MUNICIPAL FINANCE

Otago Daily Times, Issue 23796, 1 May 1939, Page 8

MUNICIPAL FINANCE

It will be a cause for gratification on the part of the ratepayers that, at a time when local authorities are, by reason of increased costs, experiencing some difficulty in the budgeting of their accounts without recourse to additional rating, the Finance Committee of the City Council finds itself in the position of being able to propose a reduction in the local rate. The Council, on coming into office, considered it necessary, it will be remembered, to increase the rate by fourpence in the pound in order to remedy the damage done to the financial structure of the city by the squandering for which the previous Council was "responsible. It will not be without the exercise of a great deal of care in the disposal of its funds that the Council will succeed in keeping expenditure within revenue during the year. A factor that has necessarily affected the preparation of the estimates in an important degree is the decrease in the relief that can be afforded to the general account by transfers from the trading departments. The Electric Power and Lighting Department and the Water Department are both faced with the need of capital outlay to a large extent, and while the former department, the revenues of which continue to expand most satisfactorily, is still able to contribute £16,384 to the municipal fund, this being a reduction of £2OOO on the preceding year’s contribution, no transfer at all from the Water Department is proposed. The Tramways Committee, also, is no longer in a position in which it can make any contribution to the general account. The whole future of the municipal transport services must, ' indeed, cause very serious concern to the City Council. The Gas Department will contribute £2OOO to the general fund, which will thus benefit by £18,384. in all by transfers from the trading enterprises and will also receive, as was the case last year, the sum of £6OOO representing a transfer of insurance premiums. It is partly because of the reduction in the amount of the assistance available from these sources that the estimated revenue for the year is below that received in the past year. In these circumstances it is not surprising to learn that the Finance Committee has, in order to avoid a deficit, deemed it necessary to prune some of the departmental requisitions that were submitted to it. Whether it should be possible to defer any of the proposed expenditure and thus to extend the margin that is available for contingencies is a question that may call for consideration later on.