LOANS ON LANDS

Pahiatua Herald, Volume XXXVI, Issue 10922, 24 August 1928, Page 7

LOANS ON LANDS

AMPLE MONEY AVAILABLE CAUSE OF HOLD-UP. Electric Telegraph—Trees Association WELLINGTON, August 22. The speech of the A!mister of Finance (the Hon. W. D. Stewart) in concluding the debate on the Budget was remarkable for its painstaking analysis of the financial situation of farmers. Air Stewart showed that ample money is available on adequate security, and gave details for the first tithe of the results of the rural bond flotation. It was alleged by critics that the finance provided for farmers by the Government was inadequate, but was this the case ? he asked. In the Advances to Settlers branch applications came to under £1,000,000. His experience was that during the sifting process about one-third of them could not reasonably be considered. In the Rural Advances branch the Government had done all it had been asked to do. It provided machinery, floated a bond issue, dealt with all loan applications to date and there was no breakdown due to lack of funds. Mr H. E. Holland: “How much money has been available ?” The Minister: “We have paid out over a million sterling and the sale of bonds up to the present is between £600,009 and £700,000.” If there was any difficulty in getting the New Zealand investor to take up these, bonds, the Minister continued, he would have no difficulty in obtaining the money, though he . assumed that it was the. wish of farmers, expressed when the scheme was advocated, that they should be popularised in the Dominion, because that was the whole basis of the scheme. It was thought that farmers would buy them at a discount and use them for repayment purposes. The term fixed was 20 years, but he was wondering whether a shorter term would make the issue more popular He proposed this session to take steps t 0 make it clear that the bonds were not to he treated as part of the public debt.

Air EL A. Ransom (Pahiatua): “What is the amount subscribed by the public?”

The Minister: “The bank took between £350,000 and £400,000 and the public took the rest.” He pointed out that in addition to the rural credit scheme many Government departments were lending money freely when the security existed. The Public Trustee informed him that he had loaned on mortgage last year between three and three and a half millions. No mortgages were turned down where there was a security. The Government Insurance Department was also lending, and there were trust companies apd lawyers with ample funds. “It is not in the lack of funds that the hold up occurs.” concluded the Minister. “Whether it is a fact that the margin is too tight I do not know, but that difficulty must be a North Island difficulty, as there is no such trouble in the South Island. If the hold up is due to the margin I do not know how you can remedy it by legislation, because the valuer will immediately under-value to safeguard himself in other directions.”