STATE GUARANTEE OF FUNDS IN PRODUCE POOL ACCOUNTS

Wanganui Chronicle, 1 September 1950, Page 5

STATE GUARANTEE OF FUNDS IN PRODUCE POOL ACCOUNTS

PARLIAMENT BLDGS., Last Night An assurance that the funds of the various farm stabilisation accounts are fully guaranteed by the State has been given by the joint, committee of the Government and farmers’ representatives. The Minister of Marketing (Mr. Holyoake) said tonight that representatives of Federated Farmers, the Dairy Board, and the Meat Board had wailed on the Government and raised certain issues regarding the farm stabilisation accounts. As a result of these representations the Government, had set up a committee consisting of Government and farmers’ representatives to examine the issues raised. The committee had agreed on the following statement:

“Dairy farmers have the protection of the guaranteed price for butter and cheese as fixed from year to year by the Dairy Products Marketing Commission, which holds and controls the funds in the dairy industry account. Accumulated funds derived from meat and allied products are in terms of the agreement, between the Government and farmers’ organisations, held for the benefit of the industry and can be spent only by agreement between the Government and the industry. The general understanding Is that the funds will be available to cushion any sudden price falls or to spread any long-term downward trends in world prices and thereby support the farmers’ incomes at a higher level than would otherwise be the case while corresponding adjustments take place in other prices and costs. Thus the funds would be available to fight a rearguard action by reducing the severity of the price falls. By arrangement between the Treasury and the producers’ boards concerned, these funds are invested in negotiable Government stock and Treasury bonds and their payment on maturity dates is fully guaranteed by the State in the same way and to the same extent as similar investments by insurance companies, banks, and the public generally are guaranteed. “To facilitate the funds being available ...whenever they might be required, investments have been arranged with a spread of maturity dates as follows: £2,000,000 Treasury bills maturing March, 1951, interest one per cent; £3,000,000 stock maturing 1953, interest 2J per cent.; £3,000,000 stock 1954-55, 21 per cent.; £4,500,000 stock, 1955-56, 2i per cent.; £2,500,000 stock, 1955-58, 3 per cent; £2,500,000 stock, 1956-59, 3 per cent.; £3,500,000 stock, 1961-63, 3 per cent.; £5,000,000 stock, 1962-64, 3 per cent.; £3,500,000 stock, 1963-65, 3 per cent.; £500,000 stock, 1964-66, 3 per cent. Total, £30,000,000.