STATE NOTE ISSUE.

Poverty Bay Herald, Volume XXXVIII, Issue 12581, 11 October 1911, Page 2

STATE NOTE ISSUE.

(From our Parliamentivv Reporter.) WELLINGTON, this day. TJie . New Zealand Notes Bill is 1 the name of the measure just introduced, containing the proposal- to issue state notes.?' Its' operation/ is 'delayed until Ist January, 1913, by, which date hanks are: to .-cease* making, ; iissuing or reissuing any,, bank notes- whatever, under a ,£5-penalty for each note. The Minister of Finance (meaning, the ment) is from .that date -to issue notes, no limit being set;. to the total value, but he is to hold as security for, their redemption a gold cpiii, reserve not less than — (a) • one-fourth' of the amount of notes issued, and outstanding up to £3,000,---000,' and (b) equal to the amount of note* for the time being issued and outstanding m . excess of £3,000,000. This reserve is to be held exclusively for the redemption- of . the 'notes, arid" a deficienty may be made up put of the Consolidated Fund, and per - contra an excess over the necessary reserve may be-, paid into the Consolidated Fund. • The other details of. administration of the reserve ar.e to be : leffc to regulations by the Governor-in-Council. The notes are to be legal' tender, except by the Government, and shall be payable to tHe bearer on demand m gold" coin at the Treasury. A monthly statenitmt is,, to be issued by the Secretary of the -Treasury, and Gazetted, showing the number and amount of notes issued and outstanding, and v the. amount of the gold reserve. At the request., of. Mr Ell> Sir Joseph Ward outlined the above proposals, and explained' that the .banks, of course, could .be responsible for the payment on all notes issued until their return to the bank, no time limit being fixed m that respect. The operation of the Bill was delayed until 1913, m ordei\ to give time to provide the necessary gold for ; the purchase of the note's^ The gold reserve was the same as that- required at present m respect of the banks. The notes were not to be legal tender. ;but the Government oould not issue them; for their own purposes. They could not be issued m payment of any claim against the Government.' It was not proposed to make any change m, the amounts for which bank ndtes were now issued (£l, £5, etc.), these having been found very convenient. , i-.-- . , .Mr Massey suggested that the Bill be sent to the Public Accounts Committee. .....■' . t Sir Joseph Ward declined, saying that lie and other members would not have time to' attend 'that corrimitt'ee every morning for a Aveek>at the end of this session or next session; The time for its coming into operation would be Ist January, 1913.