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LOCAL GOVERNMENT.

MUNICIPAL INSTITUTIONS.

ONLY of recent years has the question of Local Government received

the attention which its importance demands, the states of the Commonwealth that have adopted general systems being Victoria, Queensland, South Australia, and Tasmania. New Zealand, however, has also for a number of years been divided into districts with local governing powers. It will be noted, from the information given in the following pages, that the Acts controlling Local Government vary considerably, especially as regards the election of representatives and presiding officers, method of valuation, and rating powers; but the particulars available in regard to each state are not sufficiently exhaustive to admit of making any effective comparison between the systems of the different provinces.

The first portion of this chapter is devoted to an account of the local bodies operating under the various Municipal Acts, while the particulars relating to Boards and Trusts, for the establishment and control of which special Acts have in most cases been passed, will be found in the second part.

NEW SOUTH WALES.

The first Act providing for the establishment of a Local Council in this state was passed in 1842, when the City of Sydney was incorporated. In 1867, the Municipalities Act became law, but as that Act left it optional for any district to become constituted as a municipality, only a small proportion of the area of the state is incorporated.

Under the provisions of the original Acts, the aldermen were elected by the ratepayers (except in the City of Sydney, where both owners and occupiers voted), and the mayors were chosen by the aldermen. By legislation enacted in 1900 the franchise was extended to tenants and lodgers in the city of Sydney.

During 1900 the Sydney Corporation Amending Act became law. Under its provisions the city is divided into twelve wards, each returning two aldermen, instead of into eight wards, each represented by three aldermen, as heretofore. The mayor is still elected by the aldermen, as the proposal to provide for his election by the citizens was not carried. Other important amendments are those providing (1) for the abolition of auditors elected by citizens, with the substitution of Government inspectors to audit the accounts; and (2) for the resumption of land for the opening or enlarging of streets or public places. The rating powers have not been altered, the general rate remaining

at not more than 2s. in the £ of the annual value, but lighting and other special rates may also be imposed, if necessary.

The Municipalities Act of 1867 provided that the general rate should not exceed 1s. in the £ of the annual value, but that special rates could be levied, so long as the general and special rates together did not come to more than 2s. in the £. A further charge, limited to 6d. in the £, could be made for street watering, and an additional rate for water supply, where necessary, the amount not to exceed 1s. in the £.

The condition of Local Government in New South Wales is admittedly unsatisfactory, and various proposals have been made for the amendment of the law, but none of a general character has been passed by Parliament. Recently the Government has laid before the Legislative Assembly a comprehensive scheme for extending Local Government to the eastern and central divisions of the state, and ultimately to the whole area of New South Wales. The scheme proposes to divide the unincorporated area into shires, each shire to have an area of not less than 1,000 square miles; a municipality is to be limited in area to 200 square miles or under, with a population of not less than 1,500. The Bill proposes that the powers that may be exercised by inunicipalities shall be defined by law, and these powers are very wide, and are to be acquired in instalments as the development of municipal life proceeds. Each local body is invested at its creation with certain elementary duties and responsibilities, and propositions to extend these must be approved of by the electors of the area before the extended powers can be granted. The most important departure in the principles of municipal taxation proposed by the Bill is the authority to be conferred on all local bodies to levy their rates on the unimproved capital value of the land instead of on the annual value of improved property. The essential object of the measure is the establishment of home rule in local affairs throughout the state, and with this end in view as much as possible is left to local bodies, the Bill simply providing for the creation of municipal life. Further development is provided for by the powers which are conferred upon the local bodies to legislate by ordinances.

The total area incorporated at the close of the municipal year 1903 was only 2,829 square miles, so that it will be seen that a large area still remains under the control of the central government in New South Wales. For this some justification is claimed on account of the largeness of the territory and the sparseness of the population residing in the unincorporated areas; but this is hardly tenable, seeing that both these conditions exist to a greater degree in Queensland, where the whole territory is under local government. The total area still unincorporated in New South Wales amounts to 307,871 square miles.

The total capital value of all property in municipalities is returned as £134,218,300, and the annual value as £8,351,420; so that the annual return from property is about 6.22 per cent.

Taking the municipalities as a whole, the following particulars in regard to the number of municipalities, the area incorporated, and the annual and capital values of property assessed for municipal purposes, will not be without interest. The figures relate to all municipalities, and cover a period of twelve years :

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The annual and capital values of Sydney and suburbs since 1892 are shown below :—

A reference to these figures will show the depreciation which has taken place in the value of real estate since 1892, but it is satisfactory

to note that a steady increase is shown from 1898; while the annual value for 1903 exceeds that of any previous year since 1894, and the capital value is higher than in any year since 1895.

In view of the fact that it is proposed in the new Bill to levy rates on the unimproved values of land, the following statement will be of some value:

The values of five of the principal towns are given in the subjoined table, and for the purposes of comparison, the corresponding figures for 1892 are shown. With regard to Broken Hill, it should be remembered that the mines were not fully developed in 1892, and although the capital value in 1899 had increased by about £364,000, the values in the years 1894 and 1895 were stated to be £2,952,000, and £2,862,000 respectively, but for 1897 the figures declined to £1,232,600, which was practically the value in 1899. The annual and capital values shown for 1903 exclude the assessments on the output of the silver mines, as the mining companies were successful in the appeals against the rating of their products:

The revenues of municipalities are derived chiefly from rates, but under the Act of 1867 the Government allows an endowment for the first fifteen years following incorporation, the scale being £ for £ of general rates received during the first five years, 10s. per £ during the next five years, and 5s. per £ for the remaining period. The Government also contributes grants in aid of roads and other works, and occasionally a special endowment is given. Rates are levied on nine-tenths of the annual value of improved property, and on 5 per

cent. of the capital value of unimproved land, except in the City of Sydney, where the maximum percentage on unimproved is 6 per cent. The following table shows the receipts during the year ended February, 1903, the Government endowments and grants being specified. The total shown is exclusive of refunds and cross entries, but it includes proceeds of loans :

The burthen of rates is, therefore, 1s. 43d. per £ of annual improved value, and about 24d. per £ of estimated unimproved capital value. The total expenditure, exclusive of refunds, &c., for the same period amounted to £978,281, distributed as follows :—

The proportion of the expenditure incurred for salaries and office expenses was slightly over 8 per cent., and for interest on loans and overdrafts it was 13.72 per cent., while the average rate of interest payable on the liabilities was 4.46 per cent.

The amount of loans and secured overdrafts outstanding on the 2nd February, 1903, was £2,931,511, of which £1,301,580 was due to investors in London, principally by the city of Sydney, while of the balance, £21,762 was floated in Victoria, and £1,608,169 in New South Wales. The unsecured overdrafts amounted to £79,927, so that the total liability on which interest was payable was £3,011,438. The interest charged ranged from 3 to 8 per cent. for the secured loans, and from 4 to 8 per cent. on the unsecured overdrafts. Against the total liability, sinking funds have been established, the total amount at the credit of such funds being £323,894.