Council Loan May Rectify Finances

Press, Volume CVIII, Issue 31587, 26 January 1968, Page 16

Council Loan May Rectify Finances

The reorganisation of the finances of the Heathcote County Council depends on the success of a $200,000 special loan, which went on offer to the public this week.

The loan, authorised by Act of Parliament, is chiefly to enable the council to refund money that was taken from special accounts in breach of the audit regulations, and, generally, to meet retrospectively the cost of work done out of revenue that would normally have been paid for by loan. “All formalities In connection with the $200,000 loan have been completed, and the council is now inviting investments in the loan, which is a fully secured trustee security,” said a joint statement issued yesterday by the finance committee chairman (Cr N. G. Bowron) and the County Clerk (Mr K. D. Stills). “While the council has been most gratified by the support it has received, it is anxious to fill the loan as

speedily, as possible In order to complete the re-organisa* tion of the council's fin* ances. “Over past months, the council has made substantial progress in restoring its finances. All outstanding creditors have been paid in full, and the council is paying other local bodies the current rates collected for them which in previous years have not been paid until March.” The terms of the loan were from one to five years at 5| per cent Interest, six to nine years at 5| per cent, and 10 to 20 years at 5| per cent, the joint statement concluded. When the Auditor-General (Mr B. D. A. Greig) reported in July on the state of the council's accounts at March 31, he said there was an overall deficiency of $247,810. This included $90,578 that had been illegally transferred from loan, reserves, plant renewal and suspense accounts, and $88,260 owed in rates to ad hoc bodies for which the council had collected money. Also included in the total was an amount of $18,326 over-paid in subsidy by the National Roads Board. Since then, the council has paid the $90,578 it owed to other local bodies, and agreement has been reached with the National Roads Board to refund the over-payment at the rate of $6OOO a year. The main problem for the council, with a restriction on its bank overdraft, has been to refund the special accounts, as ordered by the Auditor-General. Cr Bowron and Mr Stills went to Wellington in December, and were given to understand that the loan would receive some help from Government lending sources; but public subscriptions are needed if the loan is to succeed in its purpose.