MORTGAGE BILL

Press, Volume LXXI, Issue 21409, 27 February 1935, Page 12

MORTGAGE BILL

[ FURTHER CRITICISM IN HOUSE OPPOSITION LEADER'S VIEWS RESISTANCE TO MEASURE [From Our Parliamentary Peporter.j WELLINGTON, February 2G. Criticism of the Mortgage Corporation of New Zealand Bill was taken up again in the House of Representatives to-day, when the leader of the Opposition (Mr M. J. Savage) claimed that the corporation would not be founded on the whole security of the State, as was the case with the State Advances Department. Mr Savage said that apart from certain lending institutions, he had heard of no one outside of the House who was in favour of the bill. . The Minister for Finance (the Rt. Hon. J. G. Coates): What lending institutions?

Mr Savag;>: They are expressed generally in the newspapers. Mr Savage said that the bill was not even acceptable to those it was designed to assist —the farmers, who were holding meetings all over the country protesting against it. Mr Coates: Well, what are you complaining about? That suits you fine. Mr Savage said that Mr Coates did not even have the support of the Prime Minister, who had at one lime expressed an opinion that was in direct opposition to some of the proposals of the bill.

"We have a responsibility equal to that of the Government," Mr Savage said, "and we arc going to honour that responsibility. Everything that looked like a structure has been pulled down during the last five years. What has the Coalition Government to show but poverty of mind? I am going to ask members to vote against the bill, because it means the destruction of the State Advances office. If the people want that sort of thing, well and good; but I know the people don't want it." "I find it very difficult to follow the leader of the Opposition," said Mr Coates. "First of all he says nobody wants this blessed bill. I suppose if we take what appears in the press, the trading banks, stock and station agents, and law societies are all opposed to it." Mr Savage: Did it ever flMke you that a sham fight is being cutried on'.' Mr Coates: I only know that unpleasant language has been used. The press is entitled to its opinion. It may be well informed, but I don't agree with what it says on this bill, and the Government doesn't agree. Mr Savage: Nobody agrees with, the Government. Mr W. J. Poison <C.. Stratford): I think the farmers agree with me. Mr Coates: Is the Government to be battered about and dragged up this road and down that alley by every opinion that is expressed in the country? I know that under this bill we are going to get cheaper money for thos« who desire to take advantage of it. Is it wise for the State to borrow all the money necessary to reorganise our system of finance I think every member will realise that it would mean piling up the nationnl debt to such an extent that we would destroy the very security upon which we arc depending.

LOCAL BODY KATES MINISTER'S STATEMENT IN IIOISE [ From Our Parliamentary Reporter.! WELLINGTON. February 2G. The extent of the liability for payment of local body rates on properties mortgaged to State departments was the subject of a statement to the House of Representatives to-day by the Minister for Finance (the Rt. Hon. J. G. Coates). Mr Coates emphasised that the proposed Mortgage Corporation could not accept liability for all rates on properties mortgaged to it, and neither could the Crown. He explained, however, that rates would be included in the pool of the budgetary system under the legislation for the rehabilitation of farmers. The subject was raised by Mr Waller Nash (Lab.. Hutt), who cited the experiences of the Lower Hutt Borough Council, which in the last five years had lost in revenue from properties reverting to the State Advances Department; a sum of £30.123, representing roughly 50s a head of the borough's population. He wanted to know if the Minister for Finance was prepared to allow this injustice to go on indefinitely.

Mr Coates said the present bill and the Mortgagors and Tenants Final Adjustment Bill would operate in conjunction with the Mortgagors Adjustment Commissions, and where an application was made to the commission for relief, rates would become a first charge. Except where the local body concerned might accept a different arrangement, the rates would come into the pool of the budgetary system proposed in the second bill, and when final adjustment was made he was satisfied that borough and county councils would be in a better position than if the State Advances Department was kept separate and carried on in addition to the corporation. If the Crown accepted responsibility for all the rates on properties mortgaged to it, it would mean a charge of about £500,000 a year on the Consolidated Fund, which it would not be reasonable to ask the State to accept. On the other hand, it would not be fair to expect the corporation to commence its operations under a similar disadvantage. FARMERS' UNION REPORT INTEREST LIMIT SOUGHT I PRESS ASSOCIATION TKLKGIIAU .) DUNEDIN. February 26. The Farmers' Union adopted the report of a sub-committee on t'l3 Mortgage Corporation proposals, stating:— (1) That the scheme would be useless if it meant that the farmer would pay more than 4£ per cent., including amortisation. (2) That it was preferable to launch the corporation without share capital, giving bondholders representation on the directorate. (3) That there should be a fixed period for the redemption of bonds, which should be issued so as not to mature all together. (4) That loans should be not trans* ferable in the event of the property being sold. Regarding the rehabilitation proposals the principle of decentralised handling was endorsed. It was considered inequitable that all farmers should be given a 20 per cent, equity in the final adjustment, and it was recommended that eu'h case should be considered on its merits.