PROPOSAL DECLINED

Dominion, Volume 19, Issue 208, 29 May 1926, Page 6

PROPOSAL DECLINED

BOROUGH ELECTRICAL UNDERTAKING

POWER BOARD’S OFFER TO PURCHASE

Palmerston North, May 28. A special meeting of the Borough Council was held to-night to consider a letter from the Manawatu-Oroua Piwer Board which proposed purchasing the borough’s electric light undertaking and taking over the loan indebtedness, together with accrued sinking fund and all other liabilities. After a lengthy statement had been delivered bv the Mayor (Mr. F. J. Nathan), in which ho'advanced arguments in favour of the council retaining the plant, his motion that .the letter be received dwas carried with no dissentient voices heard. Councillor R. Edwards moved that the discussion be taken in committee, but the majority of councillors expressed themselves of the contrary opinion. The Mayor proceeded to read a comprehensive review of the position. He stated that it would not bo proper in his opinion to consider the eale of the electric undertaking unless the council gave consideration to its responsibilities with its gas undertaking, on .account of the largo amount of money invested in the gasworks and for the reason that the two undertakings wore largely in competition with each other. The gas revenue had decreased since 1921 to tho present day by 25 per cent, and the interest and sinking fund had increased by 50 per cent. The capital invested in the gas undertaking was £203.562, and the annual interest and sinking fund totalled .£10,399. If tho council accepted the offer of the Power Board—the latter then coming into direct competition with the gas undertaking—it was almost certain that in loss than two years the council would have seriously to consider closing, down the gasworks altogether. In going on to deal with the electric light, undertaking, the Mayor gave comparative figures of the borough undertaking and the position of the Power Board, which slicked that the board’s estimates disclosed that it expected to show a loss of .£5867, including credit balanee carried forward. If tho board took over the electrical undertaking, he said, the latenayers of the borough would lose the reduction in charges recently agreed to and other advantages. After a long discussion the council decided against tho proposal.