HANDING OVER OF GOLD

Taranaki Daily News, 16 August 1934, Page 5

HANDING OVER OF GOLD

EXTENSION OF THE PERIOD.

QUESTION ASKED IN HOUSE.

By Telegraph—Press . Association. Wellington, Last Night.

Mr. W. Nash (Lab.,’Hutt) in the House of Representatives to-day asked the Minister of Finance (1) why he had extended the period in which the trading banks carrying on business in New Zealand might continue to hold coin and bullion on their own account; (2) would the extension be in any way applied to the retirement of Treasury bills with a consequential addition to the payment of interest by the Government; (3) would the trading banks continue to pay note tax on their own notes in circulation after August 1. The Reserve Bank of New Zealand Act, 1933, conferred the right to issue notes on the Reserve Bank and provided for surrender to the Reserve Bank by each trading bank operating in New Zealand of all gold bullion held by it on its own account, it was stated. The ordinary procedure provided for the powers of the bank to issue notes as from August 1 and for gold bullion to be handed over by the trading banks on that day. The Rt. Hon. J. G. Coates replied:— (1) In torms of Section 15 of the Reserve Bank Act, made operative by proclamation issued in January last, all gold coin and bullion held by the trading banks was required to be handed over to the Reserve Bank on August 1. The proclamation referred to provided for coin and bullion being handed over within a period of three months from August 1. This second proclamation had been issued merely to give sufficient time for the transfer to the Reserve Bank to be made in an orderly manner by mutual arrangement between the Reserve Bank and the trading banks. From a practical point of view it would hardly have been possible for such a large amount of coin to have been counted and formally handed over on one day. No other significance attached to the proclamation. (2) The extension of the period had not in any way affected the retirement of Treasury bills. In fact,’ all Treasury bills held by the banks had already been paid off. (3) The trading banks would continue to pay note tax on their own notes while they remained in circulation after August 1.