WAR FINANCE

Otago Daily Times, Issue 24421, 5 October 1940, Page 12

WAR FINANCE

THE INTERNAL LOAN NEEDS OF NATIONAL EFFORT POLICY OF CONSCRIPTION GOVERNMENT WILL NOT ARGUE 'From Our Parliamentary Reporter) • WELLINGTON. Oct. 4 "This is only a part of the Government's policy with regard to the conscription of wealth," said the Minister of Finance. Mr W Nash, when replying in the House of Representatives to-day to the three-day debate on war finance, The Minister gave a further explanation of aspects of the internal lean of £8.000,000 and sought to justify the course adopted by the Government. "The Government will continue to carry on the war with the maximum effectiveness." Mr Nash said "It will not argue the matter We will take everything required that is to the credit of this country so that we can put up a creditable fight. Ycu cannot, however, logically put conscription on those who get £4 or £5 a week." Defence Needs Paramount The Minister said the Government would use its powers to get the necessary money voluntarily or involuntarily to carry on the defence of the country. It would be fair with the people, but it would not argue with them. It had to defend the country and the only way to do so was to take the necessary goods and fight. " The number of taxpayers involved in connection with this loan is, I think slightly over 18,000," he added. "Of this total some 15,000 are individuals and 3000 are companies." Mr Nash admitted that there would be difficulties in connection with some taxpayers who were already paying 10s or 15s in the £ in taxation. The loan would take some of their capital, but they would still have securities representing half of their total contributions. An appeals committee would also /be there to assist in solving such cases 'and would take into consideration the circumstances of each taxpayer whose case came before it. To the extent that taxpayers had not the money to pay, then bbviouslv some steps would be taken to help them over the difficulty. Interest Clause Defended "The loan is free of interest for three years, this period being based on an estimate of the duration of tne war," the Minister said. "Of course, we cannot tell—it might be one year, but I think it might be four or five. The question has been asked why no interest is being paid for the estimated war period. A free-of-interest loan transferred from one person to another or to the State gives the right to use certain goods without charge and the Government claims that it should have the right to the goods required for tne war for three vears without paying something for the privilege. After that it pays £2 10s a year for each £IOO worth of goods it uses. At the end of the loan period it gives back the goods." , . , The Minister spoke strongly against credit being usee: without goods to back it, and described the practice as the greatest treason ever done in any country against the working people. It was nothing short of complete treason to suggest that difficulties could be overcome by issuing a lot jf money without the goods behind it. Mr W. J. Poison (Opposition, Stratford): That is just the one thing in which we are in agreement with you. Futility of Inflation "I think that inflation means not control but uncontrol of currency and credit," the Minister added. He said the Government was pledged to control credit and currency to bring into being the maximum quantity of goods for the benefit of the people. The issue of money without goods behind it would not achieve this. Mr W. S. Goosman (Opposition, Waikato): We say "Hear, hear," to that. Mr Nash: That does not make it right.—(Laughter.) Some of the best people in this country, are, however, being deceived by that propaganda which is being put over with no belief behind it. "There is no compulsion at the moment for those who want to subscribe," Mr Nash said, when replying to complaints concerning the compulsory provisions of the loan. He also paid a tribute to the people who before the loan proposal was announced had subscribed £1.500,000 free of interest, and to those who had given money for- the war effort. "There has been no disagreement that the money must be found," he concluded. " I believe the country will subscribe every penny required for this loan."