HARBOUR FINANCE

Evening Post, Volume CXXV, Issue 70, 24 March 1938, Page 6

HARBOUR FINANCE

TRADE RECORDS SHOWN

SURPLUS REDUCED BY HEAVY COSTS

CHAIRMAN'S REVIEW

Referring to the port records established during the year ended September 30, 1937, the chairman, Mr. D. J. McGowan, at the annual statutory meeting of the Wellington Harbour Board last night, said that the total tonnage of cargo handled inwards and outwards amounted to 2,311,076 tons, which exceeded by ■ over 77,000 tons the previous record established in 1930; The shipping arrivals topped the 4.000,000 mark, the actual figures being 4,090,307 "tons, exceeding the previous record year of .1936 by over 179,000 tons. The figures could not be exceeded by any other New Zealand port..

Giving the increases shown in the executive officers' report, Mr. McGowan said that imports of all classes increased by 18.4 per cent.; British and foreign imports of all classes increased by 20 per cent.; Australian imports increased by 13.7 per cent.; and coastal imports increased by 16.6 per cent. Transhipments to British and foreign ports increased by 21.1 per cent., Australian transhipments.increased by 29.1 per cent., and coastal transhipments increased by 8 per cent. It was gratifying to see that the transhipment business of the port was steadily increasing, emphasising its convenience as a transhipping centre.

"Outward cargo of all classes," said Mr. McGowan, "increased by 0.2 per cent.; exports to British and foreign ports increased by 1.4 per cent.; Australian exports increased by C.5 per cent.; and coastal exports by 15 per cent. "Importations of timber increased by 25.3 per cent; and timber exports increased by a little over 20 per cent. Coal' landed or transhipped increased by 25.1 per cent.; coal passing over wharves and paying- wharfage increased by 6.8 per cent.; Government coal exempt from wharfage increased by 59.5* per cent., and coal transhipped over side at wharves increased by 49.4 per cent. The tonnage of oils in bulk increased by 10 per cent.; bulk oil outwards increased by 1 per cent.; and bulk oils transhipped increased by 19.5 per cent. "A decrease of 7 per cent, is shown in the. quantities of wool and skins shipped this year, but this can be explained by the fact that the previous year's figures were higher by reason of the over-carry from previous seasons. ' ■ •• "There was a slight decrease in the butter exports of 4.9 per cent., but cheese increased by 2.7 per cent, and frozen meat by 11.2 per cent. "On a value basis over '38 per cent, of the total imports and 24 per cent, of the total exports of the Dominion passed through.the Port of Wellington for the year. INCREASED EXPENSES. "From the above trade figures, members would expect that the financial result would be as satisfactory," said Mr. McGowan, "but this is not so, as the surplus of £11,172 2s 2d on the year's working is not as large as the previous year's surplys, which was £18,917 10s 6d. r The receipts actually increased by £79,761 lbs, but the increase in expenditure;totalled £87,506 18s 4d. This result is similar to that which has been experienced in other businesses, in that with an increased turnover.there has been less profit, the increased costs of labour and material being responsible'for/this , state ;of things. The assets exceed the liabilities by over £2,000,000, arid the loan indebtedness of the board is now under £500,000 SOUND PAST POLICY. "I feel it necessary to here remark that the comparatively strong position in which the board now finds', itself cannot be attributed to recent years, but that the, credit must be.given to earlier boards and administrations who established the present financial system on a sound business-like basis. Statements* have been made' here and abroad in regard to the necessity of providing for serious trade fluctuations and slump conditions. This, board in the past has provided for a period of falling trade, and' members will. remember that in our depression 'years the. board, was not only able to carry on without retrenching its staff, but.it actually put in hand' capital and other works, ■■ involving the employment of a large number of men. The fine berthage provided at Aotea Quay is an actual example of such a policy, the extra berthage provided there assisting the port of Wellington in avoiding cargo 'congestion and shipping delays. '■■ ■.:.■' ' • "In May next the - Harbour Board elections will take place, and therefore the. April' and May meetings will be the last one's of the old board over which I will have the honour to preside as chairman. Therefore I thought it would be better to now include certain comments I would then make in surveying the past two years of my chairmanship of this board in the foregoing annual review, leaving'any personal remarks until the May. meeting. ,"I must say a few words regarding the executive officers and staff. During my period as chairman I have received the greatest courtesy and help from Mr. Barnett, general manager, and every member of the staff under him. At all times they have done their work faithfully and well, ;and. I would, like to record my sincere appreciation of their services." ... "'".'. He moved the formal motion for the signing of the statements of accounts. SURPLUS "MOST GRATIFYING." Mr. C. H. Chapman, M.P.f seconding the motion, said that from the increases in the tonnage handled and in the shipping arrivals, it was'- obvious that Wellington was not only the central port, but handled the major share of the trade of New Zealand ports. . The surplus of £11,172 was ; most gratifying, because the board ■ had not had any idea at the commencement of the year of what its expenditures would be. The board should', not aim at heavy net surpluses, because it was now in a most favourable position; The surplus was satisfactory, ■•in view of the high interest, sinking fund,. and other expenses. It was a reasonable surplus, justifying the policy of the board, and- it was the more satisfactory that it was shown after greatlyincreased wages and other charges, and reduction of hours of employment. Keferring to the superannuation fund, hc y said it was interesting to note that the income for- the past year amounted to £19,470 13s 4d. The payments amounted to £8053 15s, leaving a handsome balance to be placed to the accumulated fund. Mr. M. A. Elliott spoke of the large part in the shipping increases played by the United Kingdom. The position today was due to the care of past officers of the board and its pioneers. CAUTION URGED. Mr. A. Fletcher thought it behoved the board to carefully watch tha growing costs that had to be faced all along the line. The surpluses were small considering the magnitude of the board's operations.' The chairman's

The motion was carried.

statement regarding the development of the port was timely, and calculated to show those interested that the board's affairs were in good hands. The superannuation fund had been based on sound lines, but it must be remembered that the full weight of the charges on that fund has not yet been felt.

Mr. C. M. Turroll said it was as well to keep an eye on things, because berthago had been fully recently taxed. I-t was necessary to keep well ahead with accommodation. The first duty of the board was not to collect large sums from the users of the port,' but only to collect enough, to guarantee the provision. of services. There were many funds to bo kept, up, but the main object was to keep the port as cheap as possible for its^users.

Mr. R. McKecn, M.P., joined in congratulating the chairman on his excellent report, which was another, indication of the ■ efficiency of operation of this huge concern. He had heard many tributes to the work of the, officers and board, and knew from his own experience that they were deserved. The surplus might seem small, but did it not show that the board was not exploiting its customers? He pointed out that the demands made by workers, although acceded to, had not prevented the board from showing a surplus. . ■ .. . Mr. V,'. L. Fitzherbert agreed with Mr. Turrell that there :• should • be' no further increase in port charges. He was still of the opinion, that thereihad been no need to increase port charges last year. Something should be left to posterity to do. • i RESERVE FUND POSITION. •' Mr. T. R. Barrer pointed out in regard to the* widows' pensions, that the board's request had been the'cause of the increase of the widows' payments from £18 to£32, and that it had set aside a sum of £10,000, the interest on which more than met the demands. Labour weighed more heavily upon this board than any other, and if the demands increased, perhaps the board might have to review, its policy. While income had been, elastic expenditure had been increasingly heavy. He hoped that the careful administration of the board would be continued. The Reserve Fund was not kept up to the original intention. It has some £74,000, instead of the original £100,000, and he thought that it should be brought to its former position in view of .the uncertainties of the future. ' " '". '. Mr. H. Morrison'did not think, the board should produce big surpluses, but it was worth recognising that the assets of the board had increased by £70,000 odd, so that the position was sound. The reports showed that the primary producers of the Wellington district were the best clients the board had. Harbour costs should be kept down, but the board could be ■ congratulated on.its position. It was pleasing to see that .the-dock was more than paying its costs. ;