DOMINION FINANCE.

Star (Christchurch), Issue 11000, 12 February 1914, Page 3

DOMINION FINANCE.

THE LOAN FIGURES. EXPLANATION BY MR ALLEN, TPeti Press Association. "1

WELLINGTON, February 11

As several obvious errors occur in the figures as they appear in tho telegraphed report of tho Prime Minister's speech at To Aroha, a "Post" representative to-day asked tho Minister of Finance if ho would verify tho amounts quoted by Mr Massoy. Rej ferring to the paragraph dealing with short dated debentures, tho Hon .1. Allen explained first that tho .special j difficulty was that tho eight millions was in tho hands of the speculator, and notin the hands of tho investor, and tho speculator would not renew it. "So we have to raiso new loans," said Mr Allen, "to pay off this eight millions, with all the consequent costs of underwriting, brokerage charges and stamp duty, and every time a short dated loan is renewed this process has to bo gone over again, and there is where tho cost comes in. As to tho four .and a half million loan, thosefigures are right. It cost in the first instance £144,000, but it was a twoyear loan, and when it became due, after running the course of two years, tho cost occurred again, and this is approximately tho actual result, that it will cost probably another £230,000 to £240,000 to put it in the same position as the loan that I raised in London twelve months ago. The total cost therefore of this four and a half million loan, to put it in tho same position as tho loan that was floated a year ago, would bo approximately £380,000, whereas the total _ charges and expenses of tho three million loan, which runs for thirty or fifty years, were £156,000. If the four and a half millions had been three millions, the extra cost of raising it as a short dated loan would be approximately £IOO.OOO. . . j "There are some obvious misprints in the paragraph dealing with more | liberal advances," Mr Allen continued. " The report says.that tho Government proposes to increase the advances to workers from £4OO to £SOO. That is clearly a misprint. The maximum is £450 by law, and we propose to go up . to the maximum of £450.