ESTIMATE OF COSTS.

Auckland Star, Volume L, Issue 183, 4 August 1919, Page 6

ESTIMATE OF COSTS.

IP DEMANDS WERE CONCEDED. STATEMENT BY OWNERS. At the conference in Wellington on Friday, the Hon. E. W. Alison submitted an estimate of the cost involved in the concession of the demands made by the Miners' Federation. He said the report .had been prepared by a committee of practical, technical, and financial coalmining experts, appointed by the Coalmine Owners' Association. The report is as follows:— All calculations' and estimates are based on figures shown in Board of Trade report for the year 1918. exclusive of stores and materials, and in connection with costs of production shown in that report it should be noted that the figures for that year do not show the full effect of additional war bonuses granted in September 1918. Baaed on actual experience, the reduction of output due to the abolition of the contract system would be about 36 per cent., but for the purpose of this comparison it has been assumed that the reduction will be 30 per cent. It has also been assumed that the proportion of wages men to hewers will remain the same as at present. It has further been taken that the increases in wages asked for will amount to 65 per cent, over pre-war rates, as against 30 per cent, now- being paid. Travelling time has been allowed for at an average of 30 minutes each way, which makes the present actual woTking time (allowing for half an hour "crib" time), 6i hours, so that a seven-hour day :would reduce "working time to 5 J hours, and a six-hour day would reduce it to 4* hours. ' i ■?•■■.**■■ It is not possible to prevent an increase in cost of production by putting on more hewers and thus maintaining the present output, as—(l) One of the demands is for the abolition of the back shift, and (2) the present output from each working face will be reduced, and it- will take a long time to open up sufficient additional places to compensate for the reduced output per working place, even if men were available to open up and man the extra places. For these reasons it ■has been assumed that a reduction of output, if the contract system, is abolished, could not ,be prevented by the mine owners, and therefore that a decrease in the output would correspondingly increase the cost of prdduction. LESS COAL AT HIGHER COST. It is estimatea tliat the result of the abolition of contracts and the tonnage rates system would be a general reduction in output of not less than 30 per cent. This means that the coal production would fall from 2,034,000 tons to 1,424,000 tons, a. decrease of 610,000 tons per annum. The increase in the cost of production from this cause alone would amount to 6/11 per ton at the colliery, equal to £703,475 per annum, based on 1918 output. Assuming that the present shift rates of pay remain unaltered, but htat the contract system and piecework are abolished, and a bank-to-bank day adopted, the output would drop from 2.034,000 tons to 1,200,000 tons, a reduction of 534,0C0 tons per annum. While a six-hour day would mean a reduction of ofttput from 2,(534,000 to 1,597,000 tons, equal to a loss of 1,037,000 tons per annum. In terms of money, the sevenhour day means an increase in the cost of production of 11/1 per ton, or £1,127,175 on 1918 output, the six-hour day would increase the cost of production by 17/3 per ton, equal to a total extra cost of 1,754,325 on the 1918 output. Finally, assuming that all the demands of the Miners' Federation were granted on a seven-hour-day basis, the extra cost '•«r ton would be 14/10, o r £1,508,000, taking- the 191S output, or, on a sixhour basis, it would be 21/9 per ton, or £2,212,000 on the 191S output. The net average weekly earnings for miners for the whole Dominion amount to £o 14/4, and for truckers, £3 18/. WAGES ASD OUTPUT. The contention by the miners' delegates that the abolition of the contract system would not reduce the output was disputed by Mr. Alison. He said that they had had experience of a minimum , wage at the Taupiri mines. It was suggested by the management at the time the a-rrangement was made that in a ; short time a lot of men would be working on those places where the pay was made up to the minimum. In the first year the amount paid for " make-up" pay was £250, in the next year £850 and in the third year £1,350 In a snort time they would have had nearly all the men in the mines on this work. When the agreement expired the union asked for shift wages for all hands. When the case cam e before the Arbitration Court the Court did not grant the demand in view of the fact clearly shown that wen were taking advantage of this minim-.im wage. There had been other tests for the daily wage system. 4.t Kiripaka the daily wage system had been tried recently, and the difference made had been an increase in the hewing cost. Referring to the Kiripaka experiment, Mr. W. D. Holgate said: For some three' years prior to Christmas last we were working under the contract system. Our ! contract system broke down about the j commencement of the new year, and the men were paid a minimum They worked under the day-wage system until abont a month ago. Wβ had an experience which enaJbled us to compare the, difference in output and the differ-

lence in the cost of production. Tteaa 'ference in output -was a decrease ctf *> per cent under the daily wage ejsWcompared with the contract difference in the cost of production »»! an increase of 7/11 a ton under ft daily-wage system, and during the krt month the increase was 8/4 per ton. Mr. Aifeuckle declared that the m, tention of Mr. Alison that the ouV would not work if they -were p»jj daily wage amounted to an acttoJ. , that all the miners were loafers. Mr. Alison said that he had never in puted anything of the sort. 'What did contend was that if there waj to l! a flat wage of £1 a day the miner irt •had been working hard and earning 3sl a day would reduce his as he found that he could more than the man who under thece' tract system could not make more than 15/ a day. This was to 'he the natural order of things. ;.'?