PROPOSED DOLLAR LOAN

Ashburton Guardian, Volume 69, Issue 268, 25 August 1949, Page 4

PROPOSED DOLLAR LOAN

Opposition Questions About Roxburgh REPLY BY MR McCOMBS (P.A.) WELLINGTON, Aug. 24. i A suggestion that New Zealand was considering a dollar loan because of contracts it had already made for the Roxburgh Gorge hydro-electric scheme -was denied * by the Minister of Education (the Hon. T. H. McCombs) in the House of Representatives this evening. Several Opposition speakers said the speech of the Minister of Industries and Commerce (the Hon. A. H. Nordrneyer) had led to an inference that there had already been loan negotiations.

Mr W. A. Bodkin (Opposition, Central Otago) said the dollar situation was serious. It seemed from the speech of the Minister of Industries and Commerce that he was championing tliej borrowing of dollars. If a dollar loan w T as negotiated the funds would come from the International Monetary Fund after the Government had approached it cap in hand. Mr F.. Langstone (Independent Labour, Roskill): That’s just romancing. Gold Exports Mr Bodkin said that if New Zealand continued to produce gold she would not need to raise a dollar loan. Gold was the one commodity that wuld buy goods and services in any land, but the industry had been thrown to the wolves because of the Government’s shortsightedness. Mr Bodkin said the Government’s sudden policy of borrowing was the policy of despair and showed that the Government was bankrupt of ideas of statesmanship and incapable of grappling with the situation. Had the Government acceded to the request for a small subsidy op gold the Waihi mine could have been kept in production and taxpayers relieved of an additional burden of £ISOO to compensate the Waihi Borough Council for the loss of revenue. One way in which New Zealand could earn dollars was by increasing facilities for tourist traffic. Mr Bodkin said. Mr H. E. Combs (Government, Onslow) said that capitalists in the United States were in a much more difficult spot than New Zealand was. The capitalist United States had unemployed totalling 3,500,000 whie in New Zealand there was no unemployment. Mr R. G. Gerard (Opposition, Ashburton): How about giving them a loan? , . Mr W. A. Sheat (Opposition, Patea): Why borrow from them. Mr Combs said New Zealand bad funds in London that it could use to buy dollars if New Zealand forwent its rights to the Mother Country. The Leader of the Opposition (Mr S. G. Holland) had suggested that any dollar loan should be negotiated on a Commonwealth baste, but what was the difference between repaying the Commonwealth pool and repaying a loan raised in the United States direct? Reference to Roxburgh Mr C. M. Bowden (Opposition, Karori) said it appeared that some nego- , tiations had already been entered into For wHat purpose? Was it a fact that the Government had already entered into contracts with the United States to supply electrical equipment for the Roxburgh Gorge hydro scheme and that British firms have not been given the opportunity of tendering. The proposed loan was presumably to pay for American equipment to which the Government was already committed. • » Mr McCombs said Mr Bowden s statement that contracts for the supply of American goods had already been entered into and that a dollai loan had been negotiated to pay for them was incorrect and completely without foundation. No responsible member of the Opposition should have made such a statement. Mr McCombs said no contracts hact been entered into. British firms would be given a chance. This Government had diverted more trade to Britain than any other Governmenth Mr Holland had said the dollar loan should be negotiated “on an Empire basis” but what did he mean? The Empire was composed of a number of sovereign States bound by common ties but bv no financial organisation. It would be quite imDOSsible for two or more countries of the Commonwealth to borrow jointly money from another State. New Zealand was a sovereign country managing its own affairs. If New Zealand needed a dollar loan that would be New Zealand’s business and New Zealand alone would be responsible for repayment.