NO PRIORITY

Southland Times, Issue 21660, 23 March 1932, Page 8

NO PRIORITY

LOCAL BODY RATES ' RELATION TO CROWN MORTGAGES STATEMENT BY MR FORBES (From Our Parliamentary Reporter.) Wellington, March 22. “It is not intended to introduce legislation making local body rates an absolute first charge on land in priority to mortgages to the Crown,” the Hon. G. W. Forbes said in reply to a question in the House of Representatives this afternoon. “The effect of such legislation would be to make the Crown liable for payment of local body rates in order to protect its securities.” The question was asked by Mr J. N. Massey (Government, Franklin), who asked if the Government intended to make the rates a first charge on property. “Before any legislation such as that suggested by the hon. member could be considered, the whole question of local body taxation would require to be reviewed,” Mr Forbes added. “The Crown does not make advances for profit, but its activities are in the main intended for settlement purposes and to promote the welfare of the community, and it would not be desirable to restrict these activities by imposing on the Crown a new set of financial liabilities. The interest charged by the State lending departments does not provide any margin out of which the Crown would be able to meet any additional liability. Private mortgagees are in a different category inasmuch as the margin of security is generally greater and a higher rate of interest is imposed.”