POWER BOARD PROPOSALS

Hawera Star, Volume XLIX, 31 August 1929, Page 6

POWER BOARD PROPOSALS

OUTLINED AT NORMANBY.

; address by board chairman. r f| le lona proposals of till© South Taranaki Power Board were explained to 1 ratepayers at Normanby last night by Mr J. B. Murdoch, board chairman, ail attendance ol upwards of 20 listening ! to an address of over an Hour’s duration. Mr C. J. Preston, a member ci tihe board, presided. Normanby, said Mr Murdoch, ana 1 of the first places that the company 1 had put light into, and the town diis--1 trict' s -representative had fought, along 1 with the rest of the local body reprei -sentati ves, to keep South Taranaki out of- Tariki. From the point of view of supply of electricity this district was an easy one to work; it was compact and level. Only in the Tongahoe Talley - was there anything of a rough nature. The putting up of pole-s lier© was easier than in other parts of New Zealand, ./this lending to cheapness of ; reticulation and maintenance. The company had not seen fit toj extend its lines to certain portions of its district until the -inception of the -board. = The supply of electricity was practically a monopoly, and no monopoly should be in anyone’s hands but the people’s. It had) been impossible to fix a price for the company’s undertaking by a round-the-tabile conference, and arbitration had to bo gone to. The board would have to pay £13(>,500 for the whole proposition, arid at that price and with tihe -revenue at present obtained by.the company, there would be no difficulty in paying the whole qf the interest and sinking fund and making a nice profit. Included in the loan proposal of £187,500 there was provision for reticulating those areas at present without power, and that work would licit present any engineering difficulty.

Quoting from the company's balance-1 sheet for the year ended March 31. 1929, Mr Murdoch said that the net revenue, after paying aJll expenses, » £11,371. In the expenditure oolumr an amount of £I4BO was shown a,s having been paid for thank accommodation, and he added these two figures together because in dialling with tlie hoard’s position he' would add the interest and sinking fund. This, subtracting £9l interest on war bonds brought the total revenue of the company for the year to £12,757. The board would pay, assuming that the £136,500 could not he raised cheaper than at 5i per cent., £10,237 for interest and sinking fund, leaving a balance in its favour of £2520. This was without any increase in the consumption of electricity in the dis-trict,'-and it had to he home in mind •that the use of electricity was growing by leaps and hounds • the company had started • its. < present year with an increase of 26- per ‘cent-., which would bring in extra profit. In the last five years the company's profits had been: 1925, £6466 ; 1926, £7546 ; 1927, £8242 ; 1928. £9937 ; 1929, £11,371. This showed that the sale of the company’s commodity was growing by leaps and bounds, and' every pound of extra revenne meant extra- profit; In the last five years the company’s expenses had increased by £I3BB and the profits by £4905.

GROWING DEMAND FOR POWER

■ The demand for. power in New Zea-land-was increasing go rapidly that- it was hard -for the supply authorities to keep up with it. Water heaters and ranges were being installed in rapidly increasing numbers, and Tariki alone now had 500 water heaters. The board’s proposition was a sound one, and even with the worst of management he couldnot conceive that a rate would ever be Tollected. In Tariki, where they had -had to rely on estimates and had not been fortunate enough to be able tostep into an : established concern, an availlability rate had had the effect of making ratepayers take electricity, and now those ratepayers would never be without power and light. The benefits of electricity were undoubted, and the country districts should be given the same facilities -as towns. The company couild not he expected to do so, but it was the hoard’s duty to look after the interest of all its ratepayers. The ratepayers’ interests were protected in that if there was any doubt in their minds as to the ability of those vrlio re(p<reserLt«<i tlh-em, tliey [had. the right periodically t-o- elect a fresh board. No critic had yet been able to say that a- rate -would have to be collected under the hoard, and none had been able to discredit -it as a -business proposition. If the poll! were turned down the value of the' undertaking would rise in a few years to £IOO,OOO or £170,000, and if the ratepayers; rejected it next Thursday they would never be able to- buy I it. “Carry the poll and you will never[ regret, it,’’ concluded Mr Murdoch.

Q U EBT lONS ANS WEIRED. Asked by ]NJ i- H. D. Hughes to oxjj.hiin the difference between the offer made by the board and the award price, Mr Murdoch said that stocks and tools, later value at £5825, had not been taken into account by the board, while nothing bad been included in die £G7 ; - COO for goodwill. The board bad at that time no access to the company's records and bad been asked to give an indemniity in respect of any possible 'liabilities, none of which were disclosed. In the price fixed by arbitration tlie board understood that £85,000 repre- , s-ented the physical assets and' the balance goodwill; so it could be seen that the board’s first offer was not very far of the mark. Mr Hughes: As the company i.s here only at the wilf of the people, why should we .pay them goodwill ? Air Murdoch: The company must congratulate the member for .Parliament who fathered the Bill put through in 1902 that its wording gave them the right to goodwill. The greater the the money in it, the greater is the interest that a concern is returning for value of the goodwill, and more so when there is a monopoly. We could not upset the legislation. No further questions being forthcoming.' the chairman, in voicing thanks to Mi- Murdoch for .his address, said that lie (the speaker) had given the people of the Norman by town district to understand that if there was any elm nee of a rate or the concern would not bo self-supporting, lie would not recommend it. He was satisfied that no rate would he collected, and that the concern would be self-supporting; hence he heartily reeconnnendecL the proposals to the people for their support.