FARM MORTGAGES

Otago Daily Times, Issue 22520, 14 March 1935, Page 10

FARM MORTGAGES

GOVERNMENT CAUCUSES THE 20 PER CENT. EQUITY CLAUSE . PROVISION TO BE AMENDED (Fkom Our Parliamentary Reporter.) WELLINGTON, March 13. Members of the Government Party are not unanimous that the Rural Mortgagees and Tenants Final Adjustment Bill should go forward in its present form, and the Prime Minister (Mr Forbes) stated in an interview to-night that one important feature which bad been criticised in the caucus was being amended to meet the wishes of members. The “bone of contention,” as Mr Forbes called it, is in Part V of the Bill, which prescribes the method of making a final adjustment of the liabilities at the conclusion of the budgetary control period of five years in the case of farmer mort gagors working under that system. The Bill, in its present form, prescribes that a court of review should, at the end of the term, make an order defining the value of the mortgagor’s equity in his property, and it is expressly stated that in no case shall the value of the equity be assessed at more than 20 per cent, of the basic value. ABSENTEES FROM CAUCUS

The Bill has been considered at two caucuses of the Coalition Party, one meeting being held yesterday and one today. Mr Poison did not attend cither meeting. It is understood" no special significance attached to his absence yesterday, but that he was purposely absent today because 9! his “ brush ” with the Minister of Finance (Mr Coates) in the House last night regarding whether or not Mr Poison had divulged caucus discussions in the course of his campaign against the Mortgage Corporation Bill. Invited to-night to define his attitude to the party and to state in particular whether he would attend future caucus meetings, Mr Poison replied: “I am like Brer Rabbit. I have nothing to sav.” Another absentee from to-day’s caucus was Mr A. Harris, who attended yesterday’s caucus, and, it is reported, revealed himself as an opponent of the Bill. It will be recalled that Mr Harris found himself similarly at variance with the Government when the exchange rate was raised, and for a period following that development did not attend party meetings. _ Meanwhile he has shifted his position in the House from the main Government benches to a place on the cross benches occupied by other Government members and some of the Independents. Beyond admitting that he was not at today’s caucus, Mr Harris was unwilling to comment on his position in the, party when interviewed to-day, but he said his change of seat had been made purely for the purpose of having a better view of the chamber. He voted in favour of the third reading of the Mortgage Corporation Bill to-day, whereas Mr Poison voted against it. Another member who is reported not to be enamoured of the latest Bill is Mr Endean. It is officially stated, however, that he has no thought of parting company with the Government, but that he made it clear to the party leaders in caucus that the feeling in his constituency is against some features of the Bill. A further indication that several Coalition members require convincing that the Government is tackling the problem in an acceptable way was given to-day when a group was observed in close consultation with the experts who have advised the Government throughout on the question of drafting the legislation on mortgage finance.

STATEMENT BY PRIME MINISTER “ That is definitely not so,” said the Prime Minister, when commenting on reports that the party leaders were concerned at the reception given the Bill by the caucus. “Anyone would think that we had been having stormy meetings, and had reached a critical stage. In fact, the Bill has been discussed without any heat, and the caucus to-day was no different from others that have been held. It is certainly true that some members do not like the provision about the 20 per cent, equity, but it has to be remembered that 20 per cent, is the maximum. Most of the time was taken up by members giving illustrations to show that that feature of the Bill would not work out in the beet interests. There is no doubt that all the members were unanimous in agreeing that something should be done to help the farmer mortgagors, and the Government desires to give relief in a way that is most acceptable. Mr Coates promised to consider the representations made by members with a view to seeing whether that section of the Bill could not be modified to meet their wishes.” It wag probable, Mr Forbes said, that another caucus would be held, possibly to-morrow night, to consider that aspect of the Bill again in the light of any amendments that might be made to it. He thought it probable that the second reading would be initiated by Mr Contes on Friday, and it was likely that the Minister would then be in a position to announce what alterations to the Bill wore proposed by the Government. DIVERGENCE OF OPINION SECOND READING ASSURED CRITICAL PHASE IN COMMITTEE (From Our Parliamentary Reporter.) WELLINGTON, March 13. The second reading of the Rural Mortgagors Final Adjustment Bill in its present form is assured, it was learned on good authority this evening, but it is likely that the committee stages will be difficult r.n.ess some changes are made in the clauses dealing with the final adjustment of liabilities at the end of the budgetary peiiod of control. With a view to devising some acceptable amendment to the present draft several Coalition members conferred tonight with the expert Advisory Committee, but the discussions have not yet reached a practical stage. The same Coalition members, it is understood, object to any equity being granted to the mortgagor. but it is believed that Mr Contes considers that such an incentive should be held out and that actually the effect of the provision will help rather than hamper the mortgagee. Other members are prepared to accept the equity arrangement on a reduced scale, but against that it has been pointed out that the Bill prescribes a maximum of 20 per cent., which means that in many cases it will not he as great as 20 per cent. Further, it is argued by supporters of the Bill in its present form that not a great many farmers compared with the total will require to be placed under the five-year scheme, which, incidentally, is said to have worked well when adopted by certain private institutions in the Auckland province. Another point of concern to some city members is that the Bill is restricted to rural mortgagors. It is believed that the Cabinet is not able to see how such a scheme could he worked in the case of urban properties, and at the moment it does not appear that there is any prospect of the scope of the legislation being enlarged in that way. Summed up, the position seems to be that the rank and file members of the party have had insufficient time to study the full effects of the proposed legislation, and are somewhat sceptical in consequence of some of its provisions. With such confusion of thought existing, it is difficult to predict the developments in the next day or so. Meantime, the second reading is not expected to be begun until Friday, and the crucial test is expected to come when part V is under review in committee, unless, of course, some method of meeting the wishes of some members ami allaying the doubts of others can tie devised. In diplomatic language, the position is that a search is being made for a suitable formula.