THE BOROUGH FINANCES.

Taranaki Daily News, Volume LIII, Issue 45, 2 June 1910, Page 3

THE BOROUGH FINANCES.

I To the Editor. Sir, —Xone will question that it is a I good tiling that the search light of newspaper scrutiny should .be f-oeussed on municipal management, for only by weighing pro and con the arguments adduced 'by councillors and newspaper editors may the philosophical ratepayers. —the shareholders in municipal undertakings —be interested sufficiently to ' look upon public affairs as being of some personal moment. Xone, either, will question that if a subject be a contentious one, there are two sides to it. in your issue of this morning you dealt at . some length with the question of borough iinances, and questioned, wiiii a severity warranted only in righting -m- ■ righteousness, the Council's financial methods. To my mind it appears tha. :io; only is your criticism severe, bui. it is founded on a misconception of the position; in short, on a false hypothesis. You assume that had the electric light department and the abattoirs not shown a, substantial .profit during the past two years "the Council's linances would be in a bad way." Why? Because you as sume that the Council would have been so devoid of (business acumen as to have gone on spending money to the tune of many hundreds of pounds not "Knowing whence the money was coming. Had the Council done so, not even your strictures of tliis morning would have surucea , to awaken ratepayers to a realisation ot j the financial chaos into which they Here being hurled. This, surely, is a simple business proposition: When estimates of revenue are framed at the commencement of a financial year, that amount of revenue is allocated to works to be taken in hand or completed. If, however, by good fortune, it is found that., the revenue has been under-estimated, then, surely, there is nothing unusual or unbusinesslike in finding avenues for its profitable use. In using this £2OOO excess of revenue from its departments for roads and other work, the Council has been enabled to carry out that additional amount of work without an extra rate or overdraft. Or, in the alternative, general work to the value of £2OOO less would have been done in the borough in the past two years Had these .profits not been utilised in this way. There might be something in the contention that the profits of the electric lighting department should not be treated as ordinary revenue; there is also a good deal to be said for your contention that depreciation should be deducted from the department's profits. But to my mind the contention that the funds were "simplyannexed to pay pressing liabilities; is quite incorrect. Surely the liabilities j were not incurred before the revenue was available? In other words, you would not have your readers believe that by a lucky accident the electric lighting ilepariiucnt got the Council out of a j hole. But, however opinions mav diilVr t concerning the foregoing, there can be no i diversity of opinion regarding your later | contentionsI—that 1 —that if the engineer is re- j sponsible for so largely exceeding the j estimates, iihe Council should hand over [ '■the whole thing to the engineer." But is your contention based on a sound assumption? I am somewhat of a tyro on matters municipal, .but I always understood the .procedure to be,that the Council voted money for works, and instructed the engineer to have it expended. 1 am sure the ratepayers would like to know for certain if this is not so. will certainly be news to learn that the engineer and not the Council has THE say. In conclusion, I would ask, ''What] woiiks on which the £1750 excess of expenditure over estimates has beenjpent, would have been left undone?" if your protest that "there is no necessity for this (big expenditure" has anything in it, there must be fairly considerable work's completed that could have been left over till some future time. That is logical, surely. Thanking you in anticipation,—l am, etc., 1 JAS. McLEOD. [.Could it he ,sho - that a quid pro quo had been obtaineu ' the spending of the £1750, excess l. 1 over estimates, our correspondent's criticism would have been more effective I and the Council's position been stronger than it is. But this cannot tie shown. In the years 11)00-7 and 1907-8 the total cost of labor and metalling was £4038, while in the last two years it was £5751. For this extra £1713 one Wild naturally expect more work to have been done. But investigation shows a contrary position. We will take the metal laid down. In 1900-7 and 1907-8 it amounted (approximately) to 5000 yards. During the last two years only j 3750 yards (approximate:;.') war-; used, j These figures speak for themselves. It I is quite clear that had the electric light-1 ing and abattoir funds not been avail- j able, either the work of the borough j would have suffered or the overdraft | been loaded with the liability. It is t quite true that there is nothing untmialj or unbusinesslike in finding avenues for j the profitable use of surplus revenue,, so long as it is bona fide revenue, out; we submit that the electric lighting' fund is not ordinary revenue and should not be treated as such, when not a peony is allowed for depreciation of plant and machinery. This deduction made, there is no objection to the Council using the money for whatever purpose they desire. We do not wish to be misunderstood in regard to the engineer, who is a hard-working and conscientious official, and has done valuable work for the borough, It is the system producing such unsatisfactory results that we And fault with. Much of the engineer's time is devoted to his inside duties, and he can hardly be expected to give the requisite time and attention to the men employed on the onts'ide works, necessary if the best returns are to be secured. Herein lies the weakness. Briefly we contend for an allowance for depreciation on the electrical plmit; the exercise of a stricter control by councillors over the work of the borough: and a better return obtained from the money spent.—Ed. T.D.X.]