BIG CONVERSION LOAN

Evening Post, Volume CX, Issue 115, 12 November 1930, Page 11

BIG CONVERSION LOAN

DIMINISHING INTEREST

LANG OPPOSITION FAILS

(Received 12th November, 11 a.m.) CANBERRA, This Day. A dramatic feature of the Loan. Council meeting was Mr. Lang's agreement with Mr. Lyous's plans to float a conversion loan of £28,000,000 at 6 per cent, for two years; 5J per cent, for ten years, and 5J per cent, for-twenty years. The decision was unanimous, although Mr. Lang in the early discussion expressed a desire to withdraw from the Council, taking with him his share of the loan, approximately four millions. His motion that all future loans should be subject to State and Federal income tax was defeated by six votes to one. It was explained that the purpose of the two years' quotation at 6 per cent, for the loan was to enable advantage to be taken of some American capital now tied up in Australia owing to exchange rates. Mr. Lang, in desiring to withdraw from the Council, stressed the point that he had received a mandate from the people of New South Wales to pursue an independent course. He contended that it was now obvious that tho Loan Council was no longer able to give New South Wales the money it needed. He therefore should be given permission to arrange his own loans. Unemployment and distress were serious in his State and this justified an attempt to take the quickest and most effective means and steps to afford relief. If permission were refused, that would not affect tho determination of the New South Wales Government to raise' money independently. This statement was received by members of the Council with considerable feeling. Mr. Barnes, the Queensland Treasurer, said that Mr. Lang's request should be resisted mainly because, while New South Wales might benefit, the other States would suffer. Mr. Lyons declared that the Loan Council in the present circumstances was a national necessity. Its past inability to secure sufficient funds was not' due to any fault of the Council, but to the lack of money. Mr. Hill, of South Australia, opposing Mr. Lang's motion for New South Wales's withdrawal, moved as an amendment that the Committee had no power to agree to this course constitutionally, and this amendment was carried. 'The Council decided that the question of imposing State taxation on interest from, all Commonwealth loans raised after Ist July, 1931, be discussed at tho next meeting, any action to be taken not to apply to the present Conversion Loan. It was stated at a, late hour that New South Wales had withdrawn from the Melbourne Financial Agreement Standing Committee. <