HOSPITAL FINANCE.

Hawke's Bay Tribune, Volume XII, Issue 235, 18 September 1922, Page 7

HOSPITAL FINANCE.

DIRECTOR-GENERAL’S REPORT. (Special to “Tribune.”) Parliament Buildings, Sept. 16. The problem of hospitals’ finance is . dealt with bv the Director-General in 1 his annual report to the Minister of Health. “For the first time this year boards’ estimates of their capital re- ■ quirements were considered en bloc, 1 it having been found that once a > board’s estimates have been aprpoved and the money provided by way of levy and subsidy, little reason could be urged against expenditure being undertaken. lhe present method, . therefore, enables the department to r view as a whole the Dominion proposals , for the erection of hospitals or additions thereto, and, if the proposals result in too heavy a cost, to ensure postponement of all but absolutely • necessary works. “A lew years ago it was the excep- > tion to find a board raising a loan for i capital works, it being possible to • finance such work in most cases out • of the annual capital levy and subsidy. . Now. however, few boards can stand t the heavy burden, in one year, of the capital expenditure required to keep ’ our institutions up-to-date, or to re- ’ place obsolete buildings for those suitable to meet the growth of the popu- • lation and advancement in medical and surgical requirements. Boards, there- • fore, have perforce had to have re--1 course to borrow, and thus spread the i cost over a number of years. This naturally tends, for the present, to , lighten the burden on the ratepayers and the Consolidated Fund, but the fact must not bo lost sight of that the amount of loans raised annually show no signs of diminishing, and the piling up of annual payment of interest and 1 sinking fund, year after year, will eventually become a very heavy burden on both the Consolidated Fund and rates. For this reason, and having in view the present high rates of interest that are ruling, boards have been ad- ! vised not to spread their loans over 1 too long a period, and as far as possible to make them for tep years. Few, if any boards would be unable to repay by levy and subsidy a loan of, way, £lO,OOO in ten years, and, therefore. there seems to be no reason for their borrowing such sums for twenty years or longer at 6j per cent. “It might possibly b© a good step if larger boards, at any rate, were to combine their loan requirements with a view to facilitating loan flotation, reducing expenses of advertising, etc., and tending to make them independent of local facilities for borrowing, enabling them to raise their money elsewhere ”