FARMERS' PLIGHT

Evening Post, Volume CXI, Issue 38, 14 February 1931, Page 7

FARMERS' PLIGHT

ASSISTANCE NEEDED

GOVERNMENT'S PLANS

APPEAL TO MORTGAGEES

Special steps are being taken by the Government to assist the farmer during the present period of economic stress. In the statement which he issued last evening, the Prime Minister (die Right Hon. G. W. Forbes) made a special appeal to mortgagees to deal as leniently as possible with fanners to whom loans have been advanced and stated that State lending institutions would lead the way by dealing with every case on its merits. Adjustment Commissioners are to be appointed in various parts of the country to investigate the position in regard to any farm and assist various parties to come to an equitable arrangement. A Commission is also to be set up to go fully into the whole question of the incidence of local body taxation and the possibility of effecting economies in expenditure. "It is now a truism that the whole prosperity of the Dominion is bound up with the welfare of the farming section of the community, and as part of the problem of restoring economic equilibrium, the Government is much concerned about the position of tho farmers, who have been placed in a serious financial position as a result of the sudden unprecedented fall in, the prices of primary products," said Mr. Forbes. "Farm land is only worth the capitalised value of what it will produce at current prices, and the hard fact must be faced that the many farmers who bought land when prices were higher have now lost part or the whole of their equity in their farms. In many cases the position is even worse, in that the real value of the farm is not equal to the mortgages, which means that some mortgagees have lost part of the capital invested by them. These are very disagreeable but nevertheless inescapable facts, and there is nothing to be gained by refusing to face them. In some cases the losses suffered by farmers and mortgagees represent little more than the 'paper' profits arising out of the land boom which occurred in the years immediately following the end of the war. In other cases, however, tho farmer has suffered a serious hardship in losing, through no fault of his own, the hardwon savings of a lifetime. Now, apart from tho fact that the ready sympathy of the rest of the community will go out to the man who has suffered a heavy loss through a world-wide fall in prices, we are all very much concerned to see that production goes on, and is, in fact, increased. Furthermore, if the mortgagor of land that is now over-mortgaged is a good farmer doing his best, the mortgagee cannot hope to gain anything by driving him off the land. Accordingly, I make an earnestappeal to mortgagees to review all the circumstances in an equitable spirit, and recognise their losses by easing the mortgage charges or otherwise granting every relief possible. EQUITABLE ADJUSTMENTS. "This appeal also extends to stock and station agents, the banks, and others who have lent money on the security of the farmers' stock and chattels, with or without other collateral security. Many of tho advances to-day are considerably in excess of the value of stock and chattels, and in cases where the land is also heavily mortgaged, the unfortunate farmers are not in a position to meet tho high rates of interest charged on the loans, and they certainly cannot reduce the amount of their indebtedness. Under these circumstances, the Government appeals to the stock and station agents and others concerned to review all such cases in co-operation with the mortgagees with a view to making equitable adjustments to extend the utmost consideration to the farmer so that he may be able to carry on pending the readjustment of economic conditions generally, which in itself should bring a certain measure of relief. I can assure the country that the State lending institutions, which hold a largo percentage of the total mortgages of rural lands and workers' dwellings, will take this line of action, and they will deal with each case on its merits in as sympathetic a manner as is practicable with due regard to the exceptional economic conditions which prevail at present. EXPLOITATION NOT TOLEEATED. "Further, I wish it to be understood that the Government will not tolerate anything in tho nature of exploitation of the extraordinary situation that has arisen. It is highly desirable that all parties concerned in each ease should get together and make an equitable arrangement without outside- assistance or interference but to prevent any undue advantage being taken of the financial difficulties, and in order to assit parties to come to an agreement, it is proposed to set up Adjustment Commissions in various parts of the- country. The Commissioners of Crown Lands will bo the Adjustment Commissioners, and they will be available to investigate the position in regard to any farm, and to assist the various parties to come to an equitable arrangement. Tho work of tho Commissions wijl be confidential, but reports will bo furnished to the Government as to tho general position and the progress made. These reports will enable the Government to determine whether any further action —legislative or otherwise —is necessary to copo with the situation. As a precautionary measure, it is proposed, as soon as Parliament meets, to obtain legislative authority to sot up a special judicial body to which disputes in special cases may bo referred, but it is hoped that there will not bo much call for the use of this machinery. BURDEN OF RATES. "One of the most onerous items in the overhead costs of farming is rates. Tho statistics show that the rates collected by county councils, road boards, and other rural local authorities amount to approximately £2,240,000 annually, while rates, mostly rural, collected by power boards amount to about £70,000, and by a number of the smaller harbour boards to about £100,000 per annum. Land tax assessments on rural lands amount to about £650,000 per annum, but as the majority of farmers, owing to the exemptions allowed, pay no tax at all, it is clear that rates are' tne real burden to the small farmer. Now the information available shows that, apart from power boards and harbour boards, there are no loss than 299 rural local authorities, consisting of 146 roading authorities, 107 river and drainage boards, and 46 rabbit boards, and that the administration of these authorities costs about £330,----000 a year, which represent; 11 per cent, of the total revenue from, all sources, or, alternatively, nearly 15 per -cent, of the receipts from rates. LOCAL BODY TAXATION. "There is no doubt that good communications and the revolutionary de-

velopment of road transport have rendered it quite unnecessary to have so many local authorities, and it is evident that considerable relief to rural ratepayers would result from a general overhaul and reorganisation, of these authorities. Not only would there be a large saving in costs of administration, but larger districts would enable modern machinery to be kept fully employed, which would mean, of course,! cheaper maintenance and construction. Accordingly, as a further means of assisting the distressed fanners, and the Dominion generally, the Government proposes to set up a Commission to go fully into the whole question of the. incidence of local bodies' taxation, and the possibilities of effecting economies in the expenditure of all local authorities, including hospital and charitable aid boards. "It is admitted that the whole matter bristles with difficulties, but economy in all directions .is now a matter of paramount importance to tho welfare of the country. PROBLEM OF UNEMPLOYMENT. "The Unemployment Board, in deal-' ing with their special problem, have not been unmindful of the need to assist the primary industries, and they now have a scheme under which tho unemployment funds will be used to subsidise the wages of suitable men employed on farm work. The wages to be paid in such cases is a matter to be agreed upon between the farmer and the worker. Where farmers are in a position to employ labour this provision should be of considerable assistance to them. While on the questii iof unemployment, I would like to say that, however difficult the times may be, provision must be made to ensure that the unfortunate people of the community get sufficient food, clothing, and shelter. To this end it is proposed to organise special relief measures under the direct supervision of the Minister «f Health."