Coasters count the cost of $50M handout

Press, 19 April 1986, Page 19

Coasters count the cost of $50M handout

By

KEVIN PAGE

The Government decision to provide a regional development subsidy of $5O million over the next 15 years to the West Coast has been greeted mainly with relief by Coasters -- but not everybody is happy.

The Mayor of Greymouth, Dr Barry Dallas, is not afraid to speak his mind. When he talks people usually listen — whether they agree with him or not. So, as the Mayor of a borough that has just received, at least on paper, a substantial financial boost, you would expect him to be as keen as the proverbial mustard. Yet he is quite the opposite. Dr Dallas, keen on establishing some sort of export option north of Point Elizabeth, has blasted the Government decision as a bad one. The Government announced recently that it would subsidise rail haulage from the West Coast and would keep the Strongman Mine open for another five years until a new mine could be opened. This proposed development is the subject of a feasibility study. “In the initial stage it was very good news because the railways have always been one of the biggest single employers in the area and we could not afford to lose them,” says Dr Dallas. "Railway-wise it’s excellent news, but it’s not all that good so far as the long-term decisions regarding coal and industry in general in the Greymouth area are concerned.”

Dr Dallas believes the subsidy to be paid on coal does not come into effect for at least three years — the time it would have taken to build the slurry pipeline option. “It’s a question of whether the coal trade can carry that sort of huge cost load on the international market when coal is not a very easy commodity to sell.

“One of the fears that many of us have, particularly those associated with the coal trade, is that we have really only postponed our evil day.” Dr Dallas feels that Lyttelton and Canterbury will gain most

from the Government’s decision. “They are increasing employment while we hope to be holding the majority of employment on the railways, although we know for a fact that jobs will be lost. We also know that the Strongman Mine will cut back, so really the news regarding that isn’t all that bright. “We would have liked to have seen a starting date on the replacement for the Strongman Mine — the Doherty block or the Rapahoe coalfield.” The decision, says Dr Dallas, has left the isolated West Coast dependent on coal, something on which he holds firm views. “I would far rather have seen a smaller handout diversified in a number of other renewable resources, say half of the $5O million to railways and the other half for further developments.

“I would have liked to have seen a one-off grant to tourism, a relatively minor subsidy, say of one or two million, to get us coordinated on the West Coast, and I mean the whole West Coast, right from Haast to Karamea.

“I would like to have seen something to develop horticulture and agriculture. In other words, to give us a far wider base that is not dependent on the Government of the day or the power wielded by one particular Minister.”

In five years time he believes, the decision will be seen to be a bad one. In fact, will Greymouth be back to square one in five years time? “I think we’ll be behind square one, because for example, the price of oil has dropped so dramatically. You would be

crazy to go into coal-fired industry at present. “Coal will come on stream again but it could be 50 to 100 years time.” The decision, although labelled a bad one by Dr Dallas, has helped to relieve the people of the West Coast of what he terms “acute anxiety.” But that anxiety appears likely to be replaced by another pattern of anxious waiting.

“Everybody I’ve spoken to is just as worried as I am. I don’t think we’ll get any benefits out of this deal at all. At best it is a holding exercise for the railways. “We’re lessening the negative aspects. There are no positive benefits in it.” The decision also worries Dr Dallas because, he says, it was made against the wishes of Mines and Treasury. “I just can’t see that any good decision can be made by any social welfarebased ministry against the realists of Mining and the inevitable problems we are going to have with Treasury.

“I would like to have seen the recommendations of mining looked at much harder and longer because no matter what field or enterprise you are in you would rather be doing things the way you have suggested than have some outside group impose its philosophy on you. “What I’m saying is just watch out that the Mines people don’t turn dog and refuse to go along with the Government suggestion.”

Dr Dallas has no time for those “outsiders” who will say the Coasters are never satisfied. “This is what really annoys me. We didn’t ask for this. The realists on the Coast have accepted the fact that if the mining enterprise is to be looked at on its own, then the only way to get coal transported out is by slurry. “Sure, they have propped up

the railways and I guess it is a handout. The Minister has said it is to retain the employment of the area but I’ve really got the big fear that in the three years when they have competed on the coal market with the railways cost, we’re going to lose both.

“We could have a change of Minister, a change of Government, and here we are on the Coast, once again, relying on a propped-up industry. Without a doubt we are fighting for our lives.

“The good old Coaster has been down so often that he’s pretty comfortable down there. He’s a pretty philosophical creature and he’s not known for fighting back. He’s far more likely to accept these things and go along with his present way of life.

“The chap who is ambitious and enterprising will, as always leave the Coast, leaving us with our very pleasant way of life.” Dr Dallas will not be waiting around for a decision to be made. He feels the time is right to "get stuck into” tourism. “I’ll be getting stuck into it in the biggest possible way, probably on a scale never before seen in this country. Then I hope the horticulture and agriculture people will come in with Government grants.” While Dr Dallas is not in full agreement with the decision, a local real estate agent, Mr Jack O’Donnell, believes it can only bring about an increased confidence for West Coasters, particularly in the real estate field.

“The market on the West Coast has been very buoyant within the last 12 months, which is a situation completely different from any other place in New Zea-

land,” he says. “The news about the railway line and the mine will allow the market to continue at the same level.”

Mr O’Donnell is at pains to explain why Greymouth’s real estate market is more buoyant than elsewhere. “It’s very difficult to pinpoint but it’s probably fair comment to say we have always had a fairly substantial floating population. We have a considerable number of people who occupy positions on the West Coast like that. They move in, they spend their time here, they move out, and their replacements come in. Naturally one of the first things they do is look for housing.” The 65 jobs to be lost over the next five years from the Strongman Mine will probably not affect the market to any great extent, he believes.

“It’s a period of time that these jobs are lost over and the natural demand created by the likes of young couples looking for housing will tend to take up the slack.

"What it probably means is that the market is going to be essentially one of buying and selling existing homes. Whether we’re going to see the amount of home building over the next five years as we have over the last five years ... well, that could be a horse of another colour. “The market in other areas of New Zealand has been subject to very definite highs and lows. The market here is not. Real estate agents can be selling hundreds of houses in other parts of New Zealand and we’ll probably be going along here selling what we consider to be the usual customary number. “When other real estate agents

in other parts of the country are having real lows we are still maintaining that customary level. Therefore we maintain a very even level — that applies to a lot of things on the West Coast, not just real estate.” Mr O’Donnell says the town that was waiting for the decision was Westport. “I think it would be fair to spy the real estate trading in Westport was affected pending the decision but I don’t thing that applies anywhere near as much to Greymouth, and it doesn’t apply to Hokitika at all.

“The announcement was met with very considerable relief in' Westport,” he adds. “Historically, the West Coast has been subjected to significant decisions in the line of closures, whether they’ve been mining closures or mill closures. The Coast has come to live with these things and possibly they don’t cause the ripples here that would be caused if it was another part of New Zealand.

“Over the years the West Coast has come to live, as much as anything, with the prospects created by headlines in the local paper or by news items on the local radio station. “You have closures of mills or a mine and within a short time there will be a headline in the paper saying Japanese interests are looking at the concept of taking the coal. As much as anything, the West Coast has prospered on rumours of developments in a variety of fields, many of which have not come to anything at all. “We seem to be able to survive

on rumour.” Mr O’Donnell’s confidence is echoed by the chairman of the Greymouth Business Association, Mr Robert Anderson. He believes that had the decision not been positive for the West Coast, Greymouth would have been finished as a town. “Now that this decision has been made it will bring back confidence. People will be able to plan their future a little more and they should be able to buy better. We’re looking towards the year 2000. By that stage, hopefully, we’ll be booming.” Mr Anderson says that on the day of the announcement gloom and despondency lifted from Greymouth. There were plenty of smiles all round. But if the railway had gone you could just about have closed Greymouth down.” ■

He agrees that the Government has thrown the West Coast a lifeline. “Businessmen can see light at the end of the tunnel. Retailers can look forward to buying, knowing that the things they purchase are likely to be sold. It’s early days but I’d say the general public will not be looking four times at something. They’ll look twice and then buy it.”

Mr Anderson believes Greymouth will prosper. “There will be a wider range of goods on sale because the public will be able to spend more and the retailers will be able to stock extra because they know the people will have the spending power. We can now plan for the future with confidence.” Mr Anderson has some harsh words for the National Party which has criticised the decision. “What the National Party is saying is really sour grapes. Some of them are grizzling away but they want to bear in mind that New Zealand wouldn’t be where it is today if it wasn’t for

the West Coast. “They’ve dragged out our coal, our gold, our timber; they’ve dragged billions and billions of dollars out of this region, now they are grizzling about $5O million over a period of 15 years. If they gave us $5O million a month it still wouldn’t pay for what’s been taken out.” Runanga, five miles north of Greymouth, has traditionally provided the bulk of staff for the Strongman Mine. Nowadays, the staff is spread over a much larger area, including Greymouth and its surrounds. While the decision has been made to keep the Strongman Mine open, albeit for five years until the Doherty Block mine is developed, the Runanga Borough Councillor, Wayne Ford, still expresses some reservations.

“Everyone is hopeful that the Doherty Block will start almost immediately and a lot of people believe that that will be the case. However, it is not,” he says. “What seems to be on many people’s minds is whether that is an escape clause for the Government. “The council has been told that a feasibility study on the Doherty Block is underway and will be completed, hopefully, within two years. No information has come forward to suggest that the feasibility study will be completed earlier. If it is, great; but if it’s not then questions are still unanswered.

“If it did start, and the market stayed there for coal, in 10 years time Runanga must boom. If it did not go ahead Runanga would remain a satellite town of Greymouth.

“Unless an alternative industry was found this side of Greymouth then Runanga would stagnate. People would leave and Runanga would revert to what it was in the 1960 s when there was not growth or anything.”

Going behind square one

Surviving on rumours