That the scheme is in reality a 3 per cent. security, and would in its later stages become so, I entertain little doubt; but I do not forget that, though its points of novelty are the very elements which really make it secure, they may not make it seem so, and that those who are merely looking out for an investment may eye it with some distrust because of its novelty. We shall have in the first instance to look to those who will advance money with somewhat mixed motives—public spirit, love of enterprise, and possibly, as to some persons, with a lurking belief that they will be able to dispose of their debentures at a premium, as they probably will. Therefore, I put down 4½ per cent., but if anyone’s conscience prick him he may tender at 2 or 2½, or may even advance money without interest.
L. Sinking Fund.
This sinking fund, which provides for the extinction of the debt in thirty years, compares most favourably with that usually provided by local bodies for works of so permanent a character. The Local Government Board frequently allows loans to be created with a sinking fund extending over much longer periods. It is to be remembered also that an additional sinking fund for the landed estate has been already provided (see Chapter iv., p. [42]).
M. Balance available for Rates levied by Local Bodies within whose jurisdiction the estate is situated.
It will be seen that the whole scheme of Garden City will make extremely few demands upon the resources of outside local authorities. Roads, sewers, schools, parks, libraries, etc., will be provided out of the funds of the new “municipality,” and in this way the whole scheme will come to the agriculturists at present on the estate very much like “a rate in aid”; for, as rates are only raised for the purpose of public expenditure, it follows that, there being little or no fresh call upon the rates while the number of ratepayers is greatly increased, the rate per head must fall. I do not, however, forget that there are some functions which such a voluntary organisation as Garden City could not take over, such as the police and the administration of the poor-law. As to the latter, it is believed that the whole scheme will in the long run make such rates unnecessary, as Garden City will provide, at all events from the time when the estate has been fully paid for, pensions for all its needy old citizens. Meantime and from the very outset it is doing its full share of charitable work. It has allotted sites of 30 acres for various institutions, and at a later stage will doubtless be prepared to assume the whole cost of maintaining them.
With regard to police rates, it is not believed that these can be largely increased by the coming into the town of 30,000 citizens, who, for the most part, will be of the law-abiding class; for, there being but one landlord, and this the community, it will not be difficult to prevent the creation of those surroundings which make the intervention of the police so frequently necessary. (See [Chapter vii.])
I have, I think, now fully established my contention that the rate-rent which would be willingly offered by the tenants of Garden City, in respect of the advantages afforded them, would be amply sufficient, (1) to pay landlord’s rent in the form of interest on debentures; (2) to provide a sinking fund for the entire abolition of landlord’s rent; and (3) to provide for the municipal needs of the town without recourse to any Act of Parliament for the enforcement of rates—the community depending solely on the very large powers it possesses as a landlord.