LACK OF FUNDS

New Zealand Herald, Volume LXXVI, Issue 23277, 21 February 1939, Page 10

LACK OF FUNDS

LOW RATE OF INTEREST POWER BOARD'S PROBLEM ALL CAPITAL WORKS CEASED [by telegraph —OWN correspondent] ASHBURTON, Monday Unable to raise funds from private investors, who refuse to take up debentures at per cent, the interest rate fixed by the Government, unable to enlist the aid of its bankers, and refused assistance by the State Advances Corporation, the Ashburton Power Board to-day was compelled to cease all capital works. This will mean that, unless funds are made available to the board at once, 30 of the staff will be put off. When the present stocks are depleted no new consumers will be connected. The board asked the State Advances Corporation to find £15,000, part of a loan of £50,000, but only half this was granted. This sum is already absorbed and commitments on the next few weeks total £9265. "We are a solvent concern, but cannot meet our commitments," said the chairman, Mr O. F. Nicoll. "It amounts to this, for the next few weeks we have got to put off all our creditors, telling them we cannot pay."

The board decided to send to the Minister of Public Works, the Hon. R. Semple, who had been urging the pushing on of work, a letter pointing out the facts and stating that the stoppage of installation work meant the shutting down on local industries, such as ranges and water-heaters, of which the board last year put in 170 and 140 respectively. The board was of the opinion that interest at 4 per cent would attract private investors and end the trouble.