What Does it Mean?

Hawke's Bay Herald-Tribune, Issue 205, 15 September 1937, Page 3

What Does it Mean?

- Press Association.)

1 ■ MR. SAVAGE EXPLAINS The State Indebted To ltself/' IMPREST SUPPLY DEBATE

(By Telegraph-

WELLINGTON, Last Night. The Imprest Supply Bill was introduced by Govefnor's message when the House sat this afternoon, urgency being granted for the measure. Hon. Adam Hamilton asked the Prime Minister for a defmition of a term he had used very frequently when speaking at various places throughout the Dominion, namely, the phrase public credit. When in Dunedin recently the Prime Minister had stated that the Governmenfc was working under a new policy and it was no longer necessary to wait for money. He would like to remind the Government that they had to conduct their affairs like those of private citizens, and when money was not there they were unable to spend it. Mr. Hamilton referred to a certain vagueness regarding the term "public credit." They did not want vagueness; they wanted plain English terms, so plain that" the ordinary man in the street, a man like himself for instance, could understand it. Mr. C. L". Carr: Impossible (laughter). It was essential that the Labour Govemment of all Governments should avoid any accusation of vagueness or indefiniteness. Mr. Hamilton referred to the high repute of New Zealand 's credit overseas, but asked what the outside world was thinking of the course which tho Government was following to-day. There seemed to be an idea among members of the. Government that the public credit was an ineshaustible reservoir, but he would remind them that the reservoir had been built up by tho industry and economy of the pioneers and the Labour Government should not dissipate resources that had been built up so carefully in the past-. A Book Entry. lleverting to a defmition of the term public credit, he asked was it in tho Prime Minister's view just a book 1 entry, which could be wiped out, or was ; it purely a loan from the Beserve Bank at intcrest and to be repaid. i Hon. F. Langstone: Wlio owns the Beserve Bank? Mr. Hamilton: The Government think they do just now. He proceeded to deal with the Dairy Account in the Beserve Bank, and asked what was going to happen if there was a delicit in this account. Would it be a charge on tjje Consolidated Eund or how else would it be liquidated? Mr. Hamilton then went on to draw j attcntion to the surplus of £475,000 in ; Ihe Public Accounts and tho £050,000 j deficit in the Dairy Account. In view j of this defieit, he asked, how could the Government claim there had been a | surplus in the Public Accounts. In I eonclusion, Mr. Hamilton suggested two j more deiinitions of public credit. Did it mean the gathering up of the credits in all accounts in the public funds or did it mean just plain borrowing. Mr. Savage, replying, said it seemed to him Mr. Hamilton was looking for a policy, and he meant to do his best to supply him with one. With regard to his use of the term public credit, he , assured them the Government would j use the most direct manner of using ; public credit to build ,up the resources j of the country. Difference in Sources. Mr Hamilton, lie said, would distinguish between something issucd from a national banking institution an'd something takcn from a privato bank. With regard to the latter, if we borrow- , ed from private sources, we would go on paying for cver, whereas if we borrowed from our own institution, we wero indebted only to ourselves. For mstanco, with regard to the Government's housing programme, money had oeen borrowed from the Beserve Bank. A.s a result the Government was indebted to ltself. It was no use increasing national wealth in the shapo of increased pro- ' duction unless the public was to havo access to it. In 1933 the dairy farmera had doubled production without getting a penny advantage, the Prime Minister stated. The prosperity of the country had increased enormously. Recently the income of the Dominion had increased by £20,000,000 at least; in fact, the increase would be much greater than that when the final ligures 'n'ero seen, and the people of New Zealand did not teern to be worrying overmuch about slumping credit. The Government wss going to use the people 's money and the people 's credit for the development of national assets. They would use it directly and would uot add unnecessarily to the people 's obligations. Whatever obligations were created would be to their own institutions. The Government was only.interested in ons thing: That was that the people should be in a bctter position than they have been in the past and that the assets of the people be made available to them without ostia luxation being iiupos(-i on them. Tiie total wage and salarifi iiu-iease in the lu.>l live youi's had l>een IS per cent., uliile ihe nmouiits paid to pcnsioncrs had increased £20,000. Was li Worth The Money. Mr W. J. Polson, (Xat. Stratford), . Jirgejl tlia Gcyvqrnaieiit to retuxii. ta

precedent in its metbods of finance. He had alvvays supported liberal measures since be had been a incmber of the House but be would not support cxtravagsant Socialistic jneasures. Mr B. Roberts (Govt., Wairarapa), suggested that if the Government ■ould not claim credit for the improved prices'for its exported products it should not be blamed because the i-osts were rising. A.t 12.10 a.in. the Houso went into '(numittee on tbc Bill On the sccorid readiug Mr Hamilton .i.O;ed if Ihe measure providcd for more or lcxss experiditure than usual. The Hon. W. Nasli assured him thal f he Bill, which provides for an expcndir.ure of £8,781,000, was tho usual maehinery measure and it passed tlirough all stages without further discussioii, the House rising at 12.20 until 7.30 p.m. to-night, when the Address-ln-'Bejslj; debate will beg^a*