FERTILISER SUBSIDY

Inangahua Times, 4 July 1934, Page 4

FERTILISER SUBSIDY

CABINET’S DECISION. INQUIRIES MADE. Wellington, July 2 ] I Interviewed today regarding fertii- j ' iser subsidies, the Minister of Agri- ; culture said the position as stated in 1 the Press Association message from . Auckland, was correct, except for thej last sentence. ) Cabinet’s decision as conveyed by telegram to each manufacturer on the30th ultimo, was as follows: “Am di-* rected to advise you that Cahiriet’s decision regarding the fertiliser subsidy is, that it will he 2s 6d per ton, conditional on the selling price not exceeding £4 per ton, this to date from July I.’»

“Cabinet does not agree with the manufacturers that it is impossible: for them to carry any additional bur- j den,” said Mr MacMillan. “As a re-' suit of very careful investigation of |j the manufacturers’ costs, the following conclusions were arrived at: There are lour manufacturing companies, two owning one works each, one owning two, and one owning four works. The total capital invested in all works is £1,208,919. On sales equivalent to last season’s with 2s 6d per

ton subsidy, and the price and conditions the same after allowing 6s 6d per ton commission on all sales in the North Island and 9s on all sales in the South Island, and adequate: depreciation, the nett profit available! for distribution is £98,195, equal to a 8 1-8 per cent, dividend upon all capi-j tal invested in fertiliser works. This should fie considered sufficient profit. Owing to various works not having the same prooprtion of sales to invested capital, of course the divi-j® dends each company can pay is dif-' ferent. In view of this, if fertiliser companies charge £4 3s 6d, without a sub- I sidy, steps will have to be taken un- 1 der the Board of Trade Act to com- ‘ pel the price to be reduced to £4 per ton with 2s 6d per ton subsidy. ®