ATTACK ON LOAN

Press, Volume C, Issue 29515, 17 May 1961, Page 16

ATTACK ON LOAN

“Cost Country Dearly”

(N.Z. Press Association) WELLINGTON. May 16. “The Government has be gun its borrowing for the year earlier than we were led to believe would the case. This first instalment on the overseas loans which will be necessary as a result of Government inaction since they were elected last year, is going to cost the country very dearly,” the president of the Federation of Labour (Mr F. P. Walsh) said today. He was commenting on the Government’s decision to borrow £2om in London. The announced terms of loan meant that it would cost approximately £1,250,000 a year for 11J years. "That is, the interest on this £2om will amount to something between £l4m and £lsm. To meet the demands we will need to export, over this period. £l4m to £lsm worth of wool, meat, butter and cheese, for which we will receive no payment. "Less than a month ago the Prime Minister (Mr. Holyoake) said in Dunedin that the Government would borrow overseas ‘later in the year.’ The recent further decline in the balance Of overseas funds has driven the Government to taking some action. “It is a pity that they could not have read the signs sooner and taken action concerning imports and the level of bank credit,’’ Mr Walsh said.