EXHAUSTION.

Auckland Star, Volume LXVIII, Issue 267, 10 November 1937, Page 8

EXHAUSTION.

MARTHA MINE.

INCREASED COSTS RESULT. DO WORKERS REALISE tl The statement that any reduction m tonnage, or increase in costs would appreciably hasten the process of exhaustion of the Martha mine at Waihi, was made to-day in the Arbitration Court by Mr. It. G. Milligan, representing the company, when the application for an award by certain goldminlng union* was being heard. "I am not speaking of the remote future," Mr. Milligan added. "I refer to the months immediately ahead. I doubt whethe'r the workers, as a whole, fully realise the position ..." . Mr. Justice OTiegan presided, and with him were Messrs. W. Cecil Prime and A. L. Monteith. The other employers' representative was Mr. M. H. Wynyard, who appeared for the Golden Dawn mine and mine-owners in the Thames district. Mr. .1. Kobcrts, of Wellington, appeared tor the applicants, the enginedrivers, engineers, carpenters and miners at the Martha mine, the miners at the Golden Dawn mine, and certain Thames miners. Golden Dawn's Case. With the conclusion of Mr. Roberta' case, Mr. Wynyard presented written submissions to the Court. He rebutted the claim of the union that the goldmining industry was able to pay the highest wages because of the increased gold prices. He gave three reasons. The high price for gold was countered by the lower gold content of the ore, and only the higher price for gold made gold mining possible. The benefit from exchange, also cited as an argument, was considerably less than generally understood.

The gold duty, being; a first charge on production, was often a severe handicap to a struggling producing company. His company, he said, to December 30, 1930. produced bullion to the value of £201,35.1. That represented an average of 100 men employed through the depression and to the date given above, nt a cost of £107.845 in wapes. They paid to the State £20.906 in special gold duty since 1933. and had paid only £4000 since its inception in 1930 in dividends to the shareholders. It was now in the poor zone and during the lirst six months of the present year, its operations had produced a loss of £2668, of which £1662 was gold duty. Cost of Union's Claims. The extra cost involved by the claims 'of the union was conservatively estimated on the wages paid for the year ending September 4 last as £3511, a burden which, without the discovery and working of richer ore, could not be met. Mr. Milligan's Submissions. Presenting the ease for the Martha Company, Mr. Milligan said that claims had been made for 25 per cent increases in wage rates, and the onus lay heavily on the unions to satisfy the Court that justice to the men and to the company demanded such changes. No issue was expressed by the union and no real attempt was made to arrive at agreement on many of their proposals. Conciliation Council proceedings were turned into a farce when the unions refused to state their reasons for the tremendous changes proposed. — > " "They had one answer only," Mr. Milligan said, "the company conld afford to pay, and the company should therefore be made to pay." The increase® and alterations claimed by the Waihi unions, he said, would involve an additional cost in the first year of about £44,000 to the Martha Company. "This is an impossible sum," Mr. Milligan said, "and I say quite definitely that the burden could have only one result—the rapid extinction of gold mining in the Waihi field, and the disiptegrntion of the townships of Waihi and Waikino. One-half of our present tonnage would be rendered unpayable."

History of the Mine. The history of the mine was then reviewed. Production had decreased steadily, he said. In 1931 Great Britain went nfT the gold standard, and the improved price for gold saved the situation, inasmuch as lower grade ore could be worked. Nevertheless there was a big progressive falling-oflf in the quantity of gold produced each year. The gold production for 19:5.~> was 20,0990z lower than for 1930, when practically the same tonnape was crushed. Ore reserves were also decreasing. Against lower production there had been a serious increase in working costs, from 25/5 per ton in 1928 to 33/ per ton in 1930. The mine was more than 50 years old, and was now on its final run towards exhaustion. The present situation was that a yearly output of at least 220,000 tons of ore wa« essential to the running of the mine. Mr. Milligan referred to the effect of the increased price of gold on dividends. This increase, he said, had not meant increased profit to shareholders or to the company. The dividend amount had not been increased since 1913. Shareholders who paid £» for their shares in 1908 had received an average dividend of 2.72 per cent during the 28 years their capital had been invested. Mr. Milligan pointed out also that increased wages would not simply cause a reduction in the company's profit. It would mean a curtailment of develop; mental work, and that would hasten the process of exhaustion. "It can be truly said," he added, "that the mining industry in the Hauraki mining district is languishing, largely because of high working costs and the heavy burden of taxation. There is little prospect of the industry being able to expand under conditions as they are at present. If those conditions are rendered more adverse it would, in my opinion, be the death knell of the industry." (Proceeding.)