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Taranaki Daily News, Volume LVII, Issue 257, 9 April 1915, Page 3

STATEMENT BY TOWN CLERK.

BORROWING AND OVERDRAFT.

£15,557 YEARLY FOR INTEREST.

£2 A II FAD OF POPULATION

Tlie town clerk, Mr F. T. Bellringer. has'compiled a most interesting and instructive review (if tlie operations and activities of the Council for. the year ended March 31, 1915. He is to he commended for placing the information before the Council so speedily after the close of the financial year, and the ralepayers should appreciate the promptitude with which the position of municipal affairs is brought to their notice. Naturally, interest will largely centre in the question of borough finance, and in this connection the town clerk makes the following statement, and ih» ratepayers will doubtless note ',' ■ '..'..■ -\ expressed relative to the c ■•«.. ..iure of ■ loan monies on non-permanent works:

PUBLIC DEBT. After taking into consideration the new loans raised and the proportion of principal on State Guaranteed loans repaid during the vear, the total public debt of the borough at March .'list, 1915. amounted to £227,78!) 7s 4d. In addition to this the Borough have to pay interest on £7,400 Is 4d, proportion of the Taranaki County Council indebtedness i.s arranged by the various Deeds of Adjustment in connection with the merger of county lands into the borough. On page 87 of last year's booklet this amount is shown as £7873 Is -Id, but loans amounting to £413 have been extinguished since that date. For all practical purposes, therefore, the ritual public debt amounted to £235.258 8s Sd at the end of the year under review. The purposes for which the loans were raised were as follows:—Waterworks, £03,032; electric light, £58,969; streets and bridges, £80,037; sewerage svstem. £16.202;' abattoirs, £9308; baths, £3000; new hospital, £4000; total, £235,238.

Of the above amount £35,058 was borrowed from the New Zealand Oovcrnment and the yearly instalments of interest and sinking fund pay off the loans in a fixed period of years, £114.200 bears interest at 4} per cent, and £8(1,000 interest at 5 per cent. The greater proportion of the loans carry small sinking funds. When the £55,000 tramways loan is floated the total public debt of the borough will be £200.258. Of this amount however, only £84,037, being the money spent on roads, bridges, and (lie hospital, is not actually revenue producing. The hospital loan is a short dated loan and will be repaid in about three years by the special rates now being levied for that purpose.

The raising of nractically tlio whole rf the™ loans lias by their results proved to be perfectly justified. It is impossible to keep pace with the requirements.of a modern town oxecpt by the utilisation of loan monies. In largo transactions of this kind mistakes are always to be found. In the creation of our public debt it seems to me that the principal mistake has been the spending of loan monies in non-permanent works such a c metalling and footpaths. ]n a few years work of this nature is worn out, but the borough still remains burdened with the loan and the interest payments thereon. Non-permanent work should be effected out of general rates and not by a charge on posterity in the shape of loans. My remarks in this connection more especially refer to the £42.000 streets and water loan, as up to the time of the raising of this loan the proportion of loan monies utilised for nonpermanent works was hardly worth considering. I have always 'felt that it would have been wiser to have limited this loan to cover only works absolutely necessary in connection with the Iraniway scheme and then later as the town developed to have raised a further loan for the improvement of the back streets and this will become more apparent when the rate has to be collected to pay the interest charges.

LO-VNS CONTEMPLATED. At its last meeting the Council devilled to place before the ratepayers a proposal to raise a further loan of ap-v proximately £25,000 for the following purposes:—-Soltar macadam for certain streets (including £IO,OOO for tramway route), culvert in Brougham street, destructor and museum building, "the latter item being to give, effect to the conditions of the gift to the town by Messrs W. H. and H. D. Skinner of their valuable collection of articles relating- to the early history oE the district. When the £55,000 tramway loan is raised the total annual interest and sinking fund charges, including the short-dated hospital loan, will amount to £15,557 7s Id. Of this amount the Electric Light Department wilL pav £3009 15s lOd, Abattoir Department £327 17s fid, tramways (if sufficient funds are available) £3025, leaving the balance of £0195 to be paid from special rates levied for that purpose. The estimated population of the borough is 7900, so that the annual interest bill (£15,557 7s Id) represents "a charge of approximately £2 per annum for every man, woman anil child in the borough.

GENERAL ACCOUNT. After alluding to the growth of the overdraft from a credit halance of £BB01 in 1908 to a debit balance of £5500 in 1914, and the decision of the Council to increase the general rate hv 3d and levy a separate hospital rate of 2d, the town clerk states:—"Dealing with the figures for the current year, it will he seen that this account opened with n