AMENDMENTS LOST

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

AMENDMENTS LOST

SCHEDULE OF RULES DEBATED POWERS OF SHAREHOLDERS [From Our Parliamentary Reporter.] WELLINGTON, February 28. The powers of shareholders of the Mortgage Corporation of New Zealand in amendment of the rules of the corporation were again discussed in the House of Representatives to-day during the committee debate on the bill. The amendment moved by Mr W. J. Poison (C, Stratford), and designed to allow the board of directors and the Government to alter the schedule of rules without necessary reference to a shareholders' meeting, was eventually defeated. The Minister for Finance (the Rt. Hon. J. G. Coates) told the House that he would be willing to insert a slight amendment to the clause, deleting the three words "but not otherwise." to make the assent of the shareholders' meeting absolutely obligatory. Mr Poison: Does the Minister think that that would make the slightest difference.

Mr Coates: I think so. Mr H. M. Campbell (C, Hawke's Bay)- That would be a material amendment. I think it is going too far. Mr A. I\l. Samuel (Ind., Thames) said that the Minister's suggestion would make no difference at all to the intent of the clause. If it had entailed a change, the Minister would not have suggested it. Mr Poison emphasised evils which, he said, would result from vesting complete control in the hands of the shareholders' meeting. It was difficult to get shareholders to agree at any time, and the clause under discussion would be an undue restriction on the Gover-nor-General-in-Council. Mews of Independents Mr C. A. Wilkinson (Ind., Egmont) said the board itself might wish to bring about some changes in the rules, but if the clause was to stand as drafted it would not be able to do so without the consent of a general meeting of shareholders. Half the original share capital was to be provided by the Government, which meant that the people themselves were in a sense shareholders in the corporation; but thev had no vote. Mr W. A. Veitch (Ind., Wanganui) characterised the provisions of the clause as almost an entire departure from business or governmental precedent. Included in the capital of the corporation there was to be £65,000,000 representing money given to the State by State mortgagors, a reserve fund amounting to more than £2,500,000, and £1,000,000 of share capital subscribed in equal portions by the public and the Crown. Out of that total of almost £70,000,000—a significant political figure—only half a million pounds would be subscribed by the shareholders; and yet nothing could be done without their consent. Mr Poison's amendment, going to a division, was defeated by 40 votes to 28, and the Minister's suggested modification of the clause was ruled out of order of the Chairman of Committees

(Mr J. A. Nash) on the ground that the original clause had been passed. The provision in the bill which prevents the Minister from voting at the shareholders' meeting was challenged by Mr Walter Nash (Lab., Hutt). He offered an amendment seeking to give the Minister voting power by virtue of his being the holder of the State shares. Amendment Not Accepted Mr Coates said he could not accept the amendment Its effect would be that the Minister would swamp all the other shareholders, and that the object of bringing in share capital would be lost sight of altogether. Mr P. Fraser (Lab., Wellington Central): The Minister is safeguarding against the State controlling its business. He is not to be permitted even a modified vote. He is to represent half the share capital, and remain inoperative. Mr F. Langstone (Lab., Waimarino) said it was possible for one private shareholder to represent any number of others by proxy; but that the Minister apparently must not accept a proxy for the taxpayers of the country. The amendment put the Minister and the State shareholders' capital en equal terms with the shareholders. Mr Coates explained that no man could hold more than 5000 shares or wield more than 5000 votes. Mr A. S Richards (Lab., Roskill): Will the Minister say if the State capital is there to guarantee the shareholder capital? Mr Coates: It will be 50-50; but I do not expect that there will be any losses.

Mr Poison: That is going to be mighty hard on the small farmer. I fail to see how he is going to derive any benefit. Mr A. E. Jull (C, Waipawa) said he was going to oppose shareholder capital in the bill, because he did not think it necessary; but on the other hand, if there was to be shareholder capital, it would be silly to deny the shareholders any voice in the corporation's affairs. The amendment was lost by 39 votes to 28.