LOCAL BODY DEBTS.

New Zealand Herald, Volume LXVII, Issue 20600, 26 June 1930, Page 16

LOCAL BODY DEBTS.

REPLY TO CRITICISM. OBJECTS OF LOAN MONEY. BENEFITS TO THE RATEPAYERS. 'A reply to a report published, in tho press of tho findings of a committee of the Aucldand Chamber of Commerce on local body indebtedness has been furnished 'to the "chamber by Mr. S. Gray, of Mount Eden. Tho reply states that & member of * the chamber, commenting on the report, claimed that the chamber was specially qualified to criticise indebtedness.

Mr. Gray has replied to the report, and W the spocial fitness of the chamber to criticise, as follows:

"It is quite true that local body indebtedness has very largely increased, but whether that bo a matter of regret or otherwise depends upon various considerations. What are the objects on which loan money has been spent ? On reference to the upturns, I find that 22 per cent, has been spent, on roads, 20 per cent, on drainage and sewerago, rather more than one-half per cent, on parks and gardens, 1£ per cent, on municipal buildings, 7£ per cent, on transport services, 22 per cent, on electric supply and lighting, and 1£ per cent, on gas supplies. I submit that there is no evidence of extravagance in tho above list.

"You state that these are not productive works, and ifc is true that they do not, usually yield a revenue to the local bod}', but the improved roads save all users of motor traffic very much more than the increased rates cost them. In the sanio way if the drainage works save a family one illness per annum) the addi» tional money spent on rates is saved many times. A business man may refuse to' spend money which will not show a definite return. The function of a local body is not to make money, but to provide benefits 1 for. ratepayers and residents. The benefits are usually forgotten, while the cost of them is remembered. "There is another point which the business men of the Chamber of Commerce will appreciate. A solid foundation for a road can seldom be provided from revenue, yet without a solid foundation expenditure for maintenance may go on for ever, and yet neVer provide a satisfactory road. It is better business to put down a road in solid material and thus reduce maintenance to a minimum. Such . maintenance together with" interest and sinking fund will be found to be less than the previous maintenance charges, and will permit the public to have a better road. If the counties had borrowed more, they might have had less complaint about rates. "The chief cause of the largo increase in local body indebtedness is that the public call -for the ownership of transport, of electric lighting and of gas to be vested in municipalities. Whether this is wise is open to question, but local bodies should not bo blamed for borrowing. the " money required to comply with the demands of the public. Local bodies do much work and receive little thanks. They would possibly be strengthened by the presence of more business men, and members of the Chamber of Commerce might consider the advisability of obtaining seats on the .various councils and acquainting themselves with the problems from the inside."