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War Economy

The Black Market

page 473

The Black Market

With shortages, rationing and price control, a certain amount of black-market selling of goods was to be expected. From time to time cases came to light. It is probable, however, that most consumers abided by the spirit of the rationing arrangements and that, where black marketing tended to develop, it was nipped in the bud. The Courts generally took a firm stand. In dealing with cases of black marketing of motor spirits in May 1942, as a result of which three men were sent to jail, and many others fined, the Magistrate, Mr J. L. Stout, said:1

‘I think it is appropriate, before inflicting penalties in these cases, that I should state, now it is evident that rationing is likely to be increasingly extended to other goods and commodities, that I consider it is essential that any attempt to foster black markets in New Zealand should be promptly crushed. The only way, in my opinion, to do this, is to inflict such penalties as will not only punish the present offenders but will be of sufficient severity to deter others from following their examples.’

Marketing of scarce farm products was much more difficult to control because of the wider variety of possible selling points. Farm-gate purchasing of eggs by consumers, for example, has normally been a method of disposal of part of production. With supplies short, and the Government endeavouring to provide priorities for pregnant mothers and others with special needs, practices such as this had to be curtailed in the interests of a fair distribution to all consumers. There were other problems with regard to eggs. For example, the Dominion reported in June 1942:2

‘“A big black market in eggs is developing in Auckland and Wellington, and it is draining eggs away from the distributive channels,” said the Minister of Marketing (Mr Barclay) to a deputation of Christchurch commercial egg producers, who complained yesterday they had been penalised by their loyalty to organised marketing in having to send eggs to Wellington. Their complaint was that they were charged double commission and grading fees, and their receipts were below those obtained by producers who marketed eggs in Christchurch.

‘“… The opinion of the War Cabinet is that the Regulations will have to be more drastic to force all eggs through the

1 Dominion, 14 May 1942.

2 Ibid., 10 June 1942.

page 474 distributive channels,” said Mr Barclay. “There will be a shortage of eggs for pulp and everything this year.”’1

Eight days later, on 18 June, the Egg Marketing Emergency Regulations tightened up marketing arrangements.2

Prescribed marketing channels for fruit and vegetables were also evaded at times. On 22 May 1943 the Evening Post reported:

‘Prosecutions were pending in a number of districts for alleged cases of black marketing, said the Minister of Marketing (Mr Barclay) today.

‘The Internal Marketing Division was endeavouring to put a stop to black marketing and was investigating any cases brought to its notice, added the Minister.

‘He was commenting on a report from Christchurch that increased black market trading in fruit and vegetables was alleged by retailers, brokers, and growers. One allegation was that more pears were being sold on the black market than through regulation channels.’

These are some of the bad examples and should not be allowed to give the impression that such practices were widespread. No full survey is possible, but for most commodities black marketing seems to have been kept to narrow limits.

1 Egg marketing arrangements were discussed earlier in this Chapter (p. 461). Eggs were price-stabilised from 1 September 1941. See p. 283.

2 See also p. 462.