DRIFTING!

Taranaki Daily News, Volume LVII, Issue 231, 9 March 1915, Page 8

DRIFTING!

Till-] BOROUGH FINANCES. JMPOHTAXT STATKMEXT 15V MAYOR. FURTHER EOAXN NECESSARY

Prior to the discussion at the X.'\v Plymouth Borough Council last night on tin; Finance Cummi'ttce's report re iwrstife el' general rate, ami rhwillg of loan (a« set out in Monday's News) ;,'r Collii! wished to know i!' tho Council intended 1 bests ma Iters to be gone •>« ■■vif.li ai once, er whether (hey were only re;"'i,!nienda!'u:i!:; to the new council.

The Mayor stated that they would lie £ono on with at once, so as to save time, and also to save expense in taking tlie poll for raising the loan, which would be taken at tlie same time as the (lection for councillors. Cr Sykes wished to know if the mem-i-v.'rs of tlie Finance Committee were bound to vote in support of the report. He pointed out that there were eight members of the committee, and only four other members. The Mayor stated that members .of tho Finance Committee could vote as they liked, and every councillor could express his opinion and vote as lie pleased.

Cr Smith did not think it fair that what the "man in the street" knew that a surprise packet was in store for the Council meeting, before members of the Council themselves knew. The Mayor said that he did not care what the '•man in (Tie strejf' kneew. The reports of the committees had, as usual, been handed to the Press at tlie same time as tlicv and the order paper were forwarded to councillors.

Cr Clark said that iii was open to Cr Smith to move that the reports be ii.it handed to the I'resa until the evening of the Council mooting.

In moving tlu> adoption of the Finance Committer's report, the Mayor delivered a very exhaustive statement on the municipal finniters. as follows: "The report of the Finance Committee submitted to the Council this evening is more than the usual formal report recommending the payment of accounts. The Finance Committee, strengthened as it has been by the addition of Councillors Clarke and lfas held four lengthy meetings and has thorough, ly canvassed the financial position of the borough, the result being the recommendations which you have before you. I now move the adoption of the committee's report. Some of the recommendations are of such importance that I feel justified in speaking at some length on the motion, so that not only the whole of tile members of the Coun--1 cil but also the burgesses may nnderstand the position and the reason for | the recommendations. Councillors will remember a letter from the town clerk | dated February 2, referring to the Jinan, j cial position of the general and working I account of the borough. 'This letter is the result of discussions which have taken place between "Hie town clerk and myself for some time past on tlie question, datin;- from the time when I felt myself able to deal with the matter. Paragraph 5 of the report recommends the incoming Council to /levy an additional 3d in the £ for general rate to provide 'the ltiSlls necessary to prevent further increase of liability on the general account, and paragraph G recommends that a further 2d be levied as a separate rate for hospital maintenance, .which last year amounted to£7GI). These two 'paragraphs really aim at the same end.

"To explain the necessity for these f must go back a few years in the history of the borough. At March 31, 1008, tlie general account was in credit £880; that is to say, the revenue of the year ending March 31, 1008, exceeded the expenditure by the sum of £BSO. Then this account began to drift. At 'March 31, IDO'J, instead of a credit tfTere was aTlebit of £1)48, the expenditure exceeding the revenue In the following year there was appar. entlv an improvement, as the (lebit balance was only £836 but this position was only attained by placing to the credit of the • general account some

£I6OO profits of the lighting deportment, so that in reality the ordinary expenditure exceeded the receipts by some £ISOO. In the year 1910-11 the debit balance jumped from £836 to £2719, an excess of nearly £I9OO. In 1911-12 tbe figures did not show so badly, the balance being increased to" £3187, an excess of £368. In -1912.1? the balance "amounted to £SS3G, an increase of £2049, whilst at March 31, 1014, the debit balance was £5509. I do not wish to > be understood to be blaming the Mayprs and Councils in charge of tile finances during the years mentioned for the excess of expenditure over revenue, for the cost of carrying ,on the borough works generally has increased very greatly during the period. On the other lumd, while the cost has increased so has the income, especially during the years, 1911-12, 1912-13 and 1913-14. The revenue from general rate during 1910-11 was £3027; in 1911-12 it was £3215; in 1912-13, £4287.; an d in 1913-14, £5815. The increase in the two latter years was owing to revaluations and the inclusion of the merged areas in the bolough. "I - do feel, however,, that it v- oa ld have been sounder policy if the 3!avor and Council, with the evidence of. steady drift; before them each year, bad fi-jjnk, ly faced the position and provided for necessary expenditure out of rates instead of by borrowing, For that Is what it amounted to. It had to stop some time, and it falls upon this Council to lecommond what shall be done to stop it. I have said that the excess of expenditure was borrowed money, and this needs explanation. As is pointed out in the town clerk's letter, the District Fund Account is an aggregation of scpaiate accounts, some of them in elTect. though not in name, trust accounts. Those accounts are in credit to various amounts, and these credits have to that extent helped the general account and kept down the overdraft. t '•But, being credits, thev have to be accounted for sooner or later, and the time has now come when at least the hlectric Light Department will need to use its accumulations. The position of the District Fund Account, as the town clerk points out. is not the position of the general or working account of the borough, and T think that the fact that the general account has been able to utilise tiie credit balances in the district fund account instead of bori-ow-hv: by overdraft, may liave led conn, cillors fo consider fh-> position better than it lias been. That this conhl be

so is, I think, largely jiue to the practice ivliicli. lias obtained of considering the Finance Committee as merely an accounts committee, and leaving 'the important matter' of the general oversight of the finances to-the Mayor, The recommendation contained in paragraph 1,"» of the report, if adopted, will he found a useful check. In 'paragraph 17 of the report you will find an important recommendation. .nWliroi tlie tramlines are laid it wiil lie necessary to re-make the street along the route. Other streets are so worn out 1 hnt they are beyond patching, and must lie re-maile. Some of this re. making, to the value of about .-Cl.'iOD, has been done this year out of the general fund, but tills only by increasiii": the deficit oil the general account, and it must be apparent that if the general funds are insiifiicient for the maintenance of the streets it will be impossible to do the urgent renewals required on*, of general revenue or borrowing on ; overdraft. The engineer's estimate for the work along the tramway route, using soltar macadam, is £IO,OOO, and for other principal streets to be re-made hv the same process a further. ,€,IOOO. The committee lias considered the question, and can see no alternative to a loan, but the members are unanimous in stipulating that money should be borrowed only for permanent street making, not * for merely macadam streets. Tlie engineer advises that tlie up!,-ecu wdl be moderate, and *hat. the cost should diminish periodically while the streets will improve. - Teat advantage will lie the material les. seivng of the dust nuisance. '■Other matters which the, committee recommend provision for loan are a culvert in Brougham street, casting £2OOO, which is becoming a matter of urgency; the erection o» a destructor, which is estimated to cost £IO3O, and the erection of a Museum building. The Council will remember that Messrs'\V. IT. and IT. D. Skinner have • generously offered to the Council their collection of Maori curios and article* of great interest to this town, but they have stipulated that these shall l>e housed in a fiieproof and .otherwise miitnWn buHdin l ;. It would he the greatest pity if these were lost to tke towii, and if we are to retain them provision must he made at once for their reception. It is sug«f<ted that an addition to the Carnegie Library will provide the necessary spsflrfr If the recommendations of paragraph IT are approved the necessary steps will fee taken at once to furnish the necessary estimates, and a 'poll of the ratepayers taken.

".Speaking generally _on the position, .1 would not consider it serious is, for instance, we couhl say that our streets had benefited by tlie increased expendi. ture. This very obviously we cannot do, otherwise the committee would not be recommending further borrowing for street work. In fact the streets have not had fair treatment, and have been -very disheartening to tlie engineer to have to struggle against the want of money to do necessary work. From March 31, 101)8, to March 31, 1914, the average year by. .expenditure for labor and metal > for the streets has been £2805, and for plant, materials, repairs and sundries' £4(13. . That this policy was suicidal is shown by 'the position of the streets to-day." In Augr.st last I asked tlie engineer for a return show? ing what streets required re-making and what streets required attention to prevent them falling into absolute .disre, pair. The first list, in the return showed sixteen streets so worn oat* that, they must be re-made, and tlie second list nineteen. The estimated cost of these works was over £13,500. Some of tlie streets in the first list have been re-made this year, as 1 have mentioned, and the Council has permanent work to show for its expenditure. I mention this here because I hear that the Council, and, of course, myself as its head, i3>_ being severely criticised for its administration' duriiig the current year, and that the 'present unsatisfactory position is_ attributed to lis. When the end of this month is reached, and the borough engineer submits hiri annual report of work done in the borolyjh, the Council win have no cause to reproach itself. TO* shall show that though the general rate this year was over £4OO less than last year, we have done much more work, and that the deficit on the general account this year will be about £SOO. The 'Council has paid £450 this year in connection with the ""purchase from the Railway Department of the block adjoining the new sub.station site. I. think the Council has done wisely in looking ahead when new ■ municipal buildings will not only be desirable but unavoidable, and with that end in viewlias secured this land. Councillors will be surprised to hear that we are credited with having re-purchased the Colleit. exchange land for a town hall site. "The time for the election of the Mayor, and councillors is drawing close, and I feel that wo are only doing our duty. in facing unpleasant facts and showing the people the true position of the borough finances and so letting them know how the business of the borough has been conducted in the past."

Ci pollis, m seconding the adoption of the, report, said he considered that as tlie matter was of such moment and as it came as a surprise packet to 'some ot the councillors, it would possialy be better to adjourn for a couple of ,'lavs , e!;H^ S?eSti °".- Vas a<, °P twi ' an <l tlie . ting was adjourned until Wednesday evening at 7.30.