LAKE COLERIDGE SCHEME.

Press, Volume L, Issue 14908, 5 March 1914, Page 4

LAKE COLERIDGE SCHEME.

QUESTION OF GOVERNMENT

COMPETITION.

DEPUTATION TO MINISTER FOR

PUBLIC WORKS

A very important question was raised yesterday by a large and influential deputation which waited on the Hon. W. Fraser, Minister of Public Works, in regard to the question of (Joven.-uent competition with the City Council and local bodies in tho supply of electrical power ironi tho Lake Coleridge scheme.

The deputation included represontatives of tho City Council, tho lliccarton. Spreydon, Woolston, Sum nor, and Now Brighton Borough Councils, nnd the Waimairi. Ilalswcll. and Heathroto County Councils. Mr H. G. -I'-H, M.P , introduced the deputation, and Messrs G. Witty, M.P., and J. Me-(Jo.-nh-, M.P., v.c-ie at-o pros.ni. Councillor A. 6. lay;..- said thar tho dep'-iaf,o.i not only tao City Council bat also tiie whole of t..0 _vun_uiii_i__g local bodice, including Sumner. -New l_rigi;t-ii,_ Kiccariou, Spreydon, Jtlulsweil, and ' Waimairi. The city hud tne contract tor tlio supply of ener__.y on the baaia that tho l.i:_.t.r the amount tal.en tne less tho cnarge would be per kilowatt. The City Council had submitted prices to tin- surrounding local bodies at which they felt they would bo sale in supplying energy. Outside local bodies had two choices — they cotdd apply direct to the Government or to the City Council for power. Thy. Department in dealing with a number of loral'bodie.. negotiating regarding the price of power, had made a most important reservation, namely, that the Department would supply large powerusers of over ... to 20 horse-power direct. This supplying of current to larger power users would have a eerions effect on the prices charged by tho City Council, , which had offered to supply local bodies with power on a schedule of puces l.a>e.l on tin- assumption that tho Council would havo tho whole supply If the Government reserved tho right, to supply power to largo consumers, tho Council would have to revise its scale of charges, and in increasing its prices would lose its best customers owing to local bodies having to charge higher prices for energy.

The deputation v. - as thero to urgo strongly upon rlio Government to givo a guarantee that where tho city arlaugcd to sunnlv a local body the Government should not outer into competition. They wished to tako a broadminded view of tho whole question, while doing their duty as citizens, but ho would point out that tho matter camo homo more to local bodiea than to tho City (.'currcil.

Mr Staples (chairman of the "Wainjniri County Council), Mr Reynolds (Mayor of Riccarton), Mr G. It. Whiting (Mayor of Surnvdon). Mr J. J. Graham (.Mayor of Woolston), Mr C. H. Winny (Mayor of New Brighton), tlio Hon. J. Bnrr (Sumner). Mr H. Eaglesnrne (Hal-well), Mr 'George Scott (Tleatlicoto County Council), and Mr Sisson (Waimairi County), also addressed tly_ Minister on the subject. THE MINISTER'S REPLY. Tho Hon. Mr Fraser said that he was glad to meet all tho members of the deputation if only for tho purpose of clearing ar/ay tho cobwebs of any false impressions they might have formed regarding tho Government's intentions concerning the Lake Coleridge sthenic. Ho wished to disabuse their minds of any notions that tho Government desired to enter into competition with the City Council and tlio adjacent local bodie-i. The Co.eminent had to consider the fact that a very large amount of money had been sunk in this scheme, which all desired should be a commercial success. It was the first, experiment of its kind in New Zealand. Several similar schemes had been proposed in various parts of the Dominion, but it had been finally resolved to try this one. It would depend entirely on the success of this scheme whether tho others would be started. It was therefore absolutely necessary tor tho Government to keep a free hand in tho matter. Everyone who was desirous of getting the power would be able to do so. and every effort would be mado to induce peoplo to take the power. Referring to the ease of the smaller Jocal bodies, the Minister said that the Department was contracting with people taking several hundred hor..c-powci*. Ho did not think that the scheme of tho supply of power by the smaller local boiiies would work. The smaller tho local body the closer one got to the question of personal interest. People starting big unit;.-'-tics objected to their rivals who might be on local bodies having a say in the supply of power. Ju the city there was not the same risk, ile did not think the smaller local bodies would be able to* supply tho power to consumers at a profitable rate, owing to the cost of administration. They had no engineers and no stalls to deal •with the matter. In tho city, thero was one stall' for a much lai-_j,ei. area. His views as head of the Department wero that it would ho very difficult lor local bodies to distribute the power to consumers, as none of them would be able to do so without an initial oi from £'20-0 to LSdW.

Thero we:o various ways by which tho cost ot di-iributi.m could l>e got over, tho charge diminishing according to the quantify oi power taken. It the requirements ol a -mail local body v/exo, say, 600 horse nuiver, ot whicn 200 horse power went tor lighting purpose., and it wero found a-soiutcly necessary to supply a bigger quantity oi: power from tho Government, that amount could by treated at the same

price. Tho whole matter would, however, be gone into when the City Council and the local bodies came to him with a concrete proposal, when they would learn what tho views of the Govorn- ' merit were. He could not say that tho Government was not going to mako arrangements to supply large users of power outside the city. As soon a.s the power was brought in tho Government wanted a return for its money as quickly as possible, Tho city for two or three years to come could not undertake tne distribution of more than ita own share, and the Government were not going to wait for that. The Government wanted to be perfectly reasonable, and if the city undertook in advance to supply the whole of the muncipah ties, tlie Government 'could then transfer its contracts if the consumer., were willing. 'ihe Government wanted to keen tho power in order to get the revenue. It did not want the retail revenue, but it wanted the wholesale price. The Government wanted to see peoplo start industries where they wore at present non-exist-ent, and to help those already in existence. Tho Government was not asking for both the wholesale and retail profit-—that would be unreasonable. But tho local bodies could not tie the hands of the Government not to make ajiv contracts with large users of power. it was upon thc cheapness of the power that, the success of thc scheme and tne p.0.-...erity of tno city depeuded. If people came here to start industries the Government must study their interests. It was conceivable that people might want to start industries in the vicinity of tho power house, and in those cases the Corporation could not give the same terms as tno Government. If tho deputation could satisfy him as to their ability to tako over tbe distribution of tho

power, he would Rive it to them at once. But for somo time to come, the city would have as much as it could do in its own confines. When they were ready to suppiy others there would be no difficulty.

Mr Witty: Does that mean that no local body will be able to distribute power ?

The Minister: Oh dear, no. The small municipalities will bo considered on their merit.; I don't see how tho small municipalities could sell to consumers at the same rate as the city, owing to the cost of administration. Mr Witty: But they can combine. The Minister: Let th-in combine. That's- a different thing

Mr McCombs: In thc case of the city in eo.nbination*-with the immediately surroundin<_; districts, would you givo them the power on tho same terms?

Tho Minister; Each question will be settled on its merits, and in' relation to it_ particular circumstances. This is not with a view to increasing our revenue, but ber-amo wo must get 'a full and immediate return.

Mr Ell said that the difficulty was that the City Council had formulated a scheme giving a cheap basis of charges on the maximum amount cf power, and they now said that the Government were stepping in and taking charge of tho consumers.

Mr McCombs said that a very anomalous position might arise if all tho manufacturers in a district got their pewer at a different price from those on the other side of a road boundary.

The Minister: If the city or any combination of bodies can satisfy mo

of their ability to deal with large consumers at once, tho Government will immediately hand over its contracts. Tr c whole question of contracts will bo p*.;t on tho tablq when you come to mo with your scheme. But I will not tie the hands of the* Government if I can induce a man to take the power. I will not undertake not to supply him at a price lower than that of the city. Wo have not started this fvhemo to provide profits for municipalities. That is not our object, and we won't have it. We want to induce popple to start industries. We will not supply current at a pric. less f J-an will give us a return for cur money, but we do not want to mal.3 profits.

Mr S".ott as-ked if the Government would help local bodies to raise loans in connexion with the scheme.

Mr F-._-.cr said that question mirrht be considered, b_rt it should bo remembered that the Government was not a un-versal provider.

Tho deputition then thanked the Minister and withdiew.