LOCAL BODIES’

Taranaki Daily News, 12 January 1922, Page 4

LOCAL BODIES’

CONCESSIONS IN BORROWING BILL BEFORE PARLIAMENT By Telegraph.—Press Association. Wellington, Last Night. The House to-night went into committee on the Local Bodies’ Finance Bill. Mr. J. McCombs (Lyttelton) urged that local bodies should be permitted to borrow up to the full amount of a year’s rates. It often happened that rates could not be collected until the last two or three months of the financial year. Sir John Luke (Wellington North) supported the suggestion. He said limitation of borrowing by way of overdraft, as proposed in the Bill, would greatly hamper the operations of municipalities and other local bodies He thought local authorities were quite* as careful in the administration of public moneys as the general Government itself. He also advocated an ex* tension of time for repayment of loans from seven to ten years.

Mr. T. K. Sidey (Dunedin South) pointed out that the Mortgages Extension Act might be in conflict with, the provisions of the Bill. If that Act did not affect the Bill then he agreed that an extension of time for repayment of loans was reasonable. Mr. R. A. Wright (Wellington suburbs) would support the Bill as it stood. He said the Bill provided eight months' supply, which ought to be sufficient. Ratep were due in April and if local bodies would only make an heroic effort and pursue a self-reliant policy they could start each year with a balance in hand, and thus avoid going to the banks for an overdraft, and saving very Istge sums in interest. If necessary they should go direct to the ratepayers for a special loan to meet special needs.

The Minister said the committee had discussed limitation and decided it could not* agree to more than twothirds of the amount of rates. Later he had considered the matter with the Attorney-General and had agreed to an extension of the amount to three-

fourths. Provision had, also been made to enable local bodies to obtain funds for emergencies, such as floods. Regarding the term of repayment he thought seven years reasonable. In the clause requiring local bodies to furnish statements of money owing and the revenue for the year it was proposed to alter the Bill to make the statement due on June 30 instead of January 31. Mr. G. Witty (Riecarton) thought local bodies should be empowered to grant a rebate for the prompt payment of rates, thus inducing early payment and avoiding the need to go to the bank for an overdraft, on which interest would have to be paid.

Mr. W. A. Veitch (Wanganui) opposed the Bill, because he believed it was beneficial only to the banks, and that it was against the interests of the people who would have to borrow money from banks at seven per cent, to pay rates which would be handed back to the custody of the banks without interest. Dr. A. K. Newman (Wellinton East) urged that local bodies should pay at least the bank overdraft rate of interest on moneys received off deposit or temporary loan. At 915 pjn. clause one was adopted by 50 votes to 13. On a new clause (six a),'empowering the Minister to authorise local bodies to raise special loans under exceptional circumstances, Mr. Veitch urged that epidemics and unemployment should be added to the list of emergencies so provided for.

The Minister said a suggestion of this nature had been before the public accounts committee, which thought it inadvisable to widen the scope of the Bill. So far as epidemics were concerned there was already power conferred by other legislation to spend money to deal with an epidemic. The Bill was reported with amendments, read a third time and passed.