HOUSING SCHEME

Timaru Herald, Volume CXLII, Issue 20535, 29 September 1936, Page 9

HOUSING SCHEME

REVIEWED BY TOWN

CLERK

MORE A GOVERNMENT MATTER

While sympathetic with the proposal for workers’ dwellings, the Timaru Borough Council is not in a position at present to undertake any such work, according to a decision at last night’s meeting of the Council. The Town Clerk (Mr E. A. Killick) reported that on August 18 a circular was received from the State Advances Corporation asking whether the Council had undertaken a housing survey and whether it proposed to proceed with a housing scheme and, if so, what was the estimated cost and the date that any lean money would be required. In November last the Council received a circular from the Undersecretary, Department of Internal Affairs, forwarding a copy of the Housing Survey Act, 1935. The Act further provided for regulations, but as it was only to continue in force until December 31, 1936, and then would be deemed to be repealed and as in the meantime a new Government had taken office, the Council took no action thereon. A complete housing survey would entail considerable time and cost and without this he was not in a position to make anything but a very cursory report on the matter.

Nothing Approaching Slums

In regard to overcrowding, said Mr Killick, the Sanitary Inspector stated that though he has not made any investigations yet in the course of his inspections, he has come across one or two cases where more than one family was living in a house designed for one. Nevertheless with few exceptions he has not seen any instances of anything approaching slums or seriously unhealthy living conditions though in a number of cases there were existing houses which on account of their age, situation and materials were approaching a state when they would require demolition. Some of these houses were built on narrow sections and when the time for rebuilding arrived the required side yards, etc., would not be available. To buy up blocks of such areas, demolish the houses, enlarge the sections and build modern dwellings on them would be a formidable undertaking, unprofitable to a private investor, and entailing a burden on the public funds, if undertaken by the Government or local authority, though udoubtedly a most worthy object. In regard to shortage of houses, the result of inquiries he had made from house agents in Timaru, was to the effect that there was a good demand for modern brick bungalows, but in many cases the buyers were those leaving old fashioned wooden houses for which there was little demand unless the owners were prepared to reduce the price. Although there was no difficulty in purchasing a house in Timaru there was difficulty in renting one, particularly amongst the working classes. This, however, did not necessarily mean that there was a shortage of houses but rather that there was a shortage of money with which to purchase, there being a number of people who would be quite willing to purchase but cannot produce a sufficient deposit.

Question of Rent

In regard to the question of whether the Council should build houses, such would, of course, not prove a profitable transaction, and might easily entail some loss and if bad debts were incurred, it would involve the Council not only in loss of rent or interest, etc., but also in loss of rates. The Council had had this experience in the past and whereas in the case of a private landlord, the Hospital Board would pay the tenant’s rent, if the tenant’s circumstances warranted it, he thought that it might be taken as certain that the Hospital Board would not under similar circumstances pay the rent to the Borough Council though there is no logical reason why it should not. It might be argued that in view of the existing system of local taxation, which was for the object of raising money to give, services impartially to every property in the borough, it was not the province of the Borough Council to finance schemes somewhat in the nature of relief. There was at present considerable discussion as to whether Hospital Board funds, which were utilised for the relief of the needy, were raised in the most equitable manner, even though there were not raised entirely by rates but partly by levies over districts embracing a number of local bodies and partly by subsidy from the consolidated fund. If it be considered, therefore, that the method of taxation to provie funds for Hospital Boards should be altered and based on ability .to pay, how much more so was such argument applicable to the provision of houses by Borough Councils for those unable to pay for them, the funds for building which were wholly derived from the rates. It must be remembered that there are plenty of enterprising persons willing at present to build houses so long as sufficient deposit is paid ensuring against loss and, therefore, tl.ie building of houses by the Council apparently would only apply in respect to those unable to put up a sufficient deposit. “It is by no means an easy matter to obtain a rent for a newly erected house which would pay the interest value of the money invested or borrowed for the purpose,” said Mr Killick. “Local Bodies, of course, can obtain their money by loans secured by the issue of debentures bearing 34 per cent, interest as against the 5 per cent, for overdraft paid by the builder, but even then the undertaking could hardly be considered a business proposition.” Business undertakings. by Borough Councils were only warranted when they were in the nature of a community service available to every ratepayer, and under all the circumstances it appeared that if houses were to be built in Timaru lor persons, whose circumstances at present did not enable them to pay the requisite deposits, if purchasing the house, or sufficient rent to cover both interest and either sinking fund or depreciation, then it would seem better that the financing of such a scheme should be undertaken by a Government Department rather than by the Borough Council provided, of course, that the Borough Council did not lose its security for rates. The Works Committee recommended that a copy of the Town Clerk’s report be sent to the manager of the State Advances Corporation, who should be

informed that while the Council was sympathetic with the proposal for workers’ dwellings, it was not hi a position at present to undertake any work in connection with it, and suggested that it is a matter for the Government to take action rather than for the Borough Couch