REVIEWED BY THE MAYOR

Evening Post, Volume CI, Issue 54, 4 March 1921, Page 10

REVIEWED BY THE MAYOR

BUILDING THE OVERDRAFT

A REPLY TO CRITICISMS.

The Mayor eiibmitted a statement to [ the City Council last night on the condition, of the council's finance. He referred first, to recent criticisms of the council's finasicial jx>Hcy, and; d'elpracabed' the attacks, though he admitted that, in. view of the coining elections, they were natural. During the six years of the war it was impossible for the council to raise any money for the purpose of carrying out works, except out of ordinary revenue. The works thus carried on out of the revenue were all sound, and the money 6pent was recoverable by way of loan, when loans wore available. Another method would Ibo to refrain from exploiting the reI sources of the city ip the next few years, and to make an annual contribu- | tion towards paying off the overdraft. The city was about to bo revalued, but | what levy the new council would make on the city he was unable to say. The council would have stultified itself if, during the war, it had restricted itiWif merely to the' actual- needs of the city. Had it done so, it would not have carried out its trust in a proper or judicious- manner. The suggestion that the council had done differently from, other councils was incorrect. One of the gentlemen who had made these criticisms had himself, as Mayor, built, up a big overdraft. In the year 1909, the balance-sheet showed, on 3ist March, a credit balance of £896'; but the year finished with a debit balance of £30,178. Conditions then were somewhat similar to those ol recent, years. Absolutely necessary works had to be done, and it was not convenient to float small loan* to pay for them. They had to accumulate until they made a total' for the extinction, of which a loan could be raised. The works referred to were the Thottidon buildings, land purchase, plant, and material, purchase of tramlines in Miramar, anil wages arid salaries. How "hard" finance was was indicated by this charge of wages and salaries to the capital account. The position to-day was that the council had had to cany out a great number of works during the past seven or eight years, under somewhat similar conditions. The District Fund Account was dn debit to the extent of £42,578, and the tramways account was in-debit £51,978. There were the following credits :— FINANCE. Electric Light Account, £12,250; Milk Account, £37t>9; General Accident Fund Account, £7855; Tramways and Light Account Fund, £11,373; Tramways Reserve Account, £6901; Abattoirs, £1673. Total debits, £94,556; total credits, £43,821; net overdraft, £50,735. The council held temporary loans of £] 24,152, making a net debt of £166,730. The bank had advanced on the security of. debentures the following sums for, capital works: — Milk undertaking, £52,000; outlying districts drainage loan, £19,150; street widening loan, £23,991; total, £95,141. This advance, which was at 5i per cent., was to stand until March, 1922, and the council would need to obtain a further period, or sale of debentures. Summarising, the position was:—Debits: District Fund overdraft, £42,578; temporary loans, £124,152; tramway overdraft, $51,978; due on hypothecated 1 debenture, £95,141; total, £313,849; less credits, £43,821-£270,028. As a set account against the above were the following amounts on fixed deposits with the bank at 4 per cent. :— Electric Lighting Account, £70,000; Electric Reserve Account, £10,168; Electric Renewal Account, £10,168; Tramways Renewal Account, £66,459; total, £156,794. The District Fund was accounted-for for drawing on capital expenditure. In 1909, Mr. Luke pointed out, the balance-sheet showed that there were.no funds to depreciation or renewal funds for the tramways; but there was set out in the account* a sum of £43,495 12s 6d; with no cash standing to the credit; the position to-day was that a sum of £66,459 stood to the credit of the account at the bank. Similarly on the lighting side, there was set out in the accounts for 1909 a sum of £8955, but no cash to correspond with the entry. The present account showed cash credits—£2o,336, making ? total credit at the bank of £86,795. The following expenditure was chargeable to capital account: —Ngahauranga quarry, £4267; Day's Bay purchase, £10,903 (net); Lyai'l Bay purch«se and formation of grounds, £16,028; Kilbirnie Reserve, £9827; sundry* land purchased, £9430; land in Stokes-street, £2050; Wilton's Bush, £700; Consolidated Dental Company'!! building, £8200 ; expenditure on housing, £26,458; new fire station and plant, £24,033; Oriental Bay sea wall, £6333 ; Constablestreet widening, £5049; road to Brooklyn, £1840; Orongorongo waterworks, £5000; total, £130,118. ■The Mayor also presented a comparative statement of the receipts and expenditure in 1909 and 1920, giving the following details :— RECEIPTS.

The income in the latter period, compared with that of 1909, had increased by £111,000; the expenditure by £126,----000. OtheT comparisons were : The population of Wellington in 1909 was 69.357; in 1920, it was 81,301. v In 1809 there were 11,700 buildings in the "city; in 1920 there were 15,594. The total mileage of street in 1920 was 221.

iau». xaoj- £ £ Rates 139,569 206,362 Rent 24,982 42,447 Baths 693 613 Licenses 6,502 8,517 Town Hall Letting 2,797 2,333 Organ Recitals 564 141 Abattoir Revenue Account — 8,935 Waterworks 12,481 , 17,867 Libraries " 725 1,713 Reserves (fees, eto.) 744 2,306 Cemetery 2,004 2,899 Crematorium - — 20 Zoo 29 1,355 Building Fees 1,347 1,966 Miscellaneous 1.546 "2,879 Hutt-road Repayments 425 . 2,917 Total £194,408 ' £305,270 EXPENDITURE. Street Works ......... 43,832 50,992 Scavenging ' and Stree> Watering 6,338 16,618 Collection and destruction of refuse 6,698 15,239 Drainage 6,244 10,316 Fire Brigade 7J743 . . 10,258 Waterworks (including Interest and Sinking Fund) ... 29,735 49,434 Street.Lighting 6,278 7,074 Salaris 6,199 11,400 City Reserves 6,322 12,665 Cemetery 1,653 2,767 Crematorium — 101 Zoo 722 3,774 Current Expenses'... 1,684 2,168 Organ Recitals 39*1 473 Hutt-road maintenance 819 1,800 Libraries 3,510 , 6,076 Baths 593 675 Abattoirs Revenue Account — 7,968 Hospital and Charitable Aid ......... 9,623 28,242 Printing, Advertising, and Stationery 1,305 1,743 Interest on Loans (General) 37,494 47,350' Sinking Fund (General) ' 7,606 8,813

General expenses ... 4,008 Sanitary Services ... 1,684 Miscellaneous 2,754 Forestry — Public Lavatories and bathing sheSs — Superannuation ... -- Motor Workshop ... — B,W>a 616 4,481 1,610 1,841 3,794 2,105 Totals £193,737 £319,054