ELECTRIC POWER

Southland Times, Issue 22296, 11 April 1934, Page 8

ELECTRIC POWER

GUARANTEE QUESTION MR MacGIBBON URGES REDUCTION MOTION DEFEATED A plea in general for consideration for the small or “domestic” consumer, and an appeal to have the guarantee payment reduced or eliminated altogether was put forward by Mr A. A. Mac Gibbon at the monthly meeting of the Southland Electric Power Board yesterday. In accordance with his notice of motion Mr Mac Gibbon moved as follows:— That all charges for electric current be reviewed and in particular that the minimum charge for domestic purposes be either eliminated or such a low rate imposed that everyone would be able to use sufficient current to enable them to escape the lowest minimum charge. This motion was the basis of an animated discussion, and the pros and cons of the case were fully ventilated. At first members were prepared to agree that the question of electricity charges generally merited.investigation, but in the final stages of the discussion it was obvious from the opinions of members that the guarantee question or other charges were more or less subservient to the rates at present levied by the board, and that an endeavour should be made to concentrate on giving ratepayers relief first. In the circumstances it was deemed useless to adopt a resolution which would mean entailing considerable work and time in submitting data for discussion and review, especially when it was patent that there was little chance of carrying out the intention of the original resolution. This, in a modified form, was finally turned down by the board by six votes' to four. Mr Mac Gibbon’s Views. In speaking to the motion, Mr MacGibbon said that many reasons could be given why there should be an alteration in the system of charging for current. In the first place guarantees were necessary, otherwise the board would have had no assured income, but as the board had now been running nine years since the opening ceremony, and as this did not represent the actual time that power had been supplied, it should have given the board ample time to build up the load and abolish charges which were not consistent with good management. In any case the charges were of an arbitrary nature, and did not necessarily represent anything further than amounts put upon certain services which seemed necessary in the initial stages. That time was passed and they would have to depend upon the actual revenue they received if they were to have a contented and satisfactory connection with the people of Southland. The cry of the widow and the orphan could not be ignored and justice must be done to them. The unemployed could not pay 5/- a month out of an earning of 30/a week. They should not be asked to do so. Three pounds per annum instead of nearly four was all that they should be asked to guarantee. And why should the consumers be asked to pay for what they did not receive? asked Mr Mac Gibbon. Throughout Southland there had been many cut off because they could not pay for what they did not receive, and yet they were willing to pay a large price foxcurrent used. These small payments were lost and missed by the board. The small consumer’s contribution helped to swell the revenue. “Then again why should they be cut off?” asked the speaker. “They are ratepayers, or in any case the property they live on pays. The rent, no doubt, bears a proportion of those rates. For that reason I say they should be encouraged and the very fact of theii" being relieved of what they feel an injustice will induce many to use more current and probably result in their actually consuming up to the amount we were charging for. The question is a simple one: ‘Treat me well and I will treat you well, but if you try to compel me to do something which I hold is wrong, then I will decline to avail myself of those luxuries that I am willing to pay for.’ By cutting out the guarantee, I feel sure that better business will be done. We will remove the one thing that is causing so much discontent. Need For Confidence. “Public opinion is against us; common sense is against us and as we are contemplating large additions to our supply, no matter from what source, our aim should be to build up confidence,” said Mr Mac Gibbon. “By this means we will build up an increased load that will enable us to give further concessions to the people of Southland. By reducing charges we will increase oux - sales and by increased sales we will make more revenue which will eventually result in doing away with the rate, and until that happens there will be no feeling of satisfaction throughout Southland. I am not asking you to make any concession, but simply to remove an injustice and hardship which the less prosperous people have suffered. Everyone is entitled to use current because they pay for installations and it is absurd to say to them, ‘use more or we cut you off’.” In support of his argument.Mr MacGibbon cited several cases of hardship in connection with the existing guarantee. Mi - J. D. Rodger seconded the motion. He said he heartily agreed with Mi - Mac Gibbon’s proposals. The question should be reviewed from a policy point of view. He would leave it to the board to frame a new scale of charges. Mi - W. McChesney supported the motion. If the board agreed to the proposals they would not there and then be deciding what the minimum guarantee would be or whether it would be eliminated altogether. He was satisfied, however, that the board should review its charges. A number of anomalies existed at the present time. He referred to the guarantees at Mataura, Bluff and Invercargill. Four pounds was too high a guarantee and was causing a lot of dissatisfaction. There should be a guarantee sufficient to cover the costs, say about £2. He also thought the time was at hand when their prices for power also should be reviewed. An Amendment. Mr J. T. Carswell said he was prepared to support the motion to a certain Extent. It was a wise thing that their charges should be reviewed frequently. There were a lot of things to be considered, however, and whether they were overcharging as stated by Mi- Mac Gibbon was open to question. There were certain anomalies unable to be readjusted, Mataura, for instance. They had to take over Mataura’s scale of charges, and the result was that Mataura .was enjoying a £2 10/- minimum which the board could not remove. Jle was not against the motion in its entirety, but he would move an amendment that all charges for electric current be reviewed. Mr Mac Gibbon: I don’t know what good there is in that. The relief is required immediately. Mr W. Norman seconded the amendment. In answer to a question the secret-

ary, Mr C. Campbell, said the question had been gone into roughly and his estimate was that if the guarantee were reduced by £1 the loss would be £5OOO. That was allowing fox- increased consumption by consumers who would use more than the guarantee. Mr A. le H. Hoyles: How would the reduction, if approved, affect the Invercargill agreement ? Mr Campbell: That is a matter that would require investigation. Motion Opposed. Mr T. Golden .opposed the motion. He said they would have to be very carefxxl what they did in the matter. They had to remember that their power was being sold at below cost. The farmer was paying the biggest part of the rate levied and what was he getting in return? He was entitled to a redxxction in the rate. He congratxxlated Mr Mac Gibbon on bringing the matter forward as it had been simmering in the minds of members for some time. They were losing £40,000 a year now and if the guarantee was reduced by £1 it would mean increasing the rate to meet the estimates. The question of hardship to small consumers mentioned by other speakers was being met in other ways. As for the dissatisfaction spoken of, he had not noticed any dissatisfaction in the county. They had 10,000 consumers and they could claim to have had the smallest trouble of any like business concern in New Zealand. He could not support the motion as he was satisfied the farmer deserved some consideration at the present time, and the board should consider making a reduction in the rate. Mr E. K. Sim said he was impressed with both the motion and the amendment, but, like Mr Golden, he was satisfied the rate must be the first thing wiped out. Mr W. Norman also supported Mr Golden’s remarks. “Reduce Rates First.”

Mr D. J. Heenan contended that the first thing to be considered should be the reduction of rates. The people complaining were the smaller ratepayers. Mr P. Arnott also supported MrGolden. The country ratepayers wanted the rate reduced, he said. They were not quibbling about the charges. A number of farmers had been asking him what relief they were going to get. He would vote against both the motion and the amendment.

The chairman, Mx- W. Hinchey, said the matter was not as simple as one speaker suggested. A lot of consideration had been given to all phases of the question, and it would be necessary that the matter- be fully investigated before a decision was made by the board. They had to consider the question of their power. They all knew they were up to the peak at the present time, and before doing anything as suggested they should be in a position to supply everybody who wanted power. If the power- was available then they could consider reductions or readjustments, but not until then should they consider reviewing their charges. He pointed out that there were few institutions in the world which did not have a minimum guarantee, and he did not see how they could get away from a guarantee here. However, there were many things to consider. They had to consider their revenue, the agreement with Invercargill, the Public Works Department, the Loans Board and a host of other things first. He agreed with Mx- Golden’s summing up, and was satisfied that the. charges for electricity were not worrying the people. After all it was not the small consumer- who was providing the board’s revenue. What the people were looking for was to get a reduction of rates on their land. Then they would be able to deal with the selling rates. A reduction of the rates on the land would give relief to the people who needed it most, dairy farmers in particular. In the meantime there appeared to be no urgent need for a reduction of charges. Their main objective should be to get rid of the rate. (Hear, hear.) Motion Withdrawn. Mr Mac Gibbon, in reply, said he was agreeable to hold the matter over until such time as they could get certain particulars and data before them. He then withdrew his motion in favour of the amendment. Mr Arnott: What is the use of putting the office to all the trouble of getting information when it is obvious from the discussion that there is not likely to be a reduction made? After further discussion the motion “that all charges for electric cxxrrent be reviewed” was put to the meeting and lost by six votes to four.