CONVERSION OF LOANS

Evening Post, Volume CXVIII, Issue 106, 1 November 1934, Page 5

CONVERSION OF LOANS

LOCAL AUTHORITIES

RIGHTS OF RATEPAYERS

The Local Authorities Interest Seduction and Loans Conversion Amendment Bill was passed by the Legislative Council yesterday afternoon.

Commenting on the provisions dealing with the cancellation or modification of existing authorities to borrow money and the payment of principal and interest on securities, the Leader of the Council (the Hon. B. Masters) said that the Bank of New Zealand, which held about 75 per cent, of such securities, had advised the Government that it was absolutely satisfied with the clause in the Bill. Tho Bt. Hou. Sir Francis Bell said that he was still unconvinced on the point, and hoped that it would bo given further consideration. The Hon. Sir James Allen said that he did not like tho provision giving local authorities power to raise a loan not exceeding £1000 without a poll of tho ratepayers. It was opening up a precedent which might be extended in tho future. , The Hon. C- J. Carrington said that ho would vote against the clause giving the power'to raise loans without a poll. The clause was a trend in legislation which was giving the Executive more power than it should have. The trend was manifestly wrong. The Hon. L. M. Isitt said that ho was most surprised at the introduction of the clause. It was wise to maintain stringently the right of the ratepayer to have a say in any expenditure of money. RATEPAYERS' INTEREST. The Hon. W. H. Mclntyre said that he did not hold with those who, held that every small loan should be referred to the ratepayers, who took little interest in loan proposals. However, it was wrong to amen dthe. Local Bodies Loans Act by a clause in a Bill rei fen-ing to loan conversions. Mr. Masters:.lt arises out of the loan conversions. The Hon. E. McCallum said that it was futile to say that the ratepayers had no say. They had all the say. The people who proposed the loan were the elected representatives of the ratepayers, and a loan had to be sanctioned by tlio Local Government Loans Board. In reply, Mr. Masters said that a number of local bodies had not. converted''their loans because of the difficulty of raising small loans for particular districts. There was a great deal of sentiment in regard to ratepayers' loans, but in practice only 15 or 20 per cent, of tho ratepayers recorded their votes. All loan proposals had to bo passed by tho Local Government Loans Board. In reply, to Sir Francis Bell, Mr. Masters said that the departmental officers were convinced that the Bill was adequately drafted. However, he would place the question before the Minister of Finance.

The Bill was read a second time.

In the Committee stage Mr. Carringtpn allowed the clause relating to the raising of loans to be passed on the

voices. , • The Bill was put through the remaining stages and passed.