State Advances Bill Debate

Northern Advocate, 30 May 1936, Page 8

State Advances Bill Debate

Second Reading Carried Yesterday

{Per Press Association.—Copyright.! WELLINGTON, This Day. an all-day debate yesterday, the House of Representatives rose last evening' with the second reading of the State Advances Corporation Bill carried. At the conclusion of the sitting, the Prime Minister, the Rt. Hon. M. J Savage said he hoped to be able to arrange for a short title discussion on the Bill to be broadcast on Tuesday evening. That would give many members a chance to be heard. Trouble For Minister. When the House resumed, Mr W. J Broadfoot (Opposition—Waitomo) said the Minister had power to meddle with the activities of the board at any time. It was the duty of Parliament to state the policy and leave it to experts to carry it out. The Bill cast on the Minister responsibilities that would give him a great deal of trouble, as he would have to be arbiter in the case of every man who was disappointed With his application. Mr Broadfoot also spoke of the adverse effect overseas of the piling up of the Dominion’s national debt. The question of helping industries was very desirable, but it would have to be done with a great deal of care. He also urged that greater provision should be made for the payment of rates on properties taken over by the Corporation.

Hard To Get Low Rates.

No Political Influence.

Long-Term Loans Needed. Mr D. Barnes (Govt—Waitahi) said the farmer needed long-term loans to enable him to plan ahead. Private interests were inclined to look upon rural lands as bad investments, and it was time something was done to bring rural lands to the level of gilt-edged securities. He felt that something should be done to co-ordinate investments in an investment authority. In the past, the mortgage market had been definitely unorganised. The last Government had attempted to organise the market, but the present Bill went much further than previously had been attempted. Mr W. A. Bodkins (Opposition—Central Otago) said that if the Minister wanted to control interest rates in New Zealand he would have to so order the finances of the country as to make the gilt-edged securities of the State acceptable to the moneylending community, and if he were going to flood the market with all sorts of “wild cat” schemes, he was going to put up the price he would have to pay. He would make his securities unacceptable to local and oversesa investors.

Dominion’s Debt. New Zealand owed £280,000,800 with no prospect of redeeming it in the next 50 or 100 years, and it had to be renewed from time to time. The question would be what rate the country would have to pay upon a renewal. Mr H. M. Christie (Govt. —Waipawa) said the whole question facing the country seemed to be bound up in land values, which had a most important bearing on the situation. It had been said that the Bill was not much different from the old measure, and it was surprising that the Opposition should go to any length to criticise it. If that were the case the State Advances Department had been most beneficial to the country. Private enterprise would never have been capable of dealing with the housing position, and the last Government had had to introduce legislation to protect the mortgagee against private lenders.

Mr H. G. Dickie (Opposition— Patea) said the Bill would relieve the position as far as housing was concerned, but he did not think the Minister would get money at 3 per cent. It was not always easy to raise money at low rates, and rates varied considerably. He was quite satisfied that, as far as the Bill was concerned, had the Opposition remained on the Treasury benches, something of the sdrt would have been done.

In reply, the Minister of Finance, the Hon. W. Nash, said that if persons could not build houses the Government would build houses for them at rentals in the vicinity of that which they would be able to pay, and they would be administered by the State Advances Corporation. Money would also be made available to local authorities at a reasonable rate to build houses for the people, and those authorities would administer them.

Political influence would not be able to' interfere with the board. It had been said that the Bill was conservative. He would be glad if in 12 months’ time the same would be said. Some Opposition members had referred to a recent loan in support of the contention that the Government was not in favour at Home, but members who used that type of tactics put any political advantage that might be given in front of the goodwill of the Dominion as a whole. He pointed out that the underwriters gave the Government the same terms exactly as they gave the previous Government. That type of argument was wrong in its entirety, and harmful in its effects.

The Minister said there might have been some sort of salary limitation to the granting of loans. The secox’d reading was carried.