FARM FINANCE

Evening Star, Issue 19699, 28 October 1927, Page 2

FARM FINANCE

INSUFFICIENT FACILITIES SIB JOSEPH WARD ON AGRICULTURAL BANKS [From Oca Pakliamektabx Reporter.] WELLINGTON, October 27 v T}ie member for Invercargill, Sir Joseph Ward, prefaced his speech on the Rural Intermediate Credits Bill in the House to-night with the remark that members might be surprised, but ha favored an agricultural _ bank—not a bank of issue, but one whioh fulfilled the proper functions of financing farmers. The difficulty all through was that the financial facilities to help farmers were not numerous enough, nor was there sufficient capital in New Zealand to keep everything going at full tilt. Stock and station agents had invested dO millions in New Zealand, and had been the financial backbone of the farmers for many years. These concerns had not made an unusual profit, and criticism he had heard on this subject was undeserved. The present Bill would provide £5,600,U(JU to meet farmers’ necessities, but such a sum would not go far. It was necessary to have a quick-acting institution, and he regretted that the Public Trustee was to take charge, because it would have been far better to have extended the State Advances Department. He also objected to the proposed, district boards. This idea was included in the State Advances Act when he first secured its adoption, but in a conplo of years he had to ask Parliament to repeal that section, because district boards were an absolute stumbling block to smooth working, and caused no end of trouble to settlers in obtaining their loans. He ■was anxious to know if sufficient capital could be got for rural advances when local bodies were paying 6 per cent, and over for debentures. How then could tho Rural Credit Board lend to farmers at 6 per cent.? The only way wo could get cheap money was to reduce rates on deposit. It was no use theorising. Money could not he loaned under these conditions at less than 7 per cent., which was useless to farmers.

Mr Stewart (Minister of Finance), dealing with the demand for an agricultural bank, said that if tho farmers wanted it there was nothing to prevent them starting as soon as they liked, if they provided adequate safeguards for the depositors. Any such scheme so far presented was intended to depend on State backing, but farmers were represented as wishing to be independent of Government control. It was significant that the president of the Farmers’ Union, who was a prominent advocate of agricultural banks, signed tho rural credits report, saying that these banks were unnecessary.