Subsidies For Australian Gold Producers

Press, Volume XC, Issue 27499, 5 November 1954, Page 13

Subsidies For Australian Gold Producers

(N.Z. Press Association—Copyright) (Rec. 11.30 p.m.) CANBERRA, November 4. The Commonwealth Government will pay a subsidy of up to £2 an ounce for gold produced in Australia and the Territory of Papua, the Prime Minister (Mr Menzies) said today. He said the goldmining industry was facing an acute financial problem, due in large measure to circumstances over which it had no control. The subsidy will be paid according to the following formula: three-quarters of the excess of the average cost of production an ounce over £l3 10s with a maximum subsidy rate of £2.

Mr Menzies said producers whose annual output was less than 500 oz would receive a flat rate subsidy of £1 10s an ounce. A mine whose cost of production was less than £l3 10s would not qualify for the subsidy. Where the cost of production was £l5 an ounce, a subsidy of £1 2s fid would be paid and the maximum would be paid when the cost of production was £l6 3s 4d or more.

He said that if the subsidy payment resulted in a producer’s profit rising above 10 per cent, on his capital, the subsidy would be reduced to restrict profits to 10 per cent.