Earthquake Loans

Hawke's Bay Tribune, Volume XXIV, Issue 233, 14 September 1934, Page 6

Earthquake Loans

(To the Editor.)

Sir,-“The case oi tne business men of Hawke's Bay who were stricken by earthquake and tire, lor a review of tho terms ot loans made by the Government to enable some of them to ro-start, would not be subjected to criticism it the tacts were fully known. May 1 briefly recite them. The greatest damage done to property in February, 1931, apart from the public service, was suffered by the owners and occupiers ot business premises. They received the least help, f'rorn that magnificent free will offering from the people of New Zealand to the Relief Fund aino nting to £397,247 more than half was used for the repair of dwelling houses—a free gift to all whose damage was under £lOO each. In addition to the £238,825 we detiuitely know was so spent, there wan expenditure ou the homes ot Maori* which is not shown separately. That distribution was made without reference to individual capacity to bear tho loss, nor -on a basis of aid proportioned to the loss. The heaviest losers consequently received the least in proportion to their loss, if they received anything at all, Owners of business premises did .ml participate.

As chairman of the Hastings Retailers’ Association 1 received a number ol letters expressing sympathy tor our business men. Some of the writers were sure that practically all financial loss would be replaced by the Relief I'uud and Government aid. I replied that all the business men could hope for was loans sufficient for restoration ou the lowest possible terms. That was at the time when newspapers throughout the Dominion were describing our visitation as a national disaster, aud the rebuilding of the stricken towns as a national responsibility. The Hawke’s Bay Rehabilitation Committee was appointed with provision to provide aid up to £1,250,000, and an indication from Parliament that more would be forthcoming if needed. Intending applicants for loans received forms which were not encouraging reading. They stated in effect that it was no use applying if the applicants loss had made him a bankrupt, nor if the applicant was able to raise the finance for his own restoration. One mau who had lost all his tools of trade, and could not replace them, told me that according to his reading of the form he was not eligible to receive a loan. It needed persuasion to get hint to do so. Before the year’s end 1200 applications were sent in involving a total of about two millions of pounds. 1 think there were some belated applications as well. However the committee only authorised a total of loans to private applicants amounting to a little over £800,000! While nearly a quarter of a million was freely given to house owners, the very careful Rehabilitation Committee only gave £11,660 in grants up to the middle of November, 1931. The total given in grants has never been revealed, though both Messrs Barnard and Jull, M.P.’s, asked for the information. If the grants held the same ratio to loans at the conclusion ot the committee’s work that they did in November, 1931, the total grants would approximate to £25,000. As the needy sufferers would want and ask for immediate succour, it is probable that the grants given at the committee’s direction never reached £20,000. it ia further probable that this same committee brought pressure to bear upon the creditors of applicants to wipe out claims far in excess of the few grant* they recommended the Government to make. As for the charge of extravagance in restoration such a charge would be hard to sustain in the vast majority of cases. The widening of some of Napier’s thoroughfares was good sound business. Had we not deferred to an expert who after months brought forth a proposal impossible of acceptance we might hive carried through the widening of Heretaunga street. The business portion of our towns which were destroyed have been rebuilt with borrowed money. In a number of instances new stocks have been acquired in like manner. At best, a number of business men will be weighted > with liabilitie- as long as tile lasts. Thereafter, p. ended life insurance premiums have’been paid, the Government may recoup its loan, even if the widow and children are left with nothing. Even that settlement will not be possible in some cases without an easement of present terms. It would have been wise if the Government and the banks before advancing money for rebuilding had been armed with power to restrict tho number of shops to actual necessity. With the present overplus, rentals aro not generally providing a margin of safety. As for loans for replacing stock it will be an exceptional business that can repay the money advanced by instalments and the interest. To exact both those contributions from an average business will prevent needed replacements and declension will ensue. In addressing the Rehabilitation Committee on its first visit to Hastings | urged that our stricken citizens should have the same measure of he p (hat the people of New Zealand would desire to be accorded if a similar disaster occurred elsewhere Has that been done? The donors of £39<.247 have answered in a way that the Government has not. The leaders of the Government wore in control of the Relief Fund and either proposed or assented to the great measure of aid to house owners. Yet the heaviest sufferers have boon overloaded Personally 1 am one of those who had difficulty in borrowing privately at the highest ’ Hastings. 14/9/34.