THE RATE OF INTEREST.

Auckland Star, Volume XXXV, Issue 250, 19 October 1904, Page 10

THE RATE OF INTEREST.

PREMIER ON THE SUBJECT. (By Telegram— Parliamentary Reporter.) WELLINGTON, yesterday. The "New Zealand■ Times," in a financial article published yesterday morning, declared that the position shown by" the bauking rcturrs is sound, and in a measure satisfactory. If the factor of Government borrow had ea?ed. the position would b<> quite satisfactory, but ns tUii is still in operation there is some ground for apprehension as to the effect it may have upon the supply of money for the general industrial and trade requirements of the community. The Premier, vrbo is an adept ill the art of finding an opportunity to reply to that with which tie is in*disagreement, lost no time in the present instance, seizing the apparently unpropitious medium of a Local Bill to reply ou the whole position of the | colony's finance. A bill enabling the j Remu'era P.oad Board to borrow .£4OOO at 4V per c?nt. was under consideration when the Premier introduced the article to the notice of the House. He j declared that it was the local bodies ) and not the Government which was rr- j sponsible for the increase in the rate j of interest, pointing out that they j were now asking for power to borrow I at 44 per cent, instead of the 4 per cent. | at which thn Government borrowed. , Proceeding, the Premier characterised j the "Times" paragraph as a pure fnbri- j cation, and as entirely untrue. The i fact was that the Government was keeping down the rate of interest. Some of the banks -whose headquarters were in Australia, had been hard up for some months, and hud wanted to raise the rate of interest, but had been unable through the action of the New Zealand banks. A lot of the banks had limited their clients, and had taken their money \o Australia. That must do injury to the colony. He would continue as long as he oould to keep down the rate of interest, and he only objected to the bill since he saw that the rate of interest was being increased. Mr Allen: You have taken all the 4j per cent, money on the market. j The chairman said that he could not allow a general discussion on the money market in a local bill. The Premier said he could not understand why the papers did not tell the | truth. On making ; he Oisd j found that because the Wellington City Council was 3elling its debentures at 41 per cent., and was hawking them all round the city tit that price, thus the Government could not obtain 4 per cent, debentures. Mr Duthie: Surely the Government's securities are a half per cent, better than local bodies. The Premier: The question is whether it is to extend to Auckland. Mr Massey. It is all very well for the Premier to talk about the increased rate of interest when the reason is that, as far as the Colonial Treasurer is concerned, he went to Auckland and mopped up all the money in Auckland at 4 per cent. The Premier rose to a point of order. He wanted to know if it was to the credit of Auckland to say that £ 150.000 was all the money in Auckland. Mr Massey: Why. you got £170.000 from one institution alone, and £4000' from the Veterans' Home at 4 per cent. No wonder money is scarce at Auck- j land! The Premier: No wonder you want j roads and bridges when all yonr own money is gone. Mr Massey said that but for Auckland the Prenrerf's hfrflf-million loan would not have b?en a success, snd it came with a bad grace from the Premier to oppose an increase in the rate for an Auckland bill. The discussion then turned on another phase of th* bill.