POLITICAL OUTLOOK

Taupo Times, Volume XIV, Issue 69, 2 September 1965, Page 6

POLITICAL OUTLOOK

The defence review, to be tabled in about three months, is likely to put some harsh alternatives before the Government. One of these is expected to involve a form of conscription for overseas service. Revealed in the annual report of the Ministry of Defence is the fact that New Zealand's defence planning whieh involves the preparation of a combat brigade f roup and a logistic support : roup, is more than a year

behind the programme as prepared only a few years ago. This envisaged the completion of the rearming and equipping programme in the 1966-1967 year. Now the Minister of Defence, Mr Eyre, says this job will not be completed until "at least late 1968." The difficulties comprise loss of trained officers to civilian occupation; poor response to recruiting campaigns; slowness in ordering

of weapons and equipment, due to lack of funds and the method of determining requirements. The review of pay and conditions (the first in eight years) has not been completed. It is reported to be "with Treasury". In the meantime, soldiers completing their term are finding better - paid and better - found positions in private industry. This means that the general defence policy review to be completed about November, may be forced to re-

commend that in order to fill our overseas commitments and have a force ready for emergencies, the Government should follow the new Australlan system and require National Service trainees to serve up to two years overseas with regular units. The political implications of this are tremendo'us. If something drastic is not done New Zealand's regular forces will continue to dwindle, to the stage where it would be

no longer possible to keep the regular component in the brigade up to strength. If, on the other hand, the Government accepts such a recommendation and follows Sir Robert Menzies in approving of a ballot system which would involve overseas military service, this would provide a major issue in the next year's Parliamentary session and also in the General Election of November, 1966. * * * A new kind of "takeover" was mentioned by Mr M. A. Connelly (Opposition, Riccarton) during the second read-

ing debate on the Building Societies Bill in Parliament. He pointed out that the permanent building society had special privileges as regards taxation — but had no protective legislation covering it. "When the Government brought down legislation to cover takeovers it only did so in respect of the Companies Act," Mr Connelly said. "No legislation is in existence in this country at present dealing with the takeover of a permanent building society. "The income of permanent societies is tax - free, and some of them have the right to carry on banking. If an overseas financial institution took one of these over, the Government could not intervene, for there is no legislation covering the matter." Mr Connelly said he had discussed the matter with "people who understand the position," and that it appeared to be possible for an

overseas institution to take over a society which had the right to undertake banking operations and whose profits were tax-free. "Even now, financial people are having a close look at this one," Mr Connelly said. "This uncertainty is what comes of putting this type of legislation through the House before interested people have had an opportunity of tendering their advice on the whole bill or on specific aspects of it." This point will be hammered out in the committee stages of the bill.

— N.Z.C.N.A.

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