10 APRIL 1936, Page 2

New Zealand's Financial Experiments New Zealand's Labour Government has fulfilled

one of the most important election pledges by introducing into the House of Representatives the Reserve Bank Amendment Bill, which transfers to the State ownership of the one-year-old Reserve Bank of New Zealand. Private share capital will be acquired at the rate of /6 5s. plus accrued dividend per £5 share. But the transfer of ownership is less important than the greatly extended powers given to the Bank of buying Government securities, underwriting Government loans, making overdrafts to the Government, lending to the Government' on the security of Treasury Bills ; and also than the power of suspending, absolutely or conditionally, the sterling standard. These powers enable the Bank to 'give the Government all the credit it may need to finance its new social legislation, and the forthcoming nationalisation of the Mortgage Corporation will give the Government control of all State lending and mortgage activities. There are very obvious dangers in the Government control of finance, especially with a Government pledged to a great new social programme : but the Bill to some extent protects the Bank by leaving the present Governor and Deputy-Governor in office- for their appointed term.