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chiefly determines the conditions of the other industries in New Zealand. The most important thing in my paper is that statement. Mr. Herbert asked, "Is half the national income paid to the workers in wages ? " I was referring to the 400,000 wage-earners classified as such in the census returns. Ido not know whether they get it in wages, salaries, or what. But the proportion is roughly the same in every country for which I have seen the figures. In England, for instance, I found that the wage and salary workers under £160 a year were estimated as getting exactly half of the national income ; and it seems to me that the New Zealand wage-earners are probably getting rather more. Mr. Bromley says that I did not mention other costs besides labour costs, and that in the dairying industry labour costs are low. I admit the latter point, but I did mention other costs. My point is that sheltered costs and prices are too rigid, whereas unsheltered prices are variable, and costs must be adjusted to them. For instance, between 1921 and 1926 the cost of materials used in dairy factories, which conforms closely with suppliers' receipts, increased imperceptibly, from £16-40 to £1645 millions. For the same period the charge made for the factory processes undertaken increased from £2-60 to £3-34 millions, or 28 per cent. Mr. Tucker: What proportion of that was wages ? Professor Tocker : I have not the foggiest idea. Mr. Tucker : I could tell you, if you want to know. Professor Tocker : You will find that the cost of materials has not risen anything like so much since the war as the charge for the process of manufacturing ; and the farmer has had to submit to falling prices and rising prices just as the world's market changes, but the process charges do not seem to fall in that way : they seem to be subject to steady expansion. Mr. Purtell said that the Conciliation Councils were useless ; but from the other side of the room I have the information that the Conciliation Councils have settled 93 per cent, of the matters in dispute in New Zealand. I think the two statements cancel one another. Mr. Martin asked that I should prove that the Arbitration Court is a factor in preventing increased production. There can be no possible doubt that the Court does define pretty rigidly all sorts of minute conditions in industry ; and, farther, it is not generally realized that when the Court does this it is implied that things shall be done in no way other than that laid down. The essence of progress lies in doing things in different ways ; but this system binds industry in a straight-jacket and prevents people experimenting and exploring improved methods, machinery, and management. The management is not free to make the necessary improvements, and needs to be much freer than it is to-day. Mr. Churchhouse asked a question as to whether the farmer's industry was sheltered, and he instanced wheat. But he is taking a very small part of the industry and assuming that what applies to that part is true of the whole industry. Mr. Cornwell asked whether immigration was not the cause of unemployment. I took out the figures over a long period of pre-war years and found that we absorbed 8-9 immigrants per thousand of the population without any serious trouble. For the three years prior to 1926 we absorbed 8-1 immigrants per thousand of the population. The rate of immigration relative to the population was less during the period prior to the recent unemployment trouble than it was during the period before the war when there was no serious unemployment problem. Ido not think that immigration can be considered the cause of the unemployment. Other factors have to be considered. Mr. Cook asked what is meant by " flexibility of arranging jobs." By " flexibility of arranging jobs " I mean giving people the right to arrange jobs in any way they please. Piecework in some cases has been absolutely prohibited in awards. On the other hand, I have heard of people introducing piecework and increasing their output greatly. So that while a good deal has been gained by adopting the piecework basis in some cases, it is prohibited in many other cases. I want to see freedom and variation which will permit people to expand their businesses, and to find out how to expand their businesses. I have here [exhibited] a copy of a sheet of a Time, Wages, and Holiday Book for use in Hotels, Private Hotels, Tea-rooms, and Restaurants. I started to count the columns and the entries that have to be made, but I gave it up. The employee has to sign in one column for wages, and in another for the holidays he gets. "An employer who fails to satisfactorily keep this record is liable to a fine of £10." I object particularly to that split infinitive. There are a number of other matters one might refer to, but I want to quote finally from a recent Manchester Guardian Supplement on " Industrial Relations." Mr. Butler, Deputy Director of the International Labour Office, says : "In Detroit (where wages are very high) it is impossible to find a collective agreement, except perhaps in building ; wages are fixed by competition among employers in the local labour market." Then Professor Hobhouse : " If there is one thing upon which employers and workers seem generally agreed, it is the repudiation of compulsory arbitration in wage disputes. Self-respect and self-reliance, the best products of organization, are instinctively opposed to arbitration." Mr. Py-bus (Balfour Committee on Industries and Trade) : " The machinery should be split into smaller bargaining-groups. This could scarcely aggravate the conditions which'have arisen from the failure of the present ponderous and inelastic system of national negotiation." Mr. A. Henderson : " Conciliation promotes investigation of the facts and circumstances of a dispute. Arbitration leads in practice to the formulation of some principle upon which to adjust wages. In Australia and New Zealand the system begun as a method of prohibiting stoppages but has developed into a system of wage-regulation." Professor Belshaw's Reply. Professor Belshaw : Mr. Chairman and gentlemen, there is one thing which I think should be realized in reference to the position of both Professor Fisher and myself, and that is that we have endeavoured to meet the criticisms raised against the Court which we have considered invalid or

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