ONEKAKA CASE

Nelson Evening Mail, Volume 76, 26 August 1941, Page 7

ONEKAKA CASE

CROWN’S FORFEITURE ACTION QUESTION OK PRODUCTION OF CORRESPONDENCE i The case in which the Crown is prnIceeding for forfeiture of mining privilieges at Onekaka against the Onckaka [lron and Steel Company. Ltd., Golden Bay Proprietary, Ltd., and Pacific Steel. | Ltd., was continued in the Wardens' (Court in Wellington before Mr T. E j Maunsell, S.M.. yesterday. Mr 11. H. Cornish. K.C.. SolicitorGeneral. with Mr C. R. Fell, is appeal ir.g for the Crown. Mr P. B. Cooke. K.C.. and Mr M. C. Cheek for the Onekaka Iron and Steel Company, Limited <in liquidation), Mr C. 11. Weston, K.C., with Mr F. P. Kelly, for Golden Bay Proprietary, Limited, and Mr W. J. Sim, K.C., and Mr A. L. Hudson for j Pacific St (‘el, Limited. Walter Bromley. secretary of the Iron and Steel Department, continuing his evidence, said that Mr Watson, chairman of Pacific Steel, put forward on 11th February, 1936, a proposal to expend £IOO.OOO on reconditioning the Onekaka works, but the Minister was not disposed to entertain such a proposal. To March, 1936, Watson put another proposal forward for the expenditure of £500.000 on the works. He j suggested in both of these schemes that j the Government should provide linanjcial assistance. Watson came to see ! witness after March, 1938, and wanted ]advice as to what lie ought to do, as he !direction of developing the industry. Witness told him that his best policy ! was to take advantage of the offer made to him by three Ministers of the Crown I in 1936. Cross-examined by Mr Sim, witness said he was not in a position to say what was the view of the Coates Government concerning the proposals to establish iron and steel works in the Dominion before it went out of office. The discussions which had been reI ferred to had taken place after the change of Government. The Unemployj ment Board or one of its committees : had considered Watson's proposals before the change of Government. He i would say offhand that the Unemployment Board had not placed the pro- | posals before the Coates Government, i He knew that the Coates Government ; was keenly interested in the establish- ■ ment of steel works in the Dominion. From the receipt of Brasserts’ report, in October, 1935, the Unemployment (Board was of opinion that the establishment of steel works in New Zealand was desirable. The Unemployment Board recommended that the industry should be licensed, and it was 'likely that a subsidy on wages during the erection of the plant would have I been recommended if the work was i done in 1935. Witness had received j copies of Brasserts’ 1933 and 1935 re- ! ports, but had not seen a report by Professor Tocker. Professor of Econoj mics at Canterbury University College, in 1933. He remembered a report by I Professor Tocker in 1935, which re- ! viewed the whole economic prospects of the scheme as seen by him. The Government had advanced £2500 for obtaining the Brasserts’ report, and protided the industry was successfully developed by Pacific Steel, the £2500 . was to be refunded. In addition to advancing the £2500 for Brasserts’ report, the Government (placed at the disposal of Brasserts’ representative while in New Zealand certain officers of the Geological Depart (ment. The Onekaka Iron and Steel Co.. Ltd., had done its best to establish iron and steel works in New Zealand. Witness could not point to any instance in the correspondence where the Government had stated that the development of an iron and steel industry ir. New Zealand must be a State enterprise. Pacific Steel had always been ready to co-operate with th ■ Government in the establishment of the industry up to the passing of the Act. Up to the present the Government had never had an account from Pacific Steel, nor had they made an offer to the company It was not a fact that witness had offered Watson a billet in the iron industry. In a i-cport in 1939. after the passing of Ihe Art. Brasserts estimated the life of the steel and iron industry in New Zealand at. 70 years, and the net earnings at about £445.000 A WAR EMERGENCY Cross-examined by Mr Cooke, witness said the passage of the Act did not come as a complete surprise to him. jThe Onekaka plant was being equipped las a war emergency; it might never be worked at all. ! Continuing, witness said the Govern(ment would not be using the water privileges at the works, but. would just | leave them as they arc. Witness had no reason to doubt that in November. 1935, the Government's view was that there was a prospect of the early re- | opening of the Onekaka works and. according to New Zealand geologists. I there were over 60,001).000 tons of ore containing 50 per cent of pure iron | available. He knew that there was correspondence between the Govern ment and Brasserts in 1937. It would not be proper for witness to produce the correspondence between Mr Nash and Brasserts when Mr Nash was in London; the correspondence between Mr Pascoe and Brasserts while Mr [Pascoe was in London: and the correspondence between Messrs Nash and Pascoe and the New Zealand Government relating to Brasserts while i Messrs Nash and Pascoe were in (London. Witness knew that the Govjernment received a report from Brasjserts in 1937, but could not say how [the Government obtained the report, i Witness refused to produce the report ■ received from Brasserts in 1937, as the Government had not yet released it to ‘anyone. The report was under control

of the Minister for Iron and Steel, Mr 1 Sullivan. Mr Fell undertook to see if the Minis-! ter would allow the report to be pro-! duced. Continuing, witness said he did not j why the Government had not I given the 1937 report to the receivers, j It was immediately after the passing; of the Act. in 1938 that the Govern ment notified the British Iron and Steel Federation of its intention to establish the iron and steel industry, in New Zealand. Mr Heskett had informed witness what the cost was of starting up the Onekaka works in September, 1931; January, 1933; and December, 1934; ar.» he had said it did not cost more than £2OOO on each occasion. Mr Weston asked witness to produce the correspondence between Messrs Nash and Pascoe and Brasserts, and the correspondence between Messrs Nash and Pascoe and the New Zealand ; Government concerning Brasserts. At the instance of the warden, witness undertook to intervew the Minister to see if he would agree to release the files. COST OF RECONDITIONING WORK Norman John Murdock McLeod, chief mechanical engineer of the Public Works Department, said that he made an inspection of the plant at Onekaka this year, and found the whole plant, with the exception of the blower, obsolete. One boiler was 58 years old. one 41 years old. and the third 34 years old. Tho- third boiler would have to be condemned. The engine was 42 (years old. Mr Cooke objected to the evidence of any witness as to what he said or | observed after the passing of the Act. The objection was noted. Proceeding witness said the crushers were almost worn out. and the elevators and conveyors were in a very bad state. He estimated the cost of putting the plant in running order at April, 1941. at £9OOO. Witness estimated the cost of putting the plant in order in March, 1938, at £7650. Cross-examined by Mr Sim, witness said that the cost of putting the plant in running order to-day would be £22.500, without the blast furnace. In running order the works would be a |va liable commercial undertaking. The hearing was continued to-day.