CRISIS LOOMS

Poverty Bay Herald, Volume LX, Issue 18252, 22 November 1933, Page 7

CRISIS LOOMS

SPLIT IN COALITION THREAT TO MINISTER PROMISE NOT REDEEMED RESERVE BANK ISSUE \ (Parliamentary Reporter.) WELLINGTON, this day. Political developments somewhat suggestive of the dramatic may result from the failure of tho Et. Hon. J. G. Coates to Tedeem the promiso he gave

the House respecting the method of appointment of the governor and deputy-governor of the Reserve Bank of New Zealand. ' ;

Passed by the Legislative Council yesterday, the enabling Act in its final form, exactly as it left the Lower House, by no means satisfies the “Study circle” group within the. Coalition; and it is stated that unless the Minister adjusts the position within the course of tho next two. days, the members concerned will take the unusual course of moving the adjournment Of the House to enable the whole issue to bo revived and thrashed out. : Thia move, if it eventuates, May be fraught with grave possibilities, and a division may challenge the loyalty of quite a number of erstwhile solid supporters of tho Administration. During tho last 12 hours there has been much plain talking in certain quarters,, and, according to lobby gossip, Mr. Coates has been apprised, of tho action of the “study circle” will take if he declines to meet their wishes. CAUSE OF DEADLOCK When the Reserve Bank of New Zealand Bill was before the House, the method of appointing the main executive officers of the new financial institution was the subject of a spirited controversy, and so determined an attitude did the group of Coalitionists adopt that Mr. Coates was forced into a compromise. The original bill proposed that after the first seven years shareholders of the bank should elect the governor and his deputy, but this did not suit the Coalitionists who believed that a national institution should have a greater measure of State control. Various alternatives were examined, and, finally, Mr. Coates agreed to an amendment of the operative clause providing that the governor and his deputy should be appointed by the Government, on the recommendation of the bank directorate. Mr. Coates gave an undertaking to tho House to make it clear before the bill passed the Council that in the evpnt of a disagreement the final authority would rest with the Government. It is not exaggerating to state that it was on this assurance that the House allowed the bill to pass without further ado. “SOLD US A PUP” Since the passage of the measure by the House, Mr. Coates has received representations from the “study circle,” who wero still under the impression that no. difficulty would be experienced in having the provision redrafted, as promised, in the Council However, the bill was passed without that adjustment, and, to some extent, tho fat is now in the political fire. “The Minister has sold us a pup,” declared one member last night. “We have been badly let down.” A hurriedly summoned meeting of the “study circle” group was held shortly before the tea adjournment, and a deputation of six at 5.30 p.m. waited on Mr. Coates. There were present Messrs F. Lye, W. J. Broadfoot, E. A. Ansell, K. J. Holyoake, W. J. Poison, and C. H. Clinkard, the two last-named of whom are not looked upon as regular members of the circle. Messrs A. E. Jull and J. Hargest, who are definitely linked with the group, were not available at the time. Although the proceedings were held in camera, lobby information is available that words were not minced by one spokesman, who charged the Minister with breaking faith with the group and with the House, and said it was still expected of Mr. Coates that he would keep his word, even at this late hour, and have the necessary adjustment to the clause made. It is understood that tho Minister’s answer was that he had not expected the bill to be passed so promptly by the Council, and that in any event there were technical difficulties in the way of drafting a clause which would meet with the satisfaction of the deputation. OPPOSITION AMUSED To Mr. Coates it was suggested that power existed under section 56 of the Constitution Act, 1852, for the Gover-nor-General before declaring his plea sure regarding any Act presented for royal assent, to make amendments and return tho measure to the House. Ia other words, it was suggested that *teps should be taken to have the bill recommitted in tho House and amended to incorporate a provision that the Governor-General-in-Council shall appoint the governor and deputy-gover-nor of the bank upon the advice of the Minister of Finance, after consultation with the bank directorate. It was stated that such an alteration would bo acceptable to the group and to the House.

According to what is said in the lobbies, tho Minister was given to understand that failing tho complete redemption of his promise, it was well on tho cards that the Opposition would take constitutional action it could to revive the issue in tho House, and that tho same course of action lay open to the “study circle.” Subsequently a further meeting of the Coalition group was held when members discussed again the attitude adopted by Mr. Coates. As an outcome, it is stated, arrangements are being made to seek authority to move for an adjournment of the House if the Minister allows the situation to remain as it now stands.

The Opposition, of course, has been amusedly observing the widening of the Coalition gap. Its policy will be governed entirely by developments, or lack of them.

“It is up to the so-called “study circle’ to act,” said one prominent Oppositionist. “If they don’t move we will. The Minister’s undertaking was to the House, and he has not carried it out. What we will do I cannot sqy, but failing a movement from-the other quarter we will do whatever lies in oux power to have the issue wvjtod,"