IMPORTANT FINANCE.

Hokitika Guardian, 22 March 1921, Page 2

IMPORTANT FINANCE.

Finance Bill Amended

Holding Up Deposits

Moratorium Extended

the PREMIER'S REVIEW

THE FINANCIAL POSITION

FUTURE POSSIBILITIES

(By our special reporter)

WELLINGTON, March 21. The Primo Minister’s speech on the second reading of the Finance Bill was a big feature of thef business of Parliament to-day. A protest against the , spirit of the pessimist in regard to the present outlook, was voiced by Mr Massey during his speech. There were many people in the country he said, who had not lost confidence. He had spent about a, fortnight recently travelling around the South Island. .Nobody could go round the country seeing it as he saw it and remain pessimistic The country was so good with its natural wealth and its industrious people that it was bound to get through He remembered a tune ot difficulty years ago when ticio was no outlet for produce, M,ch as that provided to-day b> insulated shipping, and when our industries were not really established. Hi was quite sure that with the situation ns it was now. anil with the industry and ability of the people, we would be able to got through and look on the present time as the memory ot a bail dream. When a business firm sees financial trouble ahead it takes stock and makes its arrangements accordingly said Mr Massey. There is no ser. ions trouble ahead as far as the Government is concerned, but there w a serious financial difficulty throughout the country, and if it lasts long enough Government will he affected. My duty in these circumstances is to take the public into my confidence. He proecM cd to deal with finance in detail. 1 values of the Dominion exports were going down, and they had gone down then the country must reduce its expenditure accordingly, if it wishes to avoid ooing into financial difficulties If necessary, drastic retrenchment might come and then Government was ooing to commence with salaries o ministers and members. Public men must set an example and show their willingness to do with smaller salaries then thev were drawing at the present time. He honed that the need would not arise and it was not in-sight yet. An important saving was being effected bv the recently established Public Service Purchase Board. Tt has been the practice formerly for each Department to do its own buying. The Board is expected to he able to save £200,000 n year, perhaps more. The Public Service Commissioner estimated that economies in Departments with regard to salaries of temporary officers, would give a saving of £lbo,000 'i year Then there was the estimated‘saving of £200.000 by the Departments. making a total of £500,000. He believed pro war prices were going to he restored. The Dominion must get back to the pre-war cost of production and pro war freight charges. The total charge on meat before the war had been ljd per lb and amounted now to 4i l( l per lb. That was an increase of 100 per cent, and if the charges did not come down they would drive New Zealand meat off the market. He hoped for a reduction. When the financial figures for the twelve months ending on March Mst were completed, continued the Prime Minister there was hound to he a substantial surplus. Government was holding reserve fund securities to the value of £3,000,000. He thought that the total surplus for the year wouh be in the neighbourhood of £5,000 000. 11ip.ii there was another reserve making a total of about £9,000,000.

Great Financial Stringency

War Regulations Revived

important matters

THE SESSION ENDS.

(By Telegraph.—Special to Guardian.)

WELLINGTON, March 22. The House did important business in a great hurry last night and will end the session to-day. New clauses were added to the Finance Bill, autliorisng Government to borrow two and a half millions for public works, also empowering local bodies to borrow money for repayment by instalments and Borough Councils to pay an increased rate of interest on Bank overdrafts, with the consent of the Minister of Finance.

MORTGAGES EXTENSION BUT

Some highly important new clauses of the Mortgages Extension Bill were brought down by Governor’s message. They provide in effect that firms and local bodies holding money on deposit may apply to the Supreme Court foi an order suspending repayment until the end of this year. This does not apply to Banks or Savings Banks. Borrowers must give notice before May 30tli. that they intend to take advantage of this protection and must pay one per cent additional interest to the lender.

MR MASSEY EXPLAINS. Mr Massey said the position was that many firms and local bodies had accepted money on deposit, the total running into millions. I lie depositois •were now withdrawing theid money and owing to th ( > moratorium, financial stringency etc, firms and bodies had to go to the banks for tbeir money. The Bank funds wer being depleted so rapidly that the position was serious. If Parliament did not act. many firms would have to close their doors. He did not believed Hud, anybody would lose anything under the proposal now being made, though some deposi- , tors might be inconvenienced. ' The Hoigse accepted the proposal, after some members bad asked for , special consideration for smaller depositors, dairy companies and others. Mir Massey aid the parties could ask the Court to deal with any cases of hardship. WAR REGULATIONS. The House accepted also an extension of Clause seventeen of the War Regulation Act, 1917, giving the Supreme Court powe to suspend, or vary, or annul, contracts for buildings or works or supply of materials. The Court may take action on the application of any party on the ground of tlie disorganisation of the markets or financial stringency occasioned by, or consequent upon the late war with (•ermaiiv. ,

This drastic clause was passed with lout discussion The House evidently was impressed by Air Massey s statement that the financial situation required exceptional measures.

THE PREMIER'S RELIEF.

WELLINGTON, This Day

The session ended this morning. After members had wished Mr Massey bon voyage, the Prime Minister made a brief statement regarding the work of the Imperial conference. Tie said lie would support a continuance of tlie Anglo-Japanese alliance, provided the rights of the Dominion to choose its own citizens was recognised. He believed the legislation passed vesterday had saved New Zealand from a serious financial crisis. He believed the position was now reasonably secure.