The Dominion. MONDAY, MARCH 25, 1912. SOME STATE ENTERPRISES.

Dominion, Volume 5, Issue 1390, 25 March 1912, Page 6

The Dominion. MONDAY, MARCH 25, 1912. SOME STATE ENTERPRISES.

The cable messages have not told us much about Mn. Wade's indictment of the management of the New South Wales State bi'ickworks, but recent Australian files contain evidence that this public enterprise has not as yeb justified the hopes with which it was launched. The idea seems to have been that the bricks should be sold at a price not exceeding the full cost of production, so as to bring down tlw prices charged by the manufacturers who were supposed to be exploiting the public. Nevertheless, the market price, we leavn from the Sydney Daily Telegraph, has gone up, instead of down, and the Government appears to have found that it cannot produce cheaper bricks than other people. The (lovermnent proposed, in a Bill introduced [|;i> other day, to empower the Department in which an article was produced to sell it to any other Department of the State "at a price agreed upon." This, of course, is Ihe device whereby the New ?>,ilaurl State coal mines are ma do to show a profit. Tb.e coal is Bold to the Government.

Railways at a price to suit the coal mines, which consequently appear to be paying, while the Railway Department, which -would be run at a loss anyway, Is simply run at a slightly greater loss. Mi:. Griffith, fcha New South Wales Minister for Works, was asked to alter his Bill so that the price charged by one Department to another should not exceed the, cost of production, but although this might fairly have been expected to meet his views, he would have none of it, and only consented unwillingly to a provision that the current market rates should be charged. So the competitive industries which were to be put in their place by the State are themselves to bo the means of regulating the business activities of the State. The Government itself .apparently expects that whatever it may gain'"by the elimination of private profit will be swallowed up by the uneconomical methods_ which are usual in State undertakings. Its own proposals have thus given Mr. '' Wads material for the substantiation of his charge of incompetent management of the State brickworks, and it is difficult to_ imagine how the Minister for Works, who denied the charge, could make good his assertion that this particular undertaking had already saved the country £300 a week. Another Australian State enterprise which has disappointed expectations is the Victorian State coal mine. When the mine at Wonthaggi was taken over by the State, two and a quarter years ago, it was officially estimated that it would be able to supply coal to meet all the needs of the Government at 2s. 4d. a ton less than the average cost of New South Wales coal. The forecast as to the quantity of coal has been justified by events, but the needs of the State have increased to such an extent that tho Railway Department now has to order 150,000 tons a year of New South Wales coal. The price of Wonthaggi coal at the pit's mouth was to have been 9s. a ton, but it actually is 11s., and the Age shows, in a careful and moderate article, that when freight is taken into account Wonthaggi coal costs the railways ninepence half-penny a ton more than Newcastle coal, allowance being made for the circumstance, as stated by the Department, that it requires 115 pounds of Wonthaggi coal to produce the same result as 100 pounds of Newcastle coal. It is quite of a piece with the New South Wales brickworks experience that "the possibility of supplying cheap coal to manufacturers and the general public seems to have been quite lost to view." Yet the Wonthaggi experiment is being made under favourable conditions. It has been for the last eight months under the control of the Railway Commissioners, and is now therefore presumably free from the blight of political influence. The Commissioners are compelled by law to use the product and cannot get enough of it, so that there is no trouble in finding a market, no competition to fear, no advertising to pay for. The mine may be, as the Age asserts, "a valuable asset to the State," but it has not fulfilled what were regarded at tho time as quite reasonable forecasts of the Government, it is not producing cheap coal and it is apparently causing the railways to lose a few pence on every ton of State coal they consume. Unfortunately, the published accounts dp not'give full information and it is, therefore, impossible at present to say what relation the price of the coal bears to the cost of production, but it is not likely that, the Commissioners would pay more than the price of Newcastle coal, if the "Wonthaggi mine was • making any considerable profit. We shall not be surprised if the fuller information which should be available by and by emphasises the fact that in this instance, as in so many others, the benefits of State eitorprise are largely illusory.