THAMES BOROUGH

Waikato Times, Volume 111, Issue 18632, 10 May 1932, Page 8

THAMES BOROUGH

FINANCIAL DIFFICULTIES. COMMISSIONER TO BE APPOINTED. RELIEF MEASURE PASSED. WELLINGTON, Monday. The House of Representatives put through the Thames Borough Commissioner Bill in 18 minutes this afternoon. Arising out of the financial difficulties of the Thames Borough, the bill provides for the appointment of a commissioner to administer the borough until the municipal elections in May, 1935, and generally ratifies the. arrangement recently made between the borough and its principal debenture holders.

It was explained that the Government was in no' way affected by the bill, which was merely to give legal machinery to the agreement made between the borough and Its principal creditors. However, as Government departments constituted the bulk of the debenture-holders, it was not possible to proceed by way of a local bill, and the measure was accordingly put through as a Government bill. ■The indebtedness of the borough was stated to be £250,000. Owing to the decline in mining operations and the general trade and economic depression the borough has found it impossible to collect all its rates, and has thus been embarrassed in meeting its loan charges. It is expressly stated that the legislation shall not entitle the debentureholders to any claim upon the Government or on -public revenues. However, the bill will bind the Public Trustee, the State Advances Superintendent, the Government Insurance Commissioner, and the State Fire Insurance general manager, in so far as it affects their respective rights as debentureholders. Provision "is also made for the appointment of an advisory committee, ■consisting of the Mayor and four others, whose term of office shall coincide with that of the commissioner. The elections of the borough representatives on the Harbour, Hospital and Power Boards are also postponed until May, 1935. Loan Reductions. ‘ As soon as practicable after the appointment of the commissioner, the accumulated sinking funds, or a portion to be directed by the commissioner, are to be applied proportionately in reduction of loans. Every sum thus paid ■shall be accepted by the debenture-holders as a reduction of principal, notwithstanding that such principal shali not have become repayable. Instalments of interest becoming due in the current year shall be capitalised and added to the principal. Outstanding rates are to be credited to the general account. The commissioner is not permitted to exercise the power given in the Municipal Corporations Act to levy a consolidated rate, but must levy separately the general rate, and every special rate. Special rates are to be allocated pro rata to the sinking funds, and in satisfaction of interest before any payment is made to debenture-holders.

After the legislation is effective, debentures are to be delivered to the commissioner for registration . and amendment. All interest payments during the term of the commissioner and thereafter are to be paid by cheque. During the commissionership, no steps shall be taken, whether by way of action or proceedings, for the appointment of a receiver to enforce the payment of principal or interest otherwise than in accordance with the provisions of the bill. The Minister of Internal Affairs, the Hon. A. Hamilton, said the bill had been framed on the principle that the commissioner could not operate until either all the debenture-holders had concurred or the Governor-General-in-Council .was satisfied that the interests of any dissenting debentureholder would not be prejudicially affected.

'Mr A. M. Samuel (Government — Thames) said debenture-holders had agreed to the postponement of interest for 12 months, so that all concerned could help in the process- of rehabilitation.

Mr Samuel pointed out that, in addition- to the borough indebtedness of £250,000, there was a Harbour Board loan of £66,000, making a total of £316,000 to be split up among 1100 ratepayers. The bill then went through Committee without comment, and was read a third time. The bill was later read a first time in the Legislative Council.