PROPHECY FULFILLED

Taranaki Daily News, 8 November 1935, Page 11

PROPHECY FULFILLED

OBJECTIONS TO EXCHANGE. ADDRESS BY ‘MR. C. A. WILKINSON. Speaking to about. 60 electors at Kapuni on Wednesday night Mr. C. A. Wilkinson referred to the report he presented as the Independent representative on . the inter-party parliamentary economic committee in 1932. His suggested measures for economic rehabilitation now appeared to be almost prophetic, he said. The Government at that time would not listen to any of them, but since then most had been adopted. , Among the things advocated by Mr. Wilkinson in his report were the reduction of interest by 20 peV cent., rent reduction by a similar amount, a limited moratorium, bank deposit rates not to exceed 3£ per cent, and lending rates to be based on 5 per cent, for first-class accounts. Power to the State Advances Department to adjust mortgage liability and write off any losses he also advocated, said Mr. Wilkinson, But the people, except in the Egmont electorate, would not then listen to any of his recommendations. Now the most important of these had been made law. Interest and rents had been reduced, farmers were protected by moratorium, bank rates were lower, and the State Advances Department had the power to make adjustments. “It was said of every single recommendation I made that it . could not be done,” added Mr. Wilkinson, "yet these are now in operation. Leading newspapers said it was morally wrong to reduce interest, but since 1931 this high morality has received a great shock. There was stiff opposition to' relief for farmers, but we forced the Government to alter the order of reference of the Dairy Commission to permit of an investigation of the farm mortgage position.” , Mr. G. Luscombe asked how the farmers would fare if the exchange were removed. Farmers would be unable to carry on at Bd. "Exchange is one of the worst forms of support the industry could have,” replied Mr. Wilkinson. "My method is

to reduce the charges on the land. I would reduce mortgages, but if you sustain the high exchange it only sustains high land values. High exchange has mostly benefited the big stock and station agents, but has not brought an extra penny interfile country.” Mr. J. Mitchell questioned the candidate as to means’ of protecting people’s savings invested in-land mortgages. Mr. Wilkinson replied that if money was invested in land and-the value had disappeared the investor had already lost his money. No-one could guarantee an investor safety. He had to take some risk. ’ 1 Mr. Mitchell: What do you think of a man .who breaks his contract? Mr. Wilkinson: Not much if he is able to keep it, and if he could do so I would not help him to get out: of it. But- it: is the man who cannot possibly fulfil his contract that has to be helped. MORTGAGE ADJUSTMENT. Mr. Wilkinson proceeded to discuss the Labour Party idea to adjust mortgages on a basis of average prices over several years. He pointed out that it was very difficult to form a correct average. Over the past eight years one dairy company had paid an average of |ls 2d per lb butterfat. If a longer I period were taken the average would be much higher, but if the past three years only were taken it would be about lOd. The average for one dairy company for five years from 1924 to 1930 seasons was about Is 7d, but for the subsequent five slump years it was only lf mortgages were adjusted on the longer period of ten years the mortgage would be higher than if adjusted on the present basis. There were many difficulties, added Mr. Wilkinson. • ?

Mr. J. Gamlin jnr. said that while .he exchange was not to be entirely recommended it had helped farmers to a certain extent because they did not spend all the extra amount in imported goods. In reply Mr. Wilkinson pointed out that while the farmer might not spend all his extra money on imported art: "les he spent all his income in some way, and the whole of the expenditure was indirectly loaded with the effect of the exchang making for a higher internal price level than if things found their own level without added exchange. The

exchange really benefited the wealthier men, and* he objected to that. Mr. Gamlin asked if more administrative work.could not be done by Parliamentary members instead of by commissions. He, considered there was much waste in administration. The members of Parliament- were willing to do more work, said Mr. Wilkinson, but the Government was jealous of its power. He remembered the head' of the Government shying in 1918 after receipt of the report of the Trade and Industries Commission that he would never again allow so much power to parliamentary committees. Asked how the Budget could : be balanced without the sales tax, seeing the profit on silver coinage and the sale of gold would be non-recurring, Mr. Wilkinson replied that the revenue receipts were increasing and on the past six months’ figures he thought the Finance Minister could have taken a risk by reducing the sales tax. Mr. C. Cave presided at the meeting and at the conclusion a vqie of thanks was given the speaker on the motion of Mr. W. E. Scott, seconded by Mr. G. Luscombe. Mr. Scott also thanked Mr. Wilkinson for his representation in Parliament, stating it was often in the interest of the electorate to be represented by an Independent.