MUNICIPAL FINANCE.

New Zealand Herald, Volume LXI, Issue 18631, 12 February 1924, Page 9

MUNICIPAL FINANCE.

SATISFACTORY position. WORKS UNDER RECENT LOAN STREET PAVING AND TRAMWAYS. Matters relating to City Council finance and development works were discussed yesterday by the Mayor, Mr. J. H. Gunson. In view of a recent statement by the Prime Minister that money could not now be obtained! in London under six per cent., Mr. punson was asked, if the hardening of the money market would affect the finance of. the Council. Mr. Gunson said that the Council in December took advantage of a favourable market in London to issue £250,000 worth of debentures. This would provide finance on loan account till .the end of the present year. It might carry most of the works till the end of the administration's present term. The loan was issued at th 6 favourable rate of 5 per cent., realising 99 to the Council. Immediately afterwards the market hardened, due largely to the heavy demands of the Australian State and Commonwealth Governments. When the Council issued its loan at 5 per cent., the State Governments of Australia were issuing loatfe in their own states at 5\ per cent. ' Auckland therefore could be considered to have made a verv advantageous sale. The principal works provided for by the loan were permanent paving of streets, £109,000 and tramways £105,000. There were also the Zoological Gardens and library buildings *at Parnell and Grey Lynn. The former library was nearing completion. The last debenture issue had placed the Council's loan accounts in a satisfactory position, said the Mayor, particularly in view of the fact that £125,000 was due on account of the tramways from the Electric Power Board next month. The Council's general funds would also be in rcceipt of an amount exceeding £100,000 from the Power Board at the same time. The Council had already decided that portion of the latter amount at least would be apportioned for city improvements, such as the widening of High Street, for which no loan authority existed.

This payment by the board would close the recent sale of an electricity business of the Council to the board, as far as the financial aspect was concerned, added Mr. Gunson. " I think it will .be admitted now that the whole transaction has proved to be in the interests of the entire territory served by the Power Board, which, owing to the regrettable divisions of local government, is a much greater thing than could have been established by the Council." ~ The Mayor said that as far as could bo forecasted the present- financial year would end with a credit balance in general account. All the other accounts also were in a satisfactory position, particularly those affected by rating. The growth and development of the city were reflected to a striking degree in the city's accounts. The next budget would be submitted to the Council toward the ind of April.