HAMILTON’S FINANCE

Waikato Times, Volume 93, Issue 14538, 9 December 1920, Page 6

HAMILTON’S FINANCE

GAS AND ELECTRICITY DEFICITS. DRAINAGE WORKS HAMPERED. OWING TO LACK OF FUNDS. A report on the financial position of the gas and electricity departments yvas submitted to the Hamilton Borough Council last night by the borough treasurer, Mr E. ,1. Davcy, as follows; —

As treasurer lo the Council. 1 have to call your attention to the financial position of the gas and electricity departments and to point out Ihe necessity for immediately taking what slops may he considered advisable to deal with it.

For the eight months from Ist April to 30th November, there has been received on. gas supply towards the district fund account the sum of £20,486 4s 4d, while during the same period the sum of £24,214 4s 4d has been paid out, leaving, on the face of it, an apparent deficit for eight months’ working of £0728; during the same period there lias been received towards the district fund on electricity supply account the sum of £6717 7s Bd, and been paid out of the sum of £8227 IGs Hd, leaving, on the face of it, an apparent deficit of £lslO Os 3d for eight months’ working. In the case of the gas department, there is an amount somewhere near £llOO to be credited to that department and charged up against other departments, such as street lighting, streets maintenance, etc., and there has also been paid to the district fund account from gasworks loan account a nett amount of £OO7 0s 8d (Ibis is independent of a refund from loan account of the sum of £1509 12s 4d, the deficit on gasworks silpply account as at 01st March last); on the other hand there has been paid out from another loan the sum of £2BO IGs for the motor truck used by the gas department, and which the Council decided some time ago was to be refunded out of revenue account, as well as a proportion of general office salaries, etc., to be charged to gas account, so that the approximate nett cash, deficit at end of November is £2700 for the eight months. In the case of the electricity department, there is an amount of probably £I2OO to be credited to the department and charged up against other departments, such as street lighting, waterworks, etc.; there is also included in (lie payments made during the period referred to the sum of £37.) transferred to loan account by direction of the Auditor-General, and which properly belongs to last financial year (thereby increasing the deficit on eelctrieity account as at 31st March last to £3862 14s 8d). On the other hand, there has been paid out from a loan the sum of £265 3s for the motor-car used by the electrical engineer, and which has yet to be refunded out of revenue account; there has been sold plant to the value of £249, as well as a proportion of general office salaries, etc., to be charged to electricity account, so that the approximate nett cash deficit at end of November for the eight months is £550, making a total for the two departments of £3250. Seeing that with both departments the summer period of the year is the period when the revenue is in the ordinary way the lowest, and taking into consideration the fact that between now and the end of March there have to be paid for interest and sinking fund on gasworks account about £IBOO and on electricity account about £SOO, it appears, under existing conditions, that the, deficit on each department is more likely to be increased than to be decreased. and it is therefore absolutely necessary that something should be done to ideal effectively with the position.

The Business Manager of the gasworks and electricity departments will probably show that both departments pay, but unfortunately both departments are in the position of a business man who may be doing a good business, but finds himself unable to continue to carry on owing to his lack of cash capital. These departments have had the difference between the actual district fund overdraft and the limit of that overdraft' to work on, but that difference cannot carry an unlimited amount, particularly as payments for interest and sinking fund on loans other than gas and electricity will be heavy during (he next four months. The Council lias decided that the carrying out of drainage loan proposals is to go on, but in the absence of being able, so far, to raise the necessary loan moneys, the locking up of over £7OOO (which otherwise would lie available for drainage or other purposes which arc a direct charge on rates, if both gas and electricity departments were

“standing on their own feet”) in the business of gas and electricity supply, will necessitate the reconsideration of that decision until the financial position is considerably improved.