PUBLIC IN DARK

Hawke's Bay Tribune, Volume XXVI, Issue 92, 30 March 1936, Page 7

PUBLIC IN DARK

Government’s Plans EAGERLY AWAITED Details of Policy Remain Close Secret RESERVE BANK STATUS (By Telegraph—Press Association,l WELLINGTON, March 30. The public are eagerly awaiting the Government's first legislative proposals, and it is evident that the uninformative Speech from the Throne has given rise to some feelings of disappointment on the part of those who were expecting that the Government would seize the earliest opportunity of taking the people into its confidence. Apart from the announcement that there are to be vital amendments to the Reserve Bank of New Zealand Act. and that the Government intends to take control of the country’s credit, close secrecy has been observed as to the details of the policy to be followed. So much has been left unsaid that the public is still in the dark as to what the future holds in store. There is a general impression abroad that it is only a matter ot days before the Government will fill in the blanks. Although the next week or so will see the introduction of several major bills, including a measure altering the constitution of the Reserve Bank, it is unlikely that the Government’s main financial proposals will make their appearance until the Minister of Finance presents his first Budget. It seems certain that the Hon. W. Nash will not be iu a position to do that for several weeks. The accounts for the year do not close until to-morrow and some weeks may elapse before the Government is able to ascertain exactly where it stands. STATE BANK PLAN. In the meantime the Government intends to piroceed with the Reserve Bank of New Zealand. The amendments to the original Act will be fairly simply in character, but they will be far-reaching in effect . Shortly, the amendments will have the effect of turning the bank into a State institution. That will be done by buying out private shareholders who, under the terms of the original Act, hold shares to the value of £500,000. The basis on which private shareholders will be bought out has not been disclosed in detail, but it has been stated that shareholders have nothing to lose. Presumably then, they wiU be bought out at the current market rates. The par value of the shares was £5 and they are now quoted at about £5 16/-. The actual terms on which the transfer will be effected will be disclosed in the coming legislation. Provision for the purchase of the shares will be the main feature of the amending bill, but there will naturallv be a number of consequential amendments. For instance, the position of the four shareholders’ directors will be involved. It is plain that if there is no private share capital there cannot no any directors representing shareholders. The original Act provided that there should be four shareholders’ directors and the first of these was due to retire on June 30 of this year. What will become of the four directors under tho amending bill is somewhat obscure at present, but a suggestion is made 'that their services may be retained in the meantime at least, and they will actually become State directors. That would be in keeping with the Prime Minister's statement that those administering the bank at present would continue to do so. but that the policy would be dictated by the Government. On the other hand, there is some authority lor stating that the whole constitution of the board might be altered. However, that is one of the matters that the Government is keeping to itself. FINANCING WORKS. The Act as it stands at present imposes a number of restrictions on the operations of the bank, but it is obvious that once the bank becomes a State institution many of these restrictions will be removed. It is stated that the amending bill will give the Government complete power to finance all undertakings to which it is immediately committed. The bill is likely to be a big one. For instance, the Government is already committed to the completion of a number oi public works, of which the major is the East Coast Railway. As soon as legislation repealing the setting up of the Government Railways Board has been passed the Government will be free to go ahead with this work and with any other undertakings. There is the South Island Main Trunk line to be considered. Although no definite promise has been made that this work will be completed, sufficient has been said by the Prime Minister to indicate that the project will be favourably considered. ... , . The Government is determined to push ahead with public works as a means of overcoming the unemployment difficulty. It is essential that there should be some relief for the Unemployment Fund, which at present is being overspent at an alarming rate each week. The Government also has plans for improving the rates at present paid to men on sustenance and relief workers, so the need for relieving tho main fund becomes more urgent.