EARTHQUAKE LOANS

Hawke's Bay Herald-Tribune, Volume 81, Issue 40, 10 November 1937, Page 4

EARTHQUAKE LOANS

H.B. Local Bodies Are Disappointed REDUCTION OF INTEREST

Disappointment with the reply of the Minister of Finance, the Hon, Walter Nash, as regards the reduetion of the interest rate from 4 per cent to 3$ per cent on earthquake loans to Hawke's Bay local bodies was axpressed this morning by Mr C. Lassen, chairman of the Hawke's Bay Hospital Board. ^ Tlie matter, however, has yet come before the other members of the board' and Mr Lassen was not prepared to make any [ statement other than to express his disappointment and dissatisfaction. "I am not at all satisfied With the reduetion that has been made," he said when interviewed. 'It is disappointing to me, for I feel that the Napier Hospital Board is in a different position to other local bodies by Teason of its partieular service to the community, and because its work is of a charitable nature, being for the sick and needy." Mr Lassen, who is also chairman of the Hawke's Bay Rivers ' Board, added that the Eivers Board also had received a similar communication from the Minister but he was not prepared to make any further comment. I "I certainly am disappointed, but until other members of the council have had an opportuhity to discuss the matter, I am not prepared to make any st .tement," said Mr F. B. Logan, chairman of the Hawke's Bay County Counr.il.

Mr Logan said that he was advised yesterday afternoon that a letter had been received. by the various local bothe council for tlie caneellation of the earthquake loan and offering a reduetion of a half per cent. The matter, he said, would be discussed by members of his council at an early date. According to the letters that . have been receinved by the various local bodies concerned in the matter' of earthquake loans it appears that there? is Jittle likelihood of the Government agreeing to the caneellation of the loans altogether. Mention is .made of the special circumstances, whieh it is contended justified the caneellation of the Napier' Borough Council 's loan of £101,200. Though varying slightly in their actual wording the following is a typical example of the letters that were received from the Minister vesterdav: —

"With reference to the advance made to your council -under the provisions of /the Hawke 's Bay Earthquake Act, 1931yfor tlie restoration of earthquake damage, consideration has now been given to the representations made by various local authorities for the caneellation of these advances. I am unable to agree, however, that the Government would be justified in remitting any portion of the principal moneys now owing, and the fepayment of tHe loaiis is to proceed in the normal course. "On behalf of several of tho interOsted local' authorities it was' pointed out that the advahce to the Napier Borough Council had been remitted and, in view of this fact, a request was made' that the advances to the other lbeal i authorities be treated in the same manI ner. The caneellation of the loan to the Napier borough, however, was made only because of the partieular circumstances of that local body. In Napier the whole of the essential serviees. were either destroyed or completely disorganised, and, though it is realised that your council had considerable expenses to meet for the restoration of the earthquake damage, it must be admitted that your council 's position is not comparable with that of the Napier Borough Council. "To assisfc the local authorities, however, the Government has deeided to reduce the rate of interest on thege loans from four per centum to 3$ per centum per annum, and I have instructed the Secretary to the Treasury to coramunicate with you further and to set out details of the reduced instalI nients on your loan."