That Quarter Million

Limit Amendment of N. G. Law Expected

IT is expected that the New Guinea Ordinance which prevents a per son or firm making monetary advances on New Guinea property, except with the special approval of the Minister, if his or its interests in New Guinea have reached a total of £250,000. will be amended at an early date.

The purpose of the Ordinance is obvious. It was to prevent persons or firms acquiring a dangerously large in terest in New Guinea properties. It has worked out, however, in a manner that was not contemplated by those who framed it.

In the first place, in calculating the total, the officials take the total value of the property on which money has been lent and not the amount of the loan. That is to say, if £1,000 has been advanced on a property worth £10,000, the £10,000 counts towards the £250,000 total and not the £1,000. Consequently, both Burns, Philp and Co. Ltd. and W. R. Carpenter and Co. Ltd., in their extensive operations in New Guinea, have long since reached the £250,000 limit, although their actual advances to planters and traders may not be a quarter of that. The result now is that the registration of mortgages and sim ilar instruments securing advances on properties, made by either of the two firms, cannot be completed until each individual application has been sent to Canberra to receive the Minister’s ap proval.

The other effect is apparent. In these difficult times, numbers of pro perty-owners in New Guinea require financial assistance, and usually go to the only two firms operating in New Guinea who have money to lend. Usu ally this accommodation, when sought, is urgently needed. The firms may be quite ready to give the assistance re quired but the transaction cannot be completed until Ministerial approval has been given and months may elapse although the borrower is in urgent need of help. In a number of cases the firms, recognising urgency, have pro vided money on the assumption that Ministerial approval will not be with held; but, owing to the delay in final ising documents, there have been other financial developments which have in volved the firms concerned in heavy losses.

The Ordinance has been interpreted in a way which has caused some exas peration to traders, and urgent repre sentations were made to the Scullin Government in relation thereto without anything at all being done. The mat ter, however, was carefully considered between General Wisdom and Major Marr, the new Federal Minister at Can berra, early in January, and a gazettal of an amendment of the Ordinance is expected at an early date.