THE ONEKAKA FABLE

New Zealand Herald, Volume LXXVII, Issue 23719, 27 July 1940, Page 10

THE ONEKAKA FABLE

It is probably political obstinacy more than native simplicity that is responsible for the credulous faith shown by the Minister of Industries and Commerce, Mr. Sullivan, in his determination to establish an iron and steel industry in New Zealand. The British experts imported to check up on the reputedly fabulous wealth of the Onekaka iron deposits have proved by searching tests that the reports on which the Government's original proposals were based were largely the result of imaginative prospecting But Mr. Sullivan, having piloted through Parliament two years ago a bill providing for the establishment of an iron and steel industry on the most hopelessly uneconomic basis the original capital of £5,000,000 was to bo secured not on the industry but on the public revenues of the Dominion —is still determined that he should have his new industrial toy, "even i if some iron ore has to be imported." I This i.B obstinacy; carried to an

almost ludicrous extreme. Private

enterprise, in the years before 1938, was never able to satisfy itself that the Onekaka ironfielcl could be profitably worked, but the Government, with its fine scorn of profits, insisted that the industry could be "socially developed," either by high prices for a monopoly product or by extravagant subsidies filched from the taxpayers. Now Mr. Sullivan admits that "in .regard to ore supplies the Government has had disappointment after disappointment." Surely it is time for him to cut the country's losses. Even if the Onekaka deposits approached the original estimates, it would be impossible for an iron and steel industry to be established in New Zealand on an economically competitive basis with the great Australian undertakings. So far Mr. Sullivan's ill-founded optimism has cost the country £60,000 without any reasonable hope of return. It is scarcely conceivable that obstinacy should be allowed to add to this sum.