MINUTES OF EVIDENCE. 



47 



15 October, 1919.] MESSRS. ALLISON, JiiR., McNicoL, STEWART, DAVIDSON, MCLAREN. 



\Cnntinnfil. 



14.788. Have you formed any estimate as to the 

 increase there would he for the 1919 crop? No, 

 we have not done so, but I think such an estimate 

 could be made up very simply. Our costs are analysed 

 into labour, material, and on-cost. By taking those 

 three and applying the increases or decreases the 

 1919 figures or the 1920 figures or 1921, other things 

 being equal, could be obtained. 



14.789. You take the per quarter cost? Yes. 



14.790. I think you consider that to be the most 

 reliable basis to work upon? Yes. 



14791. This year you have a double burden as it 

 were. There is a considerable increase in the actual 

 cost and there is a decided decrease in the yield, as 

 it has been stated? Yes 



14.792. So th-.it the cost per quarter will be appreci- 

 ably larger? Yes, the cost is affected by the two 

 things, one the increased prices and wages, and the 

 other decreased yield. There is a decrease in the 

 actual materials saleable, not exactly what are pro- 

 duced but what are sold. In potatoes, for example, 

 you may produce eight tons per acre and only sell 

 six. 



14.793. In cereal crops is there not a much lees 

 quantity produced? This year we believe that will 

 be so; one can see that from the crop in the ground. 



14.794. I think you said these are taken from the 

 better class farms ? We deduce that from the results 

 we have obtained, and of course we have the names 

 of the farmers who have produced them, and they are 

 all known individually and are considered as being 

 first-class farmers. 



14.795. Their organisation, therefore, will be above 

 the average? Yes. 



1 1,796. So that probably their costs will be less 

 than the cost of a great many others? Yes. 



14.797. With regard to the cost of fat cattle, has 

 your Union come to any opinion as to what will be 

 a fair price as regards beef? No, we have kept 

 within the limits of the cost of production. 



14.798. I see the average of these costs of last year 

 works out at 93s. 4Jd-? Yes. 



14.799. That looks as if either beef production will 

 be a losing concern or considerably higher prices 

 will be required? Frankly it is a more difficult 

 matter to ppi at this cost than it is in the case of the 

 others. The cost certainly appears high. It may not 

 be so high as it appears, but these are the only costs 

 we have before us. 



14.800. These costs are actual figures?; Yes, but 

 they are not proved by accounts. As an accountant 

 I should like to produce accounts which would prove 

 that these costs are right. All costing is theoretical 

 until you come to the proof of it at the end of the 

 year by receipts and expenditure. 



14.801. For practical purposes this can be taken 

 as correct? It is the best that we can produce. 



14.802. With regard to the guarantee I do not want 

 to enter on that question in the way it has been 

 touched ujxm, but I should like your opinion as an 

 expert in figures as to whether it is not highly desir- 

 able, to put it in its mildest form, that this country 

 should producr- all the grain it possibly can, so as to 

 prevent the export of as muoh coal as possible and 

 the use. of shipping to bring in produce from other 

 countries? I agree with that, if it is possible. 



14.803. How do you mean, if it is possible? If it is 

 possible to secure this production which is going to 

 enable us to keep out the foreign supplies. The whole 

 thing, it seems to me, is governed by the world 

 market and whether corn can be sent in here at a 

 a cheaper price than is required to subsidise this 

 industry, but that is a matter of policy for the Union 

 with regard to which I am not able to speak. 



14.804. A subsidy is really a, sort of insurance 

 against a heavy loss occurring to the farmer? It is 

 bound to become a subsidy so long as the market is 

 open. 



14.805. That is assuming that the world's prices 

 arc going to fall seriously in the next few years? 

 Yes, ami it is assuming that other "countries will be 

 in a position to send in the grain ; if they cannot 

 send it into this country naturally the price here 

 will be higher. 



14.806. Do you not think that all the factors point 

 to it being impossible to send it in at a cheap rate 

 within a given time? I am afraid I have not given 

 that question sufficient study to be able to answer, 

 but I should be inclined to say conversationally that 

 that would be so. 



14.807. Mr. McNicol, you were asked a good many 

 questions about the sales of farms, and I think it 

 was rather implied that the larger proportion of farms 

 which have been sold were sold at an unduly high 

 figure. Is that your experience? (Mr. McNicol) : 

 I would not say unduly high, but they have been sold 

 at a higher figure recently than formerly used to 

 be the case. I do not know that you could call it 

 unduly high. 



14.808. In cases where high prices have been realised 

 there has been some reason for it, either sentimental 

 attachment or the fact that the farm has perhaps been 

 cheaply rented and the man has improved it by his 

 own work, and although he does not want to buy 

 it is a question of losing his own improvements or 

 buying the farm. That is the case, is it not? Yes, 

 that is the case. 



14.809. Against that have not a large number of 

 farms in Scotland been sold at low prices? Is it not 

 the fact that in your own neighbourhood there was 

 some very good farming land sold at well under 20 

 years purchase on the rental lately? Yes, but there 

 was a special reason for that. That land had been 

 turned into small holdings which restricted the sale 

 in a sense ; there is practically a form of dual owner- 

 ship there. The Government broke up that land into 

 small holdings and the buildings on those holdings are 

 Government property. 



14.810. Is that the same land near Drem that you 

 are alluding to? There was another reason there. I 

 was thinking of a different place. The reason there 

 was owing to the high rents. They are on a half fiars 

 rent; part of the rent is paid in cash und the other 

 haif ifl paid in grain, and owing to the large rise 

 in the Fiars Court these rents have enormously in- 

 creased during the war, but the buying price has 

 been based on what you might say was a market 

 rent. The rent paid during the war owing to the 

 increase in the Fiars "Court was really a false rent. 



14.811. The purchase price was not based upon the 

 false rent? The buyer based his purchase price on 

 the market value of the farm as a letting pro- 

 position. The natural result is that it shows a small 

 number of years' purchase on the present rental. 



14.812. Is it not your experience that a good many 

 farms have actually been sold at about 20 years' pur- 

 chase on a reasonable rental? Oh, yes. 



14.813. So that it is not all due to what is rather 

 implied as being the exceptional opulence of farmers 

 that they are willing to pav an unduly high price 

 for their farms. I do not think that is the case, is 

 it? They do not, as a rule, buy their farms unless 

 they see the likelihood of a commercial return from 

 them? They are mostly all looking at that when 

 tliev are buying farms unless those farmers who are 

 really paying the higher prices are sort of forced 

 into it. But the bulk of the men that are buying 

 farms are buying them as a commercial proposition 

 to make a profit on them, certainly. 



14.814. Dr. Douglas: Mr. Allison, I think you have 

 recognised that there is a very great variation shown 

 in the costs which you have submitted of all the 

 various farms? (Mr. Allison): Yes. 



14.815. The variation amounting in some cases to 

 as muoh as the lowest cost so that one cost of 

 production is double the other? Yes 



14.816. That leaves a very lar^e margin of error 

 in calculation, does it not? It is not such a large 

 margin if you consider that those high prices are 

 very few in number. If you eliminate them you get 

 a more reasonable average. 



14.817. That is just what I was going to ask. I want 

 you to develop that point. You said that it would 

 be possible to eliminate these variations? Yes. 



14.818. What do you mean by that? I mean to 

 take out all those figures that have been shown to 

 be exceptionaly high ones. For example, in potatoes 

 you have a cost of 8 4s. 3d. That is very high. I 

 think if we had time to investigate that we would 

 probably find there were reasons for that high cost 



