The Guardian And Evening Star, with which is incorporated the West Coast Times. SATURDAY, OCTOBER 28, 1933. THE BANKING ISSUE.

Hokitika Guardian, 28 October 1933, Page 4

The Guardian And Evening Star, with which is incorporated the West Coast Times. SATURDAY, OCTOBER 28, 1933. THE BANKING ISSUE.

The Reserve Bank Bill is now before the House, and it would appear that banking is to become the sport of the political parties. Mr Savage' the newly appointed leader of tile Labour party, did not mince words, nor leave one position in doubt as to the policy of the party when it reached the Haven of office. He stated at the conclusion of his review of the measure, tnat “the party was intent on putting its policy into operation, though the heavens fell!” This sounds as a rather reckless .attitude, and iff is born probably of the scattercash policy associated with Labour political ideals—to grant increases all round without counting the cost, or where the money is to- come from. Mr Savage has ideas of “putting money into the hands of the people in sufficient quantities to buy back the equivalent of their services”, which suggests the bedrock of socialism when all will be on a level plane, irrespective of merits or occupations. However, we hope that picture of the Labour millenium is long postponed. Mr Coates ardently supported the measure he has been at such pains to bring to issue, and was able to speak enthusiastically of advantages which would accrue. It appears to be agreed that there is a need for reform in banking, and that the State through a Central Bank should participate in the profits from financial trading. The banks established in the Dominion or operating here, have been doing-so on sound lines from their point of view, and have reaped profits. The Government acting for the State, has been a first class customer, and the volume of its business has added to the success of the existing system. The country has derived revenue from the note tax on banks, but the latter have passed that on as far as possible to customers. The note tax will be lost, but customers should make a saving. Yet the State will gain substantially in other directions, and there should me a big cut in interest charges for- State accommodation, which will be provided by the Central Bank at lower rates. The Government seeks, therefore, to do the bulk of its banking business through less expensive channels, and the savings in that direction are estimated to far outweigh the losses' in other ways. The success of Central Banking will rest ' v as “commercial banking has rested”) o.n the wisdom of the control. There is a world of experience as a guide and enough pitfalls have been disclosed of late, to show that care is necessary at every turn. Given sound management, a. considerable degree of success as possible. The Government control is not as pronounced as was once suggested, which is the more acceptable line to follow, and will give greater outside confidence. There are other details of the proposal still to be adjusted before the bill will be more generally acceptable, but the revision of the original scheme, recommended to the Government at the outset shows that the banking situation in the light of post-war conditions, lias been studied very carefully, and there is the evident desire to make the measure as successfully workable as possible. The bill has been in the stocks now for a very long time, and the consideration it has received should result in its scope and operations being more generally advantageous to the community.