LOAN HITCH

Evening Post, Volume CXXVI, Issue 151, 23 December 1938, Page 10

LOAN HITCH

CITY HOUSING PLAN

BOARD'S DECISION

COUNCIL SURPRISED

A hitch has occurred in the progress of the Wellington City Council's housing proposals, for which legislation was obtained by local Act last session, the Loans Board having declined the application of the council for authority to borrow the money from the Government source proposed. Members of the council at the meeting yesterday afternoon were somewhat surprised at this decision and the Minister of Finance is to be approached to see whether the position cannot be remedied. The council proposes to borrow £50,000 for reJending to intending builders, and £10,000 for renovation of existing unsatisfactory buildings. The chairman of the Loans Board advised that the application had been considered on December 14. "The board," continued the letter, "referred the matter back to your council, as it did not consider that the loans in question came within the scope of the Government's housing , policy, under which money was made available to local authorities at 3 per cent." EEPRESENTATIONS TO MINISTER. The Deputy Mayor, Mr. M. F. Luckie, said he had been very surprised by the reply. He thought that at the least the council should make representations to the Minister of Finance with a view to seeing if the activities of the Government in lending money for housing could not be extended. It was purely a matter that they could decide themselves. It was better that the council should make an effort to get that done than to borrow elsewhere at a higher, rate of interest. Councillor T. Brindle: They may be putting a wrong interpretation upon our application. Mr. Luckie: I cannot imagine that the Government would be a party to burking what was the evident intention of the Legislature. Councillor W. J. Gaudin: I think the Loans Board has missed the point entirely. ". Councillor L. McKenzie: Is the Bill we got through ineffective? Mr. Luckie: No, it is quite effective. Nobody dreamed for a moment that there would be any difficulty about borrowing the money. • Councillor McKenzie: Dunedin is borrowing money. Mr. Luckie: Dunedin is borrowing money to build houses, not to lend to other people to build houses. BOARD EXCEEDED ITS POWERS. Councillor R. A. Wright said that it was not the concern of the Loans Board where the council borrowed the money; ,the council had simply asked for permission to borrow. If the council could not get the money from Government sources it might get it elsewhere. He thought that the Loans Board had gone beyond its powers altogether. The fact was that the council's Bill was ineffective, said Councillor P. M. •Butler. It was mere kite-flying and window-dressing. The Bill gave authority for the council to raise money, ,but it did not say where it was to get it from, and there was the flaw. The Government had told the council time and time again that it would lend money to local bodies to build houses, but the Wellington City Council -thought that it was wise* to lend money to other people to build houses, but it had no legislation to give effect to that aim. "Instead of fiddling about with the thing, why does not the council get down to it~and approach the Government for money and proceed to build houses itself," asked Councillor Butler. "NOT EVEN A WHARE." "Local bodies throughout New Zealand, from city councils to river boards, are putting up houses, and we have not built even a whare. There are "thousands of people in Wellington with- . out houses, and the position is worse than when the City Engineer made his report. I suggest that we get down to the Government's original legislation, and get on with the job ourselves; accept the Government's very generous offer, and build the houses that the people need. We need 17 houses for our own residential caretakers alone." Mr. Luckie: That's a different matter. Councillor Butler: Yes, but it would ■11 help. CHEAPEST MONEY BEST. Councillor R. L. \Macalister said that the council had promoted a Bill which the Government had allowed to go through. The council was entitled to assume that when the Bill became law it would be acted upon. There were two sources of money available, the Loans Board and private sources. If the money could be got at 3 per cent., ,other sources would cost the people more, as it would have to be passed on to people who built under the , scheme. It seemed to him that the ■position was not understood by the Loans BoardJ The Deputy-Mayor's suggestion should be carried out. Councillor McKenzie: Has there been any demand? The Deputy Mayor said that inquiries had been made of loan companies by ' people with a view to securing money that might be obtainable for the purpose. Councillor A. Black pointed out that apart from building new houses under the scheme it was proposed to renovate houses. The Deputy Mayor: Exactly, where mortgagors are not able to supply the money. The Bill had received the entire consent of the Local Bills Committee. The Government was fully in accord with the policy, said Councillor W. - Appleton, TO OWN OWN HOMES. The clear position, said Councillor Luckie, was that it was an excellent method to allow people to be- ' come the owners of their homes. Councillor Butler: This thing has been going on for four or five years, but we have not built a whare. THE BEST METHOD. "We are doing out utmost to endeavour to secure homes for people which they can pay for and live in themselves on the cheapest possible terms. We believe that is the best and soundest method," said Councillor Luckie. Councillor W. J. Gaudin: I .do not think there is any doubt about the demand. I have had numerous inquiries as to when this will become operative. He thought the matter should be taken up again with the Loans Board. It did not matter 2d to the board where the council got the money. If it could not be got from the board they ' should go on the market for it. ".' Councillor A. Black, while not concerned about people owning their houses, said that if people could get

houses at a reasonable rent they would fill them tomorrow. People came to him every day asking when they could get Government houses. A deputation to the Loans Board should settle the matter quickly. Councillor Luckie thought that they should go to the board. The board was authorised to supply the money by statute. On the application they should ask for leave to borrow from the State Advances Office. WHY NOT BOTH SCHEMES? "The position is so serious that I don't see why we should not adopt both schemes; proceed with the council's own scheme, and borrow up to £250,000 to assist the Government's scheme," said Councillor C. H. Chapman. "For goodness sake let us do something; we have been talking about it for years." Councillor Butler: Hear! Hear! The Deputy Mayor said that the Government's scheme would not assist poor people, for the rent being paid for Government houses was more than poor people could pay. Councillor Black: It's much less than they are paying today. Councillor Butler said that if the City Council did not act then councillors were open to the uncomfortable suggestion that they were pandering to house speculators in view of the housing shortage. Mr. Luckie: Nonsense! Councillor Butler: It's not nonsense. Unless we do something we are open to that suggestion. Councillor Luckie said that he would undertake to get into touch with the Minister without delay, and would advise councillors.