HIGHER EXCHANGE

Hokitika Guardian, 27 January 1933, Page 5

HIGHER EXCHANGE

PROTEST VOICED

THE GOVERNMENT CONDEMNED.

(Per Press Association — Copyright.)

WELLINGTON, January 26. Hie widespread feeling or resentment which iuii4|,j}een aroused in the commercial community over the Government’s decision in raising the rate of exchange was strikingly evidenced at a public meeting to-day of Wellington business men. It was an overflow gathering, and the Government’s action was subjected to severe criticism, most of it directed at tlie leaders of the Coalition, Messrs Forbes and Coates.

A resolution was carried condemning the GovernmenV for its action.

ihe principal speakers were Alessrs Salmond (president 0 f the New. Zealand Importers’ Federation) and Air Hi Hop (Mayor of Wellington).

Air Salmond s«id the Government’s action in raising the exchange was dragging, New Zealand’s name through the mire. Never again would New Zealand occupy tlie same place ill the minds of the English people. It was not yet too late, There was still time for Parliament to repair the error.

Air Hislop said the country was committed to an , utterly artificial exchange, It was committed to the proposition that the politician should control their business operations, “That cannot last,” he said, “because if we as- a community, cannot stop it at some stage, economic forces themselves will stop it it utter confusion.” .

Mr J. P. Luke referring to Air W. Dovvnie Stewart, said it was decided at Ottawa that the questions of exchange should be held in London, -and the man to whom the Cabinet had looked for guidance had- seen that it was necessary to resign. As far as the Government was concerned, they had evidence- during the last fortnight that they could not trust the word of tlie Prime Minister, and the community -as a wnole had lost confidence in him.

At this stage an amendment was moved from the gallery to add to the resolution an expresson of no l confidence in the Government, but this was not -accepted by the chairman. The resolution carried was:—“That this meeting most strongly protests against the Government’s action in arbitrarily, increasing the exchange rate on London to 25 per cent on the grounds, firstly, that such action, after 1 the assurances of the Prime 'Minister! that there would be no political interference, is a gross and flargrant breach of public trust and confidence; and, secondly, that the fixation of exchange at unwarranted high artificial rate is opposed to the interests and ire 11 being of the Dominion as a whole. This meeting views with very grave alarm the decision to impose political control of the exchange rate, and considers that the repercussions from the adoption of such policy must be dangerous and far-reaching.”

INCREASE IN INTEREST BILL. WELLINGTON, January 26., The Mayor, when interviewed, told a reporter, to-day that there would be ai?| increase in Wellington’s overseas interest bill of between £15,000 and £16,000, and the indirect effect of the exchange rate on tliej sources of revenue would make Wellington about £25,000 worse off in the next financial year. On account of the exchange inflation, there were other items on which the revenue would be decreased next financial year. So far as he could see at present, the city would •have £30,000 less in current year. The net result was that next year there would be available for carrying on the services of the city, apparently only half the amount expended in the. year immediately prior to the present Council coming into office. One thing, now quite clear, was that after March 31, this year, the Council would not be able to carry on any unemployment relief works. That would have to be financed and controlled wholly by the Government. Last year out of revenue alone, the Council spent £BOOO on unemployment relief. The exchange inflation wiped out definitely any possibility of, the Council carrying any unemployed in future.

“Perhaps Mr Coates as Minister of Finance,” said the Mayor, “would find that the burden he had created by his exchange inflation policy would be passed on to him to carry.”

“One matter I did not mention ■ at the public meeting ' to-day,” said the Mayor, “was the inequality of Mr Coates’ exchange inflation policy. Under it, the farmefs'-no matter what their resources, are 'going to get a benefit at the expense of others. It is well known from the figures available in certain financial quarters, that there are a large number of New Zealand farmers, who have on deposit sums of £IO,OOO, £20,000, £50,000 and more, and yet these people are going to get a bonus at the expense of those unfortunate individuals, who are without anything.”