BANK SILENT ON NOTES

Press, Volume CVI, Issue 31089, 18 June 1966, Page 1

BANK SILENT ON NOTES

Govt. Unable To Publish Designs (From Our Own Reporter) WELLINGTON, June 17. The Cabinet will soon discuss ways to persuade the Reserve Bank to be more open-handed with the designs for decimal currency notes.

The Government could release designs and hold a poll on the decimal coins; but it cannot publish the note designs without the consent of the bank.

Apparently not anticipating the huge public interest, the Government drafted the Reserve Bank Act, 1964, so that the bank has absolute power over the notes.

Section 20 says: “The bank shall determine the denominations, form, design, content and material of its banknotes.”

Section 24 provides for a fine of £lOO on anyone—presumably including the Government—who “without prior authority of the Reserve Bank, makes, designs, engraves, prints, reproduces in any manner or publishes in any form” the whole or part of a banknote including decimal banknotes. The bank’s governors would prefer to publish nothing in advance about the notes, except possibly a brief description. It has already been said that the notes will be of one, two, five, 10, 20 and 100 dollar denominations. They will be smaller than

the existing notes and in the same basic colours. The Government fears that if the public dislikes the designs it will hold the Government, rather than the bank, responsible. Critics of the bank’s policy say that lack of information in advance may make it difficult for counterfeiters to make false notes, but will also make it difficult to recognise their work as false. Any piece of paper that looks like a banknote could be passed until people were familiar with the real ones. The Government is finding it difficult to reach agreement with the bank over how, when or whether the designs should be released in advance. The bank’s reluctance to allow any advance information is based on fear of counterfeiting. Bank officials say the public would lie unfamiliar with the new notes and unscrupulous persons could pass almost anything that looked like published banknote designs for some time after the changeover.

The risk is considered particularly big for 20 and 100 dollar notes. In Australia pictures of the new notes cut from newspapers and pasted back to back were successfully tendered in shops.