VERY COSTLY CAPITAL.

New Zealand Herald, Volume LXVIII, Issue 20842, 8 April 1931, Page 9

VERY COSTLY CAPITAL.

CANBERRA AND DEFICITS. HEAVY ARREARS OF RATES. LARGE LOSSES ON HOTELS. Simple accounts, which would show ths actual money spent in establishing the Australian Federal capital at Canberra, as well as the receipts for maintenance and expenditure and the results of trading activities, are deemed necessary by the Commonwealth Auditor-General, Mr. C. J. Cerutty. In his annual report upon the Treasurer's statement for the year ended June 30, 1930, the Auditor-General says that elaborate book-keeping systems followed in the past might satisfy a desire for academic accuracy, but as an aid to estimating the worth of the Federal capital as a commercial proposition they wer* entirely useless. To April 30, 1930, when the Federal Capital Commission ceased to exist, and its functions were taken over by Govern- ' ment departments, the report states that the ordinary revenue from interest, rates, rents and services was insufficient by £347,354 to meet the ordinary expenses of administration, interest, maintenance charges, losses on hotels, factories and so on. The corresponding loss for the previous year was £444,167. Comparing tho ten months of 1929-30 with the full year of 1923-29, the factories, transport facilities, hotels and other trading activities disclosed an increased loss of £56,000. This loss was - mainly due to charging a large sum for depreciation for quarries, brickworks and shc^s. Hotels, cafes and liquor bars, the report discloses, showed a loss for the ten months of £90,479, including £35,922 for depreciation of assets. For the full year of 1920-29, the 'loss on this item was £69,920. The Auditor-General directs attention to the preliminary and development expenses suspense account, which he says stood at £2,184,240 in the previous year, but at April, 1930, had been v decreased to £2,094,583, in spite of the fact that in the ten months there wa,i a revenue deficiency alone of £347,354 besides depreciation of assets' estimated at £603,863. The reduction in the total was brought about by entries appreciating assets by £1,076,295. This increase was set down as duo to a higher value placed

upon land. Serious arrears in the payment of rent for rural leases are noted in the report, and the Auditor-General says he doubts if the department has any means of recovering much of this money. The failure of the department to take action for the recovery of rates, it is considered, may allow other lessees with financial means to think that they can let their rates fall into arrears with impunity. * - * The total rent overdue at October 1, 1930, was £24,917. Individual amounts ranged up to £BOO or more. The number of rural leases in force was 343, these leases being held by 225 lessees.