LOWER INTEREST

Grey River Argus, 26 September 1944, Page 4

LOWER INTEREST

AFTER THE WAR Victory Loan Rates May be Best F.A. WELLINGTON,' Sept. 24. So far as legislative enactment can provide, interest rates in the future are more likely to be lower than higher, stated the Minister of Finance, Hon. W. Nash, when he spoke of the Victory Loan position last night. Discussing the price of war, Mr Nash spoke of the lost lives and resources, the 8,390 New Zealanders for instance who had paid the price m full. They gave all they had and lost it. Their wives, children, fathers and mothers and other relatives would, in sorrow and bereavement, even though sometimes tempered with pride, continue to pay the price. But all these human losses were less than half those experienced in the last war, when 16 302 paid the full price, and the total casualties were 58,000. The saved lives and lessor number of wounded in this war were due to the more effective use of metal and materials other than men. All would agree that the saving in lives; which were unpriceable, could not be measured in terms of money, but it had increased the price of war. Both the cost and price of war must, declared Mr Nash, come in the long run out of the resources of the country, and the price in terms of money had totalled £3BO millions to March 31st last. We expected this year to pay £133 millions. It might be that we would have fewthere would be less to raise next year. It might be tha twe would have fewer men fighting, though we would have more in New Zealand to look, after. Rehabilitation came in at this point, so what we did not spend on destruction we would spend on reconstruction to give the men who came back a chance to get back to where they would have been had they not gone away to fight. When we had paid national security and income taxes, we had, continued Mr Nash, discharged slightly less than half of the obligation we owed to the State which was defending our families and property against the enemy. The larger the property, the greater the obligation. We now required . two millions a day during the remainder lof the time available for subscribing to the Victory Loan. Many reasons had been given for the fact that subscriptions so far had been less than normal. Some suggested that thei interest offered was too low, and that this might mean a fall in the value oi securities, as happened after the laswar. “In the last war, ’ continued the Minister, ‘‘interest rates in Britain ran from £3 16s 4d to £5 6s 5d per cent. In the United States they were 4to 44 per ctent. In New Zealand they' were 34 per cent. But in this I war'no interest rate in any of these (countries has exceeded 3 per cent. The rates determined by policy for ! war and post-war in Britain unless lower are determined, as they might be—are at present 24 per cent, for short term, and 3 per cent, for long term loans. In the United States the rates are 2 per cent, for short term, and 24 per cent, for long term. In New Zealand our rates have been 2s per cent, for short term and 3 per cent, for long term; and, so far as legislative enactment can provide, these interest rates are likely to be lower than higher. I believe that money will inevitably be cheaper.”