MR. HOLLAND ALLEGES CHANGE OF FRONT

Stratford Evening Post, Volume II, Issue 343, 29 August 1933, Page 6

MR. HOLLAND ALLEGES CHANGE OF FRONT

PRIME MINISTER AND PEGGED EXCHANGE QUESTION

Some of the views of the Labour Party on the higher exchange question •were expounded by the Leader of the Parliamentary Labour Party, Mr. H. E. Holland, M.P., in an address at Sumner on Wednesday evening (reports the "Press”)

holders in the Cabinet. While we know that some have benefited from the higher exchange, we know that it has brought no volume of new money into New Zealand; in fact, I think that no new money has come in. We have debased our own currency to the extent of 25 per cent, against the English currency, and our own purchasing power is restricted accordingly. I venture to say that not more than 25 per cent, of the farmers in New Zealand have received any benefit from the higher rate of exchange. And that benefit has to be met by the people of New Zealand. At the end of the year we will be £8,000,000 behind on the cost of exchange alone, and to meet that the Government has imposed the sales tax. the petrol tax, and Taxes on sugar, tobacco, and such things. That tax money comes from the pockets of the people.

Mr. Holland commented on what he alleged was a complete change of front by? the Prime Minister (the Rt. Hon. G. ;W. Forbes) on the pegged exchange. Time and again Mr. Forbes had reiterated that it was not the function of the Government to fix the exchange late, and that the banks would have to carry the responsibility. On November 16, and again on November 19, of 1932, Mr. Forbes emphasised that the matter was entirely one for the banks, said Mr. Holland. Yet two months later Mr. Forbes executed an entire somersault and his somersault was followed by a complete one on the part of all the banks. "It seems that there is only one possible explanation for the action of the Prime Minister,” said Mr. Holland. "When he capitulated he did so because he had made the discovery that the Reform ‘cave’ in the Cabinet had reached such dimensions as to enable it .to turn the Government out of office. Ingiving way the banks took the precaution of getting a written guarantee of: indemnity in the loss on the exchange transactions with London. I have no doubt that the rate was pegged Upr at the dictation of the big land-