DISCHARGED SOLDIERS' SETTLEMENT LOAN.

Digger (Invercargill RSA), Issue 35, 12 November 1920, Page 8

DISCHARGED SOLDIERS' SETTLEMENT LOAN.

The prospectus for the Discharged Soldier's Settlement Loan is now on issue. The loan is £6,000,000 at 5g per cent. to be issued at par for a tern* of 12 years. The object oi the loan is for the purpose of settlement on the land of discharged soldiers under the provisions of the Discharged Soldiers' Settlement Act, 1915. The Prime Minister has stated that there is every reason to believe that this loan will terrninate the requirements of soldier settlement. The Goverment's policy in seltling returned soldiers is now practically confined to the development oi partially or undeveloped land. This policy at least minimises the amount of unearned increment involved in the purchase of developed land and the land is leased or purcha&ed on better terms which will make the positiofi of the soldier more secure. It is therefore evident that the loan will be a big factor in the development of the land with a consequent reflection on the Dominion's production. Every effort must be made to develop our primary industries and increase the wealth of the country. There is discontent among some

investors ahout the compuisory clauses of the prospectus. The loan is one which should appeal to all investors who, do not desire to lose the quality of sacrifice for a higher rata of interest obtainable elsewhere. With this spirit penetrating their investmenta it is not likely the compuisory provisiong would require to he put into operation. The soldiers made a sacrifice and surely the risk of life and loss of limb is a greater sacrifice than £.s.d. Where would the investor be to-day had this sacrifice not been made? It is the soldiers who have protected capital and there should be no hesitation in subscribing to the loan which is to be a factor in their repatriation and enable them to be a means of increasing the country's production. In the Budget forecast, Mr Massey stated that the compuisory levy would be used only if "the appeal for voluntary subscriptions at fair and reasonable rates of interest results in a deficiency." This statement does not imply an indiscriminate use of the compuisory clauses but nevertheless it is the thing in a nut-shell. Those persons who have capital which is free for investment should be made to subscribe to the loan if they will not do so of their own free will. Those investors who are brought within the provisions of the compuisory clauses will be paid at a rate of £3 8s 9d per cent. on their investments, and such a rate is decidedly fair provided the investor has the opportunity for voluntary acceptance of the higher rate of interest. It may be considered by some investors that compuisory clauses nullify individual judgment. A business man may conclude in certaincireumstances tliat ' the object or method of expenditure contemplated is unsound but he . is not allowed to exercise individual judgment because compulsion is introduced. This is not, however, the view we should have taken during the war. It wa-s rightly considered that machinery should be created which would ensure the stability of the 'treasury. It is true we are not at war now, but on the other hand it is peace of a very technical charaeter, and we are still in the midst of adverse conditions which are a direct result of the war. The transmission from war to norma! conditions is of an evolutionary charaeter and we-unay reasonably expect that machinery created to deal with war-time conditions will possess the same characteristics. There has been a considerable decrease in our war-time machinery y and we hope the tirne is not far away when the transitory stage shall be complete, but in the meantime, sets of conditions exikt which justify - the eoiidtioii3 of the prospectus. Provision has also heen made for the small investor to subscribe to the loan through the inedium of the Post Office. Investment certific.at.es will be issued, repayable with interest compounded at the end of five or ten years. Otago and Southland can claim to have played an important part in the successful prosecution of the war and we can confidently rely upon the people to subscribe a very creditable portion of the loan.