LEASE OF A MINE

Dominion, Volume 23, Issue 257, 26 July 1930, Page 10

LEASE OF A MINE

MacDonald Property

CRITICISM IN HOUSE Labour and Government The Government’s lease of the MacDonald State Mine to Glen Afton Cob lieries, Limited, for 40 years, was severely criticised in the House of Representatives yesterday. A coqiplaint was made that an Auckland newspaper had been given particulars of the lease transaction, which had been denied to Parliament. In reply to a question asked some time ago by the Leader of the Labour Party, Mr. H. E. Holland, the Minister of Mines. Hon. A. J. Murdoch, said it was not proposed to open the MacDonald Mine as a State coliery. Negotiations for the leasing of the area had just been completed. Mr. Holland asked the Minister to make public the details of the lease agreement. He also asked the reason for the acceptance of a royalty of Bd. a ton when other mines were paying a royalty of 1/-. Mr M. J. Savage (Lab., Auckland West), said the idea of a State mine in the Auckland province to keep coal prices at a reasonable level had now been “washed out.” He complained that a newspaper could get from the Minister information which was denied to the House. “I want to say that I think the House is at least entitled to full information of what the Government intends to do,” he added. “The Minister should state what the arrangements are.” Proposal to Sell. Mr. W. L. Martin (Lab., Raglan) said the previous Minister of Mines had intended to sell the mine to some company, and it was only when the Arapuni trouble occurred that the'present Minister had cancelled the sale. Mr. Martin claimed that as member for the district in which the MacDonald Mine was situated, he was at least entitled . to have been informed of the negotiations. “I protest at the way this business has been done,” he said. “The Minister should have taken the, House into his confidence. Instead of giving the whole of the information to the Press he could at least have informed the member for the, district of what was being done.” Mr- Murdoch said he recognised the reply he had given Mr. Holland was not a sufficient answ’er, but the time was not then opportune to make a fuller statement. Unfair statements had been made about the lease, and he wanted to say that the Mines Committee was welcome to see anything concerning the MacDonald mine. Mr. R. Semple (Lab., Wellington East): After the damage is done? The Minister: No damage has been done. No Tenders Called.

Mr. Howard asked why tenders for the lease had not been called. Had the Minister allowed himself to be mesmerised by a prominent business man in the north into giving way to the latter a valuable property? A Labour member: Was he a good fellow? , Mr. Howard: I do not want to mention names, but I want to meet that man. I always like to meet successful business men. I can remember the ex-Minis-ter of Mines protesting when the same man got £15,000 for wireless and other concessions. I have a list of the concessions. Now we find the same mesmeric trick resorted to, and the same gentleman has got away with the goods aB “We all appreciate the good humour with which the last member makes bis speeches,” said Mr. Veitch, who held the Mines portfolio immediately prior to Mr. Murdoch. “However, he asked for an explanation, and then proceeded to pronounce sentence himself without waiting tor the explanation.” Mr. Veitch said it was perfectly true that as Minister of Mines he was in favour of disposing of the MacDonald mine, which had become a serious financial load on the Mines Department. Its cost, with compound interest added from the date of purchase, and with the cost of certain developmental work, was between £80,009 and £OO,OOO, whereas the Quantity of coal in the mine was estimated as being only between £0,500,000 and £9,000,000. Not only had the Mines Department recommended that the mine should be sold, but the Public Works Department had stated that it would cost £120,000 to connect it with the main mine in order to market the coal. It would have been impossible for the State to work the mine at a profit, and he had made up his mind to dispose of the property by sale or lease if at all possible. However, he believed Glen Afton Collieries could work the MacDonald mine at a profit. Mr. W. P. Endean (Ref., Parnell): That company pays no income tax. Reduced Royalty. Mr. H. G. Dickie (Ref., Batea): Why the reduction in royalty? Mr. Veitch: That was the result of negotiating, and eightpence was the best bargain that coilld be made. Mr. Dickie: Will the same concession be given in other cases? Mr. Veitch: All cases will be dealt with on their merits. . Mr. Martin: Why did the Minister refuse me the usual courtesies? I wrote to him month after month, and never got n reply. ~ ~ “If there was some laxity, ... tne Minister began, when there was a series of interruptions. “I do not think it is worth while carrying the matter any further,” he said, sitting down. “It is a social crime that the Government should have disposed of a valuable lease for 40 years without giving any other companies an opportunity to compete,” declared Mr. Semple. This .has been done by a Government which is in a hopeless minority in the House, and, may be before the country at any time. The Speaker, said Mr. Semple, should withdraw the words “a social crime. Mr. Semple.’ Very well, but I submit the people of this country will very shortly want to know the reason why.