SOUTHLAND POWER BOARD

Manawatu Standard, Volume LIII, Issue 249, 18 September 1933, Page 6

SOUTHLAND POWER BOARD

The decision of the Southland Power Board to pay an instalment of interest due in London on Friday in New Zealand currency has created serious concern both in England and in official circles in this country. So much so that English newspapers, both financial and daily, have taken the Board to task and the Dominion Government has been constrained to announce that the difference between our currency and sterling will be remitted to the bondholders. It is to be regretted that, after making his announcement in the national interests, Mr Coates should have telegraphed the Board directing it to pay in sterling, as this only invited the reply which was given by a local body almost unanimously holding that, it is acting - within its rights. Having adopted what all responsible citizens will hold to be the correct attitude, it would have been preferable to have left matters as they were, introducing the legislation to recover the sum paid at the proper time. It has been pointed out that the Southland Board has not so strong a case as the Auckland Transport Board, but the latter body, unwilling - as it was to be saddled with exchange costs, did not take such an extreme course. . There is a State guarantee behind the Southland Board’s loan and this, it is believed, has to an extent influenced it in the matter. It is all the more surprising that the Board, possessing an option to convert its stock to current market rates in 1936, by which time it must be exercised, should have been persuaded to act as it has. The era of cheap money should . not have passed by then; neitlier perliaps will the unpleasantness of the present situation, and it may find that there will be no disposition either in England or in Dominion Government circles to help it. In that event the Southland Power Board will realise that a very short-sighted policy was adopted in 1933.