Page 619
The
the Managing Agents, the Corporation or the Contractors could have done, other than to suspend or drastically curtail operations, would have produced a situation radically different from that which faces us to-day; in particular, little more knowledge as to the economic prospects of agri cultural production could have been provided than we now possess. The plain fact is that there were fundamental miscalculations in the Scheme as originally approved, capital expenditure necessitated by the present plan in the four years from the 1st April, 1950, which is broadly estimated to produce 500,000 acres for a further £13 millions of capital, is at a rate of four times that estimated in the original Scheme after allowance for such improvements in operating technique and such economies in administrative costs as are regarded as capable of realization within that period. The figures may be capable of improvement in the future, but it would be unsafe to anticipate further reductions now. Grave as the capital figures are, the balance of advantage would obviously lie, given that at least £30 millions have already been committed resulting in an asset of about 100,000 acres, in going to £45 millions to secure 600,000 acres, provided, of course, that there is a reasonable prospect of cultivating the additional 500,000 acres on any economic basis. This prospect depends on so many factors at present unknown that it is a matter on which the Corporation can give no firm assurance at this stage.
6.
The year 1948/49 was the first in which agriculture was carried out on any scale, and it coincided with a severe drought. In any case, it was not on a large enough scale for reliable conclusions to be drawn about future operations. In 1949/50 three full units will be cultivated at Kongwa and this will apply the first test of any value to the operation of large scale agriculture. At Appendix 111 will be found estimates of the cost of operations for the four years from the 1st April, 1950, and at Appendix iv an estimate, with important qualifications, of income and expenditure thereafter for the twenty units which should be cleared by that date. On the expenditure side these are the best estimates which the Corporation can make, but it is reasonable to suppose that they will be improved upon in time. The Scheme cannot carry a European staff on the present scale or on that provided for over the four year period. During that period the Corporation will be carrying out a comprehensive, and in the
expensive training scheme for Africans.
The
short
Boar full cannot be predicted with any certainty
The hon, Africans into date horicultural staff, both European and African, lacks experience. Significant economics should rosult as intimate farming knowledge grows and improvements in agricultural equipment and technique will undoubtedly be made in the light of experience and the experimental results of the Operational Research Unit. But there is at this stage no reliable data on which a further re-assessment of costs is possible. Some allowance for improvement has already been made. Allowance has also been made for the economies in administrative costs now being carried out, but there should be scope for further reduction when the development stage is over.
276
•
On the income side the East African Management has assumed in preparing the figures of the plan a yield of 750 lbs. per acre of both groundnuts and sunflowers with c.& f. prices of £55 and £35 a ton respectively, that is those now current. In regard to yields, it is essential for the future of the Scheme that these estimates should be realized on the average, and certainly in the case of sunflowers, improved upon. The estimates allow £44,000 a year for fertiliser in the operating costs of each 30,000 acres, which averages 30% of such cost. It is obvious that the use of artificial fertiliser would be unjustified on yields below those estimated, but for a variety of reasons it is doubtful whether this output can be reached in the first few years.
It is obviously prudent also to allow for a fall in current prices. revision of the estiriates which reduce the yields to the average over the four year period considered to be a safe one by the East Africandament end the prices to those forepast by the iögis try of Foal would leave a cash deficiency in the estimates as presented of £4 millions. The fact is that there are factors affecting both income
/and expenditure
315