The West Coast mining tragedy – An international and historical class issue

Byron Clark The Spark December 2010 – January 2011

There is a famous slogan from a banner carried by striking miners at Waihi in 1912, “If blood be the price of your cursed wealth, good god we have bought it fair”. The slogan brings up images of early twentieth century industrialism; gruelingly hard work in unsafe environments, ruthless exploitation of workers by wealthy capitalists, and accidents abounded. In light of the Pike River mine disaster, the slogan does not seem as anachronistic as it may have prior to November. Indeed, not since 1914 when 43 miners were killed in a mine explosion in Huntly has New Zealand seen a mining disaster of such magnitude. Many have questioned how this disaster could have happened in a developed country, in the year 2010. It’s not the first one however; in April 29 miners died in a gas explosion in West Virginia, USA. The Pike River tragedy has an eerie sense of deja vu for some. Lawyer Davitt McAteer, who is heading an investigation of the USA deaths, was quoted by The New Zealand Herald as saying “You can’t suggest that the mining industry is going forward into the 21st century with the rate that it’s killing people.”
As the dust settles on the West Coast, it is becoming increasingly clear that the pursuit of profit was put ahead of the safety of workers. While Pike River Coal is one of New Zealand’s largest corporations, and valued at $400 million, the company made a $54.1 million loss between July 2006 and June 2010, and was under pressure from its major shareholder, New Zealand Oil & Gas, to improve its performance. The safety standards of the mine have been condemned by experts such as Andrew Watson, the operations manager of United Kingdom Mines Rescue Operations, who told the New Zealand Herald that methane levels had to have reached 5 to 15 percent of the atmosphere for the explosion to occur. In British mines, work stops if methane levels reached just 1.25 percent, and mines are evacuated once they reach 2 percent. Watson stated that “either the warning system was inadequate, or it was not sufficiently monitored”. The most likely cause of the methane build up was a power outage that disabled the mine’s ventilation system; there was no backup generator. Geologist Murray Cave had warned back in 2007 that the geological risks at the mine site included a pit bottom with deep, highly gassy coals and the associated risk of “outburst”, or gas explosions. The Hawera fault zone running through the mine could be an additional source of methane.
On November 25th, The Otago Daily Times reported that when the Department of Labour held public consultations on ways to improve health and safety in mines following two underground deaths in 2006, workers and unions said that check inspectors, elected by the workers, would be the “single most effective solution for improving health and safety in underground mines”. This policy was opposed by mining companies, including Pike River Coal, and in 2008, the Department of Labour’s workplace health and safety policy manager, Jim Murphy, told the EPMU, which represents miners; “[Minister of Labour Kate Wilkinson] does not agree to a regulatory change to introduce ‘check’ inspectors, nor for an approved code of practice for employee participation specifically in the mining sector”.
It’s often said that mining is a well paid job because of the inherent risks involved. The reality is somewhat different. Fatalities in Chinese coal mines are four times that of the USA (per miner) but the pay is much higher in the latter country. Mining is a dangerous job, but workers have only gained compensation for the risks they take though collective action. In New Zealand, miners were instrumental in the formation of the militant labour movement of the early twentieth century. Historian Mark Derby describes the West Coast coal mines of the 1900s as being seen as “the most likely seabed for a revolutionary industrial movement” by organisers of the syndicalist union the Industrial Workers of the World (IWW) who had previously had great success organising coal miners in North America and Europe. This proved to be the case, with significant working class struggles taking place in New Zealand’s mining towns. While not immune to the attacks on organised labour in the hundred years since, miners have retained high wages relative to the rest of the working class, if not relative to what they once earned. The last major industrial action by miners was a nationwide strike in 2005, when mining companies offered a below inflation pay increase. This was the first stoppage in a decade and according to the advocate leading the union’s negotiating team, Ray Urquhart, “Pay and conditions at some mines were hit hard during the Employment Contracts Act years of the 1990s”.
A high wage does not necessarily mean less exploitation of labour. Largely due to industrialisation in Asia (where most of New Zealand’s coal ends up), the price of coal on world markets has sky rocketed in recent years, so a few people are profiting handsomely from the labour of miners. Prices inflated well above the actual value of coal- ie, the cost of getting it out of the ground- are unsustainable in the long term, so for those who own the mining companies, short term gains are paramount. It is perhaps this focus on fast extraction at the expense of safety that lies behind recent coal mining accidents from China, to West Virginia, to Pike River.
Disasters are not good for business, and after the initial explosion, the share price of New Zealand Oil and Gas plummeted 28%, making Pike River Coal shares effectively worthless (trading in PRC shares was suspended at the company’s request). Before the process of pumping the mine full of inert gas began, to render it safe to enter, talk was already taking place about recouping losses and taking part in the coal boom again. As Pike River Coal CEO Peter Whittall told a Greymouth press conference, “There’s still 50 odd million tons of coal there.” Andrew Harrington, an analyst at Patersons Securities Ltd. in Sydney, who visited the mine about a year ago, made the reasons even more clear in his comments to financial news source Bloomburg; “There’s so much capital invested, and it’s such an employment opportunity in the area that, if the mine is recoverable, despite the history, there’s plenty of income and salaries to be made, [its likely] that people will go back in,”.