WELLINGTON TOPICS

Hokitika Guardian, 7 March 1933, Page 8

WELLINGTON TOPICS

DEBT CONVERSION Z GENERAL APPROVAL. 'Special Correspondent.) WELLINGTON, March 2,

Although there -was some mild 'opposition to the passage, of the..,. .New Zealand Debt Conversion Bill- in the House of, .Representatives yesterday- . from disgruntled members of the Laoout) Party it never reached the .ength - -.-of a division. .Mr Bernard, .Jie member; for Napier, was sure the i Bill was another heavy instalment: of deflation.- He- knew it was. an act of .epudiation. He had satisfied himself it was a-case of. “the mailed, first;-.in-ode .the velvet ’glove,” and another; burden upon the poorer classes of the community. Mr. Semple, thci .member or Wellington East, proclaimed that . the Labour Party stood for “the issue of money based on the natural w.ealth • jf -the country,’’ whatever that ipay be, and Mr ,T. McCombs, the future Minister of Finance of the party, announced that;what was. required -was an increase in the consumers’ purchasing power. -.

EX-MINISTER OF FINANCE

Early -yesterday morning the Hon. W. Downie Stewart, speaking nn the -second reading of the Bill that was to ■affect £115,000,000 of the‘ Dominion’s internal debt, made the position clearer than his colleagues of :a few weeks earlier had done. If the proposal • could be carried out as -a- genuine ■scheme of voluntary conversion, based on a patriotic appeal to the holders of Government bonds, he said, "he would do his best.- to . support -it. r n his opinion, however, the Bill raised i sues of l Har-reaohing importance, vhich, to his mind, would involve questions of greater magnitude than the exchange problem, the sale tax or any other problem - that had been dealt with by Parliament in recent ’-months. If the scheme -included a -forced reduction In .the State’s interest bills,' or the penal taxation of those who would not convert then,‘■he .’held,' the ’State could and -should stand by its bond. : THE DOMINION’S CREDIT Air. 'Stewart is .as • careful-‘H -‘.the credit of the State; as lie - -is of Ins own igodd -aianie. He explained to the- - House yesterday morning that in- the : Mother Country it frequently was riec- ' essary in order .to popularise a converrsion schemed- to announce that such holders las did ndt convert ' would be i paid off by the borrowing -authority. ;“Biut I have found'it difficult to apply . .conditions,, to, Ne\y,;Zealand: ’' •Mr 'Stewart went on to say. “We 'have no large loans falling due to the ’public for . some years. We have no ’option to repay them at present unless ; can induce the holders to convert or accept payment.” There is the rub. Mr Stewart’s successor at the Treasury ks not dealing- with investors ■■ looking for stock, but with those wishing to have their money in hand. These are two different! things. . CONVERSION APPLICATIONS • But in spite of all the difficulties that stand in h-is way Mr Coates takes a cheery view of the situation. Offers of conversions involving a total of £2.1,000,000 -had been received by the Government up to last - night. “Letters are pouring in by each mail,” it was announced, ■ ‘land bondholders from one end of the country to - the other are -responding with '.remarkable promptness to the Government’s appeal.” This cex-tainly is a cheering, beginning,, considering all the’difficulties that. stand in tlxe way, and' the smile is - with Mr-Coates and his colleagues for -the time; but there still are some £94,000,000 to be' obtained in one way 0 r another, and the money does not seem immediately available. The ■ priv-a-te and -public debt of the Dominion estimates at £500,000,000, with an annual charge for .interest at 5 per cent., of £25,000,000.