8.—13 a.

By the end of the year good progress had been made, as is shown by the schedule appended : — Total number of oases .. .. .. .. .. .. 10,291 Number withdrawn by applicants or disposed of by Adjustment Commissions 4,660 Number considered by Commissions and issue of order awaited .. .. 1,141 Number awaiting hearing or confirmation by Adjustment Commissions . . 2,057 Number in course of preparation . . . . . . .. . . 2,433 Following the confirmation of a voluntary adjustment or the issue of an order by the Adjustment Commission or the Court of Review, the progress of internal adjustments as at the close of the year was as follows : — Number of accounts adjusted .. .. .. 1,936 £ s. d. Total amount written off to 31st March, 1938 .. .. .. 292,998 0 0 Reduction of mortgages in addition to above transferred to Adjustable Debts Accounts .. .. .. .. .. 4,361 15 1* * These are recoverable from debtors in terms of orders made by Commission and Court of Review. Progress with the adjustment of mortgages on Urban Securities has been made more rapid than with Rural Securities, and it is not yet possible to make a useful estimate of the total loss involved. 14. Field Staff. —During the past year the staff has been working at high pressure, the principal activities being mainly under the following headings : — (а) Inspections and valuations for the purposes of the Mortgagors and Lessees Rehabilitation Act. (б) Reports and valuations for new loan applications. (c) Survey of existing securities. The work under (a) was nearing completion at the close of the year, and it is expected that within the first half of the current year this will be practically completed. In regard to (b), there has been a steady flow of applications for loans, and this was accelerated, in the urban sphere towards the close of the year by the announcement of enlarged lending terms for home-building and the provision of a " Plan Scheme " which is referred to separately in this report. Owing to the heavy calls on the services of the field staff under (a) and (b) the review of existing securities has been confined to the more urgent cases and the comprehensive survey has been deferred until this year. It is expected that steady progress will now be made. 15. Reverted Securities : Urban.—The number of urban and suburban properties administered by the Corporation as mortgagee-in-possession has increased from 4,022 as at 31st March, 1937 to 4,082 as at 31st March, 1938. Whilst the Corporation continues in the capacity of mortgagee-in-possession, the mortgagor is still the registered owner, and therefore the Corporation in its management must have regard to the interests of both, the owner and other mortgagees who have subsequent charges on the security. Bearing this in mind, an endeavour has been made to ensure that all such properties are revenue-producing. Like other property-owners or trustees, the Corporation is subject to the provisions of the Fair Rents Act, and in appropriate cases action has been taken to adjust the rents on the basis defined by the Act. The Minister of Finance has given the Corporation the following direction in regard to these reverted securities : — " The principles on which the Government wishes the Corporation to base its procedure in dealing with these properties are as set out below. Where the mortgagor has some reasonable possibility of resuming possession and meeting his obligations on the basis of the real value of the property, no action should be taken which would prejudice the right of the mortgagor to retake possession. If, however, the mortgagor has definitely abandoned the property or the Adjustment Commission has decided that he is not entitled to retain the property, steps should be taken to place the security on a permanent basis. In those cases where the Corporation considers the properties are suitable to retain for letting to tenants, action should be taken to take title in the name of the Crown and to place control in the Housing Branch of the Corporation. Those properties which are not or cannot easily be brought up to the standard required for renting under the Housing Act should be sold on best terms possible. I desire that before any such securities are offered for sale your recommendation in that behalf should be submitted to me for approval." The book value of these securities in the aggregate amounts to £3,128,856.

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