AID FOR FARMERS

Otago Daily Times, Issue 23529, 18 June 1938, Page 16

AID FOR FARMERS

THE GOVERNMENT’S POLICY LOW RATES OF INTEREST FAIR BASIS FOR GUARANTEED PRICE (Per United Press Association) DANNEVIRKE, June 17. Addressing a packed and enthusiastic audience in the Dannevirke Town Hall to-night, the Prime Minister (Mr Savage), replying to a mayoral welcome, dealt with the assistance given to the farmers by the Government. He said it was a curious fact that the Government was being blamed for having loaded the farming industry with intolerable costs, a charge which was contrary to the truth. He said without any fear of a valid challenge that the Government ‘had already done more for the farmer than those Administrations which they knew as purely “ farmers’ Governments.” Quite apart from the benefits of the guaranteed price scheme and further substantial benefits given in addition to various subsidies, the Government’s policy of cheap money had been of immense value to the farmer.

“Consider interest rates alone,” Mr Savage continued. “ Two years ago, on July 7, 1936, to be precise, 1 said that the day of high interest rates had gone. How has the farmer fared as a result of that policy in practice? To-day more farmers are getting cheap mortgages than ever before. For every six farmers with mortgages at 4£ per cent in July, 1935, to-day 26 farmers are receiving the benefit of that cheap rate. It lias been the Government’s deliberate policy that has kept the interest rates low. If the Government had consented to the raising of the interest rates to local bodies, all interest rates would inevitably have been driven higher. If the supporters of the National Party had had their own way, this is wha> would have happened.”

For more than 12 months the insurance companies and other lending institutions had refused to lend money at 3J. per cent., he continued, and it had only been a firm stand by the Government which had kept all interest rates low. Instead of the statistics showing a difference in the mortgage rates in New Zealand and New South Wales, they showed the rates in the latter place to be substantially higher. Mortgage rates generally in New Zealand were 1| per cent. lower to-day than between 1925 and 1932 owing to the' action of the Labour Government. The 1J per cent, saving in interest rates on new farm mortgages registered last year meant a saving of £183,400. On all farm mortgages (at present £135,000,000) as they fall due for renewal, the saving was at the rate of £2,360,000 a year.

Mr Savage quoted the results of the relief granted under the mortgage relief legislation, and said that the Government was doing everything possible to expedite this work. Farmers who were still oppressed by excessive mortgage debts should remember that the present Government did not put the financial yoke around their necks. The Nationalists favoured higher interest rates. It had been part of their creed. In regard to the guaranteed prices paid to the dairy farmer, Mr Savage said it had been asserted without any proof at all that the gain had been swallowed by increased costs. Every farmer knew that such, an assertion was very wide of the mark. As a result of the Government’s policy of guaranteed prices the dairy farmer to-day was enjoying a better standard of comfort and a firmer measure of security than he had ever experienced before in this country. If the dairy producer had been left to the caprice of the markets in the 1936-37 season, the monthly butter-fat payments would have ranged from to 7|d per lb. The introduction of the Labour Government’s plan of guaranteed prices that season had resulted in a final pay-out by the dairy companies of over 13id per lb for butter-fat. There could be no valid objection to the principle of the Government’s guaranteed price policy. The only complaint might be as to the adequacy of the price. “I have already said,” he added. “ that the Government is prepared to give the fullest consideration to the price, knowing that no better alternative to the formula for fixing prices is available* The desire of the Government is solely to give the dairy farmers a fair deal. It has no other objective.” Meanwhile, he claimed the guaranteed price system was the greatest boon ever given to the dairy farmer in New Zealand’s history. __