Democrats for Social Credit Leader Stephnie De Ruyter today congratulated Winston Peters on his private member’s bill ballot success, but she says the bill, which seeks to expand the powers of the Reserve Bank, is merely scratching the surface.

"Given the Government’s massive ongoing borrowing to fund such things as the Christchurch earthquake recovery, and its hurry to sell off power company assets to raise cash, the Bill should also seek to restore the right of the Reserve Bank to take back some of the credit creation currently undertaken solely by the overseas owned commercial banks. (See Reserve Bank letter attached).

"Credit creation by the Reserve Bank was what got New Zealand out of the last great depression and built many of the state owned assets the government is now putting on the block. (See State Housing Report attached).

"Borrowing money from the Reserve Bank would cost the Government less than 1 percent interest, under one third of what it now pays the commercial banks on its borrowing.

"In addition, profits of the Reserve Bank would be returned to the Government by way of dividends.

"That would save massive amounts in interest payments currently being taken out of taxpayer’s funds and channeled directly into commercial bank profits.

"MPs, the Prime Minister, the Minister of Finance and economic commentators may well decry the suggestion, simply proving they do not have the slightest clue as to how new money is created by the commercial banks. (See Excerpts attached).

"But let them explain why, if it is good enough for central banks to create credit to prop up privately owned commercial banks in Europe and the USA, they do not consider is it good enough for New Zealand’s central bank to support the re-building of Christchurch" concluded Ms de Ruyter.