ON WHIRLWIND TOUR

Taranaki Daily News, 31 October 1935, Page 7

ON WHIRLWIND TOUR

MR. COATES AT KAIPARA CAMPAIGN IN OWN CONSTITUENCY. RESERVE BANK BOGEY ATTACKED. “HOPELESS, JAUNDICED OUTLOOK.” By Telegraph—Press Association. > Kumeu, Last Night. On what is practically a whirlwind tour of his own electorate, Kaipara, the Minister of Finance, the Rt. Hon. J. G. Coates addressed meetings to-day at Woodhill, Albany and Kumeu. In each district Mr. Coates was enthusiastically received by settler audiences and gave a comprehensive review of the steps taken by the Government for the rehabilitation of the country during the years of the depression, together with an outline of the future policy, as disclosed this week in the National Government manifesto. Mr. Coates, who Is accompanied by Mrs. Coates, is driving his own car round the electorate. One of the main points dealt with by Mr. Coates at to-day’s meetings was the ill-informed criticism of the . Reserve Bank. Most of the critics, he said, seemed to be drawn from the ranks of those who held that worldly affairs were controlled by a group of rapacious international financiers. They made the ridiculous assertion that the establishment of the Reserve Bank was a device which enabled this mysterious group to control the finances of New . Zealand. It was a hopeless, jaundiced outlook. For the first time New Zealand had complete control over its own credits and currency. The Reserve Bank was established, not fthe purpose of making profit, but to direct financial affairs in the general interests of the Dominion. Most of the directors were appointed by the Government, and fne basis of election of the directorate as a whole was well devised to enable every economic interest to be expressed. The relationship between the Reserve Bank of New Zealand and similar institutions in other Empire countries was purely one of co-operation. The Reserve Bank was still a young institution, and when the financial machinery was more fully developed it would be a potent influence in stabilising economic conditions- . . ~ • Mr. Coates also dealt wit., the raising of the exchange rate and the criticism levelled against the Prime Minister, the Rt. Hon. G. W. Forbes, for saying that it would not be raised. If the Prime Minister had given an indication in advance of the action proposed there would have been a glorious rush of speculation. As it was the banks did not take advantage of their advance knowledge but carried their grave obligations with a full sense of responsibility. FINANCIAL IMPROVEMENT REVIEW OF GOVERNMENT’S WORK. DEFENCE OF THE EXCHANGE RATE. Auckland, Oct. 30. Opening his personal campaign in the Kaipara electorate last night, Mr. J. G. Coates gave a comprehensive review ot the Government’s work in the last four years to stem the tide of depression, making special reference to the raising of the exchange rate and legislation to assist farmers. The attendance was about 100 and there were no interruptions. A vote of thanks was carried unanimously. , . Although there was a Budget deficit in 1931 of £8,000,000 the Budget for 1934 was balanced this year, Mr. Coates said. The Budget was not only balanced, but there had been an expansion of expenditure where Urgently required. Also in three years the public debt had been reduced by £1,360,000, and the prestige of New Zealand was high in the United Kingdom. It was possible this year to convert £10,000,000 of Government stock at 5 per cent, to 3 per cent, stock at £9B 10s, producing a nett saving of £219,000. At the same time £2,000,000 was paid off. at London. In devising a policy to overcome the depression the Government had called to its aid the best available business technical advice. It had been said that the “dSctors” had been summoned. “Call them what you like,” said Mr. Coates. “We obtained expert advice to examine all factors, and as a result of the investigation we have established a policy that was wise. We did what every intelligent business man would have done.”

The results had justified the raising of the exchange rate. For the year ended August last the value of imports was nearly £6,000,000 more than in the previous year. The surplus exchange in the same period was not more than sufficient to meet Government interest due overseas. Mr. Coates denied that the raising of the exchange rate was contrary to the spirit of Ottawa. The right of each country to determine its own currency policy was freely recognised. If exchange were reduced the indent agent would reap a rich harvest, but what would be the position of the storekeeper and an ordinary retailer? What the country needed was stability over a period of years. Mr. Coates explained what had been done for the farmers and to meet the relative hardship of the mortgagor and mortgagee. National production had tx be sustained by ensuring that a reasonably efficient mortgagor was retained on the farm.

After dealing with unemployment Mr. Coates said it was not honest to attempt to capture votes by extravagant promises incapable of fulfilment. “The Government can, however, say with confidence,” he added, “that ,the need for drastic measures involving heavy’’ sacrifices on the part of the people is now past and that we can move forward carefully, but definitely.’