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Hokitika Guardian, 10 February 1921, Page 2

A refusal to increase the rate at which the Council may pay the interest, on its drainage loan was received from the Minister of Finance (Mr Massey) by the Hamilton Borough Council on Friday evening. Mr Massey said the figure obtained for the debentures should yield such a price as would not produce to the lender a return exceeding 53 per cent. The local manager of the Bank of New Zealand, in a letter dealing with the satno matter, expressed regret that his office could only partly provide for the Council’s requirements. He enclosed an extract from a letter

from his head office, as follows:—“In the present condition of the money market we see no possibility of debentures being sold at a better rats than 6J to 6$ per cent. In these circumstances, we are not warranted in locking up £20,000 of our funds for an advance against the same. If that could be arranged, we would be prepared to find the money, temporarily, provided the Department makes a definite commitment, even if six or nine months ahead. Failing that we will advance £SOOO against £7500 of debentures and would suggest that the residents of the area to be served by the drainage works either take up the balance, or lend funds to the Council against the debentures, ponding their sale People who want conveniences must be prepared to pay for them.” Hie Mayor said it was apparent that they were not going to get much assistance from the Bank. He regarded the last remark in the letter as gross impertinence. Hie working classes were already paying a substantial tax for light and other conveniences. The Council decided to accept the £SOOO from the Bank. This is a clear instance of the tightness of the money market, and it,should awaken the public to a sense of economy in all possible directions affecting public administration.