£1,000,000 GOES

Wanganui Chronicle, Volume 80, Issue 245, 15 October 1937, Page 6

£1,000,000 GOES

DOMINION CAPITAL INVESTED IN AUSTRALIA WELLINGTON, Oct. 13. The statement of the Minister of Finance, the Hon. W. Nash, in the House of Representatives, commenting on allegations of Mr. W. A. Bodkin that money is leaving the country has been taken to represent a denial that this slate of affairs exists. However, it is unlikely that Mr. Nash meant to issue such a denial, because he knows that this is true. What Mr. Bodkin declared was that during the past year £6,264,000 had gone out of the country, and he quoted figures to show that overseas accounts had failed to balance by that amount, and said the money could only be accounted for as exported capital. Mr. Nash’s comments on this were that the statement was quite untrue, and that he wanted to reassure the House and the country that “Not a single pound of New Zealand capital has gone out of the country which cannot be explained.” This, of course, is a very different thing from saying that no money has gone out of the country. It is known here that one insurance company alone has sent £1,000,000 to Australia for investment in Australian Government bonds. The reason for this is that investments are available in Australia at a higher return and with less taxation than in New Zealand. In this instance the insurance company will receive 4£ per cent., with 1 per cent income tax to be paid out of that. On the other hand the Government Life Insurance Department has recently agreed to advance the sum of £550,000 to the Wellington Hospital Board for construction of its new £600,000 hospital buildings. The rate of interest which the Government Life Insurance Department will receive will be 3i per cent.