Rural Bank stock issue welcomed

Press, 3 February 1984, Page 2

Rural Bank stock issue welcomed

Parliamentary reporter

The Labour Party has welcomed the Rural Bank’s issue of public stock, but called for an assurance that the bank’s funding level will be maintained.

The Opposition spokesman on the Rural Bank, Sir Basil Arthur, described the ?25 million public stock issue as a positive step towards implementing Labour’s policy for the bank.

It was regrettable, he said, that Labour’s aim of developing the bank to provide full banking services had not been achieved, and that the bank remained linked to the Housing Corporation.

Sir Basil said that limited funds had meant the bank did not have the flexibility to lend in some areas of need, particularly agricultural machinery, which farmers had had to buy through high-interest loans from finance companies.

“If the Rural Bank can assist these farmers with machinery loans at reasonable rates of interest a real burden will be eased,” he said.

Sir Basil said that the latest commercial move by the bank should not be used as an excuse to cut Government funding.

“In fact, it would be timely for the Minister, Mr Maclntyre, to give an early assurance that the 1983-84 funding level for the Rural Bank will be maintained next financial year,” he said.

The chairman of the Dominion agricultural section of Federated Farmers, Mr David Ritchie, said that the arable industry welcomed the Rural Bank’s move into the commercial area.

“Arable export is a growth industry with a need for investment in machinery to maximise its potential,” Mr Ritchie said. The industry hoped that with the increased funds available, the Rural Bank would be in a position to lend on machinery replacement and investment. “This move will reduce the advantage held by the pastoral sector, which has always had access to Rural Bank finance for capital stock,” he said. Mr Ritchie said that he hoped this was the first step towards removing the distortions affecting land use. G 'nment support

.rovernmen ppox measures to the pastoral sector had maintained land in pasture which could well have given a higher overseas revenue from cropping, said Mr Ritchie.