BOROUGH FINANCES

Taupo Times, Volume III, Issue 148, 26 November 1954, Page 4

BOROUGH FINANCES

THE reports in this issue of the "Times" dealing with Borough finances serve to illustrate both the growth and progress of the Borough, and also the increased expenditure resulting therefrom. The audited accounts for last * financial year show that the General Account had a deficit at the beginning of that year of £1522-19-4, which had increased to £2896-15-6 at March 31, 1954. The financial report for the period to October 31, 1954, presented by the Borough Treasurer, shows a credit balance in this account, as at October 31 last, of £653. It would appear that, with five months of the financial year to come, and the major part of the year's revenue already collected, the year will again end with a substantial deficit, probably considerably greater than the deficit of £959 which was budgeted for in the Council's Estimates for the year. In considering this position, it is to be noted that considerable amounts, both last year and this, have been expended from revenue on such capital items as plant (e.g. motor truck), street sealing, kerbing and channelling, the mortuary and so on. However, the fact that a deficit has been shown, for three years in succession, indicates that revenue has not been sufficient. It seems obvious, even allowing for whatever economies may be found possible, that the rating revenue next year for general purposes will have to be increased. The Council's Estimates for the current year for streets,, footpaths, street sealing, and maintenance, for example, were £3,573 more than the amount yet spent this year under those heads, £2,713. The position of the Electricity Account, as disclosed in last year's accounts and in the report for the current year, is eminently satisfactory. With a credit balance of

£5,480 at March 31 last, the report shows a credit balance at October 31 last of £5,615. The Treasurer's estimate of revenue for the last five months of this year would indicate that the credit balance at March 31 next is likely to be somewhat larger than at present. It may be suggested that the deficit in the General Account might fee reduced by a transfer from the Electricity Account. No doubt the Council may consider this later, but in doing so will have to decide whether or not it may be rather early in the history of the power scheme to transfer profits. Next year capital charges to be met by the scheme will rise to some £12,000 reaching about £15,000 in the following year. Judging by current electricity revenue, the scheme will have no difficulty in meeting these charges, in addition to its running costs, and showing a prbfit. At the same time it might be prudent to build up some reserve before assisting the General Account. The final £10,000 of the last loan to be approved cannot be drawn on until the Board's engineer has certified that all reticulation in the Borough itself has been completed. It may therefore be found convenient to have funds in hand, from revenue, which could be used for any capital expenditure over the amount of loan money available. These are matters for the Council's consideration in due course. Meantime, the financial position disclosed in the accounts and report seem to make it clear that increased rating revenue must be found. This will be the case even if the Council's application for a road grant from the National Roads Board is successful, and is further emphasised by the suggestion of a water supply yet to be considered.