The Southland Times. PUBLISHED EVERY MORNING. “Luceo Non Uro.” FRIDAY, SEPTEMBER 11, 1936. The Board And City Ratepayers

Southland Times, Issue 22992, 11 September 1936, Page 6

The Southland Times. PUBLISHED EVERY MORNING. “Luceo Non Uro.” FRIDAY, SEPTEMBER 11, 1936. The Board And City Ratepayers

The opening sentences in the amended circular which the Southland Electric Power Board has prepared especially for distribution in the city of Invercargill cannot be construed as anything but a deliberate and mischievous attempt to cloud the issue and mislead the ratepayers. In these sentences an attempt is made to frighten city ratepayers into voting for the board by the threat that if the Government takes control of the Southland power scheme their general rates may be increased, they may have to carry the losses on the trams, and the gasworks which they own may be made bankrupt. We say that these threats are deliberately and mischievously misleading because the Minister of Finance has stated on behalf of the Government that there will be no attempt to take over the Invercargill City Council’s electricity business unless the consumers in the city subsequently consider that desirable. In a statement made from Wellington on September 8 Mr Nash said: — He believed that if the whole electricity business in both city and country were run as one it would be possible to effect many economies, and, with ample power available from the Government stations, to so stimulate the use of electricity as to make possible quite considerable reductions in the average selling price. This, however, was not in the present proposal, hut could be considered later if the consumers in the city considered it desirable. Mr Nash has been impressed by the high retail charges made for electricity in Invercargill, and he states frankly his belief that if the city and country systems were combined under Government control he could give substantial reductions in charges to all consumers. It is to be noted that the average price per unit of electricity received by the Invercargill City Council is (according to the latest available statistics) 2.33 pence compared with an average among all New Zealand city, borough and county supply authorities of only 1.25 pence. In other words, Invercargill consumers are paying) for their electricity nearly double the average New Zealand price; and a substantial part of what they are paying is going towards relieving the rates and maintaining the trams, while at the same time by keeping electricity charges high the City Council tries to protect the city gasworks. As we have said, we think this situation is fundamentally wrong and we think it is retarding Invercargill’s development as an industrial city. Mr Nash may have the same views; but he has given his word that the Government will not take any action that the citizens of Invercargill do not themselves desire. City ratepayers may therefore completely disregard the various alleged “risks” set out at the head of this highly-coloured circular and later enlarged on in extravagant terms. The circular is signed by Mr J. T. Carswell, chairman of the board, but we take leave to doubt if Mr Carswell has had any hand in its preparation. For it is a circular warning the people of Invercargill against the “dangers” ,of any change in the policy which makes electricity consumers contribute to the rates and support the trams and gasworks; and Mr Carswell himself has indicated that he does favour a change in this policy. The following is an extract from a footnote written by Mr Carswell to a letter signed “Tin Tacks” which was printed in The Southland Times on June 29:—

The City Council has for years past been faced with three serious problems: (1) how to maintain its revenue from the Municipal Gasworks whilst at the same time engaging in the sale of electricity; (2) the annual loss incurred upon the running of tire trams; and (3) how to keep down the land rates in the city.

The method adopted was to fix a scale of charges for electricity which would yield a good rate of profit for that department, and so enable power to be supplied at a low price to the Tramway Department, and a sum of £lO,OOO to be applied in relief of land rates, and further —the charges for electricity for cooking and heating were fixed at high rates, so that electricity would not unduly compete with gas for the purposes mentioned. Now I am not criticizing the City Council (with whom I wish my relations to be harmonious) for the adoption of this policy, but I think I am entitled to say that, if instead of the £lO,OOO being applied towards relief of rates, the City Council reduced its charges for electricity by 20 per cent, (or possibly 25 per cent.) as it could then do, it would, almost at once, enormously increase the consumption of electricity for cooking and

heating in Invercargill, thereby not only increasing the earning power of the City Electricity Department, but also increasing the quantity of current purchased in bulk from Monowai. As for the wisdom of continuing the policy of bolstering up the gasworks, that is a matter for consideration by the City Council, but I might be allowed to suggest that a good test would be to ascertain (1) the number of new dwellings erected in Invercargill during the past two years; (2) the percentage of electric, coal, and gas ranges respectively installed in these new houses. I might further add that the gas companies trading in Wellington and Christchurch are doing very well, in the face of keen competition from the municipal electrical departments of those cities. We are not reprinting this footnote with the object of embarrassing Mr Carswell personally, for as we have several times stated we have the highest regard for Mr Carswell and we know that his motives are as sincere as our own. But we do feel we are entitled to ask Mr Carswell how he reconciles his statement on June 29, which clearly suggests that changes in the City Council’s policy are desirable, with such statements as these now attributed to him: “Don’t risk the city’s electricity profits of £15,000” [from which comes the £lO,OOO applied to rates]; “don’t risk £90,000 city loans invested in gasworks by bankrupting them . . . any substantial variations in the charges for current in Invercargill will detrimentally affect the gasworks.” And if we may make one more comment on this circular (the greater part of it is a reproduction of the country circular which we have already discussed) it is this: it is probably the first circular ever issued in which an electric power generating and supply authority has shown such grave concern for the future of a gasworks. For a simple, straightforward statement of the case for the transfer of the Southland power scheme to the Government we commend our readers to the letter from Mr A. le H. Hoyles, in length of service the senior member of the Power Board, which is printed in our correspondence column to-day.