The Press THURSDAY, JUNE 23, 1960. Change Of Front Over Iron And Steel

Press, Volume XCIX, Issue 29238, 23 June 1960, Page 14

The Press THURSDAY, JUNE 23, 1960. Change Of Front Over Iron And Steel

By discontinuing its plans to form an iron and steel investi-

gating company with a 49 per cent, allocation of shares to private interests, the Government has extricated itself from what it must obviously have regarded as an untenable situation. No-one would be so naive as to dissociate this action from the new session of Parliament In negotiations conducted in private, about which it was intended that the public should know nothing until an accomplished fact could be announced, the Department of Industries and Commerce had manoeuvred the Government into a position that it would be difficult to defend in public. Briefly, basic research undertaken since the end of the war indicated economic methods of using ironsand for manufacturing iron and steel. The present Government became interested and last year passed legislation vesting in the Crown the right to prospect and mine ironsand in any proclaimed area and excluding these areas from the provisions of the Mining Act The legislation also authorised Government participation in a company to undertake investigations. The Department of Industries and Commerce organised a company in which the Government would hold 51 per cent of the shares and the department proposed an allocation of the remaining shares among various private interests. When the department’s proposals leaked out it was alleged that one group—an Australian group without previous history in iron and steel—had been greatly favoured, and that New Zealand interests were being frozen out. Special criticism was directed to the small allocation to New Zealand Development Corporation, which had been responsible for the post-war revival of interest in an iron and steel industry and which had as one of its directors ;Mr W. R. B. Martin, a man of whom the Minister of Industries and Commerce had said: “Had it not “ been for his consistent work “ the general interest in the * possibility of an iron and “steel industry would not be “alive to the extent that it

“is”. Eventually, protests by New Zealand interests held up registration of the company. Later, Mr Martin accused the Government of having “pirated” his work, an allegation to which the Prime Minister replied, saying that Mr Martin’s work had been financed by the Government. These differences have not been publicly resolved, nor have differences between Mr Nash and the chairman of the New Zealand Development Corporation (Mr W. J. R. Scollay) about a refusal by the Capital Issues Committee to allow that corporation to increase its capital to take its investigations a stage further. But grave dissatisfaction among the New Zealand concerns interested in the project was apparent, and this aroused disquiet through the country about the department’s handling of the affair. The Government now proposes to proceed alone with a company to investigate the feasibility of an iron and steel industry. The Government will hold all the shares and there will be three directors from Government departments. Private industry will have a strong part in the management of this enterprise, the Government having appointed as directors three successful businessmen. It remains to be seen whether a wholly-Govern-ment investigating company will be able to maintain the impetus that private industry promised and, indeed, had already provided. Had the Government encouraged the New Zealand Development Corporation to proceed itself with development and research, the investigation period might well be at an end now. Because of developments that the Government has sanctioned (setting up a scrap mill, for instance) it will be necessary now for the investigating company to see whether the prospects of an integrated industry have been prejudiced. No doubt, the Opposition will seek more information about the

Government’s intentions. The earlier secrecy—the outcome of which is a remarkable change of front—is sure to sharpen the Opposition’s appetite for information.