“TIED TO LABOUR”

Sun (Auckland), Volume II, Issue 510, 13 November 1928, Page 8

“TIED TO LABOUR”

MR. DOWNIE STEWART ON UNITEDS’ PLEDGE SIR JOSEPH DENOUNCED Press Association. INVERCARGILL, Monday. “By far the most serious statement made by Sir Joseph Ward is his open declaration that he would, on a no-confidence motion, ally himself with the Labour Party to wreck the Government,” said the Hon. W. Downie Stewart, Minister of Finance, addressing a packed Opera House this evening. This statement, continued Mr. Stewart, was almost more important than his borrowing proposals, and if electors had time to realise its full implication the speaker doubted if a single United Party candidate would be returned to Parliament. It was the first time in the history of New Zealand that any responsible third-

party leader had agreed to tie himself at the chariot wheels of Labour for the purpose of rejecting the Government. TOOL OF LABOUR PARTY It might be argued that the matter was of no Importance in that not sufficient United candidates would be returned to give effect to Sir Joseph’s purposes, but the mere fact that he would be willing to combine with the Labour was sufficient to condemn the whole United Party, except such members as had expressly stated that they would in no case vote with Labour on a no-confidence motion moved by Labour. “I think Mr. Wilford arid Mr. Seddon have emphatically stated that they will vote with the Reform Party, and not with Labour, oil a no-confidence motion,” said Mr. Stewart, “but assuming Sir Joseph succeeded in his wrecking policy, he ought to explain to the electors what his next step would be.” “What justification had he now for playing completely into the hands of Mr. Holland, who for the last few weeks had been trying to engineer Sir Joseph into exactly this position? He would now have the right to make Sir Joseph walk into the lobby with him on every no-confidence motion, and the United Party would be merely the tool of the Labour Party.” Referring to the United Party’s loan proposals, Mr. Stewart said the easiest basis on which to examine whether Sir Joseph Ward could lend money without loss was to begin by showing what our last loan cost, as it was raised on very nearly the same lines as those on which he proposed to raise his loan. The Dominion’s last loan, which was issued at £94 10s per cent., with interest at 4\ per cent., yielded the investor in interest £4 15s 9d on capital subscribed by him, but if allowance was made for redemption of discount on issue, viz., £5 10s over tlie period of the loan, the annual yield to the investor was £4 19s 8d per cent. THAT LOAN SCHEME The Stale had to provide, in addition to the interest, the cost of redeemings over the period of the loan the discount on the issue just referred to, and also underwriting at £1 per cent., stamp duty, and other charges, so that the annual cost of the capital received by the State worked out at £5 3s 5d per cent. In addition to the £5 3s 5d per cent., there would also be for the State Advances administration expenses of about 3s per cent. Sir Joseph’s proposal was to raise at £95 at 4J per cent. He ought to show that, allowing for discount on the loan, brokerage charges, and administration expenses, he could lend without loss, but he admitted that there would be brokerage, which nc said “would not be higher than 1 per cent.” He also admitted that thes per cent, discount meant that lie went short of £60,000,000 by £3,000,000 “The answer that Sir Joseph makes to all criticism is that he initiated and made a success of the State Advances Office, and therefore he will make a success of this new loan proposal ” said the Minister. “My reply is that the reason he made a success of the State Advances Office was that he never lent money through that office without a reasonable margin to cover expenses and show a small profit. “If the electors wish to replace the present Girvernment, they should replace it by a Government that will borrow less than us, not by a Government that will borrow a great deal more, and lend it out at less than cost price.” ra At M t3l - e conclusio « of bis address the Minister was accorded an ovation the audience joining in singing “For He s a Jolly Good Fellow.” A vote of confidence in the Government was carried by an overwhelming majority. THAT UNITED LOAN Mrs. Maguire had a suggestion to make about the £70,000,000 loan last evening. “Sir Joseph evidently thinks he will get it without interest,” she said. “And I also believe be thinks he will never have to pay it back.”