RATE LIABILITY.

Auckland Star, Volume LXVI, Issue 49, 27 February 1935, Page 10

RATE LIABILITY.

STATE PROPERTIES. CROWN WILL NOT PAY. MB. COATES' EXPLANATION. (By Telegraph.—rarliamentary Reporter.) WELLINGTON, this day. The Government's refusal to accept liability for rates on "reverted" properties was reiterated by the Minister of Finance, Mr. Coates, in the House last night during the debate on the Mortgage Corporation Bill. The subject was raised by Mr. \V. Nash (Labour, Hutt), who said that up to February 20 last the Lower Hutt Borough had lost £30,123 in rates tiircv.'gh propertijs reverting to the Stat.i Advances r?pai tineut and theCrown. During the financial year 1934-35 the amount so lost was £11,471. There was no reason why Government Departments should not pay the full rates that were levied on properties, if they were rented up to their economic value, instead of using the money to wipe oIT arrears. Mr. A. S. Richards (Laoour, Roskili) said the Mount Albeit Borough had lost up to the ond of last Sirincidl year over £10,000 on properties under control of Government Departments. It was a serious matter for local bodies.

Effect of Mortgage Bill. Mr. Coates said he understood the position of Hutt County, but at the same time the State could not accept the responsibility for the ratos. "I say we cannot accept responsibility for general rates or all rates. The Crown has assisted in certain special ratea." He pointed out that where relief was applied for to the Mortgagors' Relief Commissions, aftd adjustment was made,

the rates became the first charge, except where the local authority agreed to some modification. He expressed the opinion that when mortgages were finally adjusted boroughs and county councils would be in a better position than they would have been h.id the State Advances Department been kept separate. As adjustments took p'.ace so would local body rates become chargeable on the land. At the present stage it was not possible for the Crown to admit liability. It would cost £500,000 a year, or probably more, and it would be unreasonable for that sum to fall on the Consolidated Fund at the present stage. If the Crown were responsible for the rates the local bodies would not go to trouble in collecting them. Mr. Nash: That won't bear examination. Mr. Coates: Do local bodies really try to collect rates? "Wouldn't it be much easier to go to the Crown? Mr. Nash: The Crown is the hardest to get anything from. Mr. Coates said it was not considered a fair thing to place £500,000 on to the shareholders of the Mortgage Corporation. As far as the State mortgages handed over were concerned there would be an adjustment between the corporation and the State in the first place, and actually the local authorities would be better off than they were at present, where the Crown did not accept responsibility at all. It was estimated that the period of adjustment would be about five years, and it was contended that the corporation should not be prejudiced in its initial stages. Mr. Nash said his point was that when the State Advances ofiico took over a property and leased it it should be responsible for the rates. He was asking that the corporation should not he freed in circumstances such as lie had mentioned.