LOANS TO LOCAL BODIES.

Evening Post, Volume LXXVIII, Issue 107, 2 November 1909, Page 3

LOANS TO LOCAL BODIES.

NEW PROPOSALS OPPOSED BY HUTT BOROUGH COUNCIL. A special meeting of the Lower Hutt Borough Council (Councillor Mowbray being the only absentee) was held last evening at the instance of the Mayor i(Mr. B. P. Bunny). Tho meeting, the Mayor explained, was convened for the purpose of considering the effect of the New Zealand State Guaranteed Advances Bill, so far as it would bear upon loans to local bodies. At the present time, laid Mr. Bvnny, under section 61, part. 11. of the Act,' local bodies could obtain loans — (a) at 4| per cent, per annum for 26 years, or (b) at 4 per cent. ' for 32 years, or (c) at 3£ per cent, per annum for a period of 41 years. At the expiration of the period of the loan, if all instalments had been paid, it was provided" that thß liability of the local body should cease. The proposed Bill, however, stipulated that the Minister of | Finance should notv grant any local authority a loan under the present Act, except where it had previously been I agreed to. The application of the Hutt Borough Council for a loan of £10,000 would not be affected, because the Minister had already agreed to grant it. Dealing further with the new. Bill, the Mayor said it was proposed to charge a procuration fee of no more than ■£ per cent, on the amount borrowed. Local bodies had never before been charged in that respect. He instanced how, in recent years, the Hutt River Board had borrowed £40,000 without paying any procuration fee. With the passage of the Bill, local bodies would have to get a loan proposal first approved of by the Minister. Councillor Clere : "What do the Government pay for the money?" He thought it would be impossible for the authorities to loan it at 3-V per cent. The Mayor: "I don't" know." Of course, he added, the new Bill would be a good thing in respect to big loans, but councillors had to consider the position | of local bodies who might want to raise I small sums — £5000, £10,000, and £15,000, etc. It had evidently not been t considered that the Bill would bo a distinct disadvantage to local bodies. [ Most of the local bodies in the country,

he presumed, did not know anything about tho proposals — the Bill had not been advertised. He had spoken, to Mr. T. M. Wilford (member for the district) on the matter, with the result that it had been arranged that a deputation should wait upon Parliament and ask it to reconsider the position. Mr. Bunny added that he had seen the Mayor of Petono (Mr. J. W. M'Ewan), who had promised to be one of the deputation; a few members of the Petone Council would also attend. The council resolved that the Mayor and as many councillors as can find it convenient to attend, shall, together with the Mayor of Petone and councillors, wait on Parliament to-day.