Higher Wharf Rates Not Warranted At Present

Northern Advocate, 24 August 1945, Page 8

Higher Wharf Rates Not Warranted At Present

(P.A.) WELLINGTON. This Day. The Wellington Harbour Board’s application for permission to increase its dues and rates by 37 per cent on the ruling 1937 levels, has been deferred by the Price Tribunal until October 1, 1946. The tribunal’s judgment delivered yesterday would be reconsidered before that date should anything serious arise which necessitated a review.

“At the lime of the hearing, we were engaged in war,” said the judgment, "but since then Japan has surrendered years, and, in the view of the tribunal, this tremendous factor points the way to a return to the board of good trading conditions, if mot within the immediate future, at all events over the next few and, in the view of the tribunal, this outlook of the board, while i! may be one of difficulty for the time. is. in the long run. one which may be regarded with confidence. "It may be mentioned that, so tar as the tribunal can judge, it would be a great pity if the hoard gave up the business of a wharfinger which it has followed since its inception, and which has. no doubt, been done with efficiency and satisfaction to the business community. It was urged at the hearing that, as a result of increased wages which it.. has In en necessary to pay since the Waterfront. Control Commission came into existence, the position of the hoard would not be remedied by an increase in business, as a large portion ol it, at any rate, was being done at loss, but it appears lo the tribunal that having regard to nast. years’ working, in particular the year 1943, the increase in cargo tonnage handled would result in an improvement of the board's position." Overdraft Justified

Continuing, the judgment said that, at present, the board had no bank overdraft and the tribunal considered, in the present emergency, that recourse could reasonably be had lo that method of financing in order to assist the position. While recognising that the present policy of the board - towards funding for repayment of loan liability and, at the same time providing for depreciation and repairs and maintenance of fixed assets, was sound financial practice so far as the board was concerned, the tribunal considered that the practice could well be departed from under present conditions without impairing the board’s stability in any way. It was in accordance with the tribunal’s ordinary practice that applicants for tarice increases in rates or fees for services should be required to absorb increased costs when they were in a position to do so. The balance of the board's accumulated funds account had, at the present, a very substantial reserve which, it was considered, as it was built up out of past profits, should now be utilised to meet any temporary excess of expenditure over income. Payments From Revenue In the past, said the judgment, it had been the board’s policy to make capital payments out of revenue and though this procedure was undoubtedly a desirable cne for local bodies to follow where possible, nevertheless, the effect had been to reduce substantially cash resources available for the financing of the board’s operating expenditure. Therefore the tribunal considered the present position of the board’s cash resources had been brought about largely by this practice. It was the tribunal's opinion that, in order lo remedy the present position relating to cash resources, the board should give consideration in future to the financing of any further capital works by means of a loan.