THE RESERVE BANK.

Hawke's Bay Herald-Tribune, Issue 155, 19 July 1937, Page 6

THE RESERVE BANK.

The statement of accounts of the Reserye Bank of New Zealand for the financial year ended March 31, 1937, the first since the bank passed under direct governmental control, give only the most vague and general picture of its position, says the Christchurch Press. When, in terms of the Reserve Bank Amendment Act of 1936, the bank 's £500,000 of share capital was acquired by the State,. Government spokesmen made much of the point that the bank was Ihereby freed from the contrql of "private interests" and that monetary policy was henceforth to be determined by "representatives of the people." The recently-published accounts show that in reality the Reserve Bank was a far more democratic institution before the amending legislation of 1936 than it is now. Before' 1936 the annual accounts had to be accompanied by an explana. tory statement and to go before a meeting of shareholders before they were adopted. The shareholders, the total number of which was about 6000, were entitled to criticise and to ask questions; and even if their criticisms and questions received no more attention than shareholders' criticisms and questions normally do, the annual meeting was at least a useful safeguard. The governor of the bank and his directors are now in the happy position that they need never submit to public questioning. Responsibility for the bank's policy now rests with the Minister for Finance, so that presumably its affairs will be discussed in the House of Representatives. But a government which is not anxious to answer questions about the bank's affairs will find it easy enough r,o burke such a discussion, particularly as no item on the Estimates has any xelation to the Reserve Bank. It is. of course, impossible for the Government to be completely frank about tho bank's position and the nature of its transactions. But thero is 110 reason why tho proi'it aud loss account, for instance, sliquld lump together "salaries, renl, cost oi notc issu-e, and £ other expenses" as one item, or why there should be no indication at all of h,ow- tho pro£it pf iI47AOOQ. was made.