NO INCREASE

Gisborne Herald, Volume LXXII, Issue 21801, 25 August 1945, Page 6

NO INCREASE

DUES AND RATES WELLINGTON WHARVES PRICE TRIBUNAL RULING (P.A.) WELLINGTON, Aug. 24. The Wellington Harbour Board’s application for permission to increase its dues and rates by 37 per cent on the ruling 1937 levels has been deferred by the' Price Tribunal until October 1, 1946. The tribunal’s judgment, delivered yesterday, would be reconsidered before that date, should anything serious arise which necessitated a review. "At the time of the hearing we were engaged in war,” said the judgment, “but since then Japan has surrendered and in the view of the tribunal this tremendous factor points the way _to the return to the board of good trading conditions if not within the immediate future at all events over the next few years. ‘ It seems to the tribunal that the outlook of the board, while it may be one of difficulty for a time, is in the long run one which may be regarded with confidence. “It may be mentioned that so far as the tribunal can judge it would be a great pity if the board gave up the business of a wharfinger, which it has followed since its inception and which has no doubt been done with efficiency and satisfaction to the business community. “It was urged at the hearing that as a result of the increase in wages which it had been necessary to pay since the Waterfront Control Commission came into existence the position of the board would not be remedied by an increase in business as a large portion of it at any rate was being done at a loss, but it appears to the tribunal that, having regard to the past year’s working, and in particular the year 1943, an increase in cargo tonnage handled would result in an improvement of the board’s position.” Method of Financing Continuing, the judgment said that at present the board had no bank overdraft and the tribunal considered that in. the present emergency recourse could reasonably be had to that method of fianancing in order to assist the position. While recognising that the present policy of the board towards funding for repayment of loan liability and at the same time providing for depreciation and repairs and maintenance of fixed assets was sound financial practice so far as the board was concerned, the tribunal considered that the'practice could well be departed from under the present conditions without impairing the board’s stability in any way. It was in accordance with the tribunal’s ordinary practice that applicants for price increases in rates or fees for services should be required to absorb the increased costs when they were in a position to do so. The balance of the board’s accumulated funds account was at present in a very substantial reserve, which, it was considered, could meet any temporary excess of expenditure over income. “In the past,” said the judgment in conclusion, “it has been the board’s policy to make capital payments out of revenue and though this procedure was undoubtedly a desirable one for local bodies to follow where possible, neverthe less the effect had been to reduce substantially the cash resources available for the financing of the board’s operating expenditure. Therefore, the tribunal considered the present position of the board’s cash resources had been brought about largely by this practice. It was the tribunal’s opinion that in order to remedy the present position relating to cash resources the board should give consideration in the future to the financing of any further capital works by means of loans.”