INTEREST BURDEN

Auckland Star, Volume LXV, Issue 223, 20 September 1934, Page 10

INTEREST BURDEN

FOR OVERSEAS LOANS. WHAT NEW ZEALAND PAYS. BEARING ON UNEMPLOYMENT The statement that a reduction in the rate of interest on overseas loans to 3i per cent, which was the rate at present ruling in London, would mean a saving of over £1,000,000 a year to the Dominion, was made by Mr. L. W. Holt, member of the staff of the School of Commerce at the Auckland University College, when addressing members of the Auckland Creditmen's Club yesterday afternoon. The address was given in the reception hall of Messrs. Milne and Clioyce. New Zealand overseas debt in London amounted to £101,000,000, he said. Of that amount £24,000,000 had been contracted with the British Government. 111 reviewing the whole position, Mr. Holt said that there were many difficulties in the way of a reduction; and he did not know of any grounds other than that the high rate proved a barrier "to trade between the countries. It would be hard to convince the bondholders in England of that fact. The solution might be more or less practicable did that problem stand by itself. But, so far from doing that, it was bound up with many others, only one of which was that of quotas, about which at present so little was known in New Zealand. Mr. J. A. C. Allum, president of the club, who presided, also spoke of the burden of debt. He said that of the total local body indebtedness in London, totalling £17,000,000, a. full half was held by the four principal Auckland local bodies, the Auckland Electric Power Board, the Auckland Harbour Board, the Auckland City Council and the Auckland Transport Board. Each year the sum of £13.1,000 was paid from Auckland in interest. It was largely that burden that made so much unemployment in the city, lie said. Were the interest burden relieved, there would be so much more to spend on unemployment in the city, "For my part, I am going-to see that local bodies get such relief as is possible," he added. "That is not repudiation; but it is reconstruction."