NEW ZEALAND’S LOAN TRANSACTIONS

Dominion, Volume 22, Issue 96, 17 January 1929, Page 11

NEW ZEALAND’S LOAN TRANSACTIONS

PREMIER’S STATEMENT POSITION OF HON. DOWNIE STEWART By Telegraph.—Press Association. Auckland, January 16. Several references were made in the Prime Minister's statement last ween to previous proposals lor the issue of a cash loan of £5,000,000, and a conversion loan of £10,000,000. These were described as "proposals of the Minister of Finance (my immediate predecessor),” and Sir aosepn Ward stated tnat he finally decided "to make a material alteration in the proposals,” increasing the amounts by £2,000,000 each. A statement of his position iu regard to the matter was made to-day by tne Hon. \i. Dowme Stewart, Minister of Finance in tne Reior mGoverument, who is at present m Rotorua. "Sir 'Josepn Maids statement on tne loan transactions has been interpreted by some newspapers to mean tnat 1 had proposed to raise £5,000,000, and to convert another £10,0u0,000 of tne 4026 maturing debt,” said Mr. Stewart. "This is incorrect, as 1 had made no proposals. What actually happened was tnat in the unuiue ot election campaign, our London financial advisers caoied suggesting that we snouid convert another £1v,000,000 of tne lOk'J maturities, and also borrow in anticipation of our next year's loan requirements, tor reasons stated by them, as tne latter proposal would involve borrowing twice ±n one year and was a marked departure rrom our usual procedure, I cabled to ascertain when London considered a decision should be made, as we were iu tne middle or an election campaign. Their reply was tnat if action was taken, by J anuary it would meet tne case/ When the election results were known, 1 considered it would be improper for an out going Government to prevent a new Government from making its own decision on so important a transaction, or to tie their hands, when there was ample time for Sir Joseph Ward to consider how the proposals would work iu with his own loan proposals. It will be seen, therefore, that the proposal’emanated from Loudon and not from me.

"The suggestion in some papers that I had known the position months before the election is entirely without foundation; also the accusation that 1 had misled the electors as to the high credit of New Zealand, and that I had embarrassed my successor. Sir Joseph Ward’s statement shows clearly tnat this was not so, and the chief correction I wish to make is as above. It Should also be noted that the £7,000,000 raised by Sir Joseph Ward are for public works. If, in addition, he raises tor State advances from £6,000,000 to £8,000,000, according to his election speeches, some idea of the annual borrowing can be estimated. Moreover, apparently, the State Advances loans are to be borrowed locally, and not iu London in the meantime.”