CO129-539-12 Loans for public works- military finances 26-2-1932 - 7-3-1933 — Page 84

amount could be provided temporarily, pending an

improvement in market conditions, from the cash

balances held by us on behalf of the Government,

or, if necessary, from the Joint Colonial fund.

5. We note that it is proposed to provide by

legislation for borrowing approximately $20,000,000,

to finance capital works in the Colony, and that the

amount should be raised in instalments over several

years as money is required to liquidate advances from

surplus balances and overdrafts at the Bank.

We see

no objection to the Government at once obtaining

legislative authority to raise sufficient money (a)

to pay off the balance of the Public Works Loan 1927

after allowing for the amount of the sinking fund and

(b) to cover the Public Works programme up to 1937.

In financing the works, however, we think that the

Government should bear in mind the fact that by reducing

their surplus balances to a low figure, they might be

placed in the position of having to issue a loan at a

time when conditions are unfavourable. If, therefore,

conditions are favourable at the time the conversion

loan is issued, they might consider the advisability of

raising at the same time sufficient further money to

already

liquidate the advances/made for capital works and to

provide for the estimated expenditure up to, say, the

end of the year 1932.

6. With regard to the legislation necessary, we

suggest that the Government might consider the enactment

of a General Local Loans Ordinance specifying in detail

the terms and conditions applicable to all future

Government

loans raised in the Colony.

Such an

/ordinance

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