RESERVE BANK

Ashburton Guardian, Volume 60, Issue 31, 16 November 1939, Page 3

RESERVE BANK

DIRECT POLITICAL CONTROL. COMMERCIAL MEN’S PROTEST. (Per Press Association). WELLINGTON, November 15, Control of the Reserve Bank was discussed to-day by the conference of the Associated Chambers of Commerce of Nbw Zealand. The conference urged the necessity of increasing confidence in the monetary management and financial measures which the present situation required.

A Dunedin remit asked the conference to express the opinion that the monetary system of the country must be restored to a sound basis and that to this end the war should bo waged as far as possible out of national income”; and the Reserve Bank must have restored to it its proper function. Several speakers thought the first suggestion dangerous and it was eliminated, whereupon the Dunedin delegation withdrew the rest of the remit.

Mr R. V. White (Canterbury) moved ■the following remit: “That whereas the politically-directed control of the Reserve Bank during the last few years has been a potent factor in bringing the country’s finances into an unsound position, this conference enters a most emphatic protest at the recent amendments to the Reserve Bank Act, which subject the bank to direct political control and urgently represents to the Government that the board of directors of the bank be brought to full strength by the appointment of qualified men of sound experience; and that full opportunity be given to such a board to carry out the functions of the bank as defined in the original act free from political interference, thereby increasing confidence in the monetary management and financial measures’ which the necessities of the present national situation require.”

“The remit is first of all a condemnation of the present state of the Reserve Bank,” Mr White said. “The present situation is so serious and the need for reform so urgent that it seems that this demand should be made with ail possible emphasis. If we must have a reserve bank, which some of u,s doubt, it must be controlled by men who will have regard always to financial safety rather than to political expediency.” The remit was carried.