“GALLOPING COSTS”

Wairarapa Times-Age, 5 August 1938, Page 5

“GALLOPING COSTS”

I THE POSITION IN LAND INDUSTRY. FARMERS’ UNION REPLIES x TO M.P. (By Telegraph—Press Association.) WELLINGTON, This Day. “In a recent speech in the House of Representatives, Mr G. H. O. Wilson, Government member for Rangitikei, stated that galloping costs are a pure fallacy,” says an official statement of the Farmers’ Union, issued yesterday. “Mr Wilson contended that there had been no very great change in farm costs as compared with 1929. “While this may be so, Mr Wilson omitted to mention that in 1929 butter was selling at between 158 s and 184 s a cwt. Today the price is fixed at 123 s 8d a cwt. It should be further pointed out that in 1929 wool was averaging £2l a bale, while for last season the average price was in the region of £ 14. So that, if costs are similar today to what they were in 1929, Mr Wilson has established the fact that the farmer is considerably worse off at the present time than he was at that date. A further statement by Mr Wilson also calls for comment, and that is that the most important single item in a farmer’s outgoings was his interest. The Primary Products Marketing Department’s Report for 1937 gives particulars of farm costs and allowances as follows: — Farm working and maintenance costs 5.07 d Allowances for interest on capital 3.06 d Labour on farm 7.29 d 15.42 d “Interest on capital is the smallest item of the three, and further, it represents only 20 per cent of the outgoings. “If further support is needed for this statement, it will be found in the Government's own figures on page 447 of the Year Book, in which the costs on a standard farm are set out. If these were worked out it would be found that they were as follows:— £ s d Working expenses .... 304 4 0 Wages 437 8 0 Interest 183 12 0 £925 4 0 “Out of a total of £925 there is £lB3 or about 20 per cent, for interest. It will be quite evident that interest is not the most important item in the farmer’s outgoings, and it should also be quite patent that Mr Wilson has definitely proved that the farmer is not anything like so well off today as he was in 1929.”