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Wednesday, 16 November 1927

Senator PAYNE (Tasmania) .- if am glad that attention has been directed to the anomaly which exists between the rates of interest paid to depositors in the Commonwealth Savings Bank and. in State savings banks. It is desirable' to inculcate thrift in the mind's of the people who are advised to deposit their savings in a. bank.;but what possibility is there of the Commonwealth Savings Bank' receiving its share of such savings if it pays a lower rate of interest than the State Savings Bank? Surely it is reasonable to suggest that the Commonwealth Savings Bank should pay small depositors the same rate of interest as is paid by State savings banks. There should be no differentiation between the rates as the depositors' money is as valuable to the Commonwealth as it is to the States.

Senator Sir George Pearce - If a higher rate of interest were paid, borrowed money might cost more.

Senator -PAYNE.- But the rates charged on borrowed money by both institutions are the same. The State savings bank pays1/2 per cent, interest more than the Commonwealth Savings Bank.

Senator Sir George Pearce - The rates were the same, but the States raised their rate.

Senator PAYNE - They did not do so without justification. If the State institutions were justified in raising their rates, the Commonwealth should do the same.

Senator Sir George Pearce - The States savings banks raised their rates in order to secure more business.

Senator PAYNE - They would not do so without some justification. They would not conduct their transactions at a loss.

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