M.P.’S PLAN

Evening Star, Issue 21286, 15 December 1932, Page 7

M.P.’S PLAN

STATE TO ASSUME ALL FARM MORTGAGE LIABILITY INTEREST FIXED ON EXPORT VALUES [Per United Press association.] NEW PLYMOUTH, December 14. The scheme of Mr C. A. Wilkinson, M.P., to aid farmers in their difficulty was made public to-night. Li brief, it is that all farm lands in New Zealand should be entirely freed from mortgage liability, both capital and interest, that henceforth no mortgage liability should he allowed on farm land, and that in view of the freeing of land from all mortgage debt all farm land over and above what is considered a reasonable area should be resumed by the State without payment for further settlement purposes, and land thus resumed by the Crown should be acquired on the basis of the reduction made by the abolishing of the mortgage debt on the land concerned.

These drastic steps, said Mr Wilkinson, would place the primary producers in a position to compete with any country in the world, and would do more to rehabilitate the country than any other proposal yet suggested. “The main feature of my scheme is that I propose to bring money values into lino with farm production values. After arriving at the true value of mortgages interest payments should be made on a 3 per cent, basis, and to provide for fluctuations up or down on an index system according to export values. I propose that all existing farm mortgages should he reduced in value commensurate with present day export prices. All farm mortgage contracts made before September 30, 1929, and still outstanding should have their value based on the average of export prices from September 30, 1925, to September 30, 1929, and be reduced proportionately according to the export values existing between October 1, 1930, and March 31, 1933. AIL outstanding mortgages entered into between October 1, 1929, and September 30, 1930, should be calculated in a similar manner, and in subsequent separate years. I propose that the State should take over the whole liability under the mortgages (as adjusted) by issuing State bonds payable to hearer and saleable on stock exchanges. I estimate this liability would not in any circumstances exceed £200,000,000, possibly considerably less, which would entail a burden of interest payments not exceeding £6,000,000 per annum.

In order to provide funds for the payment of such annual amount I propose to impose income tax upon the net profit of all farmers, or a sales tax on all produce or stock sold from farms or income tax on the gross receipts from .farms, the balance to he made up by general taxation. “ I am of the opinion that nothing short of revolutionary measures will do what is retpiired,” said Mr Wilkinson. “It is agreed that the greatest burden upon the primary producer is interest, rent, and taxation.” A representative meeting to-night set up a committee to investigate the scheme.