AUSTRALIAN FINANCIAL CRISIS

Waikato Times, Volume 108, Issue 18170, 7 November 1930, Page 7

AUSTRALIAN FINANCIAL CRISIS

REPORTED SPLIT IN THE LABOUR PARTY. MINISTER’S ADVICE IGNORED BY THE CAUCUS. MESSRS. FENTON AND LYONS MAY RESIGN. MR SCULLIN PERTURBED AT TURN OF EVENTS.

(United Press Assn.—Elec. Tel. Copyright.) (Received November 7, 10.10 a.m.) SYDNEY, Nov. 7. The Herald says a split is likely in the Federal Labour Party. The Treasurer, Hon. J. A. Lyons, after being overruled in a caucus on a financial matter, said he would have to consider his position, and will probably resign. The caucus desired to compel the Commonwealth Bank to finance maturing loans and refused to sanction the raising of a loan in the open market. Messrs. Fenton and Theodore supported Mr Lyons. After the caucus had out-voted Messrs Fenton and Lyons the latter said he would communicate with Mr Scullin. Mr Lyons absented himself from the night sitting of Parliament. Mr Fenton telephoned Mr Scullin in London late last night that unless Mr Lyons alters his intention his resignation is certain LONDON, Nov. 6. When the reports that Mr Lyons had resigned and that Mr Fenton might follow reached 'London Mr Moloney telephoned Mr Fenton who denied the resignation. Mr Fenton, however, admitted that the position was very serious, but he hoped it might yet be saved. Mr Scullin said*he had not received any communication from either Mr Lyons or Mr Fenton and was unable to make any comment. Mr Scullin is perturbed at the action of the caucus. He said he would regard the loss of Mr Lyons’ services as a disaster, and considers Mr Lyons has done wonderfully good work and shown a clear ■ appreciation of Australia’s position. THE TROUBLE AT THE CAUCUS. § COMMONWEALTH BANK AND MATURING LOANS. SIR ROBERT GIBSON’S DECISION CAUSES AN UPROAR. (United Press Assn. —Elec. Tel. Copyright.) (Received November 7, 12.50 p.m.) SYDNEY, Nov. 7. Correspondents at Canberra state the Labour Caucus differences arose over the necessity for raising £27,000,000 to meet the loans maturing in December.- Mr Lyons proposed to raise a loan of this amount in about a month’s time to cover the indebtedness. The section of the party which opposes borrowing succeeded In defeating this and carrying a motion demanding the immediate passage of legislation compelling bond holders in the £27,000,000 loan to hold their bonds for a further twelve months, interest to be paid as usual, with the proviso that necessitous persons may receive - immediate payment of small amounts from the Commonwealth Bank, which will then hold these cashed bonds as non-interest bearing securities. The sponsors of this motion stated their object was to avoid the repudiation of the Commonwealth debt, to stop the traditional method of borrowing, and attest the extent to which the resources of the Commonwealth Bank could be utilised to meet national needs.

Mr Lyons told the caucus that Sir Robert Gibson (the manager of the Commonwealth Bank), had refused to listen to Mr Gibbon’s proposal made to the caucus last,week that the Commonwealth Bank should underwrite the maturing loan.

This statement caused an uproar, members demanding to know why Sir Robert Gibson, a servant of the people, should be permitted to act as dictator.

Mr Lyons declared that the policy proposed by the caucus could only lead to political oblivion.

Hon. F. A. Anstey (Federal Minister of Health, and also in charge of Repatriation), the mover of the motion, is mentioned as a probable treasurer if Mr Lyons resigns.