“TOY PISTOL” DISPLAY

Evening Star, Issue 21783, 27 July 1934, Page 8

“TOY PISTOL” DISPLAY

LABOUR TAUNTS COALITION " STUDY CIRCLE ” INCIDENT IN FINANCE BILL DEBATE [Fbom Oor Parliamentary Reporter.} WELLINGTON, July 27. designed to Establish Government control of the Reserve Bank of New Zealand, an amendment moved in the House this morning by Mr Savage failed to attract support from those members of the Coalition who, under the description of the Study Circle, were last session spirited in their advocacy that the appointment Of the Governor and Deputy-Governor should be largely controlled by the Minister of Finance after consultation with the bank directors. By the slender margin of 6 votes, the Opposition suggestion was negatived, the only Coalitionists voting with Labour being Messrs Poison and Connolly. The alleged change of front of the erstwhile critical Government supporters was the target for a sardonic trouncing by Mr Fraser. The amendment moved by Mr Savage sought to empower the Governor-General-in-Council to appoint the Go : vernor and Deputy-Governor, the Opposition Leader explaining that if his suggestion was adopted, it would result in the maintenance of Government control of the Reserve Bank through a voting majority of 5 to 4 on the directorate. Three of the directors were now appointed by the Government and four by the shareholders, and the Government had already appointed the Governor and Deputy-Governor. If either the governor or his deputy resigned, or otherwise vacated their seats, the shareholders would immediately appoint their successors, and at once have complete control of the bank in their own interests.

' ‘ I ask members to be consistent with their attitude when the Act was passed, and vote in favour of the State haying at least a majority on the directorate, 'fhe Consolidated Fund is pledged in support of the exchange part of the Reserve Bank’s business, and at the moment 1 don’t see any end of that. In any case, this bank should always remain a State institution.”

Mr Hargest said,he was one of the group of Coalitionists last year who made to, the Minister of Finance a request that he had not been able to parry out. Those representations were that the Governor and Deputy-Gover-nor be appointed by the GovernorGenera) on the recommendation of the Minister of Finance, after consultation with the hoard of directors of the bank. The machinery of the bank had been set up, and if any change were required it could be made in the nest seven years. “ I am one of those who are strongly in favour of it,” added Mr Hargest, “ but I believe the Act as it stands should be left alone.” (Labour dissent.) “ The question is whether the bank is to be controlled by the elected Government or by the shareholders/’ said Mr Fraser. “No amount of equivocation or side-stepping will get over that fact.” . He pointed but that there was ho security for the present governor and deputy-governor holding their offices for seven years, as thete was always the possibility of death or resignations affecting the position. He could not see the reason, why the Upper House did not last year make the amendment promised by Mr Coates, unless it- was due to reluctance on the part of the members of that chamber, or difficulties with the Jaw -draughtsman. The position to-day was that it Mr Hargest and the others who pressed for the amendment last year were now convinced that they had made a mistake, they were entitled to change their opinion, and do it straightforwardly. Frank confession of sinning, and a plea for forgiveness could be understood. While he might not admire theni tor their attitude, he could at least give credit for it.

“ Do they still believe what they believed last year, and, if so, will they vote for it?” asked Mr Fraser. “If not they must admit that the ‘ study circle ’ is wrong, and is confusing instead of enlightening.” In announcing that he would vote for the Labour amendment, Mr Poison said the bank should be controlled by the State, and he was unable 'to see why the original clause had not beep altered.

Mr Stallworthy expressed amazement that' the “ study circle,” which had achieved so much publicity, should now fa ; l to make itself effective.

“It only needs the Minister to say he will accept the amendment, and Mr Hargest will vote for it,” Said Mr Langstone. After explaining that he was young in politics, Mr Hargest asked why the members of the Labour Party did pot give keen support to the Bill last year when it was now so important. Mr Armstrong: Some young members have been well spanked since last year. “Mr Hargest would have been well advised if he had left this matter alone,” said Mr Fraser. “The reason the members of the Labour Party enjoyed the comedy of last year is that it had all the appearance of a sham light. We wanted to see how these gallant highwaymen, these Dick Turpins holding a toy pistol at the head of Mr Coates, would get on.” He pointed out that the Labour Party had fought last year to give the State complete control of the bank, which was a cardinal plank in its policy.. When tlje division was taken the amendment was defeated' by 34 votes to 28, Messrs Poison, Atmore, Stallworthy, Samuel, Tirikatene, Rushworth, and Connolly voting with the Opposition, arid Mr Wright voting with the Government. The two leaders of the “ study circle ” (Messrs Lye and Hargest) also voted with the Government.