BOROUGH LOAN.

Manawatu Standard, Volume LIX, Issue 162, 10 June 1939, Page 4

BOROUGH LOAN.

A £6OOO PROPOSAL. Consequent upon advice from the Labour Department that the withdrawal of subsidised labour would take effect from June li the finance and works committees were obliged to reconsider the council's £6OOO streets and footpaths loan proposal, and the borough engineer submitted to the Borough Council, on Thursday, a further tentative schedule embracing 277 chains of streets and 70 chains of footpaths providing for a net cost of £6OOO without provision for subsidised labour.

It was also reported that provision should be made for interest at 4J per cent., which would increase the total charges to £643 as against £6OO had the loan been put through at a lower rate. The raising of the amount at 4.1 per cent, would necessitate a special rate of 7-16ths of a .penny in the £. The necessity for increasing the rate of interest payable arose as a result of the Government offering stock at that figure. The finance and works committees passed the following resolution; That application he made to the Loans Board for sanction to pay an increased rate of 4i per cent, interest, and that immediate steps he taken to arrange for the requisite poll of ratepayers for a loan of £6OOO, the works committee in the meantime to prepare a schedule of streets and footpaths for' inclusion in the proposal. It will be remembered that the council decided some time ago to defer in the meantime its original intention to seek the ratepayers’ approval to the raising of the amount, because of the uncertainty regarding the availability of fully subsidised labour, it being pointed out at the time that the possible withdrawal of such labour would necessitate the council reconsidering its proposed tar-sealing of streets and footpaths proposals. The original scheme provided for an expenditure of £12,000, of which amount subsidised labour would account for a considerable sum. When the council arrived at its decision Cr Guy protested and urged that the negotiations he proceeded with, and lie moved an amendment in that direction, but it was defeated. The Mayor, when he introduced the subject, said he was fully convinced that the council had acted wisely in not being in a hurry to submit the loan proposals to the ratepayers. although its action in showing eonmionscnse and foresight had been criticised. The letter from the Labour Department had confirmed the council's earlier [views that the subsidised labour would | not lie available, but it was a pity the [ information had not been released earlier. The proposed loan would be lor [a term of 12 years, concluded the Mavor.

Cr Guy said his idea of raising fluloan at 3.1 per cent, was right. but the Mayor had through delay lost the opportunity. He reminded the Mayor that the latter had told the ratepayers lie would go on with a roadscaling loan. Cr Guy did not blame the

Government for withdrawing, seeing that borough councils, including bedding, were using the scheme lor general maintenance purposes. The Tedding borough had subsidised labour to the tunc of £3OOO. 'J lie .Mayor replied that there had been no delay in taking the preliminary steps towards raising the loan and' he challenged anyone to prove otherwise. Any delay was not of his making. On taking office lie had prepared proposals and had made inquiries regarding subsidised labour. He could not" go to the ratepayers until he was satisfied that the subsidy would ho available. Admittedly the council would have to pay £SO more per annum, but that was not the council s fault. Tlie Government had raised the rate of interest. The council now knew where it stood, the uncertainty having been lifted bv the department’s letter. Ho felt the council had done the right thing. , Cr Andrews considered the .Mayor had acted in the best interests of the ratepayers. . Cr Smith did not think it was wise for the council to go on the market with a loan proposal just now, and it would he showing good judgment if it allowed the £6OOO loan to go by the board for at least a year. Cr McCorkindalc thought the money could he raised. The council would get tlie money at a lower rate than ever it had done before for tar-sealmg work, even at 4} per cent. Cr Buist said the ratepayers would have to decide the issue and if the loan proposals were turned down at the poll the council would at least have the satisfaction of having dono its The Mayor agreed with the remarks of Cr Buist. The motion was earned without tuitlier discussion.