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War Economy

Power Development Neglected

Power Development Neglected

Another obvious difficulty in war would be to maintain an adequate supply of power to industry, especially if the inflow of petrol and oil were restricted. In spite of this, the development of New Zealand's considerable potential of hydro-electric power proceeded very slowly in the pre-war period and in fact, up to 1938, expenditure on hydro-electric development was below what it had been during the depression. This lack of foresight may have been in large measure due to over-optimistic reports on the capacity of the existing equipment to meet expected electric power requirements.

page 47

The first offender seems to have been the National Expenditure Commission of the depression, which said in July 1932:

‘…we are definitely of opinion that the present stage of development in the matter of hydro-electric power is sufficient for the needs of the Dominion for many years to come; and, moreover, in view of the uncertainty as to what will prove to be the cheapest form of power development in the future, any move for the commencement of further works, whether by the State or by local authorities, should be strenuously opposed.’1

Even as late as 1936 the Electric Power Board and Supply Authorities Association said, ‘…it appears that the necessity for developing an entirely new (hydro-electric) scheme is remote’.2

It is not surprising that only £500,000 was spent on hydro-electric development in 1936–37 and £700,000 in 1937–38. The following year expenditure rose to over £1 million, but it was already too late for new developments to be ready for the early war years.

As a result of this delayed action New Zealand had electric power restrictions for about two-thirds of the war period. Because wartime and immediate post-war development was hampered by shortages of equipment, she accumulated a backlog of unsatisfied power requirements which she could not overtake and satisfy in full until 1959. This was a major blot on New Zealand's record of pre-war preparations.

1 Parliamentary Paper B-4a, Final Report of the National Expenditure Commission, 1932, p. 164.

2 Quoted in Parliament, NZPD, Vol. 273, p. 55. See also p. 428.