DOMINION FINANCE.

Otago Witness, Issue 3085, 30 April 1913, Page 34

DOMINION FINANCE.

LOANS AND RENEWALS. SPEECH BY THE HON. MR FRASER. (Fnoii Ouu Own CoßiiEsroNoi-.NT.) GREYMOUTH, April 24. After the reception of deputations at Kumara last night the Hon. Mr Fraser (Minister of Mines and Public Works) referred to financial matters concerning the dominion. The Minister stated that there were several matters he would like to touch on, one of which was money, or the lack of it. At present the Government was in the position of trying to make every pound spread out to 30s. New Zealand was prosperous, prices were high, and industries were nourishing, but trouble had been experienced through past borrowing on short-dated debentures, and now “the chickens were coming home to roost.” It had been the custom with previous Governments to borrow from one to one and a-half millions each year to add to the surplus for public works purposes. Out of the £3,000,000 loan recently raised they had to take £700,000 to pay for the renewal of loans. During the next two years they found that something like £9,000,000 had to be found to take up short-dated loans. If the Government borrowed that £9,000,000 it was not adding to the public debt. The debt already existed and had been contracted years ago. They were simply borrowing from A to pay B. Mr Allen had not to go Home principally to raise £3,000,000; he had to arrange for debentures falling due, so that they might be taken up and would not be again due for some 30 or 40 years. He could not say if his colleague had done this, but this was what he was expected to do. Money was essential to the development of all branches of industry, and in this connection it was imperative to borrow. Another difficulty, continued Mr Fraser, the Government had to face was the commitment in the way of promises of loans to public bodies, advances to workers, and advances to settlers. It was found that £670,000 had been promised to local bodies by their predecessors, and there was only £17,000 to pay them with. The former Government had relied on getting large sums from the Post Office Sayings Bank, and in some instances one million and a-half was obtained in this connection. But the present Cabinet was only able to obtain half a million. Money had been taken from, the Post Office by depositors and placed out at larger interest, which to a great extent accounted for the smaller amount available to the Government. Former Governments bad promised as much as £60,000 and £70,000 to rich municipalities, and smaller bodies had to go without. He was not, however, pessimistic on matters of finance. He had reason to hope that there would not be so much difficulty in obtaining money in the 1.0 ml on markets as bad beeen the case during the past few months. He did not anticipate they would get cheap money, for there were big demands for money in the Homeland, but he was very hopeful for the future.