DOMINION FINANCE

Hokitika Guardian, 18 January 1929, Page 2

DOMINION FINANCE

THE DECENT LOANS. STATEMENT BY HON W. DOWNIE STEWART. AUCKLAND, Jan. 16. Several references were made in the Prime Minister's statement last week to previous proposals for the issue of a cash loan of £5,0G0,000 and a conversion loan of £10,000,000. These were described as “the proposals of the Minister of Finance (my immediate predecessor),” and Sir Joseph Ward stated that he finally decided “to make a material alteration in the proposals,” increasing the amounts by £2,000,000 each. A 'statement of his position in regard to the matter was made to-day by the Hon W. Downie Stewart, Minister of Finance in the Reform Govern men t. who is a. present in Rotorua. “Sir Joseph Ward’s statement on the loan transactions has been interpreted by some newspapers to moan that I bad proposed to raise £5,000.000 and to convert another £10,600,000 of 1928 maturing debt.” said Mr ,Stewart. “This is incorrect, as I had made no proposals. What actually happened was that in the middle of the election campaign our Bbiulon financial advisers cabled suggesting that we should convert another £10,000,000 of the 1928 maturities and also borrow in anticipation of our next year’s loan requirements for reasons stated by them. As the latter proposal would involve borrowing twice in one year, and was a marked departure from our usual procedure. I cabled to ascertain when London considered a decision should 1m? made, as we were in the middle of an election campaign. Their reply was that if action was taken by January it would meet tile case. When the election results were known, I considered that it would he improper for an outgoing Government to prevent the new Government making its own decision on so important a transaction, or to tie their hands when there was ample time for Sir Joseph Ward to consider how the proposals would work in with his own loan proposals. It will he seen, therefore, that the proposal emanated from London, and not from me.

“The suggestion in some papers that I had known the position months before the election is'entirely without foundation, also the accusation that \ had misled the electors as to the high credit of New Zealand, and that T had embarrassed my successor; Sir Jose]ill Ward's statement shows clearly that this was not so. and the chief correction I wish to make is as above. “It should also lie noted that £7,000,060 raised by Sir Joseph Ward is for public works. If, in addition, he raises for State advances from £6,000,000 to £8,000,000, according to his election speeches, some idea of the annual borrowing can he estimated. Moreover, apparently State advances loans are to he borrowed locally and not in London in the meantime.”