DOMINION'S CREDIT

Otago Daily Times, Issue 23882, 9 August 1939, Page 7

DOMINION'S CREDIT

POSITION VERY SHAKY GROWTH OF PUBLIC DEBT REDUCED EXPENDITURE ESSENTIAL (From Our Parliamentary Reporter; WELLINGTON, Aug. 8. Concern at the present financial position of New Zealand was expressed by Mr C. A. Wilkinson (Independent. Egmont) during the Financial Debate in the House of Representatives to-day. Last year's increase of nearly £ 14.000,000 in the public debt was alarming, Mr Wilkinson said, and in addition to that, the Government had practically exhausted its credit at the' Reserve Bank The country could not stand the present strain of expenditure, and a tapering off was essential very soon if a crash were to be avoided. "New Zealand's credit is very shaky at the moment," Mr Wilkinson said 'Merchants are required to put up money in advance before goods are shipped. That is not very creditable to New Zealand after 100 years of progress." The Budget, Mr Wilkinson said, had referred to the successful negotiations carried out in London by the Minister of Finance (Mr Nash). Despite this reference to the success of Mr Nash's mission, it seemed that the terms of the loan mast have been received by the Government with dismay. The three loans involved in the negotiations meant an additional load for this country during the next five years of £6,500,000 a year. That was a staggering sum when one considered the trade between New Zealand and Great Britain. In addition, New Zealand had been called upon to hypothecate its exports to pay for the loan. -"To all intents and purposes, we have a receiver in charge so far as our overseas trade is concerned," Mr Wilkinson added, " and no doubt that receiver is the Bank of England, which has apparently made these conditions. I cannot see how Mr Nash,can be congratulated on the arrangements made. Mr Nash made the statement in London that the banks had been helpful, and although I am a supporter of: the banking system, banks in London appear to have imposed very harsh terms on this country."