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 The men soon grasped the idea, which they thought was a very good one. As often happens with the introduction of a new system, there was a little friction at first, and some difficulty was experienced in the classification of the men. The strong and able-bodied men did not altogether like to work for the aged and the feeble. Mr. Seddon, however, classified both the men and the work, giving the lighter work to the aged and less capable, and the heavier work to those best fitted for it.

The earnings, as a whole, proved satisfactory, and when the contracts were completed the men engaged on them in that way stated that they were prepared to accept more work on the same principle if it was provided. That was the beginning of the co-operative system, which now forms a marked feature of public works in New Zealand. At the present time, in 1906, between 4,000 and 5,000 men are employed under the system established by Mr. Seddon a few weeks after he became Minister for Public Works. Most of the colony’s railway and road works, and a great deal of its public building work, is done under the system.

Mr. Seddon saw that the contract system had many disadvantages. It brought into existence a class of middlemen contractors. These men often made large profits out of their undertakings, and sometimes out of those whom they employed. There had been strikes on public contracts. The result was that valuable time had been lost in pushing on important works, capital had been wasted, expensive plant had been kept idle, large numbers of men had been thrown out of employment, and there was bad feeling on all sides. Under the old sub-contract system, business people who supplied stores and materials were often unable to obtain payment, owing to the workmen not receiving their full wages, or, perhaps, having to go without any. In these cases, contracts which should have proved a benefit to the districts in which they were carried out, by leading to the expenditure of money, only brought trouble and disaster. It often happened that while the sub-contractor was ruined and the workmen were underpaid, or not paid at all, the principal contractor, who did none of the work, was made rich on the proceeds of one contract. The whole of the profits, instead of