THE H.B. TRIBUNE FRIDAY, JULY 29, 1932 LOAN CONVERSIONS.

Hawke's Bay Tribune, Volume XXII, Issue 192, 29 July 1932, Page 6

THE H.B. TRIBUNE FRIDAY, JULY 29, 1932 LOAN CONVERSIONS.

There was among the cable messages from Ottawa yesteday one that had nothing to do with the proceedings at the Conference. It had reference to a suggestion from Mr. Coates, the leader of the New Zealand delegation, that perhaps this Dominion might be able to extract some advantage from the success that is attending the huge British wardebt conversion scheme which is now being carried out and of which we should learn the ultimate result early next week. As cabled, the suggestion was that in respect of our own war-debt to the Old Country—now standing at about £24 million and funded at 5 per cent.—we might fairly claim to have the interest reduced to the per cent, basis on which the British liability is being converted. As will be seen, however, from an explanation given to-day by our Prime Minister, this claim is to be put forward in respect of only the £ll million of our indebtedness which was advanced out of the £2OOO million loan now in course of conversion.

In any case, the first thing that will strike us is to note how quick we are to ask a shore in any relief which the Old Country may manage, by her own efforts, to secure for herself and how slow we are in coming forward to share in any fresh Imperial obligations imposed upon her. Apart from this general aspect of our financial relations with the British Government, it has to be remembered that, no matter how fully hopes are realised with regard to the British conversion scheme, it is quite certain that there will be a very substantial proportion, probably hundreds of millions, of the £2OOO million that will not be converted. This will have to be paid out in hard cash, and it is not at all likely that New Zealand will be as eager to come forward with her share of that. Beyond this, Australia is no doubt in a like position to New Zealand, but for

a considerably greater amount, and possibly Canada also, and whatever concession is granted to us must be granted to them as well. However, if the claim is actually advanced, it will no doubt receive due consideration at the hands of the British Government, and that in the most generous spirit possible. This movement to get a share in the benefits of the British conversion scheme—it applies to a good deal less than a half of the total internal war-loans indebted-ness-prompts renewed allusion to the need for the initiation of some scheme for the consolidation of our own Public Debt. As has been so often pointed out in this column, our finance in this respect stands in the most hopeless-look-ing muddle, with loans at all sorts of varying rates of interest and falling due in all sorts of odd amounts and at all sorts of odd times. For years now, and seemingly alone among the New Zealand press, we have been urging the necessity for this muddle being transformed into some form of methodical order, so that from year to year there should be something like uniformity in the calls to be made upon us. The subject has more than once been brought directly under the notice of successive Ministers of Finance, but none seemed prepared to undertake what will admittedly mean a rather difficult task. Even suggestions of consultation with British financiers at past Imperial Conferences were not accepted, and so things have just been allowed to run along in the same old haphazard way. In the latest instance the subject was brought under the notice of the Hon. W. Downie Stewart on the eve of his departure for Ottawa, eliciting a reply that on the voyage it would be the subject of discussion with the head of the Treasury. As will be seen from what our Prime Minister has had to say to-day, there is a possibility of pur Finance Minister going on to London to consult with financial authorities there. It is sincerely to be hoped that, should this idea be carried out, consolidation of our disorderly Public Debt will be among the matters engaging attention. In any event, as Mr. Forbes has indicated, there will at least be opportunity of talking the subject over with the Chancellor of the Exchequer responsible for arranging the biggest public debt conversion scheme ever launched. And it is the aid of such men, of big ideas, broad views and long outlook, that we badly need.