FACING SERIOUS CRISIS

Wairarapa Times-Age, 3 June 1938, Page 3

FACING SERIOUS CRISIS

FARMERS IN NEW ZEALAND. PRICE SCHEME CRITICISED. (By Telegraph—Press Association. INVERCARGILL, June 2. The serious position of New Zealand farmers was emphasised by the president of the Southland provincial executive of the Farmers’ Union, Mr A. R. Johnston, in an address to members of the Invercargill Chamber of Commerce today. The farming industry was facing a very serious crisis and the Farmers’ Union was very concerned, he said. There was between farmers’ export prices and costs a high gap which the compensating price scheme sought to close. Since 1926 export prices had been lower than farmers’ production costs and in 1935 the guaranteed price had been fastened upon as a means of relief. This scheme, however, had not worked out as expected, and there was considerable dissatisfaction among dairy-farmers at the Government’s partial ignoring of the steadily rising costs when fixing the guaranteed price. The speaker could say with confidence that dairymen in Southland were producing butterfat at pence below the cost. Taking as a basis of calculation a farm with an annual production of 60001 b butterfat, Mr Johnston said that the year’s working would represent a debit of £l7l 9s. In his estimates the Minister of Finance, the Hon W. Nash, had not allowed for interest and depreciation and many of the working costs were placed at too low a level. Farmers working perhaps a 60-hour week were allowed an average of 1/10 an hour, whereas the unskilled labour rate was fixed at 2/4 an hour on a 40-hour week. He declared that the method of arriving at the guaranteed price was unfair and the only alternative was a scheme for a compensating price, which would take rising costs into account, as well as allowances for interest and depreciation and for the payment of competitive rates of wages and provide for a fair standard of living for the farmer himself.