WELLINGTON LOANS

Evening Post, Volume CXVI, Issue 25, 29 July 1933, Page 12

WELLINGTON LOANS

NO RECENT ORDERS

WATERWORKS DIVERSION

In Wellington tho City Council has not availed itself of the 1926 Empowering Act for some time, and during the past two years has pursued as a fixed policy that further loans shall not be raised without reference to 'the ratepayers. Thus in the case of the diversion of part of the balance of the 1920 waterworks loan the question was put to the ratepayers, who by an astonishingly large majority (three' to one in favour) approved of the work being put in hand. In that instance the council had full power, to divort the money without a poll. " •

From 1920 to 1930, however, the powers to raise money for relief works by special order were frequently utilised. The first unemployment relief loan (£12,000) was raised as far back as 1922. The next of these loans (£12,000) came in 1926, and then, following the passing of the Empowering Act of 1926, which :nado it easy for local bodies to raise relief work loans and in fact encouraged them to do so, the loans came thick and fast: 1927, £4000, £10,000, and £26,000; 1928, £10,000, £15,000, and £10,000; 1929, £25,000, £20,000, £15,000, and £21,000; and 1930, £30,000. 'Since the council election of 1931, which was largely fought on. the issue of loans without polls, only one unemployment relief works loan has been raised under special order—for .£IO,OOO in 1931. All the loans are short-term loans, for ten and eleven years, and all were raised locally, the interest being at tho rate of 51 or 5$ per cent, (since reduced in accordance with tho Government's interest-reduction legislation) and sinking funds at 1 per cent. (2.1 per cent, for tho 1930 loan). As the sinking funds arc low and tho terms short, all these loans will bo due for renewal during the nest nine years, re-d-iced, of course, by the accumulated sinking funds. Since the last of.Wellington's relief works loans was raised, finance has been provided partly from revenue but largely by transfer of funds from the Electricity Department. In the- same period the Wellington City Council has made a very favourable arrangement with the Government whereby tho Gov. eminent carries supervision and other charges far more than a certain number of men on city relief works. But for this arrangement the available finance would have been far short of requirements. SUBSIDY ON WATERWORKS. At the present time there is a marked division ,of opinion among councillors on the question of finance for tho waterworks development shortly to be undertaken as a result of the success of the poll on the diversion of part of the 1920 loan balance. The estimated total expenditure for bringing in artesian supplies from Gear Island to the city, for additional service reservoirs, and for extensions and improvements, to trunk mains and reticulation,

is £79,000, but the poll proposals were for a total of £69,000, that amount being asked on the assumption that £10,000 would bo forthcoming from tho Unemployment Board by way of subsidy. Tho board has agreed to this, but the Labour councillors, contending that the ratepayers believed that £G!),000 was the full amount required have objected on the ground that as tho £10,000 required to complete the work will come out of the total Wellington allocation,' no more men will actually bo placed in employment, though tho men transferred from relief works to waterworks development will receive standard rates of pay. The Mayor has been requested by the council to interview tho authorities and to seek a variation of the terms for the payment of tho subsidy. No doubt a report will be made at the nest meeting of-the council.