AIDING FARMERS

Hawera Star, Volume L, 14 February 1931, Page 6

AIDING FARMERS

COMMISSION TO INQUIRE GOVERNMENT STATES POLICY an appeal to mortgagors THE BURDEN OF RATING. (Government Memorandum.; WELLINGTON, Eeb. 14. The means to be adopted by the Government to assist the farmers to meet the position brought about by the drastic drop in the price of primary produce and the general financial depression were announced in a policy statement issued by the Prime Minister, the Rt. Hon. G. 11'. Forbes, today.

jt is now a truism that the whole prosperity of the Dominion is bound up with the welfare of the farming section of the community, and as part of the problem of restoring economic equilibrium about the position of the farmers, who have been placed in a serious financial position as a result of the sudden unprecedented fall in the prices of primary products. . Farm land is worth only the capitalised value of what it will produce at current prices, and the hard fact must be faced that the many farmers who bought land when prices were higher have now lost part or the whole of their equity _in their farms. In many cases the position is even worse in that the real value of the farm is not equal to the mortgages, which means that some modrtgagees have lost part of the capital invested by them. These are very disagreeable but nevertheless disagreeable facts, and there is nothing to be gained by refusing to face them.

In some eases the losses suffered by farmers and mortgagees represent little more than the ‘•paper’’ profits arising out of the land boom which occurred in the years immediately following the end of the war. In other cases, however, the farmer has suffered a serious hardship in losing through no fault of his own the hard-won savings of a lifetime. Apart from the fact that the real sympathy of the rest of the community will go out to the man who has thus suffered a heavy loss through a world-wide fall in prices, we are all very much concerned to see that production goes on, and is, in fact, increased. Furthermore, if the mortgagor of land is a good farmer doing his best, the mortgagee cannot hope to gain anything by driving him off the land. Accordingly 1 mate an earnest appeal to mortgagees to review all the circumstances in an equitable spirit and recognise their losses by easing the mortgage charges or otherwise granting every relief possible. This appeal also extends to stock and station agents, the banks and others who have lent money on the security of the farmers’ stock and chattels, with or without other collateral security.

EQUITABLE ADJU3TMENTS. Many of the advances to-day are considerably in excess of the value of stock and chattels, and in cases where the land is also heavily mortgaged the unfortunate farmers are not in a position to meet the high rates of interest charged on the loans, and they certainly cannot reduce the amount of their indebtedness. Under these circumstances the Government- appeals to the stock and station agent and others concerned to review all such cases in co-operation with mortgagees with a view to making equitable adjustments and to extend the utmost consideration to the farmer so that lie may be able to carry on pending the readjustment of economic conditions generally, which in itself .should bring a certain I measure of relief. j

1 can assure the country that the State lending institutions, which hold a large percentage of the total mortgages on rural lands and workers' dwellings, will take this line of action, and they will deal with each case on its merits in as sympathetic a manner as is practicable with due regard to the ‘exceptional economic conditions which prevail at present. Further, 1 wish it to be understood that the Government will not tolerate anything in the nature of exploitation of the ex traordinary situation has arisen. It is highly desirable that all parties concerned in each case should get together and make an equitable arrangement without outside assistance or interference, but to prevent any undue advantage being taken of the financial difficulties and in order to assist the parties to come to an agreement it is proposed to set up adjustment commissions in various parts of the country. The commissioners of Crown lands will be the adjustment commissioners, and they will be available to investigate the position in regard to any farm and to assist the various parties to come to an equitable arrangement.

The work of the commissions will be confidential, but reports will he furnished to the Government as to the general position and the progress made. These reports will enable the Government to determine whether any further action, legislative or otherwise, is necessary to cope with the situation. As a precautionary measure it is proposed as soon as Parliament meets to obtain legislative authority to set up a special • judicial body to which disputes in special cases may he referred, hut it is hoped that there will not be much call for the use of this machinery. One of the most onerous items in the overhead costs of farming is rates. The statistics show that the rates collected by county councils, road boards and other rural local authorities amount to approximately £2,240,000 annually, while rates, mostly rural, collected by power boards amount to about £70,0.10, and by a number of the smaller harbour boards to about £IOO.OOO per annum. Land tax assessments on rural lands amount to about £650,600 per annum, hut as the majority of farmers, owing to the exemptions allowed, pay no rax at all. it is clear that rates are lhe real harden of the small farmer

LOCAL BODY R FOB GA XI SAT f<) N

The information available shows that apart from power boards and harbour boards there are no less than 200 rural local authorities, including 140 rabbit hoards, and that the administration of these authorities costs about £330,000 a year, which represents 11 per cent, of the total revenue from all sources, or alternatively, nearly 15 per cent, of the receipts from rates. There is no doubt that good communications and the revolutionary development of road transport have tendered it unnecessary to have -so many local authorities, and it is evident that considerable relief to rural ratepayers would

result from a general overhaul and reorganisation of these authorities. Not only would there be a large saving in costs of administration, but larger districts -would enable modem machinery to be kept fully employed, which would mean, of course, cheaper maintenance and construction.

As a further means of assisting the distressed farmers and the Dominion generally the Government proposes to set up a commission to go fully into the whole question of the incidence of local bodies’ taxation and the possibilities of effecting economies in the expenditure of all local authorities, including hospital ars-I charitable aid boards. It is admitted that the whole mater bristles with difficulties, but economy in all directions is now a matter of paramount importance to the welfare of the country.

The Unemployment Board in dealing with its special problem has not been unmindful of the need to assist the primary industries, and it now has a scheme under which the unemployment funds will be used to subsidise the wages of suitable men employed on farm work. The wages to be paid in such cases is a matter to be agreed upon between the farmer and the worker. Where farmers are in a position to employ labour this provision should he of considerable assistance to them.

While on the question of unemployment I would like to say that however difficult t lie times may be provision must be made to ensure that the unfortunate people of the community get sufficient food, clothing and shelter. To this end it is proposed to organise special relief measures under the direct supervision of the Minister of Health.

The. addition of a ten per cent, penalty to rates unpaid at the expiration of six months and 14 days from the date of the demand lias created hardship in some eases where the local bodies concerned have publicly notified that the penalty would accrue. In such cases there is no statutory authority to allow remission, hut the Government proposes to bring down validating legislation so as to adjust any such concessions which local authorities may have given or may give in cases of hardship in respect of this penalty. 1 realise that the statement will not make pleasant reading, but- I consider that the first step towards overcoming our difficulties is to place the position fairly and squarely before the people, for the record of the past shows that when work and sacrifice are absolutely necessary in the interests of the national welfare our people have always risen to the occasion, and I have not the slightest doubt that they will do so now. The Government for its part will not hesitate to do what it considers is in the best interests of the Dominion, and given the support of all sections of the community it should not be long before the economic machinery is back into good working order.

Our difficulties are great and they have recently Jbeen considerably accentuated by a disastrous earthquake; but, even so, the courage and resource of New Zealanders is such that the troubles are by no means insurmountable It must be realised, however, that these are extraordinary times and that no ordinary measures would meet the position. Still, all that is required is a combined effort throughout the land, and I confidently appeal to the other political parties and to the whole community for support and cooperation in carrying through the programme that I have outlined for again placing the Dominion on the high road. to prosperity and better times.