H—3o

Supplies of Milk The period proved to be one of expanding milk-supplies; a guaranteed supply of milk was available on an organized basis in a number of additional areas, the number of associations guaranteeing supplies being increased by 32 to 71 and the gallonage guaranteed from 87,876 gallons to 111,375 gallons. The increase in gallonage has resulted in a problem in areas where impingement on their supplies by town milk producer associations has led some dairy companies to report the problem to the Dairy Board. The differences have been resolved, but there is no doubt that with the natural increase in town milk requirements it will be necessary to find a solution to what must eventually be a really live problem affecting principally the operation of dairy factories adjacent to areas of population by way of reducing their throughput to the stage where they become uneconomic and in some instances redundant. Treatment of Milk The Department has continued to carry out the policy of public treatment of milk in the greater consuming areas and in smaller areas where treating house proprietors have offered their business for sale. The Department, in carrying out this policy, is taking the opportunity of modernizing several of the existing treatment houses, and in some areas arrangements are being made to build_ new ones. An endeavour is made to obtain local interest in the setting-up of some form of public utility organization to take over the control of the treatment plant purchased ; the usual type of organization has been in the form of a milk treatment corporation with directors representing producers and consumers of town milk, and one Government representative. In two districts, Whangarei and Balclutha, control has been taken over by the local Borough Council. In any rebuilding or re-equipping programme the Department plans with a view to satisfying the needs of the district for the next ten years. In Auckland two milk treatment houses representing half the treating-capacity of the Auckland Metropolitan Milk District are being operated by the Auckland Milk Treatment Corporation, and plans are being prepared for a complete new building and plant which will eventually supersede these two treatment houses. Extensive alterations are being made to Palmerston North, Wanganui, and Nelson treatment houses. During the year the new Dunedin Milk Station was completed, and as a result three obsolete treatment houses were closed down. Progress has been made in the handling of a new treatment house at Hastings. In Napier, Palmerston North, Blenheim, and Dunedin the milk treatment, plants are being operated by the Department pending a decision as to the form of local organization to control and operate the plants ; milk treatment corporations have been set up at Wanganui, Nelson, and Timaru, and on the 31st August, 1948, the existing treating house at Hamilton was purchased and transferred to the control of the Hamilton Milk Treatment Corporation. This Corporation also took over control of the milk depot in Frankton Junction which had up to that date been operated by the Department. Payments Made in Respect op Milk Supplied for Human Consumption for the Period Ist September, 1947, to 31st August, 1948 (a) Payments made under National Milk Scheme to producers, treating £ houses, and vendors .. .. .. .. 1,130,256(b) Cost of surplus milk scheme .. .. .. .. .. 148,729 (c) Payment of winter feed allowances .. .. .. .. 14,188 (d) Payment of administration levy to producer associations .. 7,931 (e) Payment of levies to local milk authorities .. .. .. 12,143 £1,313,247

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