NEW AUCKLAND SEWERS BOARD TO LEASE PIPE FACTORY

Press, Volume XC, Issue 27470, 2 October 1954, Page 8

NEW AUCKLAND SEWERS BOARD TO LEASE PIPE FACTORY

SAVING OF £750,000 IN SALES TAX

(New Zealand Press Association) AUCKLAND, October 1.

As much as £750,000 may be saved on the cost of the Manukau drainage scheme for metropolitan Auckland through an arrangement made between the Auckland Metropolitan Drainage Board and a pipe manufacturing company. Under the arrangement, the board will lease a factory and make its own pipes, thus saving payment of sales tax and other costs.

A joint announcement was made on this today by Mr D. M. Robinson, chairman of the board, and Mr J. A. Young, Auckland district manager of Hume Industries (N.Z.), Ltd. Savings are expected to be made as follows:

Approximate cost of pipes, including sales tax, £1,200,000; less saving on sales tax, at least £200,000: saving on other costs, up to £100,000; probable cost of pipes, £90,000. This gives a net saving in capital cost, after allowing for payment oi fees to the company for the lease of the factory, of £300,000; add to this the estimated amount saved in interest payments over 40 years, say £450,000. total estimated net saving, £750,000. The company has a site of 50 acres at Papakura, and expects to begin building the factory immediately and have it ready for production early next year. When the scheme is completed m about four or five years the will revert to the company. Mr Robinson, who is also a member of the Auckland City Council, has suggested that if the council were to make its own pipes it would save an estimated £150,000 on a £787,766 contract let last night to Hume Industries (N.Z.), Ltd.