AGRICULTURAL CREDITS

Dominion, Volume 21, Issue 188, 11 May 1928, Page 9

AGRICULTURAL CREDITS

BILL IN HOUSE OF,

COMMONS

TO GIVE NEEDED ASSISTANCE TO FARMERS

BANKS’ PATRIOTIC

ATTITUDE

Tiie Agricultural Credits Bill, providing special assistance for fanners, has been read a second time in .the House of Commons.

(British Official Wireless.)

Rugby, May 9.

The second reading of the Agricultural Credits Bill was moved in the House of Commons to-day by the Hon. Walter Guinness, Minister of Agriculture. Mr. Guinness said that to provide the necessary long and intermediate aid credits the Government was arranging to form a land mortgage corporation, which would lend on mortgage, either on land or on improvements. The corporation would be formed by the generous co-operation of the great banks. Led by the Bank of England, these banks had arranged to put up £650,000 of paid-up capital. Mr. Guinness spoke of the disinterested and patriotic attitude of the banks, because the return on their capital was to.belimited to 5 per cent. Proceeding, he said that it was obvious that £650,000 of capital would be far too little to finance the long-term needs of British agriculture, and it was .proposed that the further money needed to lend to farmers should be raised by sales of debentures issued in the money market. These debentures, being dealt with on the Stock Exchange, would allow the farmer to take up a new source of credit. Special .assistance for farmers was necessary. On the one hand, they were just now heavily embarrassed by the severe depression caused by a persisent fall in agricultural prices, and, on the other hand, the. early types of a new organisation were bound to prove rather difficult. The Government, therefore, proposed to help the Agricultural Mortgage Corporation both in the security which it could offer and in its administrative costs.

LABOUR MOTION FOR REJECTION (United Press Association.—-By Electric Telegraph.—Copyright.) (Australian Press Assn. —United Service.) London, May 9. In the debate on the Rural Credits Bill in the House of Commons, Mr. A. V. Alexander (Lab.) moved the rejection of the Bill. There was an objection to granting a subsidy from the taxpayers without adequate information on the economic position of agriculturists. It would be more effective to stimulate the formation of co-opera-tive credit societies under a State supervisor. Mr. W. Runciman (L.) said that the Government ought to be represented on the corporation, in proposing subsidies to supplement its funds. Mr. Walter Guinness (Minister of Agriculture) said that the British banking system was in many ways the model of, the world, but it had undoubtedly neglected agriculture. The Governments of France, Germany, the Scandinavian countries, the United States, and the various Dominions had taken special action to provide credit facilities for agriculture. None of these systems was entirely applicable to Britain’s special needs. The Government, in addition to underwriting, was taking power to invest a million and a half sterling in debentures. It would also contribute £lO,OOO a year for ten years towards the administrative charges. He did not pretend that agricultural credits were a remedy for agricultural depression, but they filled a permanent need, enabling the farmer to mobilise his stock-in-trade to secure a much-needed working capital. The Attorney-General, Sir Thomas Inskip, promised that the Government would consider the possibility of being represented upon the governing body of the corporation. The Bill did not attempt to restore the capital lost in agriculture. It did attempt to keep alive those who were alive. Long-term credits were a great advantage. The amendment was defeated by 233 votes to 106. The Bill passed its second reading.