MILKING SHEDS.

Auckland Star, Volume LXVI, Issue 201, 26 August 1935, Page 11

MILKING SHEDS.

GOVERNMENT LOANS. MONEY FOR IMPROVEMENTS. "DIFFICULTIES TN THE WAY." (Prom Our Own Correspondent.) DARGAVILLE, Sunday. Replying to the secretary of the North Auckland Conference of Chambers of Commerce, Mr. B. S. Angus, the acting-Minister*of Finance, Mr. Hamilton, deals at length with the request of the conference that some provision should be made in the case of farmers who are unable to give the security in Order to lift the loans made available, under recent legislation, of up to £200 for the improvements to their milking sheds, cow yards, etc., under the Agriculture (Emergency Powers) Act. "The problem is. one," states the Minister, "for which it is difficult to find a satisfactory solution. While the Government has made money available for the purpose of enabling farmers to effect needed improvements, it is not reasonable to expect loans to be made without a reasonable business prospect of repayment. It must be remembered that the funds provided by the Government represent borrowed moneys that have to be repaid by the State. Mortgage Over Farm. "It has been suggested that it would be justifiable in such a case as that referred to in the resolution of the conference for the Crown, or, if the advance is made or guaranteed by the dairy company, for the dairy company to take a mortgage over the farm and to give such mortgage statutory priority over existing mortgages, such statutory priority not to be for more than £200 or some less sum. The justification for such statutory priority would be that the advance would be used in effecting permanent improvements to the freehold, thus increasing the security of the existing mortgages, and, further, that if the advance is not made tho condemnation of the milking shed would prevent the farmer from continuing dairying—a fact which must be to the detriment of the present mortgagees. No doubt objection would be raised to any statutory interference of the rights of mortgagees, but the difficulty is to find a solution without any such statutory priority.

Stay of Order by Court. "The difficulty might be overcome," continues the Minister, "if the dairy farmer were to apply for a final adjustment of his liabilities under the Rural Mortgagors Final Adjustment Act, and a stay order were made by tho Court, inasmuch as the Court of Review has agreed that if a stay order is made, advances reasonably and properly made for the purpose of complying with a requisition under the Dairy Industry Act will be allowed in the Budgets as an outgoing out of revenue during the period of the stay order. It is, of course, for each farmer to decide for himself whether it is in his interests to apply for a final adjustment of his liabilities under the Act, but the Government's position is that if an advance were made to a dairy farmer, he, or any of his mortgagees, might immediately afterwards apply for a final adjustment of his liabilities under the Act. As you know, the first step under the Act is to try and effect a voluntary settlement and as 75 per cent of the creditors can over-ride the remaining 25 per cent there will bt a very grave danger of a settlement being effected at thi> expense of the Government, although the moneys advanced have definitely improved the value of the security. "The Government is at th: present considering the whole position," concluded the Minister, "and my object in dealing with the matter at some length is to give your conference some appreciation of the difficulties in the way. If your conference can offer any suggestion, it will receive careful consideration by the Government."