PARLIAMENT

Wanganui Chronicle, Volume 75, Issue 280, 26 November 1932, Page 8

PARLIAMENT

GROUND RENT REDUCTION : QUESTION OF LOCAL BODIES. | I Per Press Association.! WELLINGTON. Nov. 25. The Hou.se of Representatives met at 10.30 a.m. Mr. Parry asked whether unemployed women would be given the same treatment as unemployed men with respect to a fortnight’s pay at Christmas time. The Hun. A. Hamilton said that it must be recognised that women were in quite a different category. In their ease relief consisted mainly of meals and accommodation and this would be continued on the usual lines throughout the holiday period by the women’s unemployment committees. Local Body Ground Rents. An appeal to the Prime Minister not to abolish the exemption granted to local bodies in respect of ground rents was made by Mr. McKeen when the National Expenditure Adjustment Amendment Bill was under consideration in committee. He said that many local bodies would be placed in a very serious position and the reduction in revenue could only be compensated by an increase in rates. This would mean that ratepayers generally would have to pay for the relief granted to people. who in years gone by bad made handsome profits by receiving high rents for accommodation in buildings erected on the property, which they had leased at a very low ground rent. Mr. McKeen explained that the ground rents charged by the local bodies had always been very reasonable and in the case of the Wellington City Council they varied in most cases from 44 to 4 5-8 per cent. There were few cases where the rent was a little higher. Mr. Forbes said that the Select Com mittee had fully considered the representations from the local bodies on this subject, and had come to the decision that the amendment abolishing the exemption should stand as part of the Bill. Mr. Macpherson said that the Oamaru local bodies would be seriously affected, and emphasised that the ground rents charged by these authorities had always been very low. No applications for relief had been re ceived. Mr. Fraser said that the logic of the argument that there should be no differentiation between treatment of local bodies and private lessors had to be admitted, but on the other hand it must also be realised that local bodies had previously been charging lower rentals than private lessors. He suggested that there should be a limit below which local bodies should not be asked to reduce rents. He mentioned that the average ground rents at present charged by the Wellington Hospital Board amounted to 34 per cent, of the value of the land, and a 20 per cent,, reduction on this would mean that the tenants would be receiving very generous treatment. He asked whether the Prime Minister would consider setting up a tribunal to decide what would be a fair thing in the interests of all par ties. If this were not done there would be instances where people, who had in the past been enjoying the advantage of low’ rents, would be receiving a further reduction at the expense of the general community. Debenture Interest. Mr. R. A. Wright said that interest ou local body debentures had been reduced, but local bodies did not seem inclined to pass this relief un to their tenants. Continuing, he said that where any firm received a reduction in the rate of interest it had to pay ou borrowed money, it should be made to pass that relief on to the public. He cited the case of a Wellington firm which had failed to do this. Mr. Forbes: There is nothing- to stop them reducing their prices. Mr. J. A. Nash: They will not do that unless they have got to. Mr. Fraser suggested that the leases should be fixed on a. 34 per cent, basis. This would give relief to tenants who were hard pressed and would also afford some protection for local bodies. Mr. Forbes said that the Govern m ent’s whole concern was to bring about a reduction of rents in an equitlable manner. It is possible, he pointed put, that local bodies had the right of I appeal, and added that if a revaluation pf town and country land were made I to-day the valuations of a few yerrs ago would not be sustained. Mr. W. A. Veitch said that there was no doubt that the local bodies had made a greater saving as the result of the reduction in interest rates than they would lose in the decreased ground rentals. Mr. Walter Nash said that ground rentals were regarded as first mortgages, and there was a 5 per cent, minimum with respect tu the latter For this reason he considered that there should be a 5 per eent. minimum applied to ground rents. He was not supporting high rates of interest, but he considered that consistency should be maintained. He did not mind if there was a general reduction to 24 per cent, so long as it was applied throughout. Mr. McKeen called for a division cn the clause relating to ground rents, and rhe bells were set ringing. However, when the question was again put he did not press the point and the clause was passed on the voices. The Bill was put through committee with minor amendments and the House adjourned at I p.m. When the House of Representatives resumed at 2.30 p.m., the Mortgagors and Tenants Further Relief Bill was put through committee, at which stage progress was reported pending the introduction ot* an amendment by Governor General’s Message. Hospital Amendment Bill. Discussing the Hospitals ami Charitable Institutions Amendment Bill in committee, Mr. Savage again drew attention to the danger of a number of country hospitals being closed and the services being restricted by Order inUouncil. Mr. Fraser said he desired in no wav to oppose anv step in the direction of effecting economy so long as efficiency was not impaired, but he urged that every opportunity should be given the districts concerned to make full repre sentations before any instituions were closed. Mr. Hamuel said he regretted that the Minister wa s proceeding with the com mitten stage before the hospital boards had had an opportunity of submitting their views on the proposals contained in the Bill This view was supported by Mr. Richard’.

Mr. Savage took exception to the “back door” means of closing hospitals. He said that if the Minister desired to close institutions he should do so by means of legislation, thus placing members in a position of knowing what they were voting for. Hon. J. A. Young said that the Bill was designed to meet a need which had been before the country for six years. He pointed out that the Hospital Boards’ Association, which represented every hospital board in the country, had approved of the proposals in the Bill. These proposals had also been communicated by circular letter to every hospital board in (he Dominion. The boards had made certain representations to him, in consequence of which some concessions had been granted and some safeguards included. He regarded the programme outlined in the Bill as an excellent way to meet a difficult situation. Mr. Sullivan: "What are you really aiming at? The Minister said hp desired to bring about such changes as were required from time to time in an equitable and above board way. He again outlined the stops which would have to be taken before any institution was closed or any services curtailed. Continuing, he said there was no thought in his mind that any one of the 45 hospital districts should be close down, but at. the same time there was a certain amount of overlapping of services and it was possible that by co-operation or amalgamation it would be possible to eliminate this overlapping and in this way main rain the same standard of efficiency at a lower cost. The short title of the Bill was still under consideration when progress w r as reported. The Rational .Expenditure Adjustment Bill was read a third time and passed and the House rose at 5.30 p.m. rill Tuesday.