Western Star WALLACE COUNTY GAZETTE. TUESDAY, JUNE 13, 1933. A STRONG PROVINCIAL INSTITUTION.

Western Star, 13 June 1933, Page 2

Western Star WALLACE COUNTY GAZETTE. TUESDAY, JUNE 13, 193 3. A STRONG PROVINCIAL INSTITUTION.

Replying to a deputation whieh waited upon him recently at Auckland, the Hon.J. G. Coates, . Minister of Finance, ~ said lie was afraid many thought that because a house was a Government, ope nothing at all should be paid.: If. was not possible to give something for nothing.. This was in answer! to a question -by on© of the deputation How many have gone out of Government houses? The reference, of course, was to the advances riiade by tli© Gqverhinent lending institution to erect houses. It is evident that many have got behind in their, quarterly, half-yearly or yearly payments, with the -result that alf deficiencies are thrown on th© general taxpayer. Before the' Government could advance the loan it had to borrowth© money, and wlieq itlie mortgagor default&’&he Government lias no resource left ”6111 to make uj> the deficiency nut of taxation; It would' be interesting to learn just how much the ; Government is losing to-day, ' and a clear statement should b© niade_ of the position. II the State had not embanked on so 1 many schemes, all involving loans, the position of the Government would have been much stronger financially than it is. The; depression has re-

vealed the weakness of the Government in this important matter, and when compared with the operations of Building Societies, all tlie evidence Points to the superiority of tlje latter over those of the Government. It would be far better for the State and the individual to encourage these splendid institutions. than continue in the business itself, for the cogent reason that it simply cannot resist political pressure and,, as Mr Coates said, “many think because a house is a Government one nothing at all should b© paid.” Despite this the Government has not shown itself very sym--pathetio towards the Building Societies. In hi s presidential address at the annual meeting'of the Southland Building; Society Mr A. S. Froggatt said they had been somewhat irritated by Government interferences over it's attempt to limit deposits and the proposal to tax profits had been twice tried and twic© frustrated. The Southland Society had been in operation for a period of sixty-four years. “Who,” asked the .president, “would have predicted at its inception that the Society would lead so Piush as £3,595,634.

distribute by way of profits so much. a s £667,592, and hold at any one time securities to .the value of £1,622,040, of which £1,586,195 is. the present current •mortgages!’,’ The. Society has shown continued prqgeto and prosperity, ; and during tfo pas* financial year its deposits increased by £63,624, while its profits were £46,778. It has liquid assets of the total value of £86,078, which is- more than 10 per cent, of the total deposits. It had to realise op eight properties during the year, but these were disposed-of with a loss of only £lss—a mere bagatell©; Last year the,,Society .advanced cfver.. £200,000, and it is highly gratifying to read of its strong .position.. Its methods, as was pointed out by the president, encouP age and enforce thrift. ‘lt is a tnuth,* he said, “voluntarily acknowledged that had it not been for its extensive activities thousands in Southland would never have been freeholders, and hundreds would never have saved as they have been helpedi to do. and this has been a factor in aiding the province to feel the depression less than any other parts of New Zealand.’’ Lord Snowden, foSmerly Chancellor of the Exchequer in the British ' Labour Government,' gave high praise in a recent speech to the good work performed by .Building Societies. He eaid they encouraged the praiseworthy habit of thrift, provided a safe invests raent for shape capital _ for people of moderate means'who could' hob afford the risk of investing their savings in speculativej enterprises, and - greatly' helped to supply the lions© shortage. Without their aid*the%erioas housing Shortage at tlie end of the great wan tfould not have' been met/ Thb ‘State owed a deep debt of -gratitude to the building societies fort their magnificent contribution to; the solution of the grave problem of housing- accommodation. It was . a movement that deserved; the support and encouragement of all. who believed tlmf individual. character was a nation’s greatest asset.- These .words, which ■ constitute a , great tribute, are equally a 9 applicable to the New. Zealand institutions as to those in thft Homeland. ■- The Prince of Wales also: has shown his interest in building societies. Only a few days ago he made a speech at the Congrfess ofl Building Societies in which he -recalled the (Fact that the building , society movement first sprang up on- British soil, the first recorded building society having been founded in • 1781 —152 ,year 6 ago. Since the year-1919 British building societies . had : advanced £626,000,000 to assist- in the • purchase of houses, an<l he hoped: in view of the splendid results, the movement would continue to. gain ground 1 throughout tiie Empire and in all tli© coun-' tries represented at the Congress, tlie publication of . whose proceedings should in due course be available in New Zealand; By stimulating a greater interest in these self-helping cooperative concerns th© Government could easily rid itself of an unprofitable business. thereby lessening the vast army that is depending upon the State, and at th© same time increasing the number of direct taxpayers. The State’s participation in tlie business was th© outcome of a belief* that it could borrow more cheaply than’ ajt institution. Experience' has shown that it could not do so. Much-of its loan' money .for housing was raised' at 5J per cent., now reduced, so far'as the loans-raised' in New Zealand are concerned. to 4 per cent., by th© recent conversion scheme.