SAVINGS BANKS DEPOSITS.

New Zealand Herald, Volume LXV, Issue 20075, 12 October 1928, Page 12

SAVINGS BANKS DEPOSITS.

One of tho charges made by the Leader of the Opposition in his speech at Masterton was that the Government had allowed its policy in relation to the post ofliee savings bank to be influenced by private financial interests. Mr. Holland has expounded his views on the subject frequently in the House of Representatives, and as often has been forced to abandon his attack by the Ministerial explanation of the action to which he refers. The only change in policy has been that the Minister of Finance, under the authority of legislation last year, has reduced the maximum amount on which interest is paid from £SOOO to £-2000. Nothing has been done affecting in the slightest degree the interests of the host of people who use the bank as a remunerative repository for their savings. They will still receive the maximum rate of interest on amounts up to £SOO, and the lower rate up to £2OOO. All that the Government has done has been to refuse to pay interest on deposits over £2OOO and up to £SOOO. Yet that is the wholo ground of Mr.

Holland's attempt to arouso popular opinion against the Government by his pretence that its policy has been subordinated to other interests. The existence of the £SOOO limit is simply explained. It was introduced at the end of 1920, when financial conditions were exceptional, and considerations of expediency led to the adoption of this method of securing to the State the use of funds that would otherwise not be available. The Minister of Finance has frankly stated that this was done against the advice of the Treasury and the Post Office. Now that normal conditions have been restored the Government is wisely excluding from the Post Office large deposits, representing temporarily idle funds of commercial firms, which are foreign to the purpose of the savings bank and the intrusion of which is not advantageous to either depositors or the Government. • The Labour Party's indignation is merely a pose, intended to deceive people unacquainted with the facts. One of its leading members protested in ID'2O against "permitting people with a tremendous amount of money" to deposit it in the bank; when the Government again proposed to reduce the limit to £-2000, the Labour Party made a noisy protest, but it allowed the amending legislation to pass without a dissentient vote.