BUYING MUNITIONS

New Zealand Herald, Volume LXXVII, Issue 23700, 5 July 1940, Page 6

BUYING MUNITIONS

USE OF SECURITIES AUSTRALIAN HOLDINGS LONG PROCEDURE "INVOLVED [ur TELEGRAPH —SPECIAL REPORTEB] WELLINGTON*. Thurjday ' Australian securities owned by K* eiv Zealanders are likely to be and used for the purchase of War materials, according to a statement made by the Minister of Finance, the - Hon. W. Nash, in an interview to-day. "They are likely to be used for the purchase of munitions because of the fact that we have no funds in Australia and have not had any,!' . Mr. Nash said. "Otherwise we would have to get the funds from Britain to buy " in Australia. It will be a long procedure before we can decide how the securities are to bo taken over. Several cablegrams have been received and ' negotiations are proceeding with .the ' Australian authorities." Authority was taken under the fin. ance emergency regulations for the Government, through the Reserve Bank, to acquire at current market prices overseas securities held by New Zealand residents in order that the whole of the Dominion's financial resources might be made available in the national interests.

DISCRETION URGED EFFECT ON BUSINESSES HYPOTHECATION SUGGESTED FUTURE OF GOLD RESERVE [BY TELEGRAPH —SPECIAL REPORTER] . WELLINGTON". Thursday A suggestion that instead of compelling the sale of overseas securities the Government should take them by way of hypothecation and return them to the owners at the end of the war was made hy Mr. C. A. Wilkinson (Independent Egmont) during the Budget debate in the House of Representatives to-day. "Quite a large number of overseas securities held by New Zealanders were bought & lifetime ago," said Mr. Wilkinson. "They should he in an entirely different category from those bought in the last five years. These shares are in many cases the backbone of business undertakings in this country in that they provide the security for overdrafts. The greatest discretion should be exercised by the Minister of Finance in dealing with these matters." Mr. C. L. Carr (Government— Timaru): How would hypothecation affect an overdraft? Mr. Wilkinson: The owners would still get their shares back at the end of the time. Overdrafts might be affected, but not so -badly as they would be if the securities were sold on the market. I think most owners of stock will be only too pleased to hand it over if only some fair scheme is devised.

In Mr. Wilkinson's opinion before dealing - drastically with other. people's. money the Government (should take stock of its own in the Reserve Bank where there was nearly >£Bsooo,ooo 'in' gold. \ ! 'We should send to theStates to "purchase our" requirements two men in whom the Government and the country have confidence," he said. "There is not enough, defence material . in this country and gold is the only stuff that will buy 'it. Rather than have tire gold in the :bank. where an invader could lay hands on it I would turn it into bullets and machine-guns and give the' invader them instead."