OUTSIDE OPINION.

Hawke's Bay Herald, Volume XXII, Issue 7822, 15 August 1887, Page 3

OUTSIDE OPINION.

The Australian Trading World (pub lished in London) has the following in a recent issue in connection with the failure of (lie Hastings loan :--Tn the sterling interest of the colony of New Zealand, we are sincerely sorry to .see the prospectus of a loan issued for the borough of Hasting.", in the province of Napier, N.Z , for the insignificant sum of X'i.'i.OOO : we say insignificant, because we contend now as ■we did nearly a year ago when criticising a small loan of £40,000, that loans for

these amounts should not come upon the open London market. We do not, mean for one moment that they are not authorised ; but the fact of small boroughs worrying the investing public for these small amounts must damage the market for larger loans ; and there is more reason for complaint at the present tune, inasmuch as the Government of New Zealand have set themselves to a non-borrowing policy.

[l the present instance we have no liesi-

talion whatever in saying that this loan is not warranted, and that the borough of Hastings has no real justification in borrowing such a sum of money. The prospectus states that the loan is required to provide " an efficient .scheme of drainage;" it further goes on to state that " the present ratable value (is) £25,55U, anJ the revenue therefrom £1279 (is." Now, it is perfectly easy to calculate that the service of a loan of £25,000 at 5 per cent, needs £1250 per annum for its service ; practically, therefore, tin's littie borough wants to bonow to within a fraction of

its full ratable value. We note that " a special rate has been pledged " to secure the interest and capital of this loan, and we have no doubt it is meant that the expenditure of the loan will provide a substantial increase in rating power ; but we donbt if this is a sound basis for municipal institutions to borrow apon. If the public choose to lend the money there is no reason why they should not do so,

but they would do wisely to make themselves acquainted with the j.o.iilion of the town, and to that end we give the following extract from the " Australian Handiboiik" of ISBII, which is as follows: —

" Hastings, a post town, with monoyor.ler, telegraph, and savings bank ollice, on the Ileretaunga Plains, in the provincial district of Hawke's JSay, 12 miles from Napier, with which it has railway connection, and 21 miles from Haveloclc. There are three general stores, a railway station, a large gelatine factory and

meat preserving works, an Athen:euni, a town liall, a line building, a Protestant hall, and four neat places of worship, a public school, with average attendance of 189, and a population of 017 (census 188}). Hastings js the centre of a rich agricultural and pastoral district."