PARLIAMENT. LEGISLATIVE COUNCIL.

Auckland Star, Volume XLIV, Issue 278, 21 November 1913, Page 8

PARLIAMENT.

LEGISLATIVE COUNCIL.

BANK OF NEW ZEALAND. (Cj Telejjrapb.—Press Association.) WELLIXGTOX, Thursday. The Legislative Council met. at 2.30 p.jj,. The Hon. 11. L>. Bell moved the third reuuiiig ot the Stale Advances Kill, which ■v>a- ayree.l in, and the bill passed. .Mr iiu'l then, moved the second reading (,i ii- Bank o' New Zealand Bill. He explained the objects of the bill, un the lines of the speech delivered by the ilinUitr for finance in the Lower House. The lion. -J. Rigg raid the MinL-ter hud faded to five any reasons which justified the pi liey of the Government m regard to the bank. What was necesbary ;it tiie prer-em time was a measure oi niu'-'i wider wope, and proposal- to take over tue bank m= a State institution shunld ha\e been submitted. The present bill only made the future acquisition of the bank by the Stale more difficult, because ir put the bank more securpiy :n it.-; position. That was seen in the fact lhat tlie sh-.ireholders now fpit they in. lunger required the aid of ;'■ >"..ii-. an,l ufie prepared to act aivori!:npl\. Ji ever ihere \va~ a bare-J.i.-e,! -te.il ii mm- contained in the proposal, i.i tlie .-hareholder-. and it was to tile ■!■,■.lit (if the liuverninent. that they had not given effect to the.-c pro[•"sak J,,,, i,in rt;ls not satisfacton to .r.m. beeau.-e it was not proposed to pay oil ilie million guarantee, nor wa» it proposal t ,, ~a ; i U[ , thl . unca ]] cd ca ,,i; al en the pn -ent, "hare*. Mr Bell: That has lwt been done because it might ruin the poorer shareholders. L'ontinuinp. Mr Rij.s raid that was not tli» bu-in,— of [lie Slate. If shareholders could not pay up they should loriii-. li. a!s,j notii-ed it was'not pro-r>o-e<l i.. remove the restriction;, on the A preference shares in rr-peet of dividend-. As io ilie proposal tv increase the capital, it \\a- not an increase of three millions, but of £4..)00.0l>0. The increase wan. t reijuired. but wa<s intended for inv.viinei.i in London, which was a very profitable business. l>ut it iii-aiu that millions thai, ought to have been circulated in _\>«- Zealand were being i;-c! in London. The policy of the hour should be ti>- buying out of tiie shareholdpr-. nnd the making of the bank a State institution. The Hon. .1. DutUie otronpl.v deprecated the interference of the State in the of the batik. Jt was a mislake to suppose tlr.it the State influence had contributed in any way to the bank'- phenomenal recovery. What had contributed to that end was the general prosperity of the country and the profitable re-u!ting from the XoO.--i>oo.ooo v.l.icii the country lad borrowed Juring tiie la-i lij years. With this business the bank could not go wrong, but so far an it- management was conserned it would have enormously helped the iTedit of the country in London if it was known that it was severed from all connection with the -State. He was sorry this b:ll dia not propose that severance. A .-trom; b:u:k should be built up on the shareholders' own capital. Tiie Hon. J. An«ter arprued that the bulk of tiie money on winch the bank traded was provide.! l.v tlie public He coni]ilained thai there \ras uotliinir in «''<■ I'M l;i pruttvt tlie interests or ilie Dublic. Sixteen millions was taken from lh- public in deposit' on which no inierwas paid, but -even millions of that nioney "a- .-ent away to London and invented there to the "benefit, no doubt, v! the b.-uik. but to the detriment oi tiie Dominion. The first duty of thfj (iovernment was to eon-ider the inter<sts of the public, -and nut the interests of the shareholder-! exclusively. -Mr B-H. in reply, said the speech deli', croi by Mr Rijn; was altogether up in thi- ploiids, an.! had no bearing on the bill before the Council. He advised patience and wailing for the re-nit of the I'ommonweallh experience before talking -eriuu-ly of setting up a State bank, lie did nut agree with Mr Anstey that Parliament should pressure to bear on the bank just because at one time tli" State came to its a-si.-t.uice. Parliament did not come to the assistance of the bank in 1.594 so much as it came to the assistance of the country as a whole, and. looking at i.t in that light, the Government had not soujrht t.i take advantage of tiie bunk brt-ause oi the peculiar position in which they found themselves in regard to each other. Tne (Jovernment had not in anj way coerced its representatives on ;he directorate, bin it Imd not hesitated to mo th" oviainal propranime of the shareholders, ami the bill now represented the view- of all parties >o far aj they were prepared to go. The I*lll was then read a -erond time.