LEASE OF COALMINE.

New Zealand Herald, Volume LXVII, Issue 20626, 26 July 1930, Page 14

LEASE OF COALMINE.

TRANSACTION CRITICISED.

DEBATE IN PARLIAMENT

EXPLANATION OF POSITION

[JIY TEI.EGRAI'If. —SPECIAL REPORTER.] WELLINGTON, Friday.

Complaint that an Auckland newspaper had horn given particulars of a mine lease transaction which had been denied to Parliament was made in (he House of Representatives to-day, when Labour members crossed swords with the Minister of Mines, Hon. A. J. Murdoch, regarding the leasing of the Mac-Donald coalmine to Glen Afton Collieries, Limited, for 40 years. Mr. Holland invited the Minister to make public the details of the lease agreement. He also asked the reason for the acceptance by the Government of a royalty of 8d a ton when other mines were paying a royalty of Is.

Mr. M. J. Savage (Labour —Auckland West) complained that a newspaper could get from the Minister information which was denied to (he House. " I want to say that I think Iho House is at least entitled to full information of what the Government intends to do," he added.

Mr. W. Lee Martin (Labour —Raglan) said tFm previous Minister of Mines had intended to sell the mine, and it was only when the Arapuni trouble occurred that tho present Minister had cancelled tho sale. " I protest at the way this business lias been done," he said.

The Reason Tor Haste.

Mr. Murdoch said unfair statements had been made about the lease and lie wanted to say that the Mines Committee was welcome to see anything concerning the Mac Donald mine, lie then gave details of the lease to Glen Alton Collieries on the lines of the information all early published. He explained that the reason for haste in completing the lease was the desire to prevent a power shortage in the Auckland Province through lack of coal. Mr. Savage: That trouble will not take 40 years to clear up. The Minister: J. would remind the House that f made inquiries as to other sources of supplies, but the quotations we obtained were not considered equal to the prices at which Glen Afton would contract if the. company secured the lease. The Auckland Power Board contended that if adequate coal supplies were guaranteed it could immediately older

machinery to give a sufficiency of power until Arapuni is again functioning. In order to meet the urgency of the case

I took the responsibility of accepting 8d a ton royalty instead of the shilling 1

had first asked. It must, be remembered that it would cost £20.000 for a railway alone if the mine were to be worked as a. State .colliery.

Advantageous Working

Mr. Holland: But will not the railway be required as it is ?

Mr. Murdoch: The Glen Afton mine borders on tins one and the workings are now within 11 chains of the boundary, so the company can work the Mac Donald mine more advantageously. The Minister's time limit elapsed and Mr. Murdoch said the Minister of Railways, Hon. W. A. Veitch, who formerly was Minister of Mines, would explain further details. 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 away to the latter a valuable property ? "I do not want to mention names," he said, " but I do want to meet that man. I can remember the, ex-Minister 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 again."

"We all appreciate the good humour with which the last member makes his speeches," said Mr. Veitch. ' However, he asked for an explanation ;.nd then proceeded to pronounce sentence himself, without waiting for the explanation." Mr. Veitch said it was perfectly true that as Minister'of Mines he wis in favour of disposing of the Mac Donald Mine, which had become ;v serious financial load on the department. Its cost with compound interest added from the date of purchase and with the cost of certain developmental work was between £BO,OOO and .1190,000, whereas the quantity* of coal in the mine was estimated as bring worth only between £6.500,000 and £9,000,000.

Unprofitable for Stato.

It would have been impossible for the Stato to work the mine at a profit, said Mr. Veitch, and ho had made up his mind to dispose of the property by sale or lease if at all possible. Meanwhilo it was recognised by him that, it was desirable tli.it the Government should hold deposits of coal in the Wnikato. Such deposits would bo available against the possibility of exploitation by mineowners in the Waikato. Accordingly, when the leases of the Rotoiti and \\ ai 11i Mines, near Huntlv, came up for consideration, he had refused to renew them and they had both been gazetted as State reservations. Those mines could be developed as State collieries at an infinitely less cost than the Mac Donald Mine. However, ho believed Glen Aft on Collieries could work the Mac Donald Mine at a profit. .dr. \Y. I'. Lndoan (Reform—Farnell) : 1 li.it company pays no income tax. Mr. Veitch: No negotiations for the disposal of the mine had been made when 1 left office.

Sir. Martin: But the mine was spnei fically promised to the Glen Afton Col licries.

Mr. Veitch: Definitely not. It was not promised to anyone. The lion, member has been misled.

Appeal for Protection

Ihe Auckland Power Board," continued Mi'. Yeiteh, "said a combination of Waikato coalowners was pressing lor higher pi ices and the board appealed to tho Government for protection. lam not aware whether that combination exists. I am jest repealing what 1 ani l<>ld. Finally, the board said Glen Afton Collieries were willing to sell at much lower prices. " If Glen Afton got a lease of the MacDonald -Mine two things would be dune. Firstly, the dairy producers of the Waikato, who are the owners of the mine and not Mr. Goodfellow, would Lie assured of supplies for many years. Secondly, the price would bo considerably lower than that demanded hv the combination. I claim that in view of these facts and the urgency of the position wo have accomplished 'various things that were, desirable."