POSITION DEFINED

New Zealand Herald, Volume LXXVI, Issue 23471, 7 October 1939, Page 13

POSITION DEFINED

MR. LEFEAUX'S PART STATEMENT BY MR. FRASER DISAGREEMENT WITH- BILL (>Y TELEGRAPH —SPECIAL REPORTER] WELLINGTON, Friday The position of the Governor of the Reserve Bank, Mr. Leslie Lcfcaux, was defined by the acting-Prime Minister, the Hon. P. Fraser, during the debate on the Reserve Bank Amendment Bill in the House late to-night. He said that Mr. Lcfcaux did not think that the bill would improve the Reserve Bank, but thought it would weaken the administration and bo detrimental to the interests of the country. After paying a tribute to Mr. Lefcaux's sincerity, honesty and fidelity to his employers as lie construed his responsibility, Mr. Fraser said that the Government took a different view of the bill, and if Mr. Lcfcaux considered it his duty not to carry out the intention of the Government, the question arose who was going to rule. If Mr., Lcfcaux found in his heart and conscience. that he could not carry on there was no need to feel angry. Mr. Fraser added. It would be regretted very much if there was any possibility of that developing. The Minister said that while on the whole Mr. Lcfcaux had co-operated well with the Government an occasion did arise when the studied and weighed opinion of the Government was not carried out. The Government would be hopelessly incompetent if it was going to take any risks, and'if when the country was at war. or not at war, whenever its interests were at stake, the Government had failed to give itself complete power. Mr. Fraser said that whatever happened Mr. Lcfcaux would carry the respect and regard of those who had worked with him. 'Mr. Fraser concluded with an assurance that there would be no uncontrolled inflation. RULE BY CAUCUS LABOUR PARTY SYSTEM INFLUENCE OF LEFT WING [nY TELEGRAPH —SPECIAL REPORTER] v WELLINGTON, Friday "1 do not believe in caucus rule, for it is impossible v to obtain wise administration if there is government by the mob," said the Jit. Hon. G. W. Forbes (Opposition—Hurunui), when referring to the influence of a section of the Government on financial policy during consideration of the Reserve Bank Amendment Bill in the House to-day. If members of the Cabinet were able to exercise their judgment independently, he considered there would be a greater feeling of security. "Under this bill the Reserve Bank will remain a reserve bank in name only," said Mr. Forces. "It will have none of the influence of such institutions. Because of unprecedented prosperity! the Government had no need to interfere with the Reserve Bank before, but the ordinary powers of that institution are now to be setaside completely as a result of the Government's policy on the finances of the country. -To-day we have not a Reserve Bank, but simply a political institution. "The Government has been warned time and time again of the dangers of its financial policy, and in the face of its financial mismanagement we arc now asked to give the Government complete control of the whole of the finances of the country. Has the Government itself really got control? We know from the constitution of the Labour Party that it is the Labour conference that exercises control over the Government. "The Government is influenced by a Left Wing which is prepared to go to the fullest lengths along the road of inflation, irrespective of "what the results may be." Mr, Forbes added. "The Government has broken down the symtcm which has safeguarded the financial position of the country and turned it over to the uncontrolled influence of politicians." SELECTION OF CABINET ONE REMAINING FLAW [BY TELEGRAPH —SPECIAL REPORTER] WELLINGTON, Friday "The method by which the present Cabinet was selected is the one flaw in the democratic system of the Labour Party," said Mr. A. H. Nordmcyer (Government —Oamaru), when speaking' in the debate on the Reserve Bank Amendment Bill in the House of Representatives to-night. The time must come, he added, when the Cabinet would be selected by the majority within the party. Referring to the statement of the Tit. Hon. G. W.t Forbes (Opposition— Hurunui) earlier in the' debate that the Government party was ruled by caucus. Mr. Nordmcyer said he was proud of the democratic structure of the Labour Party and he was sure that as soon as it degenerated as other parties had degenerated by allowing a little clique to rule it there would follow ruin and disintegration. All decisions on legislation and other important matters were.reached by a majority of the party in caucus. I '