BANK AND GOVERNMENT

New Zealand Herald, Volume LXXV, Issue 23109, 6 August 1938, Page 14

BANK AND GOVERNMENT

The directors and the governor of the Reserve Bank are to be nothing more than rubber stamps to endorse what the Government decides. This was made perfectly clear by Mr. J. A. Lee, speaking in the Budget debate yesterday. Because in their annual report to Parliament they commented mildly on the financial aspects of one or two points of Government policy, he accused them of using a public document to express their political opinions. The report actually mentioned two things. The Government's action in repaying all advances made during the year, except the overdraft of the Primary Produce Marketing Department, was commended as a wise proceeding. Then the report mentioned the financing of public works, confining its remarks strictly to the financial sida of the subject, and its bearing on the Dominion's credit and currency. If a responsible body of men may not thus comment on a question which belongs wholly to the responsibilities they carry, without bringing on their heads invective such as flowed from Mr. Lee, it will surely be difficult presently to find any self-respecting man to occupy any such position. If the board of the Reserve Bank may not advise the Government—and the people, who are greater than the Government —on finance, it may as well go out of existence altogether. It cannot dictate; it can make no decision which the Minister of Finance cannot override. If, as Mr. Lee implies, it must utter no word except in commendation of all the Government does, there seems little reason why there should be a board. Actually Mr. Lee's speech was illuminating. It revealed the arrogant intolerance of any breath of criticism which characterises him and many of his colleagues; and their disposition to find criticism in any statement which is not fulsome praise.