THE GUARANTEED PRICE.

Waikato Times, Volume 119, Issue 19889, 19 May 1936, Page 6

THE GUARANTEED PRICE.

The Primary Products Marketing Bill has been passed into law, hut it would be interesting to know if those directly affected, the primary producers, have any certainty regarding the operations of the Dairy Industry Account that is to be opened with the Reserve Bank. The chief point of interest is the manner of dealing with any surplus, or deficit, at the end of the producing year. The Minister of Finance told the conference in Wellington that “if there was a surplus the Government would have to decide what was to be done with it.” If there was a deficit, Mr Nash explained, it would be the responsibility of the Government, and “there would be no liability on the producer.” If the Minister meant that there would be no recourse on the producer in order to meet any deficit that should be made clear, for it would not prevent the Government, in the event of a surplus following a loss, using that money to improve the balance of the account. It would have paid the price guaranteed, there would be no liability resting on the producers, hut the use of any surplus would be entirely in the hands of the Government.

Some days before the conference of ward delegates met the Prime Minister had stated that surpluses would be used to offset deficits, but the Minister of Finance was not nearly so definite. However, attention has been drawn in the south to a significant statement made by the Leader ,of the Legislative Council, when the Bill was before that Chamber. Mr Fagan stated that the industry account was not an annual one “but a continuing one, with deficits carried forward as a set-off against possible surpluses.” That aspect should be carefully considered. The results of the year’s operations will he reflected in the state of the account, and clearly any profits made will be used to pay off any losses incurred. The plan, if Mr Fagan’s explanation is official, will therefore be one of stabilisation of prices, and if, as the result of the first year’s operations, there should be a loss that fact may influence decisions regarding the price to he paid in the following year. But the explanations about the disposal of any surplus have differed almost as much as the election predictions as to the form the legislation would take, and all interested must wait and see. However it is significant that the spokesman for the Government, in the final stages of the Bill’s passage through Parliament, made it clear that surpluses would be used to wipe out any deficits.