Harbor Board.

Poverty Bay Herald, Volume XXI, Issue 6910, 23 February 1894, Page 3

Harbor Board.

The Board met last evening. Present— the Chairman, and Messrs Gray, Matthewson, Hepburn, Chambers, Crawford, and Tucker. ELECTION OP CHAIRMAN. On the motion of Mr Gray, seconded by Mr Matthewson, Mr Townley was unanimously re-elected Chairman for the ensuing; year. Mr Crawford, on behalf of the ratepayers he represented, moved a vote of thanks for the past services of Mr Townley as Chairman of the Board. — Mr Chambers seconded, and spoke of the time which Mr Townley devoted bo the duties and the zeal he displayed. — The motion was carried unanimously.— Mr Townley briefly acknowledged the compliment. . THE TRUST FUNDS. A telesrram was read from Mr Carroll, acknowledging receipt of communication re the investment of the Board's money by Public Trustee. He promised to represent the matter to the Colonial Treasurer. The following letter was read from the Public Trustee:— "l beg to acknowledge the receipt of your memoranda of. the 2nd inst. with the copy of the report of the Committee appointed to investigate the accounts rendered by this office. With regard to the investment of the funds, I need hardly remind you that the unexpended balance of the loan was, until April 11, 1892, invested on fixed deposit with the Union Bank under an arrangement which was tantamount to the permanent investment of the money in that way. The amount was then withdrawn with the permission of the bank, and invested in Government securities at 5 per cent., the rate which would have been allowed by the bankfor the year which was to end on the 11th of April, 1893. The bank rate had fallen to 4& per cent, so that, it the money had been then redeposited with the bank, interest at the rate of 4J per cent, only would have been allowed for the following year which ends on the 11th of April, 1894. The money, however, having been invested in Government securities repayable on the 30th of June, the Board, consequently, as has already been pointed out, gained one-half per cent for three months, besides the advantage of receiving the interest half-yearly. I should again call your attention to the fact that though the bank rate is now 5 per cent, it was 4£ per cent at the time when the deposit would have matured, supposing the money had not been withdrawn from the bank; and the Board could not therefore have secured the higher rate for fresh deposits made during the currency of the period of the deposit in question. In other words : If the money had, on the 11th of April, 1893, been redeposited with the bank when interest was 4J per cenfc, the amount could not during the year, have in any way yielded the higher rate of 5 per cent. Thia must be obvious, and if the account which has been prepared and forwarded to me for the purpose of exhibiting a comparison of the result of the investment of fixed deposit in the bank with the result of the investment in Government securities, should be modified. in accordance with the foregoing facts, the comparison will prove the fund to have rather benefited than suffered by the course which has been adopted. As to the investment which is urged, in firs.bolass real security, I should state that I am willing, nay, anxious, to invest the funds in this manner when I can do so in desirable securities, worth, at least, double the amount required on them. I have not, however, been able to obtain such securities of late. If there are properties in Gisborne and the surrounding district on which money could be safely invested, I should be glad if the possessors could be directed to make to my agent, or send to me direct, the applications necessary to the consideration of the investments. The security of the fund is of greater importance than a -high rate of interest at the risk to the fund of investments in securities which may be liable to great depreciation in value, and may consequently involve loss of capital. The charges which have been made by the office for the administration of the fund are those fixed by an Order-in-Council, except the charge of one-half per cent, on the interest from the £59,000. The Order authorises me to levy 5 per cent, for this charge. The guarantee of one-half per cent, is a charge fixed by the Act of 1891 to secure the integrity of the funds invested by the office prior to the passing of the Act. The charge, however, is not applicable to the recent loan of £1000 to Mrs Hall, and the amount which has been charged will therefore be refunded to the account. The entry which appears twice of the amount of £8 5s lid, to which my attention is called, is a cross entry, that is, an entry on both sides of the account, and the error of repeating the entry does not consequently disturb the balance of the account. { ■ The Chairman said that it was only playing with- words to say that the deposit in the Union Bank was tantamount to a permanent investment. It was nothing of the sort, as was proved by the fact that the Public Trustee removed the money without notice. The reply completely evaded the circular of the Board. Regarding £12,000 of the sinking fund, the Public Trustee must be perfectly aware that the money could be invested in this district at 6 per cent, or over. He thought the. Board should take decided action in the matter. He was convinced that they would be shuffled about from one office to another unless strong action was taken. ' Mr Chambers thought the sooner the Treasurer and the Public Trustee understood the matter the better. The money was the private property of the ratepayers, and he asked what right the Government had, to take it out of their hands. He protested againut the Government making a profit of their money at a loss to the^ district. They had pledged their properties for the money, which the colony had confiscated. The position was unparalleled in the British Empire. Mr Gray remarked the mouey had been taken by a non-borrowing Government. Mr Chambers : They don't borrow. They collar. Mr Crawford agreed that the Board should take strong action. Perhaps the best thing members could do would be to resign. Mr Chambers said in that case the Government would merely step into their shoes. He thought the action of the Government could be upset by an appeal to the common law of England. Mr Matthewson said they should keep hamtneriug away until they got redress. The arrangement through which they had lost control of their funds had been carried in Parliament without a protest from the then member for the district. ■The Chairman said he did not so much object to the Government having control of the funds, as to the unprofitable manner in which they were invested. It was agreed that the Finance Committee should meet and draw up a reply to the Public Trustee's letter. Mr Gray thought they would strengthen their position very much by showing the Trustee that the money could be safely and profitably invested in the district. THE NEW WORKS. Mr Drummond, C.E., reported that Mr Sellars was carrying out his contract in a satisfactory manner, and recommended a progress payment of £289 15s, which was agreed to. THB CHANNEL. The Harbormaster reported that the channel was in a very good state. There were no alterations in soundings since the previous report. It was stated there was 9ft of water in the channel the whole way up. THE RATE. The striking of a rate of the same amount as last year was confirmed