Evening star. [volume] (Washington, D.C.) 1854-1972, 1943-01-04

Newsprint Industry
Twill Operate Under
Compensation Plan
Eoch Of Is Manufacturers
Assigned Percentage Of
TotoI Reduced Output
BY the Associated Press.
OTTAWA. Jan. Zach Of
Canada's IS newsprint manufactur-
ers is assigned an established per-
centage Of total production under
q compensation plan for the news
print industry announced last night
by the Prices Board. The plan was
necessitated by previous orders cur
failing newsprint production.
The percentage Of total produc-
ton will remain constant unless and
until changed by r. L. Weldon,
administrator of newsprint, the
| board announcement said.
1t added: This is q fixed percent
age of the total amount Of news
print invoiced by all manufactures
in any month" The statement con-
continued that the established per-
centages of the various manufacture
ers were determined by the
administration after many consul
tations with members of the indus
try's Advisory Committee.
Here's how the compensation plan
will work:
When in any calendar month q
manufacturer invoices to his Gus
! toners and to other manufacturers
quantity Of newsprint manufactured
by him in excess of his established
percentage, he will be required to
remit a proportionate sum of fund
established by the Prices Stability
Corp. for the purposes of the order.
When In any month manufacturer
invoices newsprint in an amount
short of his percentage, he is to re-
ceive from the fund a corresponding
sum. Cost Of operating the compen-
sation plan is to be borne by the
stabilize ton fund.
Amounts to Be Fixed.
Amounts which manufacturers are
to remit or receive in consequence
of ALLEGATION and other controls
exercised since September last are
to be fixed by the administrator on
or before January 20. Remittances
to the fund and payments to other
manufacturers are to be made on or
before January Is and payments out
Of the fund by February l.
The announcement said that in
tho case Of transferred tonnage
newsprint tonnage which the ad-
ministrator orders transferred by
one manufacturer to another for
production-the manufacturer who
produces and ships it is to invoice 1t
at full price to the transferring mill,
which is to pay on or before the 25th
Of the month following invoice date.
Each manufacturer who produces
and ships transferred tonnage is re-
quired when directed by the admin
istrator to pay into or receive from
the fund whatever amount is neces-
sary to adjust the basic mill net
price Of the tonnage to the basic mill
net price OF the manufacturer own
tonnage of newsprint.
The order defines basic mill net
price" as that received by each
manufacturer from his customer
| after deducting Cd all Transports
ton and delivery charges paid by
| the manufacturer; CD all storage
and incidental charges paid by the
manufacturer, in the case of water
shipments, and 60 all up-charges or
extra charges made by the manufac-
turer for newsprint other than
standard white newsprint In rolls. as
customarily wrapped for shipment
to customers in Canada and the
United States.
Formula Set Forth.
Contributions to the fund on &C
count of tonnage In excess OF estab-
lished percentage are determined by
complicated formula. It Is set
forth in the order as follows:
Such sum shall be the product
Of the average price per ton charged
by the manufacturer for the news
print paper invoiced to his own Gus
toners in such month multiplied by
the number of tons OF such excess
tonnage, less an amount equal to
the difference between such man
ufacturer's total estimated costs OF
operation at the level of his estab-
lished percentage including in both
instances full allowances for depre-
citation and fixed charges" The
amount to be received from the
fund by manufacturers falling below
their established percentage is SIM
ilarly computed.
In determining the amounts to be
paid or received, however, the ad-
ministrator is authorized to con-
slider gains or losses arising from the
manufacture on newsprint machine
of products other than newsprint
paper with respect to the relative
profits Of such other products COM
pared to newsprint and also any re-
duction In costs occasioned by oper-
alton at rate below the established
percentage.
1t is provided that no manufac-
turer shall be entitled to receive or
participate in any compensation for
tonnage in excess of his recognized
capacity to produce newsprint, based
on his previous performance as de-
termined by the administrator.
If at any time payments into the
fund exceed disbursements by an
amount unnecessarily large, the ad-
ministrator may order payments to
the fund by manufacturers on the
same basis.