LOANS TO LOCAL BODIES.

Taranaki Daily News, Volume LV, Issue 128, 17 October 1912, Page 8

LOANS TO LOCAL BODIES.

I THE INQUIRY CONTINUED. >. By Telegraph.—Press Association. | Wellington, Wednesday. At to-day's sitting of the inquiry into the allocation of loans to local bodies, Mr. Poynton said that he had looked into the question of the legality of granting loans to be paid beyond the year in which they were granted, and he differed from the opinion of the Solicitor-General. As the board, however, would be reluctant to grant further loans in view of the J opinion given by the Solicitor-General, until the Act was amended, it would mean the cessatiou of lending altogether. He therefore urged that the Act be amended. In March Ittst, a circular had been sent out to local bodies stating that . loans could not be granted at a lower rate than 3% per cent. In reply to Dr. Newman, witness said' that money was lent at 3y s per cent, until the post office informed the board .. that it required 3% per cent., and then . the rate was raised. Dr. Newman: How much of the loan money was approved in the month 'be- , fore tiho election? Witness: I don't know, * Dr. Newman: £104,009? Witness: I wish it to be put again on record that the election had nothing whatever to do with the proceedings «1 the Board. * Witness then stood down to allow Sir John Findlay to give evidence. In answer to Sir Joseph Ward, Sir John Findlay stated that at no time did he make representations to the Department on behalf of a loan for the Remuera Road Board. He telegraphed Sir Joseph Ward stating that a deputation had interviewed him regarding a loan of £84,000, that had been applied for, and that £IO,OOO was wanted by bhb Board to enable it to employ men who had been out on strike. The" strike had been settled on the condition that the men should be taken back, but the Board advanced some red tape objections to tho securities advanced* so the chairman of I the Road Board told <him, and the men . became suspicious of the bona fides of , the Road Board. That was the only 1 connection he had with the loan. He used no influence of any kind. The hut thing he dreamt of was that it would be used for the purpose of promoting hia candidature. His telegram mav not have been sufficiently guarded in 'its terms, and lie felt no resentment against Mr. James Allen for 'having put that oonetruction upon it. Mr. Myers: Under the same circumstances, you would do the same thing again?

Sir John Findlay: Yes. and I venture to say that there is not one man sitting round this table who would not have done the same thing. Sir John Findlay, in reply to further questions, said that 110 Minister had ever attempted in any -wav to influence the board. The fact of an independent board administering the Act should remove all suspicion of political influence. Replying to Sir Joseph Ward witness said that losses under the old Loans to Local Bodies Act amounted to £<> 300 • 000 at least. None of that amount would be repaid by local bodies. Sir J. G. Ward: Under the State Guaranteed Advances Act, have local bodies to repay the whole of the money advanced; J

Witness: Yes. Sir Joseph Ward: Anv loaa that occurs is due entirely to the non-invoet-ment of available funds? Witness: Yes.