RESERVE BANK BILL

Otago Daily Times, Issue 22114, 18 November 1933, Page 14

RESERVE BANK BILL

ENSURING STATE CONTROL FURTHER AMENDMENTS PROBABLE , (From Ohb Parliamentary Reporter.) WELLINGTON, November 17. Seeking an assurance that the appointment of the governor and deputygovernor of the Central Reserve Bank would be plgced beyond doubt in the hands of the Government, thereby ensuring a majority of State appointees on the bank’s directorate, the group of Coalition members which has been styled “ the Study Circle,” waited as a deputation this morning on the Minister of Finance (Mr J. G. Coates). They were moved to action, it is understood, by Sir James Parr’s statement in the Legislative Council that no amendments to the Bill would be introduced when the Bill was before the House of Representatives.

The group actively opposed the clause under which the governor and deputygovernor were to be elected by the shareholders with the approval of the Governor-General-in-Council. They persuaded the Minister to amend the Bill so that the appointment of these officers would be made by the State on the recommendation of the bank’s directorate, and they won from him an undertaking that he would go os far as he could to ensure that the final selection was left in the hands of the State.

The Bill, as introduced in the Legislative Council, had been amended to the effect that the State was to make appointments on the recommendation of the board. Members of the group anticipated a further amendment to give the State somewhat greater. powers, but Sir James Parr’s statement informed them thVt no further amendments were contemplated. They accordingly waited on the Minister to-day with a request that the Bill should be further amended. One suggestion, it is understood, was that the Government should be empowered to appoint the governor and deputy-governor merely after consultation with and not explicitly on the recommendation of the board of directors. An alternative amendment, which would probably satisfy the group, would be an additional provision that, in the event of a disagreement between the directorate and the Government over the appointments, the final selection would rest with the Government. Mr Coates discussed the matter fully with the deputation, and it is probable that a further meeting will be held before the committee stages of the Bill in the Legislative Council are reached. There is an impression in the lobbies that the Minister may see fit to give the group what it asks, but at present the whole question is under negotiation. When Mr Coates met the group’s wishes in the House it was clear that without their support the Government would have difficulty in securing the passage of the Bill.

In his speech in the Legislative Council Sir Francis Bell indicated that he might move to amend another clause in the Bill by reinstating the word “ sole ”, to describe the right of note issue to be given to the Central Reserve Bank. The word “ sole ” appeared in the original Bill brought down in December, 1932, but was omitted in the Bill as reintroduced by Mr Coates. It is understood that the Government will be agreeable to accept this' amendment, since it is, not considered to have any material bearing on the interpretation of the clause in which it appears.