CENTRAL BANK

Feilding Star, Volume 10, Issue 4002, 20 April 1933, Page 5

CENTRAL BANK

.What the Farmers Fear THE MATTER OF < ONTROL BY FINANCIAL INTERESTS AX OFFICIAL ASSURANCE FROM l[i iY. IiORDOX COATES (Per Press Association) Wellington. April 20 Fears that the proposed Central Bank might be controlled by Financial interests were expressed at. the meeting of the Dominion executive of the New Zealand Farmers* Union last evening. The president, Mr- W. J. Poison, said he was nor in favour of the Bill in its present form. A Central Bank was essential, but. there was a danger of tinanclal interests obtaining cointrol- < 'apt ain F. Col beck (Auckland) could not see liow a Central Hank was going to benefit, the farmers of the Dominion. Mr. J. I>. Ilall (Christchurch): How did Australia do it? Captain Colbeck: Australia has a Commonwealth Bank. It would be extremely unwise to hand over the sovereign rights of the people for 2f years. It was the sovereign right of the people to control their own curreney. and yet it was proposed to hand over control to private individuals. At present they had control, and it would’be extremely foolish to part with it- He would like in see a special committee set up to go int« such a vitaL question. li was decided to leave the question in the hands of the special com mil lee flea ling with itTHU MINISTER EXPLAINS The Minister of Finance. lit- ITon. .T- G. Coates, wrote stating that the sole purpose of having private shareholders was to provide a non-politi-cal franchise for the election of the hoard of directors. All world authorities. lu* added, laid great stress on the point that the difficult task of controlling credit ami currency should be entirely free from the unsettling effects of politics. If the Bill was carefully studied, however, if would be seen that adequate safeguards had been provided against the banks or any other financial concerns obtaining control of the hank through buying up shares- In the first instance it should be noted that shares must be held by individuals.- and that companies could not hold shares at. all Secondly, the shares were to he al lotted in the first, instance by the Minister of Finance, and the voting power thar might he exercised by an> one person was definitely limited Shares could only be held by persons ifesident in New Zealand. A further safeguard would Ik* found in the provision whereby not more than one of the directors might Ik* a diroc tor of any other bank, while the officers of other banks wore not eligible for appointment. From a closer examination of the proposals there would be no occasion, to fear that the Reserve Bank would he in any way dominated by the joint stock bn nks.