THE SUGAR DUTY.

Grey River Argus, 25 July 1923, Page 2

THE SUGAR DUTY.

C.R.S. Co. and its Profits. SOME REMARKABLE FIGURES. Speaking in the House of Representatives recently on the resolutions submitted by the Minister of Customs to give the Colonial Sugar Refining Company a permanent duty of £3 per ton on refined sugar, Mr H. E. Holland, Leader of the Labour Party, said: This demand of the Colonial Sugar Refining Company was simply an attempt on the part of a profiteering concern to hold a pistol at the heads of the people of New Zealand, and the Government’s answer should have been: “If these are the only terms on which you will carry on, then we will commandeer your works and produce sugar for the people under State Control.” Mr Massey: “Where would you get the sugar?” Mr Holland replied that it could be got from Java and other countries. The C. S. R. Co. was the most scandalous robber concern that Australasia had ever known. What was the history of it? He knew the Company had an advantage over the people of New Zealand because the sugar which came from Java at the present time was not suited for jam making for use in certain other industrial undertakings. The company knew this, and was out to take advantage of the fact. PROFITEERING HISTORY. The company began operations with a paid-up capital of £150,000, and within a short period that, sum was increased to three millions, wholly out of profits. During the seven years that ended with 1907 a sum of £900,000 was capitalised out of profits. During the same period in addition to this capitalisation, the shareholders drew £2,991,142 in dividends, and were thus able to take out about £400,000 a year on top of what they carried to reserves. The company had the advantage of being in a position to handle about 85 per cent, of the Australiangrown sugar, and he found one paper declaring that “the normal net profit of the company, whether it he hidden away in reserve funds added to capital, or paid out to shareholders in the shape of so much proclaimed dividend, is about £760,000 per annum, representing 500 per cent, on the original capital.” Of course, the watered stock made the per centage appear a smaller thing. The figures he had given represented only the profit made in. Australia. In addition to these results assets written up and bonus shares issued in the New Zealand and Fiji Company represented £3,250,000. A FIFTY r -THOUSAND BRIBE. He found the “Daily Standard”, the foremost daily paper in Queensland and other papers pointing out that this company only a little while ago paid £50,000 into the funds of the National Party in Australia—practically a bribe for what was to come. No wonder that sugar was dear in Australia. He quoted from the financial columns of the Sydney “Bulletin”, which paper—■ without taking into consideration the watered stock issued before 1907, declared: “The. shareholders paid up in cash for their shares £2,425,000; but by watering of shares, by bonus stock, and by the creation of subsidiary companies. they now hold £6,500,000 paid up shares.” CAPITALISED PROFITS.

It had been pointed out that of the £4,300,000 of increased capital during the last eight years, only £225,000 was cash paid, the remaining £4,750,000 being bonus scrip paid by the sugar consumers of Australia. Tho tabulated statement put out by the Company showed that, apart from other profits in 1907 the reserves capitalised amounted to £75,000; in 1908. £.350,000; and in 1910, £150,000. In 1915 assets were written up aud £3,250,000 capitalised to establish the Fiji and Now Zealand Company. In 1920 capital returned amounted io £650,000; in 1921, £1,625,000. In 1921 also cash bonus amounted to £203,125. At the present time tho Fiji and New Zealand Company was in process of liquidation, but the profits and reserves were not disclosed. The capital returned, however, was £1625,000, while the cash bonus from the Fiji liquidation was £325,000 and the reserves capitalised amounted was £1,625,000. This was the concern which now came demanding a £3 per ton on sugar, and declaring that otherwise it would not be possible for the Company to carry on. MODERN BRIGANDAGE.

The company was holding a pistol at the head of the Government, just as any ancient highwayman presented his pistol while demanding his victim’s money. New Zealand was the victim in this ease. In 1908-13 the parent company’s bonus shares amounted to £825.000; in 1915, the subsidiary bonus shares were £3,250,000. Ho presented a record of the capital repayment and accompanying cash bonused as follows:1921: Parent. Co 650,000 1921: Subsidiary Co. . • 1,625,000 1923: Subsidiary Co. 1,625,000 £3,900,000 1921 Subsidiary cash bonus 203,125 1923 Subsidiary cash bonus 325,000 Total fl ’ 428 ’°° C THREAT OF SABOTAGE. That was just a part of the story with respect to this extraordiaiy Company, which said:: “Unless we get protection amounting to £lBO,OOO a year from you, we will close down our works in New Zealand.” There should be only one answer in such a ease. The Government should

you won’t carry on, we are not prepared to see the industries of thi* country sacrificed.” There were certain industries that would be sacrificed if tho Chelsea Refinery were closed down. The company threatens to sabotage the sugar supplies of the people of New Zealand. In effect the Company’s threat was: “If you will not pay us tributes of £lBO,OOO a year, we will close up th© refinery; we will destroy your jam-making industry; we will destroy your other industries in which refined sugar is necessary; we will make you pay for having refused to bribe us with a duty of this kind.’” The Company would not give a guarantee that, if it were given this protection against the Java sugar the price of sugar within New Zealand would not be increased! However, if the Company was determined to close the works they should be taken over by the State and operated to produce sugar for use and not for profit.