"MISREPRESENTED."

Auckland Star, Volume LIX, Issue 261, 3 November 1928, Page 13

"MISREPRESENTED."

UNITED'S LOAN PROPOSAL.

NO TAXATION REQUIRED.

SIR JOSEFH WARD'S EXPLANATION.

"Since I delivered the policy of the United party in Auckland, the Prime Minister, Ministers and candidates seem to have spent their time in criticising the policy I have submitted on behalf of the United party," said Sir Joseph Ward in a statement issued in Wellington yesterday. "The reason is obvious, namely, because they have no policy of their own. That is the big difference in this campaign: the United party has a definite policy. Generalisations and deliberate misrepresentations have formed the chief ingredients of the Reform political pie.

"I summarise the outstanding features of the United party's policy by stating:—

(1) That land settleemnt forms one of the United party's first planks; that funds for obtaining further lands will be provided, as I have done on former occasions frequently, by payment in Government bonds.

(2) To complete speedily, that is, within the next few years," the whole of the authorised long-distance railways by letting several contracts, for each section.

(3) By utilising the surplus labour of the country on reproductive works in making these sections of railways available for traffic that will pay the interest upon cost of construction and eliminate the cause of the waste of hundreds of thousands of pounds annually going on by making the railways earning factors. (4) Raising that money at the rate of six to eight millions per annum, with a maximum, over a period of; years, of sixty millions—assuming that this maximum amount over that period will be required for settlers' lands and homes and workers' homes. Obviously, if the total is not required, the average amount that is required per annum up to sixty millions should be, obtained. All Loans in England. "There is no taxation whatever, I iffirm deliberately, required for either the money for settlers' or workers' honies, or for the completion of the railways. In the latter case, whatever the percentage earned by the railways, it will be applicable to the completed lines as well as the present ones. "I propose that the whole of the moneys for these purposes should be got in England and not in New Zealand. I make this statement because some of my critics are suggesting that I probably intend that New Zealand should be drawn upon in this respect. The disadvantages of doing anything of the kind will be recognised by any thinking person." After affirming the great need for a vigorous land settlement policy, including the compulsory sale of lands, Sir Joseph said:— If o Loss on Money. "Now a few words about the enormous loss that some of my critics declare will be made upon the sixty millions under the system that I propose of bonds at 95 at 4£ per cent. Let anyone—he does not require to be an actuary—calculate what 1 per cent per annum sinking fund represents on sixty millions sterling. He will find that it amounts to £600,000 per annum.- Have those people who are talking about losses taken this into account, and do they recognise that each year £000,000 additional money to the sixty millions is available, and will be invested? That is an addition of £19,500,000 production by 1 per cent over the full period of the loan of 32£ years. Moreover the interest earned upon the £19,500,00( would be available each year in additioi to- what I have already shown.

"Now let us look at the loss of the 5 per cent hy issuing honds at 95 on the sixty millions. That represents a loss of £3.000,000 on the -whole of the amount oT the money I propose to borrow for settlers and workers. Anyone can prove that the 1 per cent sinking fund produces £19,500,000 in 32J years. How those who mispresent the proposal in order to make it look bad can ask any sane person to believe that a loss is to be made is beyond my comprehension. One must assume that they consider everybody who read 3 their statements has no intelligence. As a matter of fact, it would be impossible to invest sixty millions in-the first year, or to obtain sixty millions in one financial transaction in London, or anywhere else. State Advances Success. "The fact remains that much .worse ' things were said when I established the present State Advances Department years ago. The opposition to it was so great that Cabinet decided that I had to go to London to attend to the flotation of the first loan. Our opponents declared that we could not get the money; that if we got it, we could not lend it; and that if we lent it, we would lose the greater proportion of it. We got the loan, which was largely oversubscribed, and up to date some forty millions sterling has been lent. The Department has made a profit, and a huge profit, every year over the whole period. Its losses have been infinitesimal, and have been covered over and over again out of profits. It 6aved thousands of people from ruin in this country, and it helped to put thousands of people upon the land. Public Works Loans. "I wish to say that I am not in favour of going on the London market for Public Works Joans, as is the case now, and which, as I have pointed out in the House, tends to finacial embarrassment. I would provide for these, as I did for-many years, being largely met out of revenues, towards the construction of Public Works throughout the Dominion. My chief concern is that I there appears to be no discernment on the part of the Government authorities between a policy of drift as against one of strength. I made inquires in London as to whether we could sell our 4£ per cent bonds at 95, and I -was assured that this could be done. I was assured, also, by a large contractor in England that he would be quite prepared to tender for the whole of the railways to be constructed in New Zealand, and to accept payment for the same in 4$ per cent bonds at 95 in London. "In conclusion, I say that I have, as Minister of Finance in the past, paid for areas of land for settlement on a similar basis to that I am now recommending, namely, by the issue of bonds never —so far as my recollection goes— at over 5 per cent, payable in London and they have not, so far as I am aware ever been put publicly on the market there-" ... ._*■* *l™. .aiugtifa.-'iwi*:;