WELLINGTON TOPICS.

Auckland Star, Volume LX, Issue 12, 15 January 1929, Page 3

WELLINGTON TOPICS.

THE SEVEN MILLION LOAN. SATISFACTORY FLOTATION. NEWSPAPER COMMENT. (From Our Special Correspondents WELLINGTON', January 14. The Prime Minister has reason to be well pleased by the London money market's ready response to his seven million loan. Happily the credit of tbe Dominion stood high with financiers and investors, and there was never a doubt that the full amount asked for would be subscribed and over-subscribed. There had been attempts in some quarters during the election campaign, however, to create an impression that the credit of New Zealand depended largely upon the political party that happened to be in office for tlie time bein ? , and that Keform would be more acceptable to investors than either United or I-abouv. But the present, loan of seven million* negotiated by the United Government is costing the country £4 16/4 by way of interest, while theffiev e million loan negotiated by the Reform Government in May last cost £4 10/s. Sj r Joseph Ward at least may take credit for haying done as well as his predecessor at the Treasury, and to have done it without drawing any invidious comparisons.

Information Requested. The "Evening Post," while congratuU'lting Sir Joseph upon the success of his first, appeal to the London market since his return to the Treasury, suggests that further information in regard to the financial side of his policy mi<»ht now be submitted to a friendly public. The position would be better understood by all concerned," it. says, "if the Prime Minister would supplement the statement already issued by an explanation of tbe attitude of London towards State Advances loans, an estimate of the loaa capital required for land settlement and public worke apart from the main railway lines, and a calculation of the borrowing required to complete the whole programme. The majority of the people in New Zealand are, we believe, sincerely anxious to help Sir Joseph Ward in th* operation of a progressive but cautious policy, and they will be glad to have the information which will assure them of the progress and caution of the Government." Here is an invitation to take the public into his confidence which Sir Joseph scarcely can ignore. It» i§ hi? opportunity. Playing for Safety.

The "Dominion." recoverin? its dignity, accepts the inevitable -with a good grace. "Probably," it save "it is a wise precaution to arrange for the extra two millions of loan conversion. The tendency of the money market has been towards cheaper credit: but with the heavy conversion operations in prospect Sir Joseph Ward has decided to 'play safe.' Aβ to t?ie fresh borrowing, this apparently is? for railwavs. hydro-elec-tric and public works undertakings generally. It is not quite clear from the published statement, but the provision for advance* to settlers and, workers appears to have been arranged locally. The terms of the new loan arc Miehtlv better than those of last year, but the interest to be paid will not permit of advances to settlers and workers at 4| per cent unless the State is prepared to face a loss on the advances made." Sir Joseph's critics may make their minds easy on this point. The rate of interest may b<? reduced, but it will not be at the cost of the public

Railway Construction. Probably t"he chief hone of contention in the repast Sir Joseph Ward lias spread before the public will be his railway construction policy. "I have decided," he announced the other day. "to increase the loan from £."»,000.000 to £7.000.000 for public works, including railway construction and improvements and hydro-electric schemes." Tn these days an increase of two millions to the public works expenditure is not a very alarming appropriation, but many well informed practical people have come to regard the. multiplication of railways as :u» uneconomic proceeding , . While the construction schemes of fifty odd years ajro have been dragging tbeir costly way, more or less slowly, towards completion, other means of transport have been evolved, and to-day it is a moot question whether rails and steam or roads and petrol serve the better the needs of the present renovation. Already the "unpaying lines" are costing the taxpayers half a million a year, and the new Government should examine the position closely before adding to this drain upon the resources of the communitv.