CENTRAL BANK

Stratford Evening Post, Volume II, Issue 224, 20 April 1933, Page 5

CENTRAL BANK

FARMERS’ UNION FEARS;

“Might be Controlled by Fin-* ancial Interests” | ■ SPECIAL COMMITTEE SET UP Press Association. —Copyright. Wellington, April 19.—Fears wera expressed at the meeting of the Dominion executive of the Now Zealand Farmers’ Union to-night that the proposed central bank might be controlled by financial interests. Captain F. Colbeck said he could not see how a central bank was going to benefit the farmers of the Dominion. It would be extremely unwise to hand over the sovereign rights of the people for 25 years.

The executive decided to leave the question in the hands of a special committee.

The Minister of Finance, the Rt. Hon. J. G. Coates, wrote stating that the sole purpose of having private shareholders was to provide non-political franchise for the election of the board of directors. All world authorities laid great stress on the point that the difficult task of controlling credit and currency should be entirely free from the unsettling effects of politics. If the Bill was carefully studied it would be seen that adequate safeguards had been provided against banks or any other financial concerns obtaining control of the bank through buying shares. In the first instance it should be noted that the shares must be held by individuals n.l that companies could not hold shares at all. Secondly, shares were to be allotted in the first instance by the Minister of Finance, and the voting power that might be exercised by any one person was definitely limited. Shares could be held only by persons ordinarily resident in New Zealand. A further safeguard would be found in the provision whereby not more than one of the directors might be a director of any other bank, while officers of other banks were not eligible for appointment. From a closer examination of the proposals there would be no occasion to fear that the reserve bank would in any way be dominated by the joint stock banks, Mr. Coates concluded.