“Mild Labour Criticism”

Sun (Auckland), Volume II, Issue 440, 23 August 1928, Page 11

“Mild Labour Criticism”

MINISTER OF FINANCE REPLIES

Dissertation on Rural Credits

(THE SUN’S Parliamentary Reporter) WELLINGTON, Wednesday. LABOUR opposition and criticism has been so mild that I began to feel some alarm, lest I might have produced a Labour Budget.” Thus the Minister of Finance, the Hon. W. Downie Stewart, opened his_reply to criticism of the annual Financial Statement, which criticism has extended over several days.

Early in his speech, when the Hon. D. Stewart was quoting Labour criticism based on high wages paid in American industries, he was accused by the Leader of the Opposition, Mr. H. E. Holland, of wholly misrepresenting what Mr. J. McCombs, Lyttelton, had said.

tween what the Bank of New Zealand took and the total of £600,000. Mr. Ransom: How much was that? The Minister: The bank took between £350,000 and £400.000 worth. A Labour Member: Did any other banks take any? The Minister: Not that I know of. Explaining the rise in the rate of interest on State advances, the Minister said this was occasioned by the fact that the money was costing the Government more than it had been receiving. This, £»; it was, was causing a loss of £15,000 a year on certain loans. Such a loss could not have gone on. “I prefer to reduce external debt to internal debt, and to reduce deadweight debt to live debt,” said the Minister, touching a point raised by Mr. M. J. Savage'. It was not always possible to find a basis for comparison.

Mr. Stewart said that if Labour men went to the polls advocating introduction of American industrial methods here, not one of them would be returned at the next election. Mr. McCombs: Increased demand is the first thing. Mr. Stewart: If the hon. member advocates the American system, with all its concomitants, he will find it very difficult to get a seat at the next election.

Charges that the Minister of Lands had shown lack of vision were hardly warranted. The Minister of Lands had handled a problem of extraordinary difficulty with great courage and patience. Of rural finance, the Minister said the system introduced had operated without any breakdown. The Government had fulfilled its promises. While it was true that advances to workers were behind, this could hardly be said of advances to farmers. If the rural credit bonds did happen to prove unsaleable he could easily quit them in Australia or England- Though the bonds were not specifically guaranteed by the Government, the Government was behind them, and there was an implied contract on the Government’s part. UNDERWRITING THE BONDS

Reverting to rural finance, the Minister said was nothing to prevent the establishment of an agricultural bank. If any group of people thought an agricultural bank was necessary they could come forward and establish it, but many had the sole idea that the Government should accept the responsibility. 6 HYDRO-ELECTRIC WORKS Discussing hydro-electric schemes instituted by the Government, the Minister said an interesting point had been raised by Mr. E. A. Ransom. It was the question of what should be done with the profits expected from these great undertakings. He believed ultimately these concerns would be a great factor in reducing debt and furnishing furUita social service. This would mean that *the public would have to forego concessions in power charges until capital liabilities were disposed of.

The Minister proceeded to explain the underwriting of the bonds. The underwriting was arranged with the bank before it was known whether the bonds were to be a success or not. Experience had now shown that it was going to he a slow process getting New Zealand investors to take up the bonds. Accordingly the terms might be slightly varied in later issues. It was the general wish that the bonds should be popularised in New Zealand.

Mr. D. G. SuLliyan: Wouldn’t that be benefiting the whole community at the expense of the consumer? The Minister: That is the objection that is always raised, but I believe there is room for an intermediate policy that will benefit all the people, consumers included. The Minister was applauded on the conclusion of his speech, which lasted one hour and a-half. The House at once went into Committee of Supply.

Mr. E. A. Ransom: You have not told us yet what the public subscribed. The Minister: The difference be-