Farmers and a Moratorium.

Press, Volume LXVI, Issue 20102, 4 December 1930, Page 10

Farmers and a Moratorium.

It is a little unfortunate tliat neither the Prime Minister nor the ActingPrime Minister could be in Wellington yesterday to hear the deputation representing dairying interests and to reply to the request for a moratorium on mortgages. Nevertheless, it is doubtful if either of them could have said much more than Sir Apirana Ngata said in indication of the Government's attitude. Sir Apirana stated plainly that for the distresses urged by the deputation a moratorium was a most extreme remedy, before resorting to ■which the Government would have to consider carefully all the interests likely to be affected. Even the members of the deputation themselves did | not unanimously hold that a moraj torium was the true remedy. The j representatives of the Dairy Control j Board advocated other action by the j Government to assist the dairying inI dustry; and one speaker hit the nail on the head when he said that, since a reduction in costs was the real need, the Government should work for that and begin by reducing the cost of government. Everybody must sympathise with the farmers in their present anxieties, but everybody knows that a moratorium is a desperate move. If it were possible to believe that it would merely steady the situation and enable the farmers to recover within a reasonable period, then a good deal could be said in its support. Unfortunately, it is most difficult to be confident or even hopeful of that. The war-time moratorium, which applied only to the repayment of principal moneys advanced, was justified because t it met a national calamity, outside the | course of trade. The moratorium now j proposed is of a very different kind, j Prices have fallen, in circumstances j that compel reorganisation of our inI dustrial forces; but a moratorium | would be more likely to postpone than | to accelerate the arduous process of ! '"'inffing costs into line with prices, j Sir Apirana Ngata remarked that the j very mention of a moratorium had | alarmed mortgagees, who were calling in principal moneys which otherwise would have been allowed to remain out; and this shows, the danger threatened. Anything that weakens or destroys conlidence in lending will injure the farmers. Since this, the weakening of confidence and the shrinking of the flow of money to the land, is certain to be the result of a moratorium, it could give only illusory relief to some and would impose new

hardships upon others. In the long run it is far better to attack the real problem directly and at once, and that is the problem of costs. Many may suffer seriously in this process, farmers as well as mortgagees; but distress can be limited and lightened if the Government pursues the proper course and distributes fairly over the community the sacrifices and economies necessary. Primary production must be maintained, whatever happens. It is therefore encouraging to observe Sir Apirana Ngata's suggestion that the Government should appoint a small working' committee representative of the Government and the primary industries to work out a practical plan for meeting the present difficulties.