Man In Street Pays Coal Subsidy

Chronicle (Levin), 12 October 1949, Page 5

Man In Street Pays Coal Subsidy

WELLINGTON, Oct. 11. Since the inception of .the scheme for the valuation of privately oWhed ;coal measures, the Minister had shown no sympathy for the justifiable ciaims of those coalowners and he had reason to think that the global sum for compensation might not amount to more than £500,000, said Mr. C. M. Bowdem (Karori) in the House of RepreS&ita tives tonight when the vote on the estimates for the Mines Department was under consideration. Mr. Bowden said that it was known that there would be ciaims amounting to hundreds of millions of pounds and the Minister had said no regard would be shown for the potential value of the coal. There was not a chance of the owner getting more than a fraction of the value of his coal measures. It was callous and barefaced exprop nation of private rights. Mr. McLagan said that there was ! nothing at all on which the member for Karori could base his fantastic assertions. The Coal Yraluation Commission wliic-h was one thousand times better informed than the member, was not in a position to say what the global sum would be. It was nonsense to say that the owners were not getting a fair deal from the Government which was being more generous than the Nationai Government in the United Kingdom when it nationalised the coal measures there during the war. Mr. McLagan deseribed some ciaims as "fantastic" (mentioning one of £1,500,000,000 and others amounting to hundreds of millions).

Mr. T. L. Macdonald (Wallace) said the subsidy on production from State coal mines was apparently about 17s 3d a ton yet the latest mines statement dpoke of a net profit of £30,000 after a sum of £136,000 for unpaid interest had been written ofif. Mr. Macdonald asked to what limits would subsidies be paid on State mines. The Go'. ernment could regulate the profit in State mines by increasing the amount of subsidy. Mr. McLagan said the subsidy p'aid in State mines was 17s ,64d per ton but the subsidy on private coal was nearly 3s a ton "more. Subsidies paid to four companiefi in the Waikato totalled £2,372,314 j-et those eompanies continued to show a paper profit. It was idle to eoniplain of subsidies paid to State coal mines when private mines:were given a higher rate of subsfdyf If tlic subsidy were cancelled, the price of coal would rise by at least 20s per ton. The Government 's intention was to retain the subsidy. What was the National Party's intention? Mr. Holland claimed that the subsidy to private eompanies was the result of an agreement by thq .Government to guarantee the prolits of the eompanies when the mines were taken over to appease the miners. The minister had claimed that subsidies were paid by those on higher incomes but that was absurd in face of the fact that £43,000,000 of indirect taxation, including £13,000,000 saies tax, was paid by the man in the street each year. The price of coal- was being kept down by taxing other goods. Mr. T. H. McCornbs interpreted Mr. Holland 's remark as a declaration that the National Party would abolish the subsidy but Mr. Holland said Mr. McCombs could not put such words inti -his mouth. "I did not say we would increase the price of coal," said Mr. Holland. "That is what the Minister would like me to say but I won't sav it." /