1,— 13a.

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Mr. Chas. E. Boon read the following statement: — Evidence to the Industeies and Commerce Committee by the Masteb Bakebs' Associations of Otago, Cantebbuky, Wellington, and Auckland. To assist the Committee and to shorten proceedings before the Committee as requested by the Chairman, I have, since the hearing was adjourned, taken the opportunity of summarizing the position on behalf of the Master Bakers' Associations of Otago, Canterbury, Wellington, and Auckland. All those associations support the proposed amendment to the Act, and desire me to point out — The proposed amendment does not do away with any of the offences created under the principal Act. It is still open to the Crown to prosecute for any of those offences. The amendment merely places in the hands of the alleged offender an available defence. To establish that defence an offender must prove that this action was not unfair, was not prejudicial to the baking industry or to the public welfare, and that similar action as commonly practised in similar circumstances would not be unfair or prejudicial to the public welfare. Surely the rights given by the proposed amendment to establish that defence before a Court of law cannot be considered unjustified. The trade's experience may be summarized in this way : — Wages are fixed by an award. The price of flour is stabilized. To a large extent, therefore, overhead is predetermined, and with a predetermined overhead price-cutting must inevitably end in disaster. To-day bread is being used as a decoy line by traders not wholly engaged in the baking industry. It is sold at a price without any relation to the cost of production. Rival chain stores in Auckland are using bread as powder and shot in the price-cutting war between themselves. The effect is ruinous to the baking trade. Experience has shown that the price-cutting baker inevitably faces his creditors with a deficiency. One individual who last session opposed the New Zealand Master Bakers' petition assigned his estate with a deficiency of over £6,000. The inability under the present law to refuse supply plays into the hands of the financially unsound. Recently a baker forced to meet his creditors with a deficiency was granted extended credit to enable him to carry on. He immediately announced a reduction of |d. per 21b. loaf, thus forcing solvent bakers to compete at a price which must ultimately end in insolvency. No combined action could be taken without committing an offence under the present Act. Under the proposed amendment combined action could only be taken if it was justified as not being unfair to the individual and not being prejudicial to the public interest. • The original Act was framed to suppress monopolies. It acts now as a protection to those engaged in a desperate fight to set up retail monopolies. The damage that is being done to trade generally by the retail price-cutting outweighs any benefit to the public generally. The inability of various trades to protect their own industry is assisting the retail monopolist.

Witness : Chas. E. Boon. Mr. Wilkinson.] Why do bakers sell bread to grocers ? — Grocers are the legitimate channels for disposing of bread, and bread-bakers consequently have not got the matter in their own hands. Why have they not been able to do so I—They1—They do in other parts of New Zealand, but it is not general. If it is done in some parts of New Zealand, why is it not done generally ? —I am not to know. It can be done. If it is not done, whose fault is it ?—I am not saying that it is only the chain stores. Where does the fault lie ? —A good deal of the fault lies with the bakers themselves, I admit that. You think that the amendment will give you more power ?—lt certainly would be of assistance. You do not say that without it you cannot keep on ?—lt has been a definite drawback. The Chairman.] In what way do you say that the amendment would assist you ? — We have always regarded that if we refused goods to an individual for price-cutting it was illegal. Mr. Harris.] You are a commercial trust % The Chairman.] You are from Christchurch ? —Yes. To what extent do you have in Christchurch what they had in Auckland when we last inquired into the matter —a hawker of bread ? Does that exist to-day ? —lt has never been very prominent in Christchurch. We had a strong complaint from Auckland at this time against the practice because it was impossible to compete against this type of trader who paid no rates, had no shop, and practically no expenses % —We have not had that experience to any extent in Christchurch. Mr. O'Leary.] You seem to accept the view that an individual trader can refuse to supply ? Yes. But you think that when it gets into the realm of a combination then you are committing an offence under the Commercial Trusts Act ?—Yes. You hope that under this Act as amended you will be freer to combine to exercise your wishes on the whole ?—Yes.