THE NEW LOAN

Otago Daily Times, Issue 23811, 18 May 1939, Page 9

THE NEW LOAN

PLANNED SIX MONTHS AGO? QUESTIONS BY MR R. M. ALGIE (Special ro Dailv Times) AUCKLAND, May 17. Reference to the New Zealand Government loan of £4,500,1/00 was made to-night by Mr R. M. Algie at a public meeting at Mount Albert under the auspices of the New Zealand Freedom Association. “ This loan represents a complete political somersault on the part of the Government," Mr Algie said. "Wha* is of equal importance, however, is the question of when the Government made up its mind to issue the loan That question is vital because such a complete change of policy and abandonment of principle could have been dictated only by sheer compelling necessity. The public will be interested to know that the loan prospectus and accompanying application forms issued a few days ago bear figures indicating that the order for these was placed with the Government printer in November of last year. If the Government knew at that time this loan would be necessary—if it had, in fact, even planned the necessary machinery for the raising of the loan—how could its members conscientiously tell the public during the general election campaign last October that New Zealand was enjoying unexampled prosperity? “ Why did they not take the public into their confidence,” Mr Algie asked, and tell them frankly that if returned to office the Government would be forced to raise an internal loan with which to carry on? Again, if the Government contemplated and planned this loan six or seven months ago how can it justify the worry and trouble which it has heaped upon local bodies in restricting their interest rates upon loan moneys to the impossible maximum of 3| per cent.? The continued refusal of the Government to allow local authorities to borrow at a rate in excess of 3J per cent, has in many cases been responsible for the postponement, if not for the complete abandonment, of major and essential works and has thus accentuated unemployment. “Finally," Mr Algie said, "if the new loan was in contemplation last November and was, in fact, then already cut and dried, what an utter farce it was to allow the discussion which appears to have taken place at the Labour Party’s Easter Conference regarding the possibility of the Government abandoning its principle of cheap money and consenting to the interest rate being raised above that of per cent.’’