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War Economy

The Critical Supply Years, 1941 and 1942

The Critical Supply Years, 1941 and 1942

As overseas suppliers became more concerned with the wartime demands of their own countries, the supply position deteriorated so far as New Zealand was concerned. Reserve stocks were in most cases inadequate to meet the situation. Shortage of overseas funds now became a secondary consideration and the major problem was to obtain goods from any available source.

This meant, on the one hand, developing New Zealand industries to produce munitions and other war supplies, and, on the other, a general switch from European and Empire sources to North America, particularly the United States. With the emphasis changed to procurement at all costs, rather than examination of the sterling position and its effects on the ability to import, the Commissioner of Supply increasingly made decisions about imports, rather than the Comptroller of Customs or the Industries Committee.

During 1941 an expanding world scarcity of essential raw materials and finished goods, and the need to ensure a share for New Zealand, made it increasingly necessary for Government bulk buying arrangements to take the place of private importing. The organisation set up for the purpose considerably enlarged the functions of the Ministry of Supply. Before long, a large portion of the country's requirements of imports essential for the maintenance of the wartime economy were procured by or through the Ministry of Supply. Within a year or two the Ministry of Supply became, in effect, the largest importer of goods into New Zealand, arranging supplies from the United Kingdom, Canada, the United States of America, Australia, India and South Africa.

With this centralisation of control, New Zealand's wartime supply records should have been comprehensive and reliable, but this is far from the case. Records, for most commodities, are inadequate. The rapid growth of staff in the Ministry of Supply was a problem. It was necessary to build up quickly from a staff of eighty to 550. Many of the additions were temporary public servants, directed to the Ministry under manpower control.

To add to the difficulties, the keeping of adequate statistical records was abandoned early in the war, when serious staff shortages began to be felt. Some doubt may arise about the efficiency of an import or a supply control which was not accompanied by adequate statistical records as a running check on decisions and achievements. page 122 Whether or not this doubt is justified, the supply records which have survived are surprisingly poor.

In 1942 supplies were so short and shipping so scarce1 that it was decided to use a system of allocation of shipping space to competing private orders placed in the United States and Canada. A specially constituted Priorities Section issued certificates of recommendation, according to essentiality for the direct war effort or for civilian wartime needs.

1 Losses to U-boats were high for the whole of 1942 and for the early months of 1943.