RESERVE BANK BOARD

Press, Volume LXXIV, Issue 22467, 30 July 1938, Page 16

RESERVE BANK BOARD

RETIREMENT OF TWO MEMBERS

BIG REDUCTION IN NUMBER

EFFECT OF GOVERNMENT’S LEGISLATION

[From Our Parliamentary Reporter.! WELLINGTON. July 29. Following the retirement of two directors of the Reserve Bank of New Zealand by ballot to-day, the membership of the board, exclusive of -he governor, the deputy-governor, and the Secretary to the Treasury, has now been reduced from seven to four. The names of the two members of the board who retired to-day have not been officially announced. The retirement of two directors was carried out in accordance with statute at an ordinary meeting of the directorate. The low strength of the board is due to the fact that one member who retired in a similar fashion last year, and whose retirement has yet not been officially announced, has not been replaced. When the bank was first constituted in 1933 its direction wag placed in <he hands of a board consisting of the governor, the deputy-governor, and seven directors, three of them representing the State, and four representing the shareholders. Mr Leslie Lefeaux was appointed governor, and Mr W. L. Ward deputy-governor, and both of them still hold office. The original directorate comprised Messrs Norton Francis, James Begg, D. A. Ewcn, E J. Herrick, E. A. Anderson, R. Hudson, and lan Duncan. All these members were appointed by the Coalition lovernment. It was provided in the original legislation that one of the shareholders’ directors should retire annually by ballot, commencing on June 30, 1936, and that thereafter a director should be elected annually by shareholders. Practically the first legislative stop token by the Labour Government in 1936 was an amendment of the Reserve Bank of New Zealand Act. and in addition to widening the powers of the bank very substantially, the amending bill provided for a reconstitution of the Board of Directors. Private share capital in the bank was abolished, and the distinction between State directors and shareholders’ directors disappeared. The original dire.tors continued in office, but provision was made for annual retirements up to 1940, the members retiring in any year to bo determined by ballot. New Appointments In the first year of the new regime the two original directors who lost their seats on the board were Messrs Norton Francis and James Begg. They were replaced by Messrs Mark Silverstone and George Lawn, who were appointed by the Governor-Gencral-m-Council. Last year one member was due to retire, and the choice fell m Mr D. A. Ewen. However, Mr Ewen’s retirement, which took place a year ago, has not yet been officially announced, and the vacancy created has not yet been filled. This position is j governed by a clause in the amending act, which states that the powers of the board need not be affected bv any vacancy in its membership. _ It is also made clear in the amending legislation that only those members v.ho were originally on the board take place in the annual ballots to determine which of them will retire. Not In Ballot Messrs Silverstone and Lawn, the only members so far appointed ty the present Government, do not have to run the annual gauntlet for their .mats on the board, but even then they will not be able to continue in office for longer than five years without reappointment. As a result of the two retirements to-day only two of the original directors remain on the board. There will be a further ballot before July 31 next year to determine the retirement of one of them, and the sole survivor will retire on July 31, 1940. Under the original legislation the secretary to the Treasury. Mr G. C. Rodda, was made an ex-officio member of the board, without voting powers, but these powers were given to him by the Labour Government's amendment.