STATE MINING

Nelson Evening Mail, Volume LXVI, 10 February 1933, Page 7

STATE MINING

COMMENT ON PROFITS FOR LAST YEAR MINISTER IN REPLY Tlie statement that an entirely erroneous view of tlie profits of tlie State coal mines for last year had been taken by tlie Associated Chambers of Commerce in its recent criticism ot the working of this department was made by .the Minister of Mines, tlie lion. C. E. Macmillan, in a reply issued this week. The Associated Chambers said that what was not generally appreciated was that when extraneous revenue was disregarded, there was actually a substantial loss on the year’s working, and on analysis tlie profit of the Statei mines vanished, that £8402 for royalties received on account of goal from Crown lands was included in the latest accounts, and that one private company alone paid £36,33 of these royalties—more than the profit shown on the State mines. “The deductions to be drawn from tlie.se statements are wholly incorrect,” the Minister said. “The amount of £8402 for royalties received is that shown in tlie receipts and payments accounts, tlie amounts appearing in tlie general profit and loss account being £5007 for royalties earned from the State Coal Reserve at Greymouth and £7Bl net royalty from the State Coal Reserve at Waikokowai, McDonald Colliery area. Dealing with this latter item first, tlie land, which was freehold, was purchased and substantially developed by the Government at a cost of over £43,000 out of the funds from tlie State Coal Mines Account, and, consequently, any profit from it is rightly a credit to the State Coal Mines Account.

“In regard to the other royalties, those from the Stale Coal Reserve at Greymouth, the State Coal Mines Account had to bear the cost of prospecting and boring, and in many cases the expense incurred in driving find development work, and the cost of supervision generally of the small co-operative parties working there. Some of the largest competitors of the State Coal Mines have leased portions of their coal bearing lands and also take credit in their accounts for the royalties received. “The profits of the. whole of the undertaking of the State coal mines, including the depots, etc., for 1931-32. before providing for a contribution of £7885 to the sinking fund for redemption of loan capital and a special contribution of £SOOO to the _ Consolidated Fund ill respect of administrative expenses of previous years, was £16.032, so that even excluding the royalties which have been credited, the State Coal Mines Account would still show a handsome profit.

“In order to remove any misapprehension, it is pointed out that the royalties on Crown lands which are outside tlie two State coal reserves are credited to the Consolidated Fund. Greymoulh Harbour Board, Westport harbour revenue and oilier accounts as prescribed by the, Coal Mines Act, 1925. “It should also not be overlooked that the State Coal Mines Account is a liberal supporter of research, and last year the account paid toward the cost of research work carried out by the Department of Scientific and Industrial Research about £IOO more than all the other coalmining companies and coalmine owners together. It is quite, evident that the statement was prepared without the writer being aware of all the facts and without a close examination of the accounts.”