A STATE BANK

Hokitika Guardian, 15 August 1929, Page 5

A STATE BANK

PRIME MINISTER’S VIEW

“ LEAVE WELL ALONE.”

WELLINGTON, August 13. That the country would be wise in leaving well alone' was the opinion expressed by the Prime Minister when discussing the question of a State Bank in the House to-day. . '

Sir Joseph Ward said that at one time lie had been favourably impressed with the idea of a State bank, but that was before the Bank of New Zealand was assisted by the Government, and to-day he was of opinion that a State bank could not be .operated side by side with the Bank of New Zealand. . ' ' - ' h j •' '. The question arose in the debate on the first reading of the Bank of New Zealand Act Amendment Bill, a measure introduced by Mr F. Langstone (Waimarino). The Bflliwas described by Mr Langstone as a ..measure which would, by the alteration\of a 'few words and clauses in the existing Act, make the Rank of New Zealand to all'inputs and purposes a State bank controlled absolutely by the people of New Zealand. A great mistake had been : made in not making the Bank of New Zealand a State bank in 1894, when' the country came to its aid. Although the bank was ready enough to accept assistance when in difficulties, it gave, short shrift to those who found thbmselves in trouble and appealed tjo it.. for help. .t , ' v r ‘' Sir Joseph Ward said he did not thoroughly understand the views expressed by Mr Langstone, However, • as Finance Minister, he" saw . that it was dlls duty to show how the matt''" was regarded by. the Government. At 5, the period when the State came to the" assistance of the Bonk df New Zealand, that was then in admitted difficulties, the institution had 37,000 clients • and a great number of depositors} to whom a responsibility was owing. 'Had the bank been converted'into, a State bank at that time, it could only have been ''one by putting the Bank of New ; v . "enland into liquidation and locking nn the assets: ' That - edurse Was Miorouglily considered at the time.

Mr Langstone: The bank could have - yy: been bougH for a song. Sir Joseph. Ward: No; it couhl have been bought without disaster to the people concerned. The rescuing the. Bank. of -New Zealand put'•the/.' country ahead by 'years. , Had .the not been t helped,...practically eyeryon concerned with'. itAyduld'jhav© heayily,j However, pw!in|:ta 1 ipnkei^^ it ''clparthat' the.;;bank majority of Government i(directorsF Mr. Langstone AVith nb“ . :^6wer. Sir: Jpsepli y Ward i d^es; /.theyv power/;and' there-;j>is the: Government* Hiwell. It 'is an institution serves the. respect, of ".the this country.. I may, say that, I y/li.mi| I took charge last .year as' Mii?isW;( of Finance, the-Bank-oRNew Zeh-'-land offered to come .'.'to’-the tance of the country '. Government dby making money rayscilHi alble for advances to settlers and ' purposes. Fortunately, ifdid not.ne|®p' ; to avail myself of that? offer, • buf/itr' was satisfactory to know bank was ready with assistance in ~ case of emergency. /•:/•/ ' “In my judgment, to attempt to change the Bank of New Zealand in-: to a State bank is impossible,” add-i ed Sir Joseph. VTlie responsibility' bo the shareholders has to he recog- . y nised, and except by paying i-he fidl'; ~y amount of interest to shareholders,. ' / it could not be don©. As it exists at present, the Bank of New Zealand is a semi-State bank. It-is. as nearly a State bank as you could have it, and we would be well j advised to leave well alone. In my opinion, we could not operate a State bank side by side with the Bank of /New-: / m Zoajand.” " . , Mr Langstono’s Bill wqs read a . first time. *lt is unlikely to come up '/ again this session. - "