OAMARU HARBOUR BILL.

Lyttelton Times, Volume LXXVI, Issue 9491, 13 August 1891, Page 6

OAMARU HARBOUR BILL.

EEPOET OF THE PUBLIC ACCOUNTS COMMITTEE. [from oub own correspondent.] WELLINGTON, August 13. The Public Accounts Committee’s report on the Oamaru Harbour Bill was today laid on the table of the House. The report is as follows: —ln 1874 the Oamaru "Harbour Board was constituted, by Provincial Ordinance of Otago, authority being given to borrow to the extent of £IOO,OOO at 6 per cent, on the security of any lands for the time being vested in the Board, and of the rents thereof; and of the dues chargeable or receivable by the Board, under “ The Oamaru Harbour Board Ordinance, 1874.” The Board proceeded to borrow on mortgage the full amount authorised, of which the Post Office advanced, at 5 j per cent interest, out of the trust funds £35,000, afterwards reduced to £33,000 by part payment of sinking fund. The balance of the £IOO,OOO was borrowed privately, at 6 per cent. In 1878 further powers were given by the General Assembly to the Board to borrow on debentures another £IOO,OOO, and that amount was raised at 6 per cent interest. In 1882 further power was given by the Assembly to the Board to borrow another £50,000 on the security of its endowments and on a special rate on property within the district, and that amount was raised at 5 per cent. In 1887 further powers were given by the General Assembly to borrow £40,000 on an additional special rate. Against this there was advanced in 1838 out of the Post Office trust funds the further sum of £30,000 at 5 per cent against the deposit of the debentures for £40,000, of which debentures for £6600 were afterwards banded back. This advance appears to have been made on the condition that the Board should undertake to introduce in the session of that year a Bill to repeal “ The Oamaru Harbour Board Loan Act, 1887,” and to authorise the raising of a loan of £66,000, of which £32,000 was to be expended on harbour improvements, and £33,000 to be applied to paying off the mortgages to that amount held on behalf of the Post Office account (part of the first loan of £100,000). The Government agreed, if the Bill was passed, to take up the proposed loan at par, the money to be applied as follows:—(a) To paying off the mortgages for £33,400 held in the Post Office account; (b) to the repayment of the advance of £30,000 which was then being made ; (c) the balance to be paid over to the harbour account. It was part of the arrangement that in the event of legislative authority not being obtained, the advance of £30,000 was to be repaid at twelve months’ notice. The Bill was introduced, but not passed. The Post Office (besides the balance of £33,000 still outstanding on mortgages under the loan of 1874) remains the creditor of the Board for the £30,000 advanced in 1888. Interest is now overdue to the Post Office* under both advances, amounting to £3315, besides which sinking funds to the amount of £SOOO under the original advance are also in arrear.. The Board appears to have duly met its obligations to"'the' other creditors. The Board has lodged the £66oodebentures handed back by the Post Office—part of the issue of £40,000, under the Act of 1887—with its bankers as security for an overdraft of about £3OOO. The revenue of the Board last year amounted to £20,125, and the expenditure (including interest £16,325 and sinking fund £1000) amounted to £20,107. This year, by reason of the railway “ cutting ” freights, and decreased rents from endowments, the income is estimated as likely to be from £IOOO to £ISOO leas than last year, while the expenditure, if current engagements are to be kept, cannot be materially reduced. It may be estimated that the Board will be £IOOO more to the bad at the end of this year than last, while it will be seen that last year it was unable to pay in full its current engagements. It now appears by the Bill before the House that the Board is desirous of obtaining authority to arrange for further advances against the balance of the loan; in other words it desires to make other arrangements in respect of the £6600 worth of debentures held by the Bank against the present overdraft, and also to use the margin of £B4OO held by the Post Office in nominal excess of its last advance of £30,000. The Board also desires by the Bill authority to hypothecate its dredge and other plant. The rating powers of the Board are not exhausted by a probable further 'revenue of £2700 per annum, which, if collected, would, after allowing for the probable shrinkage in the revenue from competition with the jailway, suffice to keep current engagements on foot, but without providing for the arrears of interest and sinking fund. The position of the Board appears to render it advisable for Parliament to abstain from encouraging further financial operations by the Board outside the means it already possesses or may f under the powers already conferred legitimately exercise. The Committee, therefore, recommends that the Bill re- , ferred to it be not further proceeded with. —A lfbbd Saunders, Chairman.