Bank Issue Prominent in Address-in-Reply

Manawatu Times, Volume 70, Issue 157, 5 July 1945, Page 5

Bank Issue Prominent in Address-in-Reply

Messrs. Meachen and Combs o]»en Debate (Per Press Association.) WELLINGTON, July 4. That New Zealand airmen had prob ably won more decorations in proportion to their numbers than airmen from any other part of the British Common wealth was mentioned by Mr. E. P. Meachen (Marlborough) iu paying tri» bute to the Dominion’s armed forces when lie moved the address-in-reply in i the House of Representatives to-night j There was a moderate attendance in the j public galleries. Mr. Meachen said New Zealand would J go ou playing her part militarily until a Pacific victory was achieved. Iu a tribute to Mr. Fraser for his work at San Francisco, Mr. Meaehen said all New Zealanders irrespective of political creed acknowledged the achievements of the Prime Minister ut the United Nations Conference where his name had been on the lips of every delegate as one who formed the spearhead of the movements for the welfare of the small nations and for negotiations leading to a lasting and beneficial peace. Mr. Meachen urged tho cooperation of alt in a national endeavour for the Dominion’s advancement when peace came. Unfortunately there were some people who endeavoured to make a cleavage between one section of the community and another. Anything which might tend to disturb our people was against the public interest. Mr. W. S. Goosman (Waikato): Such as taking over the Bank of New Zea land. Mr. Meachen said the Government with its splendid war effort, with an internal economy which was the envy of the world, with £500,000,000 raised for war purposes without increas iug the external debt and with £11,000,000 of surpluses during the war years, was well qualified for the peace time tasks ahead. Housing Policy Defended. There was a general desire for the lifting of some of the controls which had been necessary under wartime exrg encies and already some steps had been taken in this direction. This relaxation of controls would continue progressively us circumstances allowed, but it had to be remembered that any .hardships ex perieuced by eivilians in New Zealand had been less stringent, than in any other part of the British Commonwealth and also less arduous than the sacrifices of the man who put on uniform. The Government rehabilitation policy was well advanced. Even in housing, which would be one of the greatest postwar difficulties the Government would have to solve, the rehabilitation programme was well forward with 7000 discharged servicemen satisfactorily housed either in State houses or by loans to buy or build their own houses. The Government intended to push forward with housing construction as rapidly as possible. The only limits were material ones. Money would not stand in the way. Mr. Meachen said substitute materials would increase tne number of houses built. To May 31 24,966 contracts to build State houses had been let and in the main those houses had been completed. It had been said that housing should be left to private enterprise, but if it had been New Zealand would have had 24,966 fewer houses to-day. How. had State housing interfered with private building, he asked.

Opposition members: By preventing private buildings from getting material.

Mr. Meachen said it did not matter who built the houses, but if private en terprise went on at full pressure for the next 10 or 20 years there would still be room for State housing for particular requirements such as the man who moved from one centre to another and did not want to build a home. The Government was doing its best to keep up with the demand for electrical supply, he continued.

Mr. A. S. Sutherland (Hauraki): Yon haven’t been too successful. Mr. Meachen said there had been a lot of criticism. He quoted figures to show the increased demand for domestic power and said if the Government were to blame it was because it had enabled the people to purchase power. The Bank. Referring to the Government’s proposal to take over the Bank of Now Zealand he said most people praised Mr. Seddon for what he hud done and before Mr. Seddon left Australia ou his last voyage, which he did not complete, he had said he was returning to New Zealand to nationalise the banks. There was a lot of publicity iu the press about the proposed banking legislation. Those opposed to tho proposal saw danger in them, but so did he —he saw danger to the mercantile firms in that they would lose their grip on their clients. There was more than the proclaimed fear of socialism behind the objection to the Government’s proposals—there was feai of loss of profits and power. Why? Mr. H. E. Combs (Wellington Suburbs) seconding the Address-in-Reply, said the Government was going to do things which he believed would be in the interests of all the people of New Zealand for instance, taking over the internal airways. Mr. M. H. Oram (Manawatu): Why? Mr. Combs: In the interests of the people of New Zealand. Mr. Combs said another measure which would benefit the whole country would be the taking over of private shares in the Bank of New Zealand. An Opposition voice: How will that help the war against Japan? Mr. Combs said it was the prerogative of the State to issue legal tender money and create credit. It was high time the people of New Zealand had a trading bank to implement that prerogative. Mr. Oram: Why not establish one of your own? Mr. Combs said the advantage of buying out privately owned shares w r as that it would call a halt to the watering of the shares and it would stop the com pounding of the ownership of those shares. A further advantage was that it would take the oauk out of politics. Opposition laughter and cries of; “It will put it into politics.” Mr. Combs said the taking over of tho bank would facilitate the Government rehabilitation aud reconstruction policy, it would help iu rehabilitating returning men and women going into their own businesses, and it would as-

sist national development. A State trading bank would help to weather bad times, it would cushion the blow of a depression. An Opposition interjector: So you are going to have one. Mr. Combs said with the return of large numbers of servicemen from overseas and with the gradual tapering off of munitions and associated production there would be a need to find many jobs. For some time these would be readily available in housing and in the maintenance of national undertakings such as railways, the communications system, roads and bridges, but the time would come when this maintenance work which had fallen behind during the war would be brought up to date and then jobs would have to be provided iu hydro-electric development, river control, land development, afforestation, etc., and we did not want a repetition of past history when orthodox finance had said capable workers should not be employed on necessary and sound development projects. Banking History. Members on the Government side of the House believed that the decision to take over the private shares of the Bank of New Zealand was a practical step to the end of safeguarding against that repetition. Supporting his statement that the bank should be taken out of politics, Mr. Combs said the bank 's history showed that its association with politics had been mischievous in part, evil in part and downright bad In other parts. There had been an occasion in 1865 when the bank brought about a change in Government. In 1567, its intervention caused the Government to change its mind. In the seventies, the Bank of New Zealand had set up a dummy land company tho operations of which were called by a South Island editor “another fraud and a swindle.” That editor was called to the bar of the House to justify his use of the words and the Premier of tho day said the editor should go to gaol or he would go out of the House. But the editor did not go to gaol and tho Premier remainod in tho House. Mr. Combs recalled the time when the bank got the Parliament of the day to cover its losses and said that was another reason for taking it out of politics. After dealing fully with what had resulted in the Government taking shares in the bank, Mr. Combe said in spite of what the Government kad done for the bank when the Government was iu difficulties in 1932, the bank had held a pistol to its head by insisting on 5} per cent, interest. That had resulted in the standard of Bring being lowered and the wage tax being increased from 8d to Is in the £. It had been said that business firms would take their accounts from the bank if the State acquired the private shares but the businessmen of New Zealand had a very high respect for Government Departments. That was shown by the big business estates which had been put in the care of the Public Trustee. The suggestion that accounts would be withdrawn was all moonshine. On the contrary accounts not now in the bank would flow to it when the State took it over. That the Government would bo fair to the shareholders was proved by the treatment given to the shareholders in the Reserve Bank when they received more than that to which they were justly entitled. The Government roust have a State trading hank, and if instead of taking over the Bank of New Zealand it set up a bank of it* own, it would.be competing against the bank in which it owned half the ahares and against the shareholders who held the other half. On the other hand, if the Government took away its shares from the Bank of New Zealand it would prejudice the other shareholders aud remove the stabilising factor which had been supporting the bank for fifty years. There had to be a bank to operate in the interests of the people instead of the private shareholders. The taking over of the bank would be one step further towards the goal of the nationalisation of production, distribution and exchange. Mr. S. G. Holland moved the adjournment of the debate and the Houae adjourned at 9.50.