LOCAL BODY DEBT.

New Zealand Herald, Volume LXVII, Issue 20595, 20 June 1930, Page 12

LOCAL BODY DEBT.

INCREASE IN PAST DECADE.

TOTAL NEARLY TREBLED.

CAREFUL EXPENDITURE URGED.

"There is no body which is better qualified than the Chamber of Commerce to criticise tho indebtedness of local authorities," said Mr. A. G. Lunn, at a meeting of the Chamber of Commerce Council yesterday, in commenting on a report on the growing indebtedness of local authorities, which was submitted by the parliamentary and taxation committee of the chamber. Mr. Lunn added that the Chamber of Commerce constituted the largest organisation of business men in Auckland, and its members were in sympathy with tho difficulties with which tho local bodes were confronted. The salient features of the present state of local body indebtedness were summarised in tho report of the committee. The gross indebtedness of local governing bodies had nearly trebled in the past decade, the figures having risen from £28,000,000 in 1919, to £68,000,000 at the present time. The per capita figures had risen from £24 to £46, while annual loan charges had increased from £1 6s to £2 19s per head of population. Taxation, on tho other hand, had risen from £2 14s to £4 5s per capita. In analysing tho purposes for which money had been raised, the report stated that relatively little of the expenditure had been on definitely productive works, and some of the so-called productive schemes, notably harbour works, wero not fully so. The non-productive character of this loan expenditure was indicated by tho great increase in per capita taxation.

The assets of the local authorities were estimated by the authorities to be of an aggregate value approximately equal to the gross debt. In fact, however, the assets included such items as reserves, parks and gardens which were not directly productive.

The committee reported that a letter had been sent to the Local Government Loans Board commending it for its refusal to authorise expenditure of an uneconomic character, and urging it to refuse to countenance the holding of polls in all cases where the expenditure was not proved beyond all doubt to be of a fully productive character, or in the public interest. >■ With regard to the system of State advances, the committee reported that it was of the opinion that the present system should not be interfered with except in two respects, namely, that the Government should be urged to exercise a greater measure of caution in lending on city and suburban properties, and also that the statutory provision for advances to workers of up to 95 per cent, of Values, should be altered to 75 per cent. The report of the committee was adopted.