THE COAL PROBLEM.

Hokitika Guardian, 27 June 1919, Page 1

THE COAL PROBLEM.

RETORT OF BOARD OF TRADE

DOMINION COAL HOARD TO TAKE OVER INDUSTRY.

NO PROFITEERING FOUND

Tiic Board of Trade was instructed in September last to investigate the whole coal problem. Its report, which it dated Tiay 20th., has now been made public.

The order of reference covered the following matters: (1) The present cost of the production and distribution of coal in New Zealand.

(2) Any increases in the cost of such production or distribution since the commencement of the present war, and the causes of such increases.

(iJ) Whether the profits made in the production and distribution of coal are fair and reasonable.

(4) Whether the selling-prices of coal ire fair and reasonable .

(5) Whether increased economy or efficiency can be obtained in the production and distribution of coal, and if so, in what respects and in what manner.

(G) All other matters alFectiug the supply or price of coal.

(7) The increase since the commencement of the present war in the cost- of living so far as such increases affect men engaged in the production of coal, distinguishing between increases, if any. prior to and subsequent, to the industrial agreements made in the coal industry in the year 1917.

The increases since the commencement of the present war in the earnings of men engaged in the production of coal, distinguishing between increases, if any, - prior to and subsequent to the said industrial agreements.

The report is ail exceedingly bulky document of over 100 closely printed pages. The evidence, which was mainly taken in camera, is not- printed. The report-consists of eight chapters, with appendices, and photographs illustrating the housing conditions of the miners

7IECOMMKNDATIONS. liie eignlb chapter of tiie report consists oi six sections, Jive containing tin. ieconilucntl.il ions, mu! tile sixth the tiudings. 1. in tliis intruiluctory section tiie report says : “The coal-mining industry of New Zealand cannot be said to have exploited the public during Llie period of tiie war. Though the supplies of coal have not been as regular and uninterrupted as should have been the case with less industrial friction, neither the owners of the mines, nor those actively engaged in the management and direction of the industry, nor the workers in the mines, nor those engaged in distribution have received remuneration that should be regarded as unduly high in existing conditions. It is an industry which experience shows to bo one of very uncertain return, of varying cost, and with labour conditions that do not appeal strongly to the ordinary worker. The markets arc small and widely scattered, and there is considerable waste in production duo to the great amount of small coal necessarily produced with the larger, for which in normal times there is little or no demand at a profitable price. The experience of the past it not very eiicourngirag for the future. The conditions directly and indirectly governing the industry are such that there is not much scope for effecting any considerable fall in the price of household coal relative to the price of other commodities in common demand. Hut unless

certain improvement's are made, particularly in tiie organisation of tliis industry, the relative price of coal "ill continue to rise, and probably rise rapidly. The means of establishing the permanent conditions necessary to prevent or minimise such a rise have received our chief attention. The main recommendations to this end are set out below in sections 2 and 3.” 2. “A more efficient orgilnisation of the industry” is recommended rather than reforms in technienl details, which would follow, and most easily through the appointment of a body charged with the direction of the industry for the whole country. The technique of coal-mining in Now Zealand is described as equal to that anywhere else, and the Hoard proceeds: “In view of this undoubtedly strong national interest in' the coal supply, the Board devoted considerable thought to the question of the desirability and practicability of “nationalising” the mines of New Zealand. ‘Nationalising may he interpreted in several senses. The Government of the Dominion might—(i) Buy the mines outright ; and.

having dolU: so. might—(a) Either work them itself, as it does the present Slates’ mines; or (b) Lease them to concessionaries under strict conditions; or (ii) It might institute some form of control of 1 lit' privately-owned mines through a public Department charged with the enactment and administration of regulations binding the industry; or fiiit It might obtain representation

on the directorates of the ehicl mines by legislative right or by virtue of financial grants for developmental purposes. “All these forms of reorganisation may he regarded as varieties, of nationalisation.” The questions we set ourselves-to answer tire — (1) Is nationalisation desirable; and (2) If so, which particular form of nationalisation promises the best results for Lite coal industry in Nett Zealand ? (3) if not, tvhat modifications, if any, are required, so that the industry may best serve the community during the remainder of its term? a “The Board, after carefully considering all relevant arguments, is of opin-

lion that some form of nationalisation is urgently needed as an essential step towards removing shortcomings of long standing elfecting needed improvements of a positive kind, and avoiding evils that threaten to turn the industry out of ihe course of healthy and sane development.” The chief aims of reorganisation would be: Economy in production, conservation of resources, concentration in the most profitable fields, removal of. causes of., labour '.unrest, proper housing, efficient distribution, and regulation of coal prices. The Board remarks that consolidating the mines under a single control would effect economies and facilitate a well-reasoned policy of development . The value of unity in production and distribution was already suggested by the facts relating to the Westport, State, and I'ukcmiro coals. Tile report proceeds: ‘‘But the Board is of opinion that this desired change should not take the form of .State purchase and direct management of the mines. It believes that direct State ownership and management though it might lead to some of the | objects in view, would not foster the highest degree of enterprise, initiative, and resourceful management, nor tile necessary singleininded regard for efficient service from all ranks, nor the accumulation out of the profits of the industry of the fund adequate to its future development without becoming a burden on the other industries of the Dominion. The most pressing need is to combine the undoubted advantages of centralised policy and management with those that may reasonably bo expected to result from representation of Labour and of consumers (.through the State) on the controlling body. “Th 0 Body therefore strongly urges the 'immediate institution of a Dominion Coal Board (for development and conservation). “The Dominion Coal Board shook, consist of representatives of—(1) The existing cowl-mining companies; • (2) The employees of these companies ; and

(3) The Crown. “It is suggested that the Board com

prise live members at most—the companies to appoint two members, the conl-worhers two, ami the Crown one, who shall be president. If the Board look over the function of distribution the employees engaged in that branch would exercise a voice in the selection of thy representatives of labour on the Board. The nomiuoc of the Crown should be appointed for a definite, term. The, representatives of the coal eompaides should be elected by tile shareholders voting by a method similar to that prescribed for the election of the directors of a eompaiy under the Companies -Act. The representatives of the coal-workers should be elected annually according to a system to be determined after consultation with the workers. In order to establish some continuity in policy the members of the Board should retire from office not as a whole, but one representative of each of the two interests of capita! and labour at a time; this would involve a, two-years term of office for each representative, but lie should lie

eligible • for re-election. “The Dominion Goal Board should be in a position to achieve olleetively tbo objects detailed above and similar aims. To these ends the Board should be empowered to take over the existing coal companies • with their assets nndi liabilities at valuation, and to issue stock to the existing shareholders in exchange for their shares held by them at the average market value ol such shares for the period of the three years immediately preceding such exchange; such average market value to be icaleulior.ed and determined by a specially appointed Commission. “Existing company law should apply to the Dominion Coal Board, hot it should bo modified wherever required to permit the Board to exercise the functions necessary to achieve the ob-

jects in view. “Stockholders should be guaranteed n pure interest rate of -1 tier cent, on their paid-up capital. From the balance left, after payment of this rate, working aad maintenance expenses, and making provision for renewals and depreciation and reasonable development., there should be paid; (1) A risk rate of stockholders, and (2) bonuses to stockholders and employees in the proportions respectively of the amount of dividend calculated at. the pure interest and risk rates combined and the total amount of the pay roll of the Boaid The Board should also take over, administer, and develop the existing coalmines of the State. The industry should be subject to taxation and rating in common with all other industries.” After setting out various subjects to which the Board should give prompt attention (including the provision ol

suitable housing accommodation, to he financed by a, levy of ,3d. a- ton on all coal raised) the Board concludes this section of the chapter, by a. strong expression of opinion in favour of giving the mine workers a voice in the determination of the business policy of the industry and the conduct of the management. 3. The organisation of distribution is described, .as “generally much more faulty and defective than that of production. Those defects, and possible improvements are discussed in the thiid chapter of the report. Tit the chapter nf recommendations the following occurs : “At Christchurch and Dunedin the excessive number of men engaged in coal-dealing, ami the overlapping of deliveries which are features of the distribution of coal in all the centies, were condemned. The elleet of these, and of the trade convention that the small dealer must be given a fair chance in fixing the association price scale, undoubtedly fends to keep th<> costs higher than they would otherwise, be. The establishment of a monopoly in distri bution was advocated by witnesses here

and in. other centres. At Dunedin the general trend of the evidence in regard to the methods of delivery was that it is altogether wrong, and that it should be systematised in the direction of restricting the operations of a given dealer to a particular district. The opinion

was expressed that there are too many

dealers, that the cash system should be extended at the expense of the credit system, that householders in erecting houses should give greater attention to the provision of coal-cellers, that orders for coal should be given a few days before fulfilment is required, and that if all coal were state-owned there would be a more continuous supply, a greater possibility of a cash trade, and consumers would be more willing to’ give reasonable notice of their requirements.”

RePerenqe is made to complaints against the Railway Department, and this section concludes:

, “In order to secure the general application of the advantages that result, from large-scale distributing businesses, the abolition of overlapping in , deliveries, the concentration of depots, , and the ownership by the mine of the means of transport to the main dis- , tributing centres, the Board recommends that the Dominion Coal Board be empowered to undertake the business of distributing coal, including its carriage by sea. This function it might exercise wherever it, seemed desirable in conjunction with municipalities, and other local authorities and wherever power to do this is not possessed by these bodies the necessary authority should he granted them by Parliament. The question of the installation of improved mechanical means of handling ■■on! in transit from mines to depots should he decided by the Coal Board iftcr consultation with engineers who have made exhaustive enquiries into this subject. J. The Board says that if the above recommendations are adopted a lowering of prices relatively to other commodities should result. But consumers could also help, (1) by giving orders well ahead of their requirements, so that deliveries might he systematised, (2) by providing eoalbins in convenient places, thus reducing delivery costs in time and labour. (3) by more generally using unscreened coal, and by better methods of stoking, and (4) by an extended use of gas and electric heating. The Government is recommended to encourage experimental work for the utilisation of the largely-wasted slack. The rise in the price of coal lias, in cart, been due to the inflation of currency and credit. The Board concludes its remarks on prices by declaring strong against any attempt to discourage the Importation of foreign coal. The temptation to raise prices which besets all monooplies, complete ir partial, should he guarded against: COST OF XIVING—MININGSTATISTICS. 5. The Board recommends that it lie authorised, with the assistance of tlio Government Statistician, to carry out in investigation into the cost of living and the general social conditions of the mine workers of the Dominion. It is also of opinion that the Coal Board should devise a system of re•ording costs, output, amount and character of labour employed, time worked, output per shift, etc., as far as possible uniform for the mines of tin! Dominion, so as to 'make it possible to institute those statistici.nl companions which arc necessary for measuring the changes in the industry. In view of the close connexion between occupation, health, and mortality, it is of the greatest importance that living workers he periodically examined in order to obtain accurate records of the diseases from which they suffer.