SINKING FUNDS

Hokitika Guardian, 18 November 1932, Page 6

SINKING FUNDS

RESTRICTIONS ENACTED

WITHDRAWAL FROM PUBLIC TRUST. WELLINGTON, November 15. In -the House thi?. evening urgency was accorded the passage of the Local Authorities Sinking Funds Bill. In moving the second reading, the Prime Minister (the lit. Hon. G. W. Forbes) said the Public Trustee held £4,500Q,00U in sinking . funds investments. If local bodies were allowed to displace the Public Trustee and call upon him to provide the money, «.b - Government as guarantor would have to find that money. It was only right that 'local bodies' should share in the common sacrifice necessitated by the general reduction of interest rates. Ho pleased that the majority of local bodies were 'prepared to agree to this, but a few considered that they bad the right to obtain a higher rate of interest elsewhere. He thought that 4 per cent, was a reasonable rate at the present time, especially as it was guaranteed by the State. Sbme local bodies which,had invested their money other than with tho Public Trustee, especially in rural securities, w r eie having to face the problem of . arrears, but no such situation bad arisen in connection with the common fund of the Public Trustee. The problem of interest rates w;as one that would have to be tackled by "the Government in order to stimulate trade and bring about a rise in prices. This was in line with'tjta decision reached at Ot‘Uftvri. •'***•

- Mr Forbids said that when the Bill was in Cornmittee he would move an amendment.,.- ip make provision for special investment by the Public Trustee un'der cerfa’u conditions of current instalments paid at any time after October Ist, 1932. The Bill was put through is remaining stages and passed, with the amendment to which Mr F.orbes referred during his second reading speech.