STATE ADVANCES

Waikato Times, Volume 119, Issue 19900, 1 June 1936, Page 6

STATE ADVANCES

When the legislation with regard to the National Mortgage Corporation was before Parliament the Government of the day was severely criticised by the Opposition on the ground that the new institution would just take the cream of the advances business for the benefit of private shareholders and leave the losses to the State. The critics were very outspoken and the issue was revived during the election campaign. It is cheering, therefore, to find the present Minister of Finance so confident that the losses, if any, will be small. The Mortgage Corporation took over mortgages aggregating £36,485,373 and against this it issued stock to the value of £29,485,000. The balance represented the contingent liability, and with overdue interest and interest accruing this liability was raised to £8,850,000. It was this item that the Labour members so adversely criticised, and it is this item that the Hon. W. Nash states will be reduced to a comparatively small sum. The improvement in general conditions in the last twelve months will have enabled many borrowers to reduce their liabilities. Losses were to be balanced by writing olf the contingent liability to the State, and it is satisfactory that the Minister of Finance at this early date should be so confident that the total losses will be greatly reduced. It would appear that the machinery provided by the legislation of 1935 has worked smoothly and that the fears entertained by the Labour members when they were in Opposition will not be realised. The amending measure will retain much of the machinery provided, but the Minister will exercise powers that his predecessor never possessed. It has been stated in Wellington that it will be possible for the Minister of Finance to issue instructions to the Board that will over-ride all previous decisions and existing regulations. If so then, as in much of the recent legislation, everything will depend upon the use made of the powers taken.