LOCAL BODY LOANS.

Waikato Times, Volume 121, Issue 20283, 27 August 1937, Page 6

LOCAL BODY LOANS.

The Counties’ Association has decided to ask the Government to provide funds from which local bodies may obtain the money they require for capital purposes, and on the terms laid down by the Local Government Loans Board. The position is becoming increasingly difficult. The larger local authorities, especially those with extensive rating powers or proved earning capacity, have been able to secure the funds required at the rates imposed, although some adjustments have had to be made in many instances with regard to certain terras, especially those dealing with repayment. The smaller bodies have not been so happily situated, and have had to make temporary arrangements —at higher rates of interest—in order to put the authorised work in hand. The terms of any loan are dependent on the consent of the Loans Board, and if the money is not available on the conditions laid down then there seem to be only two courses open. Either the terms must be revised or the Government must find some way to ensure for the borrowers a loan that conforms to the conditions. It has been stated on occasion that the lending Departments were either unable or unwilling to lend the mdfcey at the rates laid down, and there should be some official statement on the matter. The Government took authority last year to borrow internally a very large sum. It was understood that the greater part would be provided by the Post Office Savings Bank, and the excess of deposits over withdrawals last financial year must have been used in that way. But if the State is also absorbing, to finance its public works, the funds usually available in the other Departments for local body loans then the request for State action to enable them to carry on is the more weighty. The facts should be disclosed in the various annual returns presented to Parliament during the session. The departmental accounts show what sums have been invested in Government and in local body securities so that transactions during the past year will be easily followed. The Government, naturally, wishes to keep money rates as low as possible, but they are hardening in Australia and elsewhere, and probably will harden here. If it is intended to maintain the existing limits then something must be done to ensure that the money is available.