SUBSIDY ON COAL

Press, Volume LXXXII, Issue 24900, 13 June 1946, Page 6

SUBSIDY ON COAL

DEFENCE BY HON. A. MCLAGAN “ STATE OWNERSHIP ONLY ALTERNATIVE ” State ownership of mines was the only means by which subsidising of mine owners could be discontinued, said the Hon. A. McLagan, president, at the annual conference of the Federation of Labour in Wellington on Tuesday. If the Government stopped paying subsidies to the mine owners, he said, at least one-third *of the mines in the country would cease production. “We had no option but to maintain some inefficient units of capitalism in production,” Mr McLagan said, referring to subsidies generally. “If we had condemned inefficient units to unprofitable production they would not have carried on." Any attempt during the war to do away with capitalism would have decreased production and would not have been justified, he added, in reply to criticism that subsidies had strengthened the position of capitalism. Subsidising was “inevitable and inescapable? and necessary to make stabilisation work.” Even if working people paid the whole amount of the subsidies they would still be the gainers. Payment of £716.000 in subsidies to mineowners had been the alternative to consumers being charged very much more if the price of coal had been allowed to rise. “however, as with social security.” Mr McLagan commented, “the rich man pays part nf the cost of the poor man’s commodities.”