OUR COAL MINES.

Auckland Star, Volume L, Issue 167, 15 July 1919, Page 11

OUR COAL MINES.

NATIONALISATION SCHEME. LABOUR'S POINT OF VIEW. (From Our Own Correspondent ) WELLINGTON, this day. Mr. H. E. Holland, M.P., in a reply to the Hon. W. D. S. "UacDonald, actingchairman of the Board of Trade, on the subject of the suggested nationalisation of Xewr Zealand coal mines, says in re' gard to the Labour proposals that there was no misunderstanding whatever on the part of either of the Labour conferences of the board's recommendation. Copie? of the report were obtained, and the proposals ivere carefully examined and unanimously condemned. It -was true that the board expressed the opinion that "some form of nationalisation was urgently needed," but the board'B proposal iras not nationalisation at all, but as a Labout resolution described it, the semi-private control of the industry! trith State-guaranteed dividends for owners. "The proposal," says Mr. Holland, "is that all existing companies shall come within the jurisdiction of the proposed board, and this, of course, means that dividend?, risk rate, and bonuses are to be provided for all of the companies concerned, notwithstanding that certain of the mines may not have hitherto paid dividends. The idea of the State entering into a sort of co-partnership with mine-owners under an arrangement irhich would make the owners' dividends the first charge on the industry, with risk rate added, and this to be followed by a bonus, if profits permit, it some, thing the people are not likely to approve." Referring to Mr. MacDonald'a discussion of the financial aspect of the scheme, Mr. Holland says:—'"lt does not appear to have occurred to the actingchairman that if the mines were being purchased outright by the State sound methods would dictate that only such mines be purchased as were ■worth pur chasing, nor that when money is borrowed for such a purpose it is "borrowed for a fixed term, whereas the board's proposal appears to amount to a guarantee of interest in perpetuity. But there is no reason to discuss these aspects of the question, because the need to borrow money disappears before the fact that New Zealand had, at the end of the last financial year, a surplus of £15.000.000. The amount of the paid-up capital in all the privately-owned coal mines of Xew Zealand, excluding Roa (in liquidati.-in). Taratu, and Tyneside, for which figures are not given in the board's report, is less than £1,300,000, and. since some of the mines would not he worth purchasing, it may be assumed that the amount of the paid-up capital in the mines worth taking over would be less than £1,000,000. If it is further assumed that the price to be paid for the mines taken over will be based on the amount of the paid-up capital, £1,000,000 would have to be* provided, and it would be absurd to talk about the need to borrow money at high interest with 15 times the amount required in Government coffers. How safe the undertaking of the public ownership of the coal industry would prove, as well as how profitable an investment coal mining has proved, may be ascertained from..the reports covering the operations cTf the State mines during the past 15 years. For instance, the gross capital expenditure on State coal mines up to March 31. 191S, amounted to £359,730, and £205,400 of this amount has now been written off out of profits for depreciation, etc., being nearly 58 per cent of the total capital embarked. This, despite the manner in which charges have been loading up against State mines in favour of the Railway Department, ordinary profits, heavy interest charges, and other handicaps."