Whangarei Glassworks

Press, Volume CII, Issue 30143, 29 May 1963, Page 14

Whangarei Glassworks

New Zealand’s brief expert-j ence of glass manufacture has been sufficiently dis- | astrous to suggest that an; early end to the business is desirable. But an end there is not to be; and. from what the-public have been told, the Government’s new commitment may be even more burdensome than its obligations to the McKendrick company’s creditors. Moreover, the New Zealand consumer must bear the cost of trying to make an uneconomic industry economic. For a maximum of 10 years glass prices are likely to be inflated so that the Dominion can retain its own glassworks. It was perhaps only to be expected that the Whangarei plant would be sold under complicated conditions. However, the statement issued by the Prime Minister (Mr Holyoake) and the subsequent comment by the Minister of Finance (Mr Lake) have given an unduly cloudy picture of negotiations in which the taxpayer, because of his involuntary support for the McKendrick company, is directly interested.

Under the arrangements for sale to the big Pilking-ton-A.C.L combine, shareholders in the original glass company have no prospect of repayment; and the Government will also lose money. The manoeuvres by which the Pilkington-A.CJ. group was brought to terms are of little interest compared with the effects of the agreement upon New Zealand users of glass and upon the taxpayer. From the outset the McKendrick company encountered difficulty in producing a commercially acceptable glass. It is now generally recognised that the plant installed at Whangarei does not measure up to modern requirements, and that the McKendrick company was

handicapped by the limits of its own technical resources. Such deficiencies [should not worry the purchasers of the company’s assets, though there seems substantial doubt whether glass manufacture will be continued indefinitely at Whangarei.

When the works were offered for sale in January this year, one of the principal unanswered questions was whether the successors to the McKendrick company would receive from the Government concessions and guarantees comparable with those obtained in the industry’s earlier stages. Would the Government (which inherited the problem from the Labour Administration) be so anxious to foster indigenous glass manufacture that it would prejudice further the interests of New Zealand consumers? Was the expected saving of overseas funds (about £500,000 annually, according to Mr Holyoake) so significant that special measures of encouragement would be justified? These questions, and others, have yet to .be answered fully; but the Prime Minister has announced the Government’s view that “ the maintenance “ of the sheet glass industry “is important to New Zea- “ land ", and that “ protection in the early stages is “ well warranted ”, To put the industry on its feet, a change of process is apparently essential; and presumably the consumer must pay for this. Much as it may have wanted to exploit available raw materials, the Government would perhaps have been better advised to abandon its endeavours to keep the glassworks open It might then have known the total cost of the venture —something that cannot be assessed for years under the new arrangement.