MUNICIPAL MATTERS

Evening Post, Volume CV, Issue 57, 8 March 1923, Page 8

MUNICIPAL MATTERS

THE FINANCES

AN EX-MAYOR'S CRITICISM.

TO THJ IDirOB.

Sir, —I have been looking carefully over the addressed letters and the one newspaper leading article referring to the affairs of the city to find anything from which the public can learn what the financial operations of the City Council have been for the past few years, and having found nothing I,venture to produce a few figures and to make a few comments. Two years ago I showed' that the result of the year's operations from 1911 till then was a deficiency in revenue account of over £250,000. This deficiency was largely made up of absolute deficits in annual revenue and expenditure. The rest arose from expenditure on works more or less advantageous and being of a more or leas permanent character, and in part at least fairly chargeable to capital.

The public were 'then told by the present Mayor that things were not as' I described them and that I was a Jeremiah, which was, according to him, though contrary to his usual attitude toward the prophet and teachers, meant as a term of opprobrium; yet very soon after his election he informed the council that the leeway had been £324,000, and he has since floated a loan to'cover it, which is costing the community over £20,000 per annum. The deficiency in the year '20-21 was £47,500, and had- to be added to my estimate of deficiency. The estimates for '21-22 were made up by the present Mayor and council, and we were promised equalisation, if not a surplus. The result has been, however, that the balance-sheet (not yet published) of '21-22 showed a deficiency, notwithstanding a large accession in income from rates of £30,000 to £42,492. This year, according to the figures shown in returns in the Treasury, there will probably be a deficit of about £30,000, which I have made up from the Treasury records as follows:—Up to 31st January the expenditure was £329,442, add to this the estimated expenditure for two months, £88,000. The total expenditure will be, if all works are carried out, £417,442. As the vote for repairs of roads, etc>, was exhausted by the end of January, there will have to be spent another £10,----000, making £427,442. Now the income to 31st January was £347,693; add for. February and March. £49,000—making £396,693, showing a deficit of £30,749. But the following items - may not be spent: £5000 for technical school, £1000 for Stokes Valley Bridge, motor works £3000, and £1000 miscellaneous. . The first item, at least, is for a public necessity, and the bridge is a statutory liability. If these items are left' out,' and, say, £1000 saved otherwise, the deficit promises to be over £20,000.

Then consider this: the general rates in 1920-21 were £13,000, and the following year being the first year of the present Mayor, were well over £165,000. Yet, notwithstanding this increase in rates, a deficiency of over £42,000 arose. There ia a further increase of rates for the current year of about £7000, and there is likely to be a deficit in the year's working of between £20,000 and £30,000. I^t -us again regard in contrast the year 1908, this being the one . of which I have a balance-sheet, and compare the expenditure in respect of which the city authority v to a large '' extent exists— namely, street work. In that year the general rates were £83,000 odd; this current year the estimate is £172,000. The K exssn(yt£rg-X6ft;-'stiteetsC a'riff-' exceptional amounts in-1908 was £56,000 odd, and there was a credit balance of £896. Now, this year the expenditure, .with rates-of more/than 'double the-amount," was up to 31st January, £50,000; add to this £10,000 for the last two months and the other items I have mentioned— namely, Stokes "Valley £1000, Technical School £5000, and motor works £3000, in all £9000, and the whole expenditure will be in March £69,000/ being made up of, say, £39,000 out of rates, and £30,000 out of deficiency. That is only about ohe-half of what was spent in 1906 out of revenue; although the income from rates was double that of 1908.

An examination of tramway, power, and electric lighting also shows a very unsatisfactory condition, and yet we find the. Corporation going blindly on to the erection of liability upon liability. I notice that the engineer stated to a deputation that no loan money has been spent on streets since 1904. ' If my figures are correct, * and it cannot be denied that they are substantially so, a very large proportion of the amount of the deficiency loan has been borrowed to replace money spent on streets,- etc., and from £60,000 to £70/)00 in respect of the deficits for the last two years will have to be borrowed to replace the temporary borrowing for street purposes. It is difficult to believe that with proper management the amount of income available for streets would not have increased in proportion to the increase of the general rate. Certainly no explanation has been given of the wild increase in the expenditure. Surely we are entitled to some explanation Now take one other matter: the immense expenditure on tramway electrical works, the standy plant. lam sure that anyone intending to build a house for, say, £3000, gives it more critical consideration than has been given to this immense expenditure involving a charge for interest of something like £30,000 per annum. Has any councillor,critically examined the report upon which the Ayork was undertaken? This report was based on money costing 5 per cent. It will cost about 1£ per cent, more,- say, an extra £6000 per annum, or £4300 mor» than the assumed annual charge. No proper inquiry was made a* to the necessity of a jtandby plant, nor wag proper consideration given as to the possibility of the necessary change of system being in great part possible out of money In hand and the rest out of income. However, this is a large question, which has, unfortunately, been settled without any opportunity being given for discussion, and without the necessary information being afforded, and I am afraid it is too late to be cured. The general apathy of the public and the want of critical examination of civic affairs on the part of the Press, has produced a condition which, unless immediately altered, must produce municipal ruin.—l am, etc., T. W. HISLOP.. Bth March.