HOROWHENUA POWER BOARD BUSINESS.

Manawatu Herald, Volume L, Issue 40029, 28 November 1929, Page 3

HOROWHENUA POWER BOARD BUSINESS.

SUMMARY OF HALF YEAR’S

WIORK.

NO REDUCTION IN 'CHARGES LIKELY. Statements showing the income and expenditure for the half-year ended September 30th, a comparison with the estimates, and the net revenue account, foir the same period were presented ait the meeting of the Horowhenua Power Board on 'Tuesday. They were summarised in an accompanying report by the secretary' (Mr. P. W. GoldSmith) as follows: — INCOME AND EXPENDITURE STATEMENT. I have to place before the Board the statement of income and expenditure for the half-year, which has been prepared by the Accountant to reveal the Board’s financial position, and to enable a comparison to be made with the estimates which were formed at the beginning of the year. The statement of income and expenditure (omitting shillings and pence) sholws that the total income was £21,054 and the expenditure £13,324, leaving a balance of £7,729 to be earned to the net reveune account. . PARTICULAR'S OF THE INCOME. Electricity £20,574 Penalties 167 Rents 136 Gross Profit —Trading ac. 143 Sundries 34 Total £21,054 STATEMENT OF EXPENDITURE. This shows that the largest items are as follows: — Electricity purchased £8424 -'Salaries 1322 "Wlages and transport 1160 Renewal 4 motor_vehicles 750 Meter reading 312 Insurance premiums 221 Board members 202 The balance of the expenditure, somie £934, is made up of many items, such as printing and advertising, office rent and expenses, collectors’ fees, legal charges, motor registration, postages, stationery, rates, and hank exchange. NET REVENUE ACCOUNT'. On the income side will .be seen .the balance brought down from income and expenditure account £7,729, and interest from various sources amounting 'to £317, making a total of £8046. On the expenditure side there appears:— For interest on loans £5520 Principal repayments' and' •sinking fund 1014 Depreciation reserve £BB7 (Bad depts reserve 140 National Provident Fund 78 (superannuation or a total of £7639. The balance of £407 is the nett credit palanee for the half-year under consideration: COMPARATIVE STATEMENT. In this statement members of the Board will be able to see how the actual returns on the one hand and disbursement on the other compare with the estimates made when the year was young. The revenue for electricity, it will be noted, has reached the half-way mark. 'There seems to he a good increase in the items, lighting, heating, and cooking and waterheaters; but the returns for power have as yet not come up to the estimates. Doubtless in the second half of the year considerable leeway will be made up under this heading. The position of the other ■ items of revenue seems to indicate that there is every possibility that at the end of the year the estimates will have been reached. lOoming now to 'the comparative statement regarding the expenditure for the past six months, s'ome items ha,ve exceeded even the estimated amount for the year, hut on tin; other hand in some instances considerable reduction is shown. The power purchased from Mangahao at £8424 is slightly over half the amount estimated for the year. -The renewals of two cars and two trucks cost £756, which is £250 more than was put down on the estimates. Owing to. the engagement of the staff upon construction work, little lias been expended upon maintenance and renewals for the period, and there is a likelihood that for the present year the estimates will not he reached in the items which cover this class of work. In some instances the bulk, if not all, the. expenditure has occurred in the first half, now under review. There are other items, of course, where the bulk of the expenditure will come iu the second half of the year. On the whole the position seems fairly satisfactory. With a credit balance of £4OO for the first half of the year, there seems a reasonable prospect of a satisfactory position when the year ends. 1928 AND 1929. A comparison of the revenue from electricity to the September 30th last year, and this year, respectively, is interesting. 1928 1929 Lighting £7,866 £8,072 Heating and cooking 2,890 3,511 Power 4,853 6,635 Water-heaters 1,571 1,688 Street lighting- 651 667 £17,831 £20,573 Cost of electricity £6,130 £8,424 LOAN EXPENDITURE. For 'the first six months of the year the sum of £3,726 has been expended. The items are as under:— Copper wire £llOO, poles £4Ol, line materials £495, meters £299, transformers £265, insulators £146, sundries £43, wages £977, a total of £2,726. At the beginning of the year it

vns estimated that, lo do the work in sight, some £6,250 would he wanted. With ’the passing of the months and the extensions and services applied for, there seems little doubt hut that more funds will be wanted than was contemplated in March. However, the question of further loan moneys is under consideration by a committee of the Board set up for the purpose. As I see the position at the close of the first half of the year, it is of quite an encouraging character. The bulk of the dairying revenue will come in the second half of the year and will more than compensate the smaller lighting returns which avo inevitable during the summer months; so 'that the revenue for the year should be satisfactory. The Board does not get so large a return for electricity ' purchased from the Government as some of the Power Boards, but there is still, I believe, a good prospect next year for the Board to he able to make a reduction in the charge for electricity to the general consumer throughout the' district. CAUTION .JUSTIFIED.

The chairman (Mr. G. A. Monk) said the position disclosed only went to show that the Board would not have been justified in making any very great reductions in the price of power to the consumers this financial yeatr. While the revenue from lighting was over the amount estimated for the half-year, there would be a considerable fal-ling-off in the current half-year, but the opposite would be the case in regard to power. The secretary was optimistic enough to believe that ifche result of this half-year would be sufficient- to warrant reductions. The Board, however, had to consider that they were spending loan money, and, while the revenue was increasing the interest alc'eount was also increasing, aiuf the bill for power had risen considerably in the past half-year. He thought- the Board would find that there was no chance of obtaining any (reduction of costs in that direction for a year or two. DIMINUTION OF FLAX-

MILLING. v

“I think that this half-year will probably reveal a fair balance on the Board’s working, if nothing untoward turns up,” the chairman added.- “We have to hear in mind, as Mjr. 'Seifert has indicaetd, that we will have to look for a reduction in the flaxmills load. 1 I have on more than one occasion warned the Board that it, was likely, after what happened on the Malkerua Plains, that the flax would have to go out and that country go back to grass. There is a transition stage, and while it -will follow on the outgoing of the flax I feel that the load will not he at its full extent for a yeatr or two; there will be a- falling-off, and it will have to he built up. The country grasses easily, hut there is a stage where we have to get people established in the dairying business before we cam get the load taken to its utmost.” The chairman concluded with the remark that the report was entirely satisfactory.

NO REDUCTIONS IN CHARGES FOR, THE TIME BEING.

Mr. Seifert said that some time ago he thought 'that the 'Public Works Department would probably make a reduction in their charges, but now he understood that it, had been made quite clear that the Board could expect no reduction for the time being. The Department pointed out. that when the drought was on it had host them many thousands to buy power. He would like to have particulars <f£ the individual loans raised by the Board, and the terms of them. If these were supplied to the Board, members could file them away and they would form a very good business 'record.

The secretary promised to have the desired returns prepared. The financial statements were of - ficially received. '