WORK OF LABOUR GOVERNMENT

Southland Times, Issue 23538, 18 June 1938, Page 8

WORK OF LABOUR GOVERNMENT

Assistance Given To Farmers REDUCED RATES OF INTEREST EFFECT OF GUARANTEED PRICES (United Press Association) DANNEVIRKE, June 17. Speaking to a big and enthusiastic audience in the Dannevirke Town Hall, the Prime Minister (the Rt. Hon. M. J. Savage) replying to the mayoral wel-. come, discussed the assistance given farmers by his Government. He said it was a curious fact that the Government was being blamed for having loaded the farming nidustry with intolerable costs. The charge, he claimed, was contrary to the truth. Mr Savage said that, without any fear of a valid challenge, it could be stated that the Labour Government had already done more for the farmer than those administrations which they knew as purely “farmers’ governknew as purely “farmers’ governments.” Quite apart from the benefits of the guaranteed price scheme, other substantial benefits had been given by the Labour Government in addition to various subsidies. The Government’s policy of cheap money had been of immense value to the farmer.

Discussing the interest rates, Mr Savage said that two years ago, on July 7, 1936, he had said that the day of high interest rates was gone. How had the farmer fared as a result of that policy, he asked. Today more farmers were getting cheap mortgages than ever before. For every six farmers with mortgages at 4| per cent, in July 1935, 26 farmers today were receiving the benefit of that cheap rate. “It is the Government’s deliberate policy that has been keeping the interest rates low,” he continued. “If the Government had consented to the raising of the interest rates to local bodies, all interest rates would inevitably have been driven higher. If the supporters of the National Party had had their own way this is what would have happened.” For more than 12 months, insurance companies and other lending institutions had refused to lend money at 3i per cent., and it had been only the firm stand by the Government which kept all interest rates low instead, statistics of the difference of mortgage rates in New Zealand and New South Wales revealing the rates at the latter place to be substantially higher. Mortgage rates generally in New Zealand were 1? per cent, lower today than betwee’n 1925 and 1932. To the Labour Government, 1J per cent, saving in interest rates on new farm mortgages registere’d last year meant a saving of £183,400. On all farm mort» gages (at present £135,000,000) as they fell due for renewal the saving was at a rate of £2,360,000 a -yeai. MORTGAGE RELIEF Mr Sgvage also quoted the results of the relief under the mortgage relief legislation. He said the Government was doing everything possible to expedite mortgage relief. Farmers who were still oppressed by excessive mortgage debts should remember that the present Government did not put the financial yoke around their necks and that National Party supporters favoured higher interest rates. It had been part of their creed. The cheapening of borrowed money was not the only benefit the present Government had given the farmer. Substantial assistance had been given in the form of increased subsidies. Concerning the guaranteed prices to the dairy farmer, it had been asserted without any proof at all that the gain had been swallowed by increased costs. Every farmer knew such an assertion was very wide of the mark. As a result of the Government’s policy of guaranteed prices, the dairy farmer today was enjoying a better standard of comfort and a firmer measure of security than ever before in New Zealand. If the dairy producer had been left to the caprice of the markets, in the 1936-37 season the monthly butterfat payments would have ranged from IOJd to 7?d per lb. The introduction of the Labour Government’s plan of guaranteed prices that season resulted in a final payout by the dairy companies of more than 13Jd per lb for butterfat. There was and could be no valid objection to the principle of the Government's guaranteed price policy, Mr Savage said. The only complaint might be as to the adequacy of the price. “I have already said,” he continued, “that the Government is prepared to give the fullest consideration to the complaint knowing that no better alternative to the Government’s formula for fixing prices is available. The desire of the Government is solely to give the dairy farmers a fair deal. It has no other objective.” Mr Savage claimed that the guaranteed price system was the greatest boon ever given to the dairy farmer in New Zealand’s history.