Better Treatment For Local Bodies Sought

Press, Volume CI, Issue 29829, 23 May 1962, Page 15

Better Treatment For Local Bodies Sought

(New Zealand Press Association)

WELLINGTON, May 22. Central government had left the structure and finance of local government at the 1840 stage. It alone had the real power to instigate a new and fair deal for local authorities, Cr. W. H. J. Duff, of the Wellington City Council, told members of the Wellington Chamber of Commerce tonight.

Lacal Government had no ' r.ghts, power or authority ex- 1 cept these derived from j central government. The ways j in which it could raise money ’ were limited by statute and 1 the extent of its responsibilities were defined by ! central government. • He likened local govern. 1 ment to a Hansom cab in the ; age of the automobile ex- ‘ pected by central govern- ( ment. its conservative and un- ' helpful owner, to trade in 1 unequal competition with the owner’s fleet of modern J taxis.

Public disfavour was descending on the back of local government because it was being asked to do a job it was not geared to do. Till the State met its responsibilities by providing local government with both the means and the money for p-operly-shared development " had the unenviable choice between sponsoring stagnation or imposing doublefigure rates increases. Not Partnership The conception of central and local government as a partnership except in snecial fields was a farce. They were, in fact, in keen competition. Apart from reading there

was no major operation in wh-ch local government could rely on the Government for help. State officials called for reduction in construction works by local bodies, citing totals of loan sanction issued. But these included projects of national importance of the size of Wellington Airport. Bluff Harbour works and the Auckland Harbour Bridge. Much of the development was Government - sponsored and much more of it should be financed by the Government. The responsibility was squarely on the Government, Cr. Duff said. A Royal Com-

mission on local authority finance showed clearly the urgent need for additional sources of revenue, yet local authorities could take no action themselves other than by raising the rates each year, discrediting local goverment still further in the public’s eyes. One reason local government had not done well in competition with the Government was that it had never spoken with a single voice. “We have our Municipal Association, our Counties’ Association and various others; but for a full-scale assault on the evils in the central government and local government relation we need

better organisation than this.” Rates were not satisfactory by themselves to finance local bodies. In Wellington fewer than 35,000 people out of a population of more than 123.969 paid rates directly. Those who paid rent contributed indirectly to their landlords’ rates but riot to an equivalent extent. A vacant section, a private home, a boarding house and an office building producing considerable revenue for its owner, were all on the same footing. There should be statutory provision for extracting very much more from the productive buildings than from residences and for seeing that all citizens contributed adequately to the maintenance of the city, said Cr. Duff. The scandal of many central government buildings escaping payment of general rates could be rectified overnight and would be evidence of the Government’s understanding of the local authority plight. Local government was very much a poor relation expected to do a great deal with very little wherewithal, he said.

About a third of Wellington's annual rate collection went on servicing loans which was far too much. Rates ought to be spent primarily on maintaining current -ervices.

Local bodies were having the utmost difficulty in obtaining consent to the rising of the loan, although the Government had proposals for substantial internal and overseas borrowing for its own purposes. The current policy that local bodies were the area for restraint on development was one in which local bodies had no means of obtaining a judicial decision.

Would local bodies have access to the overseas loan market, or be able to barrow from the World Bank for local projects for national imoortance? asked Cr. Duff. But borrowing was not the answer. Cr. Duff said. Shortterm borrowing did for a time provide means of raising money for urgent work but it was a trap. Sinking funds could not be built up fast enough to extinguish loans within their currency. The inevitable result was re-financing for further short terms. Borrowed money was dear money but if the annual rate product was insufficient in spite of increases to do work which must be done, could local bodies be blamed for using this as the only means of keeping going? Cr. Duff asked.