COUNTY SUBSIDIES.

Hawera Star, Volume XLVIII, 25 September 1924, Page 5

COUNTY SUBSIDIES.

FAIRER SYSTEM NEEDED

MINISTERIAL ADMISSIONS

(By Telegraph—Special to Star.) WELLINGTON, Sept. 24. A petition from the Southland County Council asking that the maximum subsidy to counties be increased provoked, an important discussion in the House to-day, when it was mentioned that the Government has untried to evolve an improved system of graduated subsidies in place °f. the present system, which the Minister of Public Works described as inequitable.

Tne matter arose on the report of the Public Petitions Committee, which stated that, as the question was one of policy it had no recommendation to make.

Mr Forbes, expressing dissatisfaction with the report, pointed to the tendency of the counties to subdivide simply to secure a larger number of maximum subsidies in the same area by. the multiplication of local bodies. He asked if the Government’s promise to reform the local body system had been consigned.to the limbo of things forgotten.. i

Mr de la Perrelle (Awarua), who said that Southland County was the largest in the Dominion and collected £56,000 in rates, moved to refer the report back to the committee. The Hon. J. G. Coates, Minister of Works, while not objecting to the matter being referred back to the committee, said that he would have preferred, to have heard more reasons for this course. The problem was not new. Various Governments had tried to solve it, and he felt that the present Government had done well '• in assisting local bodies. Personally, he believed thsvt local bodies would w r ork out a solution themselves, and reach a position to more effectively handle their difficulties. No Government would be strong enough to force them to amalgamate. The Southland County was. one of the lowest rated in New Zealand — (Members: Oh!) “I admit that the system of subsidy is not equitable,” continued Mr Coates. “I do not say that it is the fairest, but if you increase the subsidy to the Southland County it will immediately reduce its rates. (Laughter.) They are not high now.” He declared without hesitation that Southland had received its full quota of the Government contribution, probably more than it would have received under an equitable system of subsidy. He had considered the subsidy question in conjunction with the Minister of Internal Affairs with the object of obtaining a graduated scale which, while keeping within the present total expenditure, would encourage local bodies to strike a sufficient rate. Many schemes have been worked out, and a lot of time has been spent on the problem in the hope of getting local bodies to take hold of larger areas and reduce working expenses. They have not been able to get any further than a previous Minister (the Hon. G. W. Russell), because it was complicated by the counties which struck a high rate and those which struck a low rate. The Highways Board, with district councils, was going in the direction required. A number of counties were amalgamating with the object of drafting by-laws controlling a large area, including boroughs, town districts and counties, and at the end of the year there would be an adjustment account. Of that each local body would get its share of the proceeds from /the by-laws, licenses, and other fees."

The Premier reminded members that whatever was done for Southland County must be applied all round. The burden of the future was going to be heavier on local bodies than on the Government. The question was 1 whether settlers could make a profit after paying the heavy cost of production and all rates imposed. Greater care would have to lie taken with local body expenditure. If larger subsidies were to be found on larger local expenditure it meant increased taxation. "He asked if the House was prepared to consider and have enough courage to adopt a scheme under which, a larger subsidy than the present would be given to districts that needed development and less to districts that did not require it. He believed that something of the sort would have to be done.

The report was referred back to the committee, its chairman remarking that it would probably return with no recommendation.