MORTGAGE BILL DEBATE

Press, Volume LXXI, Issue 21411, 1 March 1935, Page 18

MORTGAGE BILL DEBATE

CLOSURE APPLIED SHAREHOLDER CAPITAL DISCUSSED HOVSE RETAINS CLAISE rFrom Our Parliamentary Reporter.] WELLINGTON. February 28. The meluMMi <>!' shareholder capital in :hc financial structure of the "'.loffrui."-' Corporation of New Zealand met with renewed criticism in •■-;!• House of Representatives to-night. v. ;:>_•:! the relevant clause was under cii:ca . '■'::: m committee. ■■; ,■ ;:: :;oi::i, io ark members to von.- u-iiinii lm-. clause as a whole," «aid the leader o/ the Opposition (Mr M. J. Sa-.ae-'. 'The £1,000,000 worth of ea.j.-jl to be- provided will Of heuii't'oie. '.'■ i> hardly worth talkh.t; about b; ie-:a>-d 10 the business, o; lb'- ce'eor; lien. Half a million is to be the -earehuldcr capital. That y.rovuie- an cxi use for private "> craw profits rather Vhim'e e.\e relict io farmers and othcie va; : : niort;: ; aecs." The Mmi.-tt-r ' :) '' i'manee uiie m. ?]r.n J G Cuaies> said he disagreed v.-i'h the Labour alternative that the State '~i-..,uki stand the whole responsibilhv lor I'.Jiai.re. The £1,000.000 was important. One had to remember v. could expand 1"; limes. It had been ; -ked whe'.hir companies shoiSd be allowed n, invest in the corporation.

!: had to be remembered that such coma'vcr: had cither to be- New Zeaiand concerns or compajiies doing b'j' : "" - in 'sow Zealand. Mr K. McKoen 'Lab., Wellington South*: I'.u' companies with hoad-fiua'-tt-r?- c-1.-ewe re could take shares. ' Mr Come-: Yes. if they are doing husines- m New Zealand. And they must conform to all the requirements of the !avr to which the New Zealand eomnana-s arc subjected. Mr McKivii: But isn't there a dan:xr "f e.rsale !-M',, : . i: ii;i's clotting control v Mr Coaiv : 'I he moment: it is seen the e. roovatioit is being dominated .7>v ot ; r-:- than internal national Ir.xov'Ji'.fi. arlien will be taken. Mr M( ■!■'.' eu: Hew would yon allot ■hare:; to me cornoanies? Would tli.-re hi- a limit of 5000 V Mr Coates: I: might not reach 5000. That wo'.iln depend on the r.umber of application:-. The basis will be to onsure that everyone who applies will •:et at leas: one share. Borrow inn Suggested Mr Savage said if the £1.000,000 capital was not there at all. and the iiou.-c- .-av.- tit to do so, the corporator- could borrow on the foundation <<!' the State, which was much better. .Mr Coate.-: My reply is that that would be i:mvL-e. Mr V.'. J. l'-ohson <C, Stratford) ;. A:ed whether the Bank of .New Zealand had i: spired the bill in the form J-: which it had been introduced. Did ■he bank want the shareholder capital befoiv 't wou'd step out and lend Mr C"ate.-: Th:s matter ha-; never ).l ■:: d:-cu.--;cd with any bank.

M'- P'-.::--.ii sad there had been an < . ca::iou when the Slate had had to -,.ve the- Bale--, of New Zealand a '-;e:i rii'i" ;<i ir -Dire confidence in the i-a.nk. and it \- - ; he State"s interest •'a- cc;>enM'->. which would in-*T-re continence a ;t —not the interests ■■ f private individuals. He asked why M.nistCi-'- should wait until there was a ri-rger of oat-we.- interests becom- ..-.-■ dom-msai. \','!'i- were steps not :. !:e.'i e- th ")'.l\ to prevent that (iii-rr:- ;.r -"■ ''.' ':".]• (."•..'ti Th:'! wi ! ! never happen Mr pi boo: !< ha.-; happened. When '-'.- Pecan our rural advances system - ■ had <o chart: c an. extra one per ■ '.-.• uvea, -t becnipe of inTnonces M:- Coat-:-: v uu were solelv re- : p." --hie for mat. Mi- Poii .-:: '■'..>. I was refused a '■ • .■-an;.. a!;hou'_'h I was a commis- '•:• -r. "!:•-• S'a'e- allowed ouiside in- •■>■' vces to ooura'o. and we have to < iea"e < u.- fanners one per cent, more ■•crest. I dopier:- that, and T will ' !>.;l «:' the Coalition" Mr A. M. Samuel 'lnd.. Thames' '■■: ! that when "-a- Stale Advances .-■■ d the I):schai-.od Soldiers' Settle-;.-<-t-t account v.- -.-(> brought under the • ■■< v;'-i-'in- .-I' 'h.-> bill, that would be f .- riifi of -he C a'ition. ■ t -scold !.«e :-• -rrv.'' he added. b-i'-jMi" ir- u.b'-r.-- Oh. "..'■• Samuel: I have a good deal of f• : .'.;•!'. v with the Minister. I ' < '".i'-l i-i'm to put through ids good 1- " tiiCoii. out when he became re-.-ei i jn;e-y v.c- severed our allegiance. '!" '■ -.-i'.arei okl--r capital is for one ; a-pore —to protect the big financial a 'ero-fs iu t'-'is country, and that is a ieiiica! 'ii the interests of those ].->.< o!c w'no have mortgages. Mr P. Sufiii"' M.ab.. Wellington T'.ati aia.'-'i the Minister if he could p-ie/e that h va: a fair thing to hand over the a:-:ec of the country. amountia-'! P, iu-arly £70.000,000, to a ;:ro';p of private shareholders who w.-'-o ;i S k,-J to jjii +- up only £500.000. "The Government is creating the J" arc! a.r a political scapegoat," he i-'.-d. "If is tu }"■ something for the Gove 'Timeni to hide behind when it 's o-i ici-.-od. Ii will point to the board in •"■ ■'. the sana- wav as if now points to '"e TjneiiiPiovHK-nt Board, which is a'-ao-derma the money of the coun- "■.-• V.'j-.-.ht expressed the opinion t a* a> iom.; as rare was exercised '•■■: ere was no danger of outside in- • ie:-t- •.-•■•uing'Tontrol of the corpora- ' 0.0. Tie- Australian Mutual Pro--•'dei-t Society and other similar inVioj'a,:■• for i!;;-.iance. lent money to '.'".<> VVc-Dini'.teii City Council. a*nd he «-.'' aot .c» any reason why they should not invest in the shares of the t arporatiom After further discussion the closure '-'a ■ applied, and the clause was re<amcd by ?,2 votes to 27. Mr Wright «-'/od will) th.e Government, and siiia-; W. J. Poison <C. Stratford), J. Connoiiv dnd. C, Mid-Canterbury), -, d A. B. Jull 'C. Waipawa), with ',':■>■■ Oripeit.'ition. Allotment of Capital '")ji elause fi. which deals with the y-ieataao.ot .of lti t > original capital of the {orpeinta-jii. Mr R. A. Wright (Ind., "'■'.''•l'lngto-ii Suburbs* moved an amend- : writ will) the object of limiting the 1 hlrr- r.f -hares to British citizens r> eti.ont in New Zealand. "It rnav be bad enough for shareh'l'di.-.-.; m New Zealand to be in the f-onta rn. bu! it would be 10 times *■'-orse to admit shareholders from oute.de." he said. Mr Coates said the amendment vould dei:ar companies from taking up - -.uTbz. He could see no wrong in /•o:r.panic-. : doing so if Ihev so desired. Mr R. MaKeen (Lab., Wellington femth;: If the banks subscribe shares, %'.:'. y will evL-iituall.y gain control. Mr Coates: Would ihc banks be in-vo.-.tori. in the bonds? That is the question. < Mr V/. E. Parry (Lab., Auckland Central) said that no private investing company should be permitted to hold a share. The Minister considered that Mr Wright did not have that in mind; but that he was more concerned lest shares should be held by persons outside • New Zealand. The Minister would to prepared to accept the amendment

if it were altered to permit companies registered or operating in New Zealand to take up shares. Mr Wright agreed to this course and later in the debate he elaborated his amendment to allow any company or corporation incorporated in New Zealand, or any company incorporated outside New Zealand but having its place of business in New Zealand, to take shares in the corporation. This amendment was agreed to and read into the bill. The House rose at I a.m.