SCOPE OF BILL

New Zealand Herald, Volume LXXIII, Issue 22431, 29 May 1936, Page 13

SCOPE OF BILL

NOT FULL REVERSION

"A COALITION MEASURE"

FUNCTIONS OF GOVERNMENT

[by TELEGRAPH —SPECIAL reporter] WELLINGTON. Thursday The assertion that tho State Advances Corporation Bill did not effect a complete reversion to the Old State Advances Department was made by the Hon. Adam Hamilton (Opposition—Wallace) during the second reading debate on the bill in the House of Representatives to-night. "The bill, although making very farreaching and drastic alterations to the constitution and management of the corporation, does not revert by a long way to the previous position of tho State Advances Department," Mr. Hamilton said. "I should say that it goes about half-way. It is in a sense a coalition of the Mortgage Corporation and the State Advances Department. The new institution is still managed by a board of directors, although the board will be very much under the influence of the Minister of Finance." Mr. Hamilton contended that in some instances the practice which the bill outlined lifted the financial safetyvalve a little higher, and perhaps in some cases it blew it right off altogether, but generally the usual lines of finance were followed.

"It cannot bo gainsaid that the present corporation has done very well indeed," continued Mr. Hamilton. "It has lent out £1,000,000 and has been considering lending more. Its lending rate has been very favourable for any mortgagoi. When a borrower gets a table mortgage and terms over a period of anything up to 45 or 50 years at a low rate of interest he is very fortunate indeed, and if the Minister can get those conditions he will be achieving something." Mr. Hamilton thought that the proposal to refuse a second mortgage on corporation mortgages would have too much of a restrictive influence. There was a lot of good in such a proposal, but there might be some evil. The Minister had said that the Government could do the work set out for the new institution better than private enterprise, but that could be debated. There were some functions which belonged purely to the State; others belonged to outside interests, and should be divorced from the Government. it was open to question whether the country would not bo going too far in bringing lending operations under the charge of the State, when strictly it was not a function of the State.

SIR W. HUNT'S WORK TRIBUTE BY MINISTER SEVERAL POSITIONS HELD [BY TELEGRAPH —SPECIAL REPORTER] WELLINGTON. Thursday A tribute to the work of Sir William Hunt as chairman of the board of directors of the Mortgage Corporation was paid by the Minister of Finance, Hon. W. Nash, when speaking on the State Advances Corporation Bill in the House of Representatives to-night. All the evidence obtained from the administrators of the corporation, said Mr. Nash, suggested that Sir William had given excellent service.

The Minister said the managing directors of the corporation had advised him that Sir William's experience of the mortgage and lands position of the Dominion had been invaluable. Certainly his experience on these questions was not surpassed by any one in the Dominion. At the same time Mr. Nash was satisfied that the attitude adopted by the then Opposition when the original Mortgage Corporation iiill was before the House was correct. The Opposition view was that it was impracticable for Sir William to serve all the time as chairman of the Australian Mutual Provident Society, which was largely interested in the mortgage business, Wright, Stephenson and Company, of which he was managing-director, and also the Mortgage Corporation.

The Minister made it clear he was not questioning Sir William's integrity, but said it was inevitable that there must be at some time a conflict of interests, which perhaps might not bo known of at tho moment. There was no suggestion as to Sir William's integrity and certainly none as to his skill and ability. The managing-direc-tors, Mr. A. D. Park and Mr. T. N. Smalhvood, were particularly able men. Mr. Park was well known as former head of the Treasury and Mr. Smallwood had had a long experience of the mortgage business. Tho feeling of the Government was that these two gentlemen should continue in tho terms of their contract. The reference made bv the Minister to tho position of Sir William Hunt was mentioned by the Hon. A. Hamilton (Opposition —Wallace) during his speech on the bill. Mr. Hamilton said that ho could not agree with Mr. Nash that because Sir William was associated with other businesses he was not capable of giving an impartial judgment when acting with the Mortgage Corporation. "I think it is possible for big men to sit 011 one board and administer it as conscientiously as if thev bad no interests in any other concern," Mr. Hamilton said. "I believe that has been done in this instance. Sir William has been chairman of the board and not a managing-director and it is beside the point to think that he could influence the course of action decided on by the managing-directors."