STATE MONEY FOR LOCAL BODIES

Press, Volume XCI, Issue 27664, 21 May 1955, Page 6

STATE MONEY FOR LOCAL BODIES

No Applications In Christchurch SUFFICIENT FUNDS AVAILABLE No share of the £1,000,000 made available to the State Advances Corporation by the Government to provide urgent finance for local bodies up to the end of June will come to Christchurch. The only local body in Christchurch which may soon face difficulties in raising finance to meet its commitments is the Drainage Board. It has sufficient cash in hand to meet its commitments for the next two months. Subscriptions to loans are at present very slow and if they fail off the board will undoubtedly be “in the red” before the end of July. If the board’s receipts from investors in loans is not increased or maintained, it will have to apply for Government assistance. Commitments entered into by the Drainage Board are already £263,413 above the cash in hand. Cash subscribed to the new loan issue of £550,000. being half of the total amount to be raised, has been £59,300 since April 1. The commitments under the No. 1 loan of £BOO,OOO for the main sewers, the main pumping station and other work, are £165,613 and under the New Brighton sewer loan of £300,000, they are £97,800. . Unless the loan market improves, the board is faced with the need of assistance in the next six months. The board is concerned over future contracts including the northern relief sewer, estimated tq cost £200,000, and the necessity of continuing to issue contracts for ’ sewers at New Brighton. The City Council has had no difficulty in meeting its loan commitments and it .will soon test the market to raise the second half of the £200,000 loan authorised for waterworks extensions. The first half of £lOO,OOO has now been almost expended. The City Council has never experienced much difficulty in raising finance but in recent weeks inquiries for debentures have fallen off; and the only inquiries by investors in the last week have been for short-dated securities. The Christchurch Transport Board has not gone on the market yet to raise the authorised loan of £102,000 for 1.7 buses for the North New Brighton service. Funds for all capital works in hand are held by the Lyttelton Harbour Board, which, like the City Council in the past, has not had difficulty in raising money to meet all foreseeable commitments. The capital works proceeding are the reconstruction of No. 7 wharf and the breastworks. Tne financing of the major harbour extensions is not an immediate problem, as the loan empowering bill has not been considered by the House of Representatives.