The Waikato Times THURSDAY, MAY 26, 1938 DIRECTION CHANGED

Waikato Times, Volume 122, Issue 20508, 26 May 1938, Page 8

The Waikato Times THURSDAY, MAY 26, 1938 DIRECTION CHANGED

In his address to a gathering of farmers in Wellington on Tuesay t e rime Minister said that the Government intended to pay to tne producers of butter and cheese whatever balance was available in e airy Industry Account at the close of the production year. The atement will be welcomed. Ho one else has any right to the funds, r - i .-aiage must not expect the producers to believe that this was always the intention of the Government. The change of direction can be seen in the two following quotations : JIH NASH MR SAVAGE London, January 15, 1937. Wellington, May 24, 1938. create t i‘ e thi' oC !S ds from sales are Mr Xash the tarmers very then guaranteed price definitely that the surplus that was amSum - * IS !l ? credn - The in the Dair J Account belonged to ufed n oi l SU o P n US " ould he t,le dairy farmers an <l to no one might occur any deficiency which else, and that he was going to work "ant ensu , red a c °u- out a plan tor submission at Napier mer which H lnff *° the far - as to how 11 "' aa S°lng- to reach creases Drodnction das he in ' them ' 14 means this: they have a production. minimum price this season ot 112 s a cwt. and they are going to get everything above that in the open market. The basis of the guaranteed price has been abandoned. It is wo J= blllSatl ° n Plan no ' tv - That basis ™s, Hr Hash’s . ■ +ih pa J men 4 a legitimate sum, as far as can be ascertarned, to the farmer for the work he does.” It was claimed, and with no lack of emphasis, that the prices fixed provided that return 6 P ril ? ar > producer. The claim has been jettisoned, the attitude , 1r ,;.. n ln ddon and ln Ca nada has vanished, and the farmer, by uniting solidly on a purely economic issue, has compelled the Govemment to yield. What remains is the guarantee of a minimum price, nd State control of the marketing machinery. The former could e defended, in the interests of economic stability, but there is now no need fur any measure of State control. The men who built up he industry are quite capable of handling the marketing of the prouce. The idea of a central control did not originate in Labour circles. Far-seeing men tried to obtain it years ago, but, as its adop- „ A epeDded ° n com P let e agreement, it was found impossible to effect the change. The system has now been introduced by legislation, but it is practically the same as that advocated long ago. The men who are actually doing the work of marketing New Zealand dairy produce were trained in the industry under private control and could carry on if direction were returned to the industry itself. Things obviously have not gone according to plan, and the Prime Minister has swept away the greater part of the system which his colleague strove so hard to establish. It did not stand the first real test—a surplus in the account. And it also failed in matters of detail. In the early stages Mr Nash said that it would save the ““O' industr Y £60,000 in bank charges. That was in August, 1936. Last year the Minister of Agriculture addressed a conference of dairy farmers in Hamilton and explained how it was that so many companies had had to pay increased interest under the new system. It is a little late in the day for the Prime Minister to assert that it was the object of the Government to keep costs down. The country has his earlier assurance that his Administration came into office to increase expenditure, and also that of an’ Under-Secretary that high human costs are part of the present policy. The recent adjustments of the tariff were all in an upward direction, and it seems certain that the most effective factor in stimulating opposition to guaranteed prices was the constant increase in production costs. It is impossible not to feel sympathy for the Minister of Marketing. The scheme was his, as far as prices went, and he was able to incorporate the control of marketing previously advocated by an influential section of the industry, but he made it a State activity. All that remains now is the so-called minimum price and the marketing. The scheme that was to ensure stability by means of prices, that was to measure the payment of tbe farmer by the same tape as was used to measure the payment of others who rendered equal service, has virtually gone. The establishment of a tribunal to fix prices is important, provided the conditions governing the issues laid down at the recent conference of the industry, are also accepted. The declaration of the Prime Minister that the surplus must be paid out establishes a precedent, and by so doing alters materially the guaranteed price, as advocated by the Government in 1935. It might have stood longer in a period of depression, but it could not withstand one of rising prices overseas.