SHORT OF MONEY

New Zealand Times, Volume XLVII, Issue 10852, 18 March 1921, Page 5

SHORT OF MONEY

LOCAL BODIES AND LOANS COMPLETION OF HYDROELECTRIC SCHEMES. CAN AMOUNTS BE RAISED? Would the Prime Minister take the necessary steps while at Home to secure finance for the local bodies which were to act as distributors of hydroelectric current? asked Mr J. P. Luke (Wellington North) in the House of Representatives yesterday. The Government schemes at Mangahao and Waikaremoana, he said, would soon be well forward, and unless the local authorities could get the machinery, etc., required for distributing purposes, the Government hvdro-electrio works might be lying idle and the whole scheme frustrated. He asked the Prime Minister to endeavour to raise at Home sufficient money to carry on these works, but make it a charge on the local authorities so that they could redeem it as soon as the financial position improved. PRIME MINISTER'S REPLY. LOANS ON LONDON MARKET. Mr Massey agreed that tho hydroelectric works were the'most important now being carried on, whether by the Government or by local bodies. Recognising that fact, the Government had endeavoured to help the local bodies concerned to the best of its ability ; and in some cases successfully. He knew that one local body was placing a loan in London pn its own account, and a big one, too; and that it was likely to be successful. He understood that arrangements were being made by another local body to borrow in London. The Government was assisting other local bodies in other ways. If he could assist the Wellington City Council in providing machinery, etc., for the distribution of hydro-electric power he would be very glad to do so. He was not sure, however, that he could raise a big loan. The London market had been very bad, but there was now a distinct improvement. NO LONG-TERM LOANS. The Hon. J. A. Hanan (Invercargill) asked whether the Prime Minister would make inquiries in London as to the possibility of raising loans for local bodies which had. loans falling due, whether here or in London. He expressed the hope, however, that the Prime Minister would not tie up the people of this country by long-term loans at the present time. He understood that the local body referred to was practically paying 7 per cent, for a loan in London. Mr Massey said that a good principle to go upon was, “Tho higher the interest the shorter the term’’ ; and that was the principle he intended to go upon! In mentioning 7 per cent Hie hon. member was not far wrong He believed the figure was £6 15s per cent. Mr Hanan: New South Wales has paid 7 per cent. Mr Massey: Well, I don’t want to institute comparisons, but our finance is so unquestioned that I think we shall be able to do better than that. MANGAHAO SCHEME. MINISTER EXPLAINS. The H.on. J. G. Coates explained that he had made a mistake in telling Dr. Newman (Wellington East) the other day that the Mangahao scheme would be finished in two years’ time. Ho should have said in two and a half years, the estimate given last session being that the Mangahao scheme would be completed in three years from October of last year. ■Dr. Newman: Can we rely upon it being finished then ? Mr Coates: As I stated on the previous occasion, the indications are that the work will be carried .out according to programme; that is to say, that it will be completed within three years from October last.