The Press FRIDAY, SEPTEMBER 26, 1958. Mr Watt and State Electricity

Press, Volume XCVII, Issue 28701, 26 September 1958, Page 8

The Press FRIDAY, SEPTEMBER 26, 1958. Mr Watt and State Electricity

In his first public speech as Minister of State Electricity, Mr Watt was in buoyant verbal form when he spoke at the opening of the New Zealand Workers’ Union canteen in the development village at Benmore. But Mr Watt’s respect for realities hardly matched his exuberance. When people say that Benmore will provide more power than the South Island will need, it is not something that “ perhaps ” can be shown by figures. It is a fact. It is also a fact that Benmore is linked inseparably with another concept—the Cook Strait cable. When Benmore power is available for the production grid, a huge extra charge will be put on the power bilk The interest on capital charges for Benmore will increase heavily the total power bill for the whole of New Zealand. It is foolish, therefore, to speak of the absorption of Benmore’s production as a “challenge to “ the South Island ”, If there is a challenge, it is a challenge to the whole of New Zealand. Of course, the South Island would be gratified to share, as it unquestionably should, in industrial expansion that would absorb some of the huge electricity generating potential of the South Islfind. Mr Watt’s remarks suggest that he has in mind plans to encourage industry to develop in the South Island by providing power “at “ the cheapest possible price If this is so, these plans should be put in hand at once, and publicised. Establishing industries that would be substantial consumers of power is a longterm project, and 1965 is not a

long way away. Entrepreneurs might be attra'cted by the prospect of cheap power, but, obviously, price and terms would have to be known. Moreover, any question of differentiations in price would have to be studied thoroughly, if only for the implications for established concerns. In brief, Mr Watt was dealing at Benmore with subjects that call for much more than discussion in general terms. It is satisfactory to have Mr Watt’s assurance that he does not “ condemn ” the principle of the Cook Strait cable, and to notice his belief that “ ulti- “ mately ” there will be a connexion between the North and South Islands. Surely his reasoning is rather mixed when he is found speaking—in the context of the Cook Strait cable —of the need to save money because the nation has suffered a reduction of its income by one-fifth, and in the same breath saying that the cheapest power in New Zealand can be produced “right here at Ben“more”. It is only cheap if it can be sold. In the interests of lowering production costs, it would surely be sound policy to dp everything practicable to go ahead with plans to distribute the “cheapest power”? It has never been shown that capital is what holds up the Cook Strait cable. There is no evidence that the most likely source of capital has ever been considered. The project has every appearance of being of the kind the World Bank favours for its lending. Again, the new Commonwealth scheme for providing development capital might be available.