HELP BY STATE

Press, Volume C, Issue 29505, 5 May 1961, Page 6

HELP BY STATE

Suggestion By M.P.

“It is calamitous that at a time when the Public Accounts show a surplus of more than £7 million and the Minister of Finance (Mr Lake) has been able to pajover £3 million to a reluctant dairy industry that vital sewerage work in Hoon Hay. Sockburn, Avrmhead, Bexley. Northcote aud Papanui is being held up by lack of loan finance,” said Mr M. A. Connelly. M.P. for Riiccarton, last evening.

Several of the areas which cannot be provided with sewers until the Christchurch Drainage Board’s financial position improves are in Mr Connelly’s electorate. “Could not Mr Lake have used some of the surplus to help local bodies in his own area such as the Drainage Board?” Mr Connellj’ asked. “I share with the chairman of the Drainage Board the fear that if loan monies are not made available the seweraee contractors now working for the board may be lost to wo; k of other kinds, and thus hinder the completion of the present and projected sewerage works at a time when Christchurch is developing rapidly and after the board and its officers have worked hard to meet public demand.” Of Mr Lake’s statement “I doubt whether the reinstatement of higher underwriting fees and placement fees would do much to make greater amounts available, more probably the result would be an increase in the costs greatly affecting the amount raised.” Mr Connelly said it implied a desire to relieve ratepayers of increased costs in loan flotations. Interest Rate “But that is cancelled out by the Minister’s action in increasing the maximum interest rates for Government loans and local body loans to 5 per cent.,” Mr Connelly continued. “This means that ratepayers as weH as taxpayers will now have to meet a heavier burden. "Since Mr Lake thinks there should be a margin between the terms offered for local body and Government loans, the assumption is that the local body rate will rise above 5 per cent., so thfere is an implied further burden yet to come on ratepayers "The National Government’s early surrender to financial interests is now reaping its own reward, as brokers and the large investors hold the pistol at the Government’s head for still higher interest rates.” Mr Connelly said he would be making immediate representations to the Government urging it to take steps to meet the Drainage Board’s needs before lack of loan finance became further damaging to its programme.