SLOW PROGRESS

Rotorua Morning Post, Volume 3, Issue 695, 22 November 1933, Page 5

SLOW PROGRESS

("Post" Special Commissioner.)

SPURS MUST BE APPLIED TO CONCLUDE BY XMAS DULL BUDGET DEBATE

Wellington, Tuesday. There is no gains,aying the fact that the Budget debate which has occupied the House of Representatives for the last week has been one ■iof the dullest of recent years. The Budget itself is partly responsible for this. It lacks the 'spectacularness of some of its immediate predeeessors, and is little more than a summary of the economic situation which has been well thrashed out already. Even the exchange rate controversy, which has been one of the principal topics of the debate, is becoming threadworn now, because members have previously expressed their views on this question, and any further remarks for the most part are but re-iteration. The outstanding speech so far has been that of the ex-Minister of Finance (the Hon. W. Downie Stewart),' who gave a deeply-studied analysis of ihe exchange situation. The speech had obviously been carefully prepar■ed and was a masterpiece- of coiitiriuitjiy and conciseness. Mr. Stewart pointed out the dangers of th'e creation of a floating debt or suspense aceount in order to finance the exchange

transactions, and drove his point home with telling emphasis, but the weakness of his remarks lay in its lack of constructiveness. When Mr. Stewart left the Cabinet as a result of a disagreement on the high exchange issue, his criticism of the Government's1 action was logical from his point of view, but his alternative to the policy which had been decided upon was conspicuous by its absence. Like the late Lord Balfour he seemed to he paralysed by philosophic doubt. This would appear to^ be a fatal weakness at a time of emergency when action — land definite action — is needed. Liability Is Contingent The crux of the high exchange issue, as far as the liability of the Goverpment is concerned, is that the liability on outstanding, or surplus, London funds is contingent. It depends on the initiative of importers to accept th'e new rate and on the length of tme the Government will hold its policy. If the importers gain confidenee and the Government decides to hold. up the rate for a year or two, then the favourable London balance may disappear. This has been tbe tendency with' currency depreciations in the past. The people have beeome used to the new level and have returned to their normal activities which in the long run ensures that a country's finaneial and trade transactions assume an approximate balance. It is quite clear that th'e Government will take no steps to create the new Reserve Bank of New Zealand until after the conclusion of the present session. As soon as the Bill, which is now before the Legislative Council has been passed, the, preliminary work will be put in hand, but it is not likely that th'e bank will operate until July or August of 1934. The first step will be the drawing up of the artieles of association, and after the £500,000 private share eapital has been provided. the Government will appoint the directors, the Governor and the Depultjy-Governor. Already many applications for shares in th'e bank have been received. The Proceedure The intention is to> spread this as widely &s possible, and each applicant will reeeive one share before a pro rata allocation is made. After the bank comes into being, six months notice will have to> be given to the tradin'g banks of the Reserve Bank's intention to issue notes, so th'at it will be about the end of next year before the new issue is in the hands of the people of New Zealand. Efforts are still being made by the group within the Coalition known the the "Cabinet Supervision Committee'-' to ensure tbat the Government, after th'e expiration of the first seven years has the final say in the appointment of the bank's principal administrative officers, and. it is now expected that an amendment will he made to the Bill in the council to give effect to this idea. Slow Progress Unless the Parliamentary spurs are applied by the Prime Minister, the Rt. Hon. G. W. Forbes, from the commencement of th'e new week, which will be the ninth of the session, it will be quite impraeticable to conclude all the business in sight by the time of the Christmas adjournment. The legislative programme still ahead of the House is most formidable, and some of the measures on the stocks are contentious. An effort is to he made to straighten out the anomalies which have arisen in the administra•tion of the mortgagors' relief legislation, iand to this end a consolidating and emandin'g Bill will be introduced. Its contents will provide suffieient material for a long debate, and the sanie is true of the contemplated provisions of the Valuation of Land Amendment, which will, it is understood, seek to impose a greater measure of responsibility for relief on local bodies and considerably widen the field of buyers of properties in cases where the Crown does not exercise its right to purchase at the lower valuations. More than ordinary interest at-

taches to the provisions of the Finance Bill, because some of them will revive the recess controversy over the payment of local body oversea iii— terest in steiTing. As several important local authorities are affeeted, members will be anxious toi know whether tbe Government will undertake itself to eover the difference in exchange in cases where the indebtedness - was the outeome of prospeetuses issued in New Zealand only. Before the House at present are coiitentious measures such as the MunL cipal Corporations Bill, the Harbours Amendment and other legislation, to say nothing of the registration legislation which th'e Minister of Agriculture is sponsoring. Without attempting to survey in detail the crop of hills which the House will be asked to pass, it can be said with certainty that the session cannot end on December 16 without a wholesale slaughter of innocents. Cabinet is faced with the question of consideting whether the House should adjourn and he re-assemhled early in 1934 or wheth'er Parliament should he prorogued and a new session opened, say, in March to enahle the tariff revision legislation to he considered. Long sittings for the next three weeks are definitely in prospect.