ANSWER TO CRITICS

Evening Post, Volume 97, Issue 97, 21 October 1933, Page 12

ANSWER TO CRITICS

THEY "FINANCIAL TIMES"

(From "The Post's" Representative.) LONDON, September 13. Beferring to the New Zealand Government's Keserve Bank measure, to be submitted to the coming session of Parliament, the "Financial Times" says: "Criticism has been directed mainly to that part of the measure designed to curtail the functions of the trading banks, and, in the larger sphere, to the relation of currency and credit policy to that of the Bank of England. The first of these criticisms has long since been met. On tho second point it is evident that there has been some difficulty in the minds of the critics in distinguishing between co-operation with and subjection to the monetary policy of the Mother Country. The establishment of a Keserve Bank no more implies the domination of New Zealand affairs by outside interests than does the linking with sterling of the exchange of certain foreign countries govern the economy of the latter. The Finance Minister, emphasised that thie legislation proposes to do no more than confirm and fix tho existing" voluntary sterling exchange system and place the administration in tho hands of an institution specially constituted for the purpose. "Complete Empire unity may not yet be practical politics, but an important step was taken at Ottawa. Tho New Zealand Bank Bill and the Macmillan inquiry now proceeding in Canada are developments in a different sphere directed towards the same end. On the large questions of credit control and international monetary co-operation there can be no doubt that a central institution is best fitted to take action. The importance of deliberations on policy among monetary authorities at this stage of world affairs cannot bo overestimated. Necessarily, international banking co-operation cannot be entirely free from political considerations, which is not the same thing as State control.