GAS COMPANIES’ BURDEN

Hokitika Guardian, 14 September 1928, Page 3

GAS COMPANIES’ BURDEN

UNFAIR COMPETITION. LOCAL BODIES’ TRADING. (Niuteon Twenty-Eight Committee.) For some years past tlio gas companies of New Zealand have been suffering n grave injustice) from the intrusion of municipal concerns and electric power boards upon their spheres of activity under conditions which give the intruders flagrantly unfair advantages without conferring any corresponding benefit upon tlie State or the public. While privately owned Gas Companies pay large sums in land tax, income tax, licenses, stamps, Board of Trade levies, municipal rates, royalties and other annual charges,, the municipal electrical concerns and the power boards are exempt from all of these payments. During the last six years the Wellington Gas Company, which is typical of other enterprises of the kind, has paid £83,170 in land and income tax, £1,200 in annual licenses, £2,184 in stamps, £377 in Board of Trade levy, £8,840 in Municipal rates, £4,825 ill royalties and £1,401 in other annual charges, a total of £101,997 or an average of £17,000 a year during the six years. An analysis of the figures of the Auckland Gas Company oil similar lines over the same period shows that this concern was taxed to the extent of £202,158 or an average of £33,793 a year during the six years. EQUAL TERMS DEMANDED.

Representations in regard to this matter have been made to the Government again and again and successive Ministers have disclaimed any wish to see private enterprise placed at a disadvantage in legitimate trading. The position remains unchanged, however, and though the Prime Minister has revived tho popular slogan of “Less Government in business and more business in Government ” lie lias not yet pointed the way towards this much needed reform. This is not a case b which the shareholders are clamouring for larger dividends nor in which the companies themselves are seeking relief. Tho shareholders are satisfied with a reasonable return upon their investments and the companies are not grudging their contributions towards ine State and Municipal revenue. But Loth tlie shareholders and the companies object, and object strongly, to State and Municipal enterprises being exempt from the taxation and other charges private enterprises of the same character have to bear. Here a ease in point is provided by the Wellington Corporation Electrical Service, which in addition to supplying current to the tramways,-is in active competition with the Wellington Gas Company. The service pays neither State taxation nor Municipal rates, annual licenses nor stamp duty, royalties nor levies, and is a law unto itself in all its ventures and operations. AN AUCKLAND ANOMALY.

In reviewing the position, an Auckland correspondent, who lias studied the subject closely and reached definite conclusions, explains how the recently 'introduced competition of power boards with the old-established gas companies has found acceptance with many of the ratepayers. “ Where there is a monopoly, as in the case of supplying tho tramways,” this authority says, “a full rate is charged, but where the supply of pipver or heat is furnished to private consumers, thus entering into competition with gas, the rate is actually less for the few odd unit required than it is for the millions of units given to the tramways. The competition with gas is only possible because power hoards pay no rates and taxes, whereas during the last six years tlie Auckland Gas Company lias paid £202.158 under this heading, and also because a liuge revenue is obtained by supplying tlie tramways at a price out of all proportion to the rates charged elsewhere.” This means, in effect, that while concessions of one kind and another are made to the private users of electricity in Auckland, in order to meet the competition of the Gas Company, a very high charge is made for current supplied to the tramways, with the result that the advantage conceded with one hand is taken away with interest, by the other.

A SQUARE DEAL

It cannot be emphasised too strongly that the Gas Companies are asking for no more than that the concerns competing against them shall he subject to the same charges and same conditions as they are themselves. As already stated, they are not seeking exemption from legitimate taxation oi from necessary provisions in , tlieii charter. What they are demanding is a fair field and no favour. At present they obviously are not receiving these essentials in any shape or form. They are subject to charges and conditions which are not imposed upon their rivals and they are compelled to supply information and to give assurances which are not required from State and Municipal concerns of the same character. They are not pleading that any of the obligations placed upon themselves shall he' relaxed ; they are simply asking, in full consciousness of the justice of their request, that in competition with their rivals they shall he given a “ square deal.” Wellington, September 12th., 1928.