No Direct World Bank Loans For Local Bodies

Press, Volume CI, Issue 29994, 1 December 1962, Page 10

No Direct World Bank Loans For Local Bodies

(New Zealand Press Association)

WELLINGTON, November 30.

Harbour boards—for which the World Bank may provide port development finance —will not be able to borrow direct from the bank.

A Finance Bill introduced in Parliament today allows the Minister of Finance to borrow from the bank to make loans to local bodies, but the distribution of such funds by the Minister of Finance will be subject to any terms and conditions decreed by the Local Authorities Loans Board.

The Minister of Finance (Mr Lake) emphasised to members of the House of Representatives today that, at present, only harbour boards were concerned. But although there was no suggestion that any other class of local bodies would be considered, the clause had been drafted to include all local authorities, he said. “I must make it clear,” he said, "that the World Bank has not agreed as yet to make any loans.” The Leader of the Opposi-

tion (Mr Nash) protested strongly at the provision. “It is one of the most dangerous clauses I have seen,” he declared. “It must affect the overseas liability of this country. I believe it to be a tragic mistake for local authorities to be allowed to use overseas money—money for which the State will, in the long run, be responsible. “I remember earlier problems for the Government of this country in paying off local body debt abroad,” said Mr Lake.