BOLD MOVE

Star (Christchurch), Volume XLIV, Issue 372, 14 March 1932, Page 1

BOLD MOVE

LANG DRAWS MONEY FROM BANKS. Pla*. to Nullify Federal Bill. MR LYONS DECLARES SCHEME WILL NOT WORK. United Press Assn.—By Electric Telegraph—Copyright. (Received March 14, 10 a m.) SYDNEY, March 11. Mr Jarvie, a Nationalist member of the State Assembly, made a statement yesterday that just before the banks closed on Saturday two State Government cheques were presented and cashed in notes. One was for £750,000 with the Bank of New South Wales, and the other for £400.000 with the Commercial Bank of Sydney. authorities admitted that |750,000 was withdrawn by the State Government from the Bank of New South Wales and £250,000 from the Commonwealth Bank, though Mr JaiK-ie maintains that he was informed that the latter sum was £400,000. The “Daily is suggested that the State Government withdrew the money from the banks to forestall Garnishee Bill passed by the Senate on Friday. If this is the case the object of the move no doubt is to embarrass the Federal Government by attempting to put the money beyond its reach. If anything of the kind has happened, in the long run, of course, the taxpayers will have to pay the cost of the fight between the Commonwealth and the State Government.” The “Daily. Telegraph” adds: “A trifle of £1,150,000 will not go far in the running of New' South Wales. It costs the State Government about £50,000,000 a year to carry on, including £8.000,000 for interest payments.” The amount was deposited in the New South Wales Treasury, and the ordinary Treasury police guard has been strengthened. The Prime Minister. Mr Lyons, commenting on Mr Lang's action, said : ‘lt will not in any way prevent the carry ing out of the Federal law to compel the State to meet its obligations. Mr Lang is deluding himself if he thinks that his action is a means of evading the effective weapon that has been forged by the Commonwealth Government to compel him to meet his undertakings.” Mr Lyons added: “It would seem that Mr Lang had sufficient money in the banks after all with which he could have paid the interest had he desired to do so.” Speaking at Wollongong Mr Lyons declared that the Government’s efforts to restore industry and consequently to remove unemployment had been hampered by the Lang Ministry, and the only absolute remedy that he saw was an early New South Wales election. The Prime Minister said the Government would’ have to consider the use of the credit of the country to enable it to carry out reproductive works and to provide for the unemployed. Tt would be wrong to go back to the old policy of borrowing money to relieve unemployment and to rehabilitate Australia.

BILL NOW IN FORCE.

Federal Move Against N.S.W. Government. MUST HONOUR OBLIGATIONS. (Received March 14, 12.30 p.m ) CANBERRA, March 14. The Financial Agreements Enforcement Bill and the Financial Agreement (Commonwealth Liability) Bill received the assent of his Excellency, the Governor-General, and both measures, therefore, are now in operation. A Bill to compel Mr J. T. Lang (NewSouth Wales Premier) to comply with the provisions of the financial agresment, and to honour his obligations to the Commonwealth was introduced in the Federal Parliament on February 19 The Bill provides that the payment of revenue due to the State must be made by the taxpayer through the Commonwealth, instead of the State. Payment to the Commonw-ealth has the effect of discharge to the taxpayer of his liability to the State, while payment to the State does not discharge that liability. * Penalties are imposed for payment by the taxpayer otherwise than to the Commonwealth, and on a State Minister, officer, or employee, for attempting to secure payment to the Sta^e. The Bill contains provision for the enforcement of payment to the Commonwealth of the State revenues Power is conferred on ’ the Common wealth to retain loan moneys borrowed for a State by a decision of the Loan Council. The banks can be required to hand over to the Commonwealth moneys they hold or receive, on behalf of a State.

Offences against the Bill are puniih able. Where summary proceedings arc taken, the maximum penalty is a fine of £IOO or imprisonment for six

months. Where an offence is prosecuted on an indictment, the maximum penalty is a fine of £SOO or imprisonment for two years, or both.