THE COAL INDUSTRY

Hokitika Guardian, 26 November 1930, Page 7

THE COAL INDUSTRY

OWNERS VIEWPOINT. In his presidential address to the annual meeting of the New Zealand Coal mine Owners’ Association held in Wellington on Thursday, Mr W. D. Holgate said that ;the coal industry from the owners’ point of view was anything but satisfactory. Most of the mines were not paying chiefly because of the high cost of production, in spite of the introduction of improved plant and A better handling methods. Also, mining freights and distribution costs were far too high. The output of coal for the year 1929 (rf- Was 2,616,099 tons, an increase of 741,- ' i 527 tons over the output for 1920. Against that increase there were 19 more mines working and 22 co-operative parties producing coal, with an additional 419 men employed since 1920. If all the mines were working full time they would be capable of a much laiger increase in the output. It was, theiefore, obvious that there were too many mines in operation to give a fair return on the amount of capital invested; yet there were other new companies pn the point of commencing operations. Investment Legislation. “There is no doubt that the industry Is being seriously affected by the so--called company promoter who imposes extra royalties Over and above the royalties demanded by the owners of ’the property, or, in other cases, in cash, and paid-up shares,” said Mr Holgate. “I am fully convinced that the time has arrived when the Government should bring in legislation insisting on all coalmining prospectuses being taxed in order to protect the investing public. The Government should also refuse to issue any further licenses to mine coal until it is satisfied there is room for additional companies to operate without serious loss.” Mr Hoi gate said the New Zealand coal industry was also seriously affected by the reduced cost of producing New South Wales coal—lower wages, ’State subsidy, reduced railway freights, and other .concessions, which enabled New South Wales '’■oal to be dumped ipto New Zealand at a reduction in selling price of over 5s a ton. Representations had been made to the Government to protect the industry, at least to the extent of the Commonwealth or State subsidy, but so far nothing had been done in tTiat direotion. That fact, together with hydro-electric power and over-production, was the chief cause of the industry being in a depressed state.

v Lower Wages Necessary.

Speaking- of conditions generally, Mr Holgate ’ said \ New Zealand had reached a stage where, unless an economic adjustment of expenditure was at once adopted, our; exports would not be - enough to pay - our overseas indebted-, nesa with regard'to loans and imports. The remedy did not - lie with increased production or with excessive taxation, but by lowering the cost 1 of production. That could be done, first,' by-reducing Government ;'administration , expenses,

which were abnormally high for a country with New Zealand’s population. Second, expenditure should be cut down in avenues which affected labour least, including municipal activities. Third, wages should be lowered all round. As the prices of necessities had already dropped and rents were 40 per cent, lower, a decrease in the cost oi living would naturally follow. Earlier in his address, Mr Holgate had mentioned that new agreements had been entered into with the district miners' unions on practically the same terms and conditions as in the ag'-'C-menfs. ending in April last. “Many of th ? companies were under ilio impression that, we shuild have insisted on a

substanf’al reduction in union mls's anc wages generally,” said Mr Holgate. “However, after long conferences in each district, the unions obtained an agreement as stated for another two years. It is now very obvious that it the coal companies arc to continue working, wages and the cost of production must be considerably reduced, as both the Government' and the public are insisting on a reduction in the price of coal, in keeping with all other products, the prices of which are much lower than two years ago,”