CHATTELS SECURITY

Evening Star, Issue 21090, 30 April 1932, Page 13

CHATTELS SECURITY

POSITION OF FARMERS PRIME MINISTER’S REPLY TO REPRESENTATIONS Farmers generally have felt considerable concern over tlio Government’s proposal to exempt from the 20 per cent, reduction in lixed charges the interest on moneys lent at call on chattels security. This means that the farmer will get no alleviation from the burden he is carrying in the nature of interest on his current account with stock and station agents, banks, or other lending institutions. In many cases the farmer is paying 7$ and 8 per cent, for this money, or, if unable to pay, it is being debited up to his account. and his position is getting more and more hopeless. The Otago Provincial Council of the New Zealand Farmers’ Union has forwarded the following telegram to the Prime Minister and to various members of Parliament:—“ln view of the fact that farmers’ current accounts in many cases are secured by land mortgage, in conjunction with chattels security, and that others have no chance of converting current account to table mortgage in order to get relief, we view with alarm the proposal to exempt interest on money lent at call on chattels security from compulsory reduction. We realise the .difficulty stock agents and others have to face if the bank rate is unaffected by the general reduction, and strongly urge that an equitable adjustment be arrived at between banks and stock firms.”

The following reply has been received from the Prime Ministerln reply to your telegram and with reference to similar representations made by Mr Bodkin, M.P., it is not feasible to apply a statutory reduction to loans repayble on demand, as it would be quite open to lenders to avoid such provision by calling in the loans and making new contracts which would not be subject to the provisions of the legislation; and in cases where stock agents and other companies would be embarrassed by any such statutory reduction there is no doubt that this course would be adopted. The banks have agreed to make a reduction in overdraft, rates, and as a result of discussions with representatives of stock companies I am satisfied that any benefit derived by such companies from a reduction in bank rates will be passed on to their clients.” Mr A. IS. Ansell, M.P., telegraphed stating that he had discussed the council’s representations with the Prime Minister, and that a reply was being sent.

Mr P. M‘Skimming sent a telegram stating that the whole position was most difficult, and he considered the Government had gone as far as it could be expected to go in the meantime. The Bill had passed its third reading.