THE MORATORIUM

Evening Post, Volume CVIII, Issue 62, 10 September 1924, Page 9

THE MORATORIUM

EXTENSION TILL 31ST JULY NEXT

MORTGAGES BILL AMENDED

IMPORTANT ALTERATIONS,

Important amendments have been

made to the Mortgages Final Exteu-

sion Bill, by tho Public Accounts i Committee of the House of Representatives. As amended, the Bill extends the moratorium until 31st July, 1925, but no extension shall be made by the Court unless notice of motion has been made by. the mortgagor before 31st March. The . date originally fixed for. the termination of the moratorium was 31st December next. The Committee has also amended the Bill to allow a trustee to arrange the renewal of a trustee mortgage at 'such rate -of interest as he tbinkß fit. It was previously proposed that the interest . rate on trustee mortgage's should not be less than 6 per cent. A new clause has been added providing that no party to any proceedings before the Supreme Court shall be liable to pay the costs of any; other party to the proceedings.

When the report' of tha Committee came before the House of Representatives' yesterday afternoon xthere . appeared to be some-differences of opinion between the Chairman (Mr. J. A. Nash) and members of tho House as to the effect of the amendments. ...-"■ '

Explaining tlie nature of tho amendments effected by the Committee, Mr. Nash stated that the Committee was of opinion that the time to be allowed for tiie receipt of motions objecting to. the lifting of the moratorium in individual cases should be up to 31st March, 1925. The cases would then have to' be heard by the Court before the 31st July. Mr. G. W. Forbes (Hurunui): "Does it postpone the lifting- of. the moratorium lrom 31st December'to 31st March?"

: Mr. .Nash: ."It simply means that the moratorium will expire in December of this year, and that by the 31st March the notices of motion to the Court must be made. y .; „. ■'■'.-'

The Leader of the Opposition (Mr. T. M. Wilford): "It" has: not altered the date of the expiry of the moratorium?" , Mr. Nash': " No."

MR. WILFORD'S PROTEST

The Leader of the Opposition protested against the lifting of trie moratorium on the ground that it would cause more financial trouble thanhas occurred for.many years 'past. It would,. mean bankrupt>ies, dislocation, and chaos in many parts of the _ Dominion, and would mean the beginning" of a . new year for the mortgagor to exploit the mortgagee. If the moratorium were'lifted, the rate of interest would be raised and the country vvould.be; thrown back to the position it was in in the bad days of 1889. Speaking of high, rates of interest,. Mr. .Willord said he saw a .mortgage go through the other day where the party was compelled' to pay 10 per cent, for the money. ; .Mr, F. J,Bolleston (Timaru) said the effect, of the' amendments would mean .that the House would be able tosecure information ,as to the number''of mortgages, affected.-by the moratorium. Some witnesses before the Committee paid the amount would be between £60----000,000 and £70,000,000. Members of the House had, quoted, other 'estimates'. There was no evidence before the Committee to show how much was' affected.' Mr. J. M'Combs JLyttelton) hoped the report of the Committee, would be agreed ■to and the amendments accepted, be-, cause it would enable Parliament next session to- have full information respecting the amount of. mortgages affected lie. said that Mr.;' Nash had really misled members, by his explanation, otherwise the Leader of the Opposition would not have made the speech he did. Mr. J.-A.. Young (Hamilton) said that only those applications lodged between Ist January'and 31st March next would be considered; V He still, thought, however, that mortgages should be allowed 'to. terminate as by the month instead of on the one date. : : . .

;Mr. Forbes said he.was pleased, that the Committee had.extended the period of the moratorium, because that' was really 4he effect of the report. The Bill was now more workable than if had been originally. . • . .

PRIME MINISTER'S OPINION

The Prime Minister said he thought the /fixing -of the. date for-, the lodging of .notices .of . motion at Olst, March was an .improvement en. the ,original date of 51st December, but he did not agree with the . other', amendment.'.-There-was a difference of opinion on the Committee, and he himself .i was in, the minority. Ho .would have preferred flic moratorium to. have ended on 31st March/because lie knew.perfectly well tliat continuing it; was causing a good deul of injury to those settlers requiring borrowed cap-■■)iaU_-]4o did not,like it, especially when tlie Government had arranged for a considerable sum»of money (o bo. made available for those requiring assistance He was referring to the £'100.000- a month from tho Advances to Settlers Mr. Forbes: " When does that start?" .. Air. Massey: ".It is ou now. There is.no difficulty about it." His objection to ■ the 31st July ' was that' it brought .them into,another, session. He thought they would know the position regarding mortgages: by 31st July next. It was impossible to find out at present, except in the case of a very few. who were affected by the moratorium. ■■ If the '"matter were brought into another session, 'there, .was' no knowing how Ions: it would drag on. , V •-.,.■ a Mr. Forbes:: "No more legislation is required,.is there?".

.; Mr." Massey: " There may be. ' That is where the trouble comes in. If we get 200 or 300. people .demanding 'that the moratorium: be further extended, well I will make a very shrewd guess as to what Parliament will do." He was quite prepared to accept the verdict" of ihe majority/of .the House, but if the natter rested with him and the minority on- the Committee, who supported him the moratorium, would have finished on olst March. '.'lt is the fact of its cutting into next session I do not like " .said Mr: Massey, "/because I think thill will do ninro harm than good." •Mr. W. X Parry (Auckland Central) remarked that it was very satisfactory to note thai the Labour" Party's' proposals had been taken into consideration by the Committee and hv the Prime Minister.

'Mr. Massey: "What proposals?" Mr. Parry referred to Hie £400,000 for settlers. ." :

The Prime Minister Paid that not -i s'.ngln proposal wus-laUoii from the Labour Parly. . '

Mr I'ivvry snid tho Committee had cuiw. ...U'llk. assistance of the Govern-nri-nt. iind ils .report W.-1S worthy or (.ouswmil-iuu. H was jjutisliiclury uTuul"

that in some measure effect was being {tiven to the Labour Party's proposals. ■The Prime Minister: "Not one of them."

Mr. Parry: " Oh, yes; I think that could very well be substantiated. Surely the Prime Minister will not deny that fact. At least we . did not expect him to do it." (Laughter.) More required to be done, However, to meet the posilion adequately. Mr. G. Witty (Riccarton) thought ifc Well to extend the moratorium to 31st March.

Mr. ;M'Combs: "It is extended to 51st July."

Mr. Witty: "It expires on 31st March, and notice has to be given to carry it on to 31st July." Voices: "You are wrong."

"A VERY FAIR COMPROMISE"

: The Hon. J. A. Hanan (Invercargill) laid he had voted, for extending the period to 31st July, but he had done it reluctantly. He hoped the amendments would go through as representing a very fair compromise, but he-also hoped there would be no more legislation dealing with the moratorium, as it was not in the best interests of New Zealand, The moratorium tended to maintain fictitious land values and high rates ,of interest. There were members in the House who would extend tho moratorium for two or three years.

The Hon. C. J. Parr: "Two or three hundred years." (Laughter.). Mr. O. J. Ha-wken (Egmont) was inclined to think the final extinction of the moratorium would be in the best interests, of the country. The Minister of Education (the Hon.. C. J. Parr) thought the amendments were very drastic, and that they would continue the uncertainty that at present existed. The object of bringing the date to 31st July next was to give Parliament another opportunity of extending the moratorium. Was that the way to encourage people to lend money, on broad acres.' He knew people who were prepared to lend money at 6 per cent, on broad acres, but they would not do so when 1 arliament was continually interfering with lending operations: Lenders were shy because of legislation of the character under notice, and because land values were too high. , The Loader of the Opposition: " What f° y°" call a : reasonable rate of interest? .■.-.'

The Minister:-" Six per cent." « v■'. ■* c Lanßstone' (Waimarino): J° ul; e r .a.Sh ylock-" (Laughter.) , Thß.Minister said it was wrong to Keep the,legislation going in, order' to urfp people who had.no security. He tliought the number of genuine cases of people requiring further assistance, l-ut who had good security to offer would be found to be very small No one could complain that Parliament had been hard on the mortgagor -In his opmion it had been too generous for the mortgagors' own good. No other country m the world was keeping-war-lime legistoon "afloat " 'so long as New Zealand. He regretted the'amendments as bexng not in the best interests of public finance.

Mhll't 3ngS- eld not aSree with, the Ministers views, because if a man had no secunty and could not pay his in\vi P™e, of '»o»=yws too nhrl P V tl6 lf famers -were prosperous. Six •SSSrer Cent- >astt>o:hi Sha

STEP IN RIGHT DIRECTION

fWr"tl W- D- Ly finar (Gisborne) said tnat argument that other countries had lifted the moratorium did not weich •m his opinion. He agreed 'that the alterations made by the Committee were thTrr'T 1- 6,- ■■. It was us*s« t° ™y that the legislation was not needed. It was difficult to find money, oh rural «o eurifaea af present, and time must be £4on^n° r thePP osition tO-ease- 'The ft !'T P""/" 011", 1, 10 be made available vonll Z , al6 Advanc« Department Mould only be a drop in-the bottom, of the pail - He advocated that the Court should have discretion to extend the moratorium for af least two years. TheBiU was a step in the right- diction "vr ; vel=omed «»e amendments a£dmLtf i 6 (Clutl-),-PPorted the

3gS& Sf'£?'£ c. Hnfti he/am(:ndmGnts seemed to o l!r^ enable inf ormati0 n to be elicited which had not been do* »|ble up to the present. He referred to taSd, reP°rfc ! °f the Committee ; was