DISSENTING VIEW

Waikato Times, Volume 127, Issue 21189, 12 August 1940, Page 9

DISSENTING VIEW

CASE FOR EMPLOYERS OPTIMISM NOT JUSTIFIED EVIDENCE NOT CHALLENGED The dissenting opinion of the employers’ representative, Mr W. Cecil Prime, is attached to the general order by the Court of Arbitration increasing rates of wages by 5 per cent. Mr Prime holds that in all the circumstances, especially the economic and financial conditions prevailing, no general increase in wages is justified. Mr Prime criticises Mr Justice Tyndall’s assumption that the Court is justified in granting an increase large enough, not only to compensate for the rise in prices to date, but also to provide a margin for a further rise in future. He personally sees nothing in the regulations, which are expressly war regulations, to suggest that account should be taken of any cost-of-living fluctuations before September 3, 1939, when war was dedared. “Unjustified Optimism” “Under present conditions,” the ! memorandum continues, “in which prices for the bulk of our exports are already fixed, it appears to be nothing short of unjustified optimism to assume that there can be an in- j crease in the returns from our ex- | ports sufficient to enable the Domin- j ion to pay for its share in the war effort and at the same time maintain the extraordinarily high standard of living which has been enjoyed dur- ! ing the past few years. Presumably, it is intended that the Dominion’s war effort should be paid for; if so, it is madness to hope to avoid a fall in the standard of living of the people of the Dominion as a whole.” j Mr Prime adds that wageearners can avoid their share of the sacrifice only by putting: others at a disadvantage, and in the long run they themselves will suffer. Regarding the analogy of war-time wage increases in Britain, Mr Prime points out that these appear to have been limited to certain sections of workers, and that the cost of living there has increased very much more sharply than in New Zealand. He attacks the use of commodity prices as a gauge of “effective wages,” and comments that no account is taken :

of social services, improved award ! conditions, including the 40-hour week, and the reasonable requirement that people should adjust their mode of living to altered conditions. Statement In Parliament The memorandum goes on to quote a statement by the Hon. D. G. Sullivan in Parliament last August, that the effective wage rate at that time was 10.5 per cent better than in 1929, which the speaker regarded as a boom year, and better than ever before in the Dominion’s history. . Mr Prime comments that, even if • the cost of living has increased by J 3.1 per cent since then, the workers j should be able to bear it without j hardship. Mr Prime also quotes a reported statement by the Prime Minister, the |

! Rt. Hon. P. Fraser, in June last, that “he knew that among the wageearners there would be a realisation that this was not the time for asking for increased wage rates and for standing pat on hours.” Replying to Mr Justice Tyndall’s : arguments from the high figures for » exports and the trade balance, Mr Prime contends that against the statistical trade balance of £19,800,000 ' for 1939-40 must be set those of only ; £1,400,000 and £4,100,000 for the two ? preceding years, which failed to meet the annual sterling requirement of approximately £12,000,000 for debt services, etc. He also refers to the expansion of State housing production with created credit, the shrinkage in the wool clip, the smaller livestock population, and a number of other factors tending : to discourage optimism regarding in- | creases in either primary or second- | ary production in the near future. Mr Prime also suggests the desirability of increasing both output and earnings in industry by reintroducing the 44hour week. j “I cannot accept His Honour’s . statement that 5 per cent is the maxii mum which can be justified on a cost of living basis alone,” says Mr Prime, in summing up his contenj tions. “In my view, for the reasons | I have given, the maximum which any attempt could be made to justify would be 2\ per cent. Neither can I accept the contention that the large . value of exports, with the consequent high trade balance for the past year, justifies an optimistic outlook as to the prospects of an increase in production for home use. “In the first place, the trade balance, large as it was, was insufficient to wipe off the deficits in the preceding two years. In the second place, there has been so much political interference with economic forces that the normal stimulation of local production is less likely to occur, particularly as a substantial proportion of labour has been withdrawn for military reasons from productive enterprise. Even the 2k per cent, therefore, cannot be justified.” Treatment of Evidence i

In conclusion, Mr Prime feels compelled to say that in his opinion the facts and conclusions put before the Court by witnesses would seem to have been either largely ignored, or, where they could not be ignored, given interpretations which do not bear a sound relation to all the'facts. He also points out that no witnesses were called to support the union’s arguments. The facts put forward by the employers’ witnesses were not challenged or their conclusions shaken: yet the finding of the Court is that they were wrong. In his view . they were right. i _ OPINION RECORDED I WORKERS’ REPRESENTATIVE 7 h PER CENT. RISE FAVOURED The memorandum, Mr A. L. Monteith, to the general wages order by : the Court of Arbitration records the ! opinion that the increase should have been 7i- per cent. Mr Monteith states: “Since September 7, 1937, on 1 which date the Court announced its standard wage rates, the cost of liv- . ing (all groups) figure gives an increase of 10.6 per cent, to May 31, 1940. It is correct to state that these standard rates did not become fully operative for, in my opinion, about IS months. It is also true that workers will have to face increases in the cost of living for another six months before any further relief can be given by way of general order. “I have carefully considered all these differences and, taking into consideration the fact that our trade balance is very healthy, I am of opinion that an increase of 7 A per cent, should be awarded. However, so that the workers can get some immediate relief, I am recording my opinion, but am not recording a dissent from the order now made.”