LOCAL BODY BORROWING.

New Zealand Herald, Volume LXIII, Issue 19388, 24 July 1926, Page 10

LOCAL BODY BORROWING.

The demand for some form of supervision over local body borrowing has been met by the Government with proposals which nobody will accuse -of being half measures. The bill just introduced provides for the setting up of a board to consider all borrowing schemes which may be devised. Its consent is to be necessary before the loan will be authorised, or even submitted to the ratepayers for approval. In brief it is, on the summarised terms of the measure, to have absolute power to disallow any loan proposal formulated by any local authority. " It may approve it in whole or in part, or it may disapprove entirely, in which case the local body is to have no remedy save the doubtful course of resubmitting the proposition a year later. Two objections suggest themselves. The bill provides for a board of seven, the Public Works Engineer-in-Chief, the Secretary to the Treasury and five other members not specified. The two ex officio members should be capable of good service, but they are busy men, with a host of other duties. There is no assurance that the other members will have any qualifications for their work. This body, then, is to wield a power greater than that of the people who will become responsible for the loan and its repayment. Where the need was really for an adviser qualified to adjudicate on the technical and financial merits of the scheme advanced, giving the people who should control the purse some basis for accepting or rejecting what their representatives propose, the Government offers an autocrat whose yea or nay shall be final. The idea behind providing control was that local body borrowing was growing too fast. The people, especially the ratepayers, might have been trusted to redress that position if a proper advisory board were provided to guide them in determining the merits of any proposal. Instead, it is suggested that the authority properly belonging to them shall be first exercised by a body owing them no direct responsibility. The bill calls for very serious consideration before being declared acceptable.