy farmers and share milkers already overworked to benefit our. Dominion's population by 3d per lb "on butter-fat, which benefit means a paltrv sum of (is per year or 15-13 d per week for every citizen in New Zealand. Mr. (Jane seconded the amendment.

Mr. Marx (Mangatoki) considered that the %d levy wa.s not likely to lie the end. If the principle was adopted there was no reason why in the wisdom of certain people butter might not be reduced to Is or even 04 pei lb. They had now got an arbitrary price, whereas hitherto, the price had been governed by the markets of the world.

Mr. Powdrell thought the position had arisen through the parties in the House being so equal and there being a spineess Government. He believed meat would be the next thing tackled. "You people," lie said, "who have purchased cattle at the present prices can wonder how you wdl sell them when, fat." This regulation of prices was an attempt to catch votes at the fanners' expense. The farmers must put on the whip, if not noiw, at next election.

Mr. Dunn (Farmers' Union) thought that if taxation was needed the proper way was to tax the wealthy and those able to pay, not to squeeze the farmer for political purposes. At present if a .man earned £IOOO per year he got a reduction in price. It was a class tax, which he would oppose to the utmost. It had a tendency to

raise one section against another when all should he at one in a desire to win tile war. If for patriotic purposes all would be prepared to give the contribu-

tion. It was ridiculous to "regulate the price here where there was no congestion of population and so many open places. Mr. Gane considered that farmers were the hardest worked people in New Zealand. If the fanners .spent their money in the same, way as the rest of the community butter would now be (Is per lb. . Mr. Marx, whilst he liked ginger, thought the amendment was hardly politic.

Mr. Burgess. (Warca) expiessed the same opinion.

Mr. Mellahon (Tnglewood) favored the amendment. He pointed out the heavy loss the stock farmers had to 'hear, the position this year being accentuated by the high price. Mr. Powdrell refused to withdraw his amendment, which wa? lost on the voices and on a show of hands. The resolution was then carried.

On the, motion of Messrs Murdoch and Burgess, Me.«rs A. Morton, W. D. Pawdrell, and J. Marx were appointed

Taranaki's representatives on the Advisory Committee, a tribute being pail] to the good work already done by the trio. On the motion of Messrs Dingle (Stratford) and "Rowlands (Mangorei), it was resolved to pledge the factories to bear 'the cost of litigation pro rata according to output. Before the meeting dispersed, Mr. W. D. Powdrell read the following resolution: "That this meeting' recommend t'hat the Board of Trade be dismissed or retired on pension, and after next election all retired politicians losing their seats be favorably recommended for the next reinforcements or any employment where no hard thinking is required." THE PRICE OF CHEESE.

At the same meeting the question of tlie price of cheese was discussed, and it was decided to send the following cable to Mr Masscy: "Cheese sold 10jd in factory here. Before anything further be done factories be consulted."

(Our detailed report is unavoidably postponed till next issue.)

By Telegraph—Press Association. Wellington, Oct. 21. According to a decision of the producers' representatives an originating summons is being issued to test the validity of certain portions of the Order-in-Council which embodies the Board of Trade scheme for the regulation of local butter prices. The Dominion secretary of tlie Fanners' Union cabled to Mr. Massey protesting against the export tax on 'butter-fat imposed without the sanction of Parliament as directly opposed to the Government's expressed policy, and relying on Mr. Massey to prevent thi3. Mr. Massey replied that he is communicating with the Government.