KEEPING AFLOAT.

Taranaki Daily News, 20 October 1922, Page 4

KEEPING AFLOAT.

The Companies Amendment Bill, introduced in the House on Wednesday, is a kind of measure which a year or two ago would have been regarded as almost revolutionary, but which in these days of moratoria, is becoming quite common. We are certainly living in extraordinary times. Wo had at the beginning of the war the moratorium which was designed to meet extraordinary conditions, and was therefore more or less justified. Then followed extension after extension,, even to the inclusion of deposits at call. Now the rights of a creditor are to be interfered with. Under the latest Bill, if a company is threatened by a creditor a meeting of all the creditors may be called, and if a majority decide upon a scheme for carrying on the company, a Judge of the Supreme Court may order a stay of proceedings, and any arrangement or compromise come to by a majority is to be binding upon the rest of the creditors? Our Wellington correspondent says the Bill has particular reference to certain large concerns in which farmers are interested. This continued interference with the economic laws may cause more harm than it will prevent. The position that has arisen may itself be due to the operation of the moratorium, particularly the extension in regard to money at call, which on request has to be repaid in instalments. Or it may be a case of but postponing the evil day. If daylight is .indiscernible in respect to the affairs of these involved concerns, surely it would be 'better to face the position now and reconstruct on a different basis or' liquidate entirely. It is an unpleasant process, as many of our local producers have found during the past year, but it is the only sound course to take in order to get back to earth again. Of course it may be that the Concerns spoken of as being in difficulties may be able to pull round if given protection of the kind .proposed in the Bill, but the House should be thoroughly satisfied before passing the Bill that it is not perpetuating and adding to the financial troubles of the country. The precedent is a very bad one indeed, and may operate disastrously if Labor ever gets into power—which we trust will never happen, at anyrate whilst the Extremists are in the forefront of the Labor movement. The sooner we stop tampering with financial and economic laws the sooner, speaking generally, will we regain financial and economic equilibrium.