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Page 530
Part 7
Page 530
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of the rated extensions had been petitioned for by a majority of the settlers. Sixty rated consumers only have used in 1916 more than the rated allowance to the extent of £500; only 23 have used excess to the amount of £5 and over. 8556. Does that meant that, out of a total of 843 holdings, only 16 paid excess?— that only applies to the rated holdings, 373. It only applies to the rated holdings of extensions, not to the 30th. main 8557. By Mr. PAYNTER: You are not concerned in providing a water supply a water supply with a view of land settlement?—Only indirectly where we have commissions from the Lands department to do so. Since the water supply Department has been constituted it is supposed to consider how farmers generally are the be supplied, and also whether it should advise the Government to put in supplies as an aid to development. We are also supposed to work the undertaking on commercial lines. 8558. By Mr VENN: Petitions are still being received for extensions?—South Merredin did not actually sign a petition; they asked if there was any probability of the matter going on. Reports where put before the Minister and he said it was not practicable to provide money at this juncture. 8559. By the CHAIRMAN: Relating to the scheme as a whole I noticed that your deficit last year was £51,000. Is that amount made up from the general revenue?—The sinking fund is provided by the Treasury. 8560. If the scheme does not earn sufficient to make up the sinking fund, does the Government provide that by direct payment from the Treasury?—It comes from Consolidated Revenue. 8561. There are one or two points that I want to be clear about. We are assured by the departmental officials that the water supplied on the extensions is supplied at a annual loss without taking into account the head work expenses and office charges?—Yes, that is right. 8561A. The extensions, we are told, are designed to provide only the water which the department has contracted to supply if all the holdings where occupied and were consuming up to the value of their rates. Excess water could not be supplied by the department under such circumstances?—That is a point on which there is some doubt. It resolves itself into the question of the basis taken by the engineer in designing his scheme. He has assumed that the whole of the rebate will be taken in three months. If you can spread that period, it will mean that there will be more water available. 8562. You say that the life of the pipes is 15 years?—Yes. 8563. How many years have elapsed now?—We have been putting in pipes every year. The greater portion have been put in since 1912, and with them there are still over 10 years to go. 8564. What would be the position at the end of that 10 years when the pipes were paid for and the upkeep was provided for; would a substantial reduction of the rates be possible?—If the period of the useful life of the pipes were under-estimated, it would be a matter for the consideration of the Government, but the evidence seems to point to the fact that the period has not been under-estimated because a fairly large proportion of those pipes are of Mannesman steel and it is not expected that they will last 15 years. There are 120 miles of steel pipes and 15 years is considerably in excess of the estimated life of steel pipes with Mundaring water going through them. So far as we know, the useful life of the pipes has not been over-estimated. 8565. At the end of 15 years, therefore, it would be necessary to renew the pipes and the capital cost would still go on? -—Yes. 8566. What does the 5 per cent. depreciation cover?—The original cost of the pipes. 8567. Where is that 5 per cent. invested?—As a matter of fact, it is not separately invested. 8568. Do I understand that you have not that 5 per cent. in your possession?—It goes into Consolidated Revenue. 8569. It is credited to the —Yes, in the books of the department. The Treasury have to provide for sinking fund that is necessary on the loans they have raised. A sinking fund on a loan might be one-half per cent., and that loan money might be invested in a project which would last only 15 years and the department that is operating that project would allow for depreciation sufficient to wipe off the loan in that time. 8570. The state will add to the goldfields water scheme at the end of the term an amount sufficient to replace the pipes?-—Yes. 8571. What is the life of the goldfields water scheme as a whole, that is to say, when your sinking fund payments will wipe out your indebtedness?— The annual report on page 7 contains the note that provision for redemption at the present rate should enable the loans for the original works to be paid off in a little over 10 years from the 1st July, 1916. Of course, in regard to the supplementary works and reticulation, their sinking fund only starts from the day they where put in. 8572. Do you think when that period comes, it will be possible to make the reduction in the rates, or will there be any expenditure which you will have to face then to maintain the pipes, or anything of that kind?—It is entirely a matter of finance. The state has spent from general revenue in support of this scheme something over a million pounds sterling in making up deficits. Then again it is difficult to forecast anything in regards to the future, especially in connection with mining. The revenue from this direction is decreasing and that has been the mainstay. With the decrease in the mining revenue there will be a larger call on the general resources of the State to support the undertaking. 8573. It seems to me quite hopeless to expect sand plain and inferior country to pay a 4d. water rate because the earning capacity of sand plain is so low. Has the questions of grading lands been discussed?— We did go into the question of rating on the unimproved value, and that went to show that farmers from one extension would pay only half what farmers would pay from another extension. 8574. The position is so radically different here as compared with south Australia where the water is supplied to £5 or £2 10s. land and where the benefit is the same. Here where the land varies so much between the productive forest country and the unproductive sand plain, it is a very different matter?—We cannot rate any considerable area of that sort of country; we do not rate far enough back from the pipe line. I would like to revert to
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