NOT ADVISABLE

Evening Post, Volume CXI, Issue 67, 20 March 1931, Page 8

NOT ADVISABLE

EARTHQUAKE DAMAGE

REPLY TO ME. A. E. JULL

In the course of an interview to-day, the Prime Minister (tho Right Hon. G. W. Forbes) stated that, in connection with the rehabilitation of the Hawkes J3ay district, there had been brought under his notice particulars of proposals put forward by Mr. A. E. Jull, M.P. for Waipawa.

The whole basis of Mr. Jull's suggestion, remarked Mr. Forbes, rested on the raising of a special Joan for the purpose of restoring damage in the affected area. When the proposals already announced by the Government, i.e., the provision of the sum of £1,----500,000 from reserve fund securities, were being framed every possible avenue of providing finance, both internal and external, was explored, and an early opportunity was taken of inquiring from the Government advisers as to the possibilities of a special loan issue. The* Prime Minister intimated thai the reply received left no doubt as to the inadvisability of inviting subscriptions to a special earthquake loan. In view of this, the Government necessarily had to seek other ways, and means of assisting tho people in the affected area, and the realisation of the reserve fund securities represented the only means whereby a measure of Government assistance could be immediately provided. CONFIDENCE OF INVESTORS. "It is hoped," said Mr. Forbes, "that this action on the part ot the Government, which will demonstrate that the Dominion is able to make good earthquake damage out of her own resources, will have'the effect of restoring the confidence of overseas investors in the Dominion." As evidencing the necessity for this, the Prime Minister stated that advices received from London indicated that the market price ot Now Zealand securities dropped considerably immediately after the earthquake. Mr. Jull's proposals for the imposition of a special addition to insurance premiums for the purposo of meeting interest, and sinking fund on a long-term loan were similar to the proposals of the Government m connection with the reinstatement of its reserve fund. By means of a special nx of l/6d per cent, it was calculated that the reserve fund would be reinstated in from five to seven years. "As soon as this is accomplished, , said Mr. Forbes, "the tax will.be used to build up a special emergency reserve, and will be available in the event of a similar catastrophe overtaking the Dominion. The suggestion of compulsory earthquake insurance is a matter that would require careful consideration by experts, and could not be dealt with in the time available for the present session. PRESERVING OUR REPUTATION. "Whilst I am grateful for all suggestions of a constructive nature it must be realised that, as long as capital is required to develop our internal resources, it is essential that we preserve the reputation of the Dominion on the world's money, markets. "As previously announced, the amount of £1,500,000 is a first instalment, and provision will be made m the ordinary loan programme for an additional sum to be made available if required when definite information is forthcoming as to the actual extent of the losses sustained."