P.O. loan information

Press, 4 July 1985, Page 12

P.O. loan information

PA Wellington The Postmaster-General, Mr Hunt, and the Minister of Finance, Mr Douglas, approved the now aborted Post Office 19 per cent housing loan scheme on April 9. This was revealed in correspondence between the Leader of the Opposition, Mr McLay, and Mr Hunt, which was released by Mr Hunt Mr McLay wrote to Mr Hunt on June 28 asking questions in relation to the scheme which meant that people who did not bank with the Post Office were able to borrow up to $60,000 at 19 per cent. The first question asked whether the scheme had been approved by Mr Hunt in his Ministerial capacity, by the Cabinet, or by a Cabinet committee. In reply, Mr Hunt said the extension of Post Office lending to non-customers was one of a number of changes recommended by

the Post Office on April 4 and subsequently approved by the Treasury. “It was approved by the Postmaster-General and the Minister of Finance on April 9, this being the normal level of approval for such changes.” Mr Hunt said he decided to end the scheme on June 25 after consultation with the Director-General of the Post Office and Mr Douglas. He said the Treasury had reported on the scheme before its establishment but did not report on any aspect after it was set up. “In the six weeks from its inception on April 15 until the introduction of ‘queueing’ for non-customers on May 24, 4200 non-customers had loans approved to the value of almost ?140 million,” Mr Hunt said. Commenting on the information, obtained under the Official Information Act, Mr McLay said Mr Hunt’s letter revealed that 1200 to 1300 loan applications had

been held “in the queue” since May 25. Mr McLay said it was significant that the Prime Minister, Mr Lange, implied that Mr Hunt alone was responsible for the scheme. “The information that has now been disclosed ... reveals both Mr Hunt and Mr Douglas were involved. “Mr Lange’s inference that Mr Hunt was on his own is obviously wrong,” Mr McLay said. Mr McLay said Mr Hunt’s letter revealed that the

Housing Corporation had not been consulted. That was extraordinary, he said. Mr Hunt said he did not take anything Mr McLay had to say seriously. Mr Lange said last week that the scheme moved the Post Office from its traditional image of a provider of funds to being a commercial banking operation. The scheme was curtailed abruptly when funds set aside for the scheme ran out.