THE DREDGING INDUSTRY. PROSPECTIVE LEGISLATION.

Poverty Bay Herald, Volume XXVIII, Issue 9306, 20 November 1901, Page 4

THE DREDGING INDUSTRY.

PROSPECTIVE LEGISLATION.

INTERVIEW WITH MR H. E. EASTON. Air H. E. Easton, who for the last, nine months has been stirring up the directorates of certain dredging companies in a manner little to their liking, and with results that have opened the eyes of the shareholders and the investing public generally as to the extraordinary methods of management of some companies, was interviewed in Christehurch last week prior to his departure for England. Mr Easton explained that he had come to New Zealand a year ago on behalf of a number of capitalists who, having money idle on account of the South African war, were looking for fresh fields for investment, and whose attention had been consequently directed to the dredging industry in Now Zealand. The condition, of the industry on examination astounded him. The colony was simply selling its birthright. He had found mismanagement, over-capitalisation, wasteful extravagance, over-loading, blundering and fraud prevalent throughout the industry. It was the exception rather than the rule to find a claim efficiently managed, and the industry was simply being smothered in the interests of men who were waiting a chance to step in when the panic they had created reached its climax, and profit by the reconstruction of companies which were needlessly being forced into liquidation. The industry he was satisfied was a splendid one under proper conditions, and there was an excellent future before it after the inevitable cleaning up. Very few of the claims had turned out duffers, and many of those which had closed down had done so not on account of the poverty of the claim, but because they had been mismanaged, and the capital had been frittered away. It was clearly the duty of the Government, Mr Easton pointed out, to step in and set the colony right in this matter in the eyes of the investing public. There were companies which, to his knowledge, had done nothing but make monthly calls, and which were no nearer starting work than when they were floated, but which were still paying directors' fees and bountiful salaries and expenses out of the capital fund. The same system of payment was carried on with dredges that were laid up for the summer, the directorate and staff .continuing to draw fees while the dredge was earning nothing. Such a state of things was wicked extravagance, and companies could not expect to pay dividends as long as it existed. The present panic was being fostered, to his knowledge, by interested parties, and his advice to shareholders was to hold tight to their shares, and devote their attention to seeing that the claims in which they were interested were economically and efficiently managed. Recognising the value of the industry, he had made an attempt to secure a measure of Parliamentary control, with a view to remedying the existing abuses, and making smooth the way for the investment of foreign capital. He had approached the House by petition, and after long waiting and a strenuous battle had got a report submitted upon his petition. The report was of a somewhat "wobbly" nature, but it still admitted the necessity for a Government inquiry and legislation. He had found the members, even of mining districts, singularly apathetic concerning matter, and even the Minister of Mines had approached it in a quite half-hearted manner. The amount of capital invested in the industry in New Zealand made it a matter of the utmost moment that it should be safeguarded, and were the industry allowed to drift, there would very soon be something like a financial disaster. Fortunately, the Premier recognised the importance of the occasion, and he had spoken to Mr Easton, expressing in no uncertain terms his intention to frame legislation dealing with the. matter during the recess, and to make its passage a matter of urgency in the next session. Many of the dredges at present working were quite incapable of dealing with the claims. They had been rushed up, with faulty and inefficient machinery, and their dividends were being frittered away on stoppages and repairs and directors' fees. He had reckoned out that there was one director for every £1500 of- nominal capital. Such an absurd state of things did not exist in any other industry in the world. Another evil which Mr Eastoij, points to is the over-flotation of claims. He considers that the area, permissible should be two miles of river, and 200 acres, instead of one mile and 100 acres a£ at present. Had this been the case in the infancy of the industry, only about half the number of companies would have been floated. Speaking of the various centres, Mr Easton said that, after carefully inspecting the various areas, he was satisfied of the future of the industry everywhere. The West Coast would probably prove an even steadier field than Otago. He had a particularly good word to say also for the claims in the Gore district. In conclusion, he remarked that all the people at Home wanted was the knowledge that they would have a fair protection for their money, and it would be forthcoming. But if the people here could not guard their own interests, they could not expect others to entrust theirs to the colony. Hence the necessity for prompt protective legislation.