RURAL FINANCE

King Country Chronicle, Volume XXIV, Issue 3240, 9 December 1930, Page 5

RURAL FINANCE

RELIEF WITHOUT DELAY. CHRISTCHURCH SUGGESTION. Christchurch, Monday. Discussing the present difficulties in regard to rural finance, the Christchurch Times advocates greater use of the long-term mortgage scheme, with provision for a gradual reduction in the principal, and suggests that a reduction in the taxation on income from these investments should make it easier for the man on the land to obtain financial assistance. Approval of the idea has been expressed by Mr. Norton Francis, a member of the Rural Intermediate Credit Board. Regarding the urgent need of temporary assistance in order to keep production going, the Times states editorially to-day: “According to a deputation that waited on Ministers of the Crown last week, there is quite a probability that some of the dairy farmers, for instance, may have to abandon their farms. There must be a practical method of obviating disasters of that kind, and it is the duty of the Government and the people to co-operate in finding it. We have not seen any recent statement relating to the financial position of the bodies especially created to control the provision of rural credits to farmers, but assume that the sale of bonds to provide necessary capital will not be an easy matter. Indeed, the policy of issuing these bonds within the country at the present time would be difficult to defend. Conditions in London are such that a further reduction of the bank rate in anticipation of a huge conversion transaction is being discussed, and if, as is thought probable, the market should come to a 414 per cent, basis, the time should be opportune for the placing of our rural bonds. If, however, the credit boards have not sufficient funds available for their purposes, it might be possible for them to issue certificates to those whose applications had been approved after the usual investigations, so that they could be lodged with banks or firms as security for temporary assistance. The rate of interest, of course, would be that now current, but as the security would be undoubted, and practically tantamount to a Government Bill, it should be possible for the borrower to secure the money required to tide him over a period of difficult until the seasonal returns were available. We suggest this as a possible expedient, as it would have the great advantage of affording some relief without undue delay.”