The Wanganui Chronicle. TUESDAY JUNE 16, 1931. THE £5,000,000 LOAN

Wanganui Chronicle, Volume 74, Issue 140, 16 June 1931, Page 6

The Wanganui Chronicle. TUESDAY JUNE 16, 1931. THE £5,000,000 LOAN

piE partial success of the Government’s £5,000,000 loan on the London money market should give critics of the Local Bodies’ Loans Board occasion to think furiously. Sixty-eight per cent, of the loan was left with the underwriters. The return to the investor was high, namely, £6 Is 3d per cent and this return, despite the short period, should have been attractive. India had recently raised a loan at 6 per cent. The raising of £5,000,000 in London to-day is no easy matter despite the fact that the Government Bonds are Trustee Securities. Wanganui Harbour Board debentures are not. The chances of the Wanganui Harbour Board successfully raising £40,000 at 5-j per cent for a harbour that is not paying its way is, therefore, remote. Storming at the Local Bodies’ Loans Board is in consequence, a somewhat futile activity. That at the present time the London money market requires nursing is obvious. The Government will require to exercise strict control over local body borrowing. A survey of the growth of Local Body indebtedness reveals the considerable expansion of this form of mortgaging of Dominion assets. The growth has been considerable in yecent decades as will be seen from the following:— Year. Total Local Body Debt.

Local Body and Public Debt cannot go on forever mounting in this way. Some cheek must be put upon it, and that check had better be applied here and not in London.

£ 1900 . . 1910 .. .. . 14 937 683 1920 .. .. 24 608 29;: 1925 .. .. . 45,720,794 1926 .. .. 51 726 897 1927 .. .. . 56 412 759 1928 .. .. 58 949 028 1929 .. .. . 62,003.786 During the sam e period the net nationa 1 debt has grown as follows:— Year. Net Total Indebtedir ess Percentage of Debt per Capita. £ s d 1900 . .. 46,930,077 58 15 6 1910 . .. 73,387,420 70 17 10 1920 . .. 193,913,191 156 .15 5 1925 . .. 214,287,128 155 6 9 1926 . .. 236,581,216 .167 16 3 1927 . .. 243,407,349 169 5 5 1928 . .. 248 740 736 1929 . .. 256.652,371 .174 JO 4 1930 . .. 265,051,920 178 1 J