COLLECTION OF RATES

Press, Volume LXXIV, Issue 22592, 23 December 1938, Page 10

COLLECTION OF RATES

CHANGE IN SYSTEM LIKELY FIGURES BELOW NORMAL LOCAL AUTHORITIES ARE INVOLVED The unsatisfactory position which has arisen over the collection of the City Council rates is likely to lead to an important change in the system of collecting them. Since the demands for the current financial year were issued the flow of rate revenue into the council office has been so slow, compared with previous years, that the council and other local authorities depending on the council for the collection of rates have become perturbed. It is authoritatively stated that the council will be asked to set an earlier date for the payment of the rates, so that ratepayers will not be embarrassed by an accumulation of calls on their purses.

On figures it does not appear that the situation is at all alarming. To date just a little more than £43,026 l.ns been collected since the rate demands were issued in September. To the same date last year £33,753 had been collected. On this basis the collection has improved, but this year the total levy is higher by £50,000, so that proportionately the collection is well behind last year’s. City Council officials said yesterday that the flow of rate revenue had shown a definite slackening off, when compared with other years, the opinion being advanced that the people were thinking at the moment only of spending the money they had and not of applying it to the extinction of rate obligations.

Other Authorities

This slackening off of the council’s rate revenue affects several other major local authorities in the city, for whom the council collects the rates, including the Christchurch Drainage Board, the North Canterbury Hospital Board, the Christchurch Tramway Board, the Christchurch Fire Board, and the Waimakariri River Trust. They share proportionately in the rate collections and as the payments are made to the City Council, are paid m proportion to their share of the general rate. As an official explained yesterday, any slackening of the general collection by the council affects the affairs of all these local authorities.

These local authorities, unable to maintain their financial obligations out of revenue, are obliged to work on bank overdraft. This, one prominent official explained yesterday, was the case with most local authorities for 10 or 11 months of the year. This rebounds on the' ratepayer, for lie has to pay the overdraft rate of interest (round about 4i per cent.) on the local authorities’ commitments for nearly the entire year. This meant an increase in the call on the ratepayer, for which the ratepayer was directly responsible., The Christchu/ch Drainage Board is typical of many other local authorities who find themselves in a difficult position over the delay in securing rating revenue. Although the demands were out in September, the board has still £125,000 owing it in outstanding rates due for the current year. For nearly 11 months of the year the board has to work on bank overdraft, an official said yesterday, and interest on this overdraft goes on to the rates. The ratepayer, it was claimed, pays for his own delay. One local authority in the city claimed yesterday that the best possible solution for the problem would be for local authorities to get their demands out earlier and for all local authorities to agree among themselves to allow, by legislation, for quarterly payments of rates. This, it was claimed, would help the local authorities by ensuring a fairly reliable and regular flow of revenue and help the ratepayers in two ways—by reducing the demand on the purse and reduce the charge involved in interest on the overdraft calls.

However, it is likely that one certain change will be asked for by City Council officials. The council will bo asked to consider advancing the time for the final payment of rates, making the date at the end of February instead of towards the end of March, a date when the average householder has to meet so many other demands on his finances. This, it is claimed, will also assist local authorities in making thenannual balances in March. A wider change in the system of collection might also be aimed at, but this would have to be done through general agreement among all local authorities, and by legislation.