CO129-572-14 Proposed reorganisation of water services 7-4-1938 - 3-4-1939 — Page 90

(iii) Capital Charges.

4.

(a) Expenditure met from loan; interest and sinking fund

actually payable on loan until redeemed.

(b) Past expenditure mot from revenue (including "loan"

expenditure temporarily advanced from revenue);

to be repaid by an annaal charge of 2 per cent,

crasing aftor fifty y„ars.

(c) Future expenditure from revenue, intorost and sinking

fund contributions at a ront market rate of interest

(to be fixed annually, toresont 3 per cent).

Some of these items cannot be exactly calculated

until the water accounts are fully separated, but the attached tablo (Appendix I) shows that possible cstimate of the

above charges, besed generally 1957. The net revenue for

that year is shown ior comparison.

on

5. Two matters call for social count.

(a)Repayment of past exture from r venue.

It may be argued the as his is over and done with

there is no justification for making consumers pay

for it now. un the other hand if the water undertak-

ing had been financed from loan, as is the most usual

practic, much higher charges would have had to be

borne than ar. now proposed ne int rest would have

been charged as well as

redemption contribution.

If general revenue is not made up by this means extra

taxation will have to

the community will b To

while the prime object

water pay th. full cost

Virtually what is props

expenditure as n lor

generous terms.

(b) Provision for Renewals.

raised in some other form and

b trur oil on balance,

aking the consumer of

ill not be attained.

is to treat the past

hout intrest repayable on

The

100

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