THE LAND BILL, AND HOW IT AFFECTS THE FARMERS.

Wairarapa Age, Volume XXIX, Issue 8351, 6 February 1907, Page 3

THE LAND BILL, AND HOW IT AFFECTS THE FARMERS.

No. 6 .Ut is weii known that the inauranee companies, which are such large investors in mortgages, .refined loans pending the fate of the Land Bill. The directors dare not lend money on country lands with the prospect of not having untrammelled power to enter upon land in the case of default. "It ceases to be a security we can touch," said one. And the anomaly would have existed that town lands would have been gilt-edge security, whilst "broad acres" would have been looked at askance. A farmer of a couple of hundred acres, who is fairly well-to-do, but who started about ten years ago with a heavy debt (to pay off which he has had to exercise the greatest frugality, economy, and self-denial), said: "If such a clause had been passed eight or ten years ago, it would have simply wiped me out." Another, who is nearer the commencement of his career, - and therefore has the debt still unpaid, said: "This Bill will undoubtedly raise interest, and if it does I shstll lose everything." Another small farmer saya: "The whole credit system of the colony rests on the security of the land, not alone affecting the farmers, but also storekeepers, mer- ' chants, and even foreign as well as colonial manufacturers!. By limiting the purchasing value of land to £15,000, it means no bank doing business in the colony can accept land as other than collateral security; this means the 'calling up of overdrafts, which in 'turn means the stoppage of improvements. When the farmer stops, the business man and the manufacturer must do likewise, and thousands of workers would be thrown out of employment." Of course we are quite aware that there are some people in the ■community who would not be averse to the rate of interest rising and the risk increased. Such ■people are accustomed to fatten upon the misfortunes of others. We think we have said enough 'to show that in the event of the Bill passing money must be more ■difficult to borrow, and that, in •order to secure themselves, lenders would reduce the amount they would lend on "broad acres" and increase the rate, and we would •excluded ."rom the market all .large lending companies who have 'hitherto been such a large factor in our prosperity. These companies, against whom we have 'never heard a word of complaint, would be gone, and the r.mrers would remain. Th? price of money and the safety of security has so much to <li! with the price of land that -any' rise in interest at once ''nvev-; the value of land. It is •;iii a::iom that if the rate of interest, rises, the value of land falls. If you add to this that •(besides this rise in interest) ii.niicy is more difficult to procure, and that the' margin required by lenders is greater, it is easy to be seen that the land vajues must be considerably de'preciated. Not that the well-to-do farmer will be much affected; he will, at any rate, be the last to feel the effect. But thousands of farmers in New Zealand, who 'have bought it at high prices, and who have burdened themselvea with a large debt in the hope that by self-denial and hard work they will be able to reduce the debt before difficult times come—"fche3t/ will be the men who will suffer. Our concern is with the small farmer, who will be so seriously affected by the Bill. There are thousands of farmers in portions df New Zealand who have been assisted into farms by those who had confidence in their integrity and determination to work to pay off their debt. There ia first a mortgage for what they can get lent on the land, then some firm finances the rest. The man himself may have a hundred or two of savings, and this he puts in, but he practically mortgages the whole of the property. Sometimes he receives assistance to buy cows, etc., or an auctioneer will buy them for hiai and take a bill-of-sale over them. The storekeeper trusts him for his requirements in the way of food, clothing, etc. Then he starts to work to ■battle his debt off. The dairying industry is a wonderful debt-re-ducer, and if the farmer has hick with his cows he can make a very .good start the first year. But naturally the cows are not so good as an old established herd, and some time elapses before the weeds arc found out and •carded, and others bought t-o take their place which are better violdcr.-j. Given a fair run of luck and good times, he begins to feel his feet the third year and make money after. To such men any check is s-.'noin, but imagine what it wouM mean to them if interest wore suddenly to, The iiauctioneer, or storekeeper in whose debt he was would begin to feel anxious. The bank,

THE UNION'S o;UNCTIONS.

| in the re-adjustment of their ad- ! j vances, would require to cal' in j a portion, and the firms by i whom the money was advanced | to the farmers would require to realise. The storekeeper who had given credit would not be likely . to be paid at all, and he again would not be able to meet his engagements, and the effect would be felt in towns sooner than anywhere. Thus it will be seen that the commercial man who said there would be a "grave upheaval" was right in his conclusions. ' There are thousands of struggling men who "will win through" if left alone, who would lose all they had, and have to begin the world again were the Bill as we have it before us to I pass. The Premier lias said that i not a line of the Bill is against , the Freehold. Surely it is safe to say the Freehold is being at- ' tacked if it is made unsafe for these men to hold. Our Premier ; said that a graduated tax put on I the land would throw "large areas ' upon the markets and would also j cause a very considerable disloca- ' tion of the land market from end to end of the colony." That is certainly what would happen if the Land Bill passes with the provision relating to mortgagees as it stands. To some, all this "upheaval" might be a matter of congratulation, and we are trulyglad to see the Ministry does not desire "to dislocate the land market from end to end of the colony;" but we claim to have shown, that • outside the £50,000 men altogether the land market | will be "dislocated." Values will fall, to what no one can say. Here are the thoughts of a ' man writing to a paper which is in favour of the Bill:—"It seems to me this is worthy the careful attention of farmers. If the land to be cut up i 3 sold at current rates it will benefit nobody; if it is sold at, say, 25 per cent, less, it means that all the land in the colony will depreciate simultaneously. Farms are continually ■changing hands in the colony, and if every farmer whose land is today worth £l2 an acre realises that if the Bill passes it will fall to £9 and not recover its value for some years, will not the Bill damage more than it assists? Could not the promoters! of the Bill make some reasonable forc•cast as to this matter?" On the London Stock Exchange, or on Wall Sti*cet, when financiers and capitalists want to make money out of stock they "bear" the market and resort to all sorts 'of devices to depreciate the value 'of the shares.. When shares have touched bottom, they buy in and make a fortune. That would be the effect of the Land Bill. The House would be "bearing" c. the land values if it passed the Bill. But no one would gain by it; the poor man would have no credit, therefore he could not take advantage of the market. The capitalist, if he cared to put down his cash, would be able to buy at his own figure. And why all this turmoil? Not because there was no land for sale in the colony. There is not 25 per cent, of the freehold properties in New Zealand which cannot be bought to-day. There are, according to the Premier, 1,600,000 acres of Crown land remaining for settlement. But the Year Book just published gives the Commissioner of Lands' reports, and from these we find the following: Crown Lands Available for Settlement. Auckland Province ... 834,169 Taranaki Province ... 84,774 Wellington Province ... 39,333 Marlborough. Province 4i0,000 Nelson Province ... 19,575 Province ... 101,952 Otago Province ... 33,665 Southland Province ... 52,311 Hawke's Bay Province 25,117 1,230,896 Areas which are not yet open for selection: Auckland (note the Commissioner speaks of the land as suitable for settlement except in the case of Thames and Ohinemuri, and .these we have not taken into account), 736,485; Taranaki, 131,550; Hawke's Bay, 122,880; Wellington, 67,000. The lands in the other provinces are given together in round numbers, but leaving the South Island out, there is, according to the reports of the Commissioner in the Year Book, an area of 2,288,811 acres still fit for settlement, together with all the available unsurveyed land in the South Island. (To be Continued).