The Evening Star THURSDAY, APRIL 14, 1932. CORPORATION SERVICES.

Evening Star, Issue 21077, 14 April 1932, Page 8

The Evening Star THURSDAY, APRIL 14, 1932. CORPORATION SERVICES.

The financial results of the city’s four trading departments appear with customary promptitude after the close of the year on March 31. Making allowance for the saving in working expenses through the 10 per' cent, wages cut, they are at least as satisfactory as might have been expected. For it has been obvious that citizens have been practising economy in their utilisation of the services provided. As a result the total revenue was nearly £IB,OOO less than in the previous year. But the corporation managements have been practising economy even harder than the citizens, with the result that the total profits exceed those of the previous year by £8,610. The decreased patronage of municipal services was naturally most obvious on the trams. On transport—whether electric or cable trams or buses—the public curtailed its expenditure by very little less than £13,000 as compared with the previous year. The city electric trams were naturally the chief sufferers, and a revenue showing a decrease of nearly £IO,OOO sufficed to provide the very insignificant profit of £250, whereas between them the two hill trams contributed about £3,000 profit. The motor bus services, which four years ago made a loss of nearly £BOO, and in the intervening three years contributed only £l2O profit as a set off, again show a loss of about £260. On the other hand, Waipori has made a partial refrom the very serious drop it showed last year through fuel-derived power having to be generated over a considerable period of water shortage. Waipori profits approximated those of five or six years ago, the figures since 1926-27 having been in successive years: £21,004, £23,870, £28,094, £36,333, £12,003, and (last year) £20,760. Roughly, the Waipori recovery just about accounts for the total increased profits of all the trading departments as compared with the previous year. From the city’s viewpoint it was a far-seeing move when the urban and suburban areas were retained and the rural areas were severed, to be administered by the Otago Power Board, which buys power in bulk from Waipori and finds it next to impossible to distribute it at a profit. The Government’s decision to practically suspend work on the Waitaki scheme means a recasting of the corporation’s Waipori headworks programme, and it may be that further capital expenditure looms ahead. The urgency for this, however, is the less acute, since the depression has here, as elsewhere, wiped out the 10 to 15 per cent, annual increase in demand for current which has prevailed generally when power at a reasonable schedule of prices has been made available. It seems as though an effort by the E.P. and L. department is being made to develop a market so as not to let all that annual normal increase in demand disappear. The reference is, of course, to the decision to try and popularise electric range cooking, which has the reputation of being dear, if clean and convenient. It has been denied that it is contemplated to infringe on the gas department’s preserves. But it is difficult to see how the one’s gain can help being the other’s loss, in part if not in whole. The results of the gas department since modernisation of the plant have surely not fulfilled expectations. In 1925-26 the gas profits exceeded £20,000. In the following year they were £19,268, and it was then explained that the benefit of plant reconstruction would not show in the figures until after the following year. But they have not shown then or since, as the subjoined list of profits in successive years indicates: £9,771, and (last year) £9,348. The inference is that in this case modernisation has been the equivalent of overcapitalisation, although doubtless consumers have bad tho benefit of gas of higher calorific value. To summarise

the combined figures of the four trading departments, on a total loan capital of somewhere approaching £2,400,000, the year’s revenue has been about £504,326, of which working expenses, interest, renewals, and depreciation have absorbed £519,491, leaving £44,835 for transfers, such as relief of rates and of unemployment. Needless to say, pressure of circumstances has been such that no such sum remained intact for transfer on March 31, because of interim application of sums as they became available.