Minister hints at water-grant cuts

Press, 31 March 1980, Page 13

Minister hints at water-grant cuts

PA TekapO The National Water and Soil' Conservation Authority had been asked to review the current rates of firants, the Minister of Works (Mr W. S. Young) has said.

This was being done together with the Ministry of Agriculture and the T reasury. Mr Young, speaking at Tekapo during a tour of the Waitaki catchenmt commission’s area said the time , was considered opportune to review the position to determine whether the genrous basis of' Government funding could be maintained. “Would more be main-

tained by lesser individual funding or a lower subsidy.rate allowing a greater spread?” he asked. “in reviewing the overall situation we might consider to what degree funding has been affected by loan assistance from the Rural Bank, deferred payments, tax exemptions and in some cases suspensory loans, all complementing the ' grants available through the national water and soil conservation organisation.”

Mr Young said he believed the review would be completed by today. The government was also concerned at the rapidly increasing level of catchment authority administration grants, now approaching $1 million a year.

“These grants absorb funds that would otherwise add to the pool available for new works and the Government has asked the authority, with Treasury, to fully review the need for them,” Mr Young said.

While forward planning was essential, a list of approved schemes was accumulting which could not be begun, within a reasonable lime. The Government was

committed in the next five years to about $l2O million of grants and subsidies for water and soil works, Mr Young said.

But enthusiasm for water supply and river control had meant that programmes- had been promoted which were far in excess of current funding capacity. Until recently, one of the criteria was a 10 per cent internal rate of return. But the Government had decided that as from today no new works would ■go ahead unlesss they could show an internal rate of 15 per cent, Mr Young said. Investigation of the Waitaki River from Kurow to the sea was nearing completion, the Minister said.

“If present projections long remain unaltered, it could. mean the very costly river control works of the last 15 years or so won’t be able to rely on electricity development for their future support and should now be reviewed in terms of our present financial problems. “Still, the rising - prices for oil and the necessity of finding an alternative to it for industrial purposes could see this situation change,” said Mr Young.