A SERIOUS MATTER

New Zealand Times, Volume XLIX, Issue 11158, 14 March 1922, Page 5

A SERIOUS MATTER

LOCAL BODIES’ FINANCE EFFECT OF NEW LEGISLATION DISCUSSED. PETONE BOROUGH’S POSITION. / The effect of certain clauses in the Local Bodies’ Finance Act in connection with the financial management of borough councils was touched upon at the fortnightly meeting oi the Petouo Borough Council last evening. , The -Minister for Internal Affaire, (the Hon. W. Downie Stewart) submitted a letter to tho council ana explained tho objects of clause 5 of the Act, making special provision as to the payjn® nt of moneys owing by local authorities as at the end of the present financial year, cither to bankers on overdraft or to oersons from whom moneys were received on deposit. Section oof tne Act gave power to a local authority to borrow- the amount of the antecedent Habilitv, either wholly or in part, or to extinguish the liability by seven equal payments out of revenue, one payment to be made in each of the period of seven years commencing m the council’s financial vear, 1923. A local authority may, however, in any one year, out of its revenue, provide jn extinction of the antecedent liability a sum greater than such seventh part. _ The Mayor (Mr J. W. McEwan) said the aspect was really a lawyer’s .conception of local body finance, and showed that <a legal mind- was in control. One could understand the Government crying a halt to anv further increase of the debt, but to simply transfer the overdraft debts and temporary deposits from one set of money-lenders to another—if debentures were issued to cover the total debt under these heads —was not satisfactory, and forced local bodies into needless expense ana probable competition in order to wise loans. “To force local bodies—if it is found impossible to raise loans to cover tme overdraft and temporary deposits—to increase rates at this time, , . McEwan, “inevitably means hardship to many deserving workers who are acquiring homes, and, as we oil know, in the case of rentpayere, it means increased rents and increased oost ot finally decided that the matter be held in abeyanoe in naturally coming up for further discussic® a Ifttor date*