FINANCES OF THE DOMINION.

Dominion, Volume 7, Issue 2124, 16 April 1914, Page 5

FINANCES OF THE DOMINION.

mv : m%m hon, j..allee j||i|feEUS, £408,000,' /;■-■■"", £ REFORM'S NAVAL POLICY. ' MISREPRESENTATIONS EXPOSED : ; -'(By "■' TefefMph.-Pies* vUso&iitloiU ':' ," '■ Milton, April IS. Tho lion. J. Allen addressed a meeting of jib constituents to-night, There was a. large attendance', although tho night was wet and cold. The Hon. Mr. Allen, after the applause with which ho was greeted had ceased, said it was because of tho conjideuco his constituents liad reposed in him for 20 add years that lie was enabled to come to them ns a Minister of the- Crown, and with a 'fuller responsibility as ft Minister of tho Crown ho wptiid not like to tako up their time iu a/isivei'ing «oine of tho personal attacks made on himself. Ho could not demean himself or his audience by answering these personal attacks made upon him. Ho passed thsm over, knowing that there was no need for him to say anything in defence of his 'actions. Ho was satisfied to leave his return iu their hands, whether they were his supporters or not. When the}" came into office, tbo Prime Minister had done him the honour to entrust him with the position of Minister of finance. He was goilig to doid with finance, defence, and tlio naval policy, and only with these, three q«os* tioas. Later he hoped to go to Lawrence to speak at Kaitangata, and then it would he his business to take up the policy of tho Government as outlined in the first Financial Statemenfcj and to show how far tho promises had been fulfilled. They had been told that nono of their premises had been fulfilled. That was untrue. A great many had been fulfilled, hut ho aiduot wish them, to suppose thai everything had been fulfilled. That tras not possible, There were yet things undone which ho hoped would be done if the people trusted the Government another term in Parliament,

financial Affairs. Ho would first take up the question of finance. The finances of the country when he took office were not in a satis- ' factory condition. Ho had kid bei'oro tiae puhlio in the first Financial State-' ment tho various accounts of the coun» i try, and it was the first time that had : been done in that shape. The* balances ; in each account, the liabilities and committments of each account, had been plainly put before tho public, and tfcey were Jiot challenged .at that time and had nee bean challenged until lately. Tho challenge was that tho Stances were not so bad as they were r. ado out to' bo, but the facts were there and spoke for themselves. He was xot feeing into- gay details of them, Tboso who cared to do. so could read them in the Financial Statement. Another statement', made was that they were left with a large balance in hand, and that there was plenty of money in hand: that a loan of £480,000 tad- been floated shortly before the piesßut Government e'ama into office, and if a Kin like, that had bee-n.ffoated within a fcw weeks by theffi-coming into office there should have been ft" largo balance available for the- use of the conn-try. They would imagine' that'£4so,ooo passed into the Treasury would have made things very rosy for matters of expenditure : during tho twelve months. What was tho 'position? Ho would go back to March 31, 1912, just three or four days after Sir Joseph Ward gave up office, and sco what the position of loan moneys was then. The Finance Minister of that day had his chance to float _ his loans in London, and lie missed it—deliberately missed- it. He was advised to take the chance, but he took it not, On March 31, a few days after Mr, Myers took office, lie found that the provioas Minister of Finance had. Secured bv way of temporary advances £870,500," awl had pledged all tlio Reserve- Fund securities to do this, and these securities were to meet any serious financial-contingency. Everyone of these Reserve Funds had'teen pledged to the money-lenders in London to secivro temporary advances. Temporary advances had also been secured for current expejid.itu.ro 'amounting to .£916,000 in London. At March 31 tike-position was that though no loans had been floated temporary advances had been secured for £1,78"5,OO0, and that was tlio legacy left to Mr. Myers when he took office-. Mr. Mvcl's imcl don-o his best to float a loan, though ho was not suro that Mr. Myers had not missed an opportunity or floating a loa,u. Mr. Myers, however, had started upon the same policy by securing temporary advances in anticipation of loaiis he, was going to float at a future date, and a few days after he ioe.k office lie had to get- a temporary advance 'of another £'300,000, and during April or May lie had to get another million added.

sir (Joseph Ward's Loafl Record; Tiierofo.ro. th-o amount' raised by way of temporary advances firing Sir Joseph Ward's last t'ow months ef office, and during the short time Air. Myers was in office, madd a total altogether fif £2,785,000, afid not a halfpenny of loan was floated'to meet it. 'High Sir. Myers was in the position in which he bad to-float Us Joan whether lie wanted to or not. As they know, li-o had raised a loan for two years only. Ho (Mr. Allen), as the present Mniister of Finance, had to repay that tear. now—that was for out of which had had to bo met immediately tho £2,783,000 which had been prcViotisly pledged by Kay of advance's. O'ttt of that loan tuerc was allocated to public ivwks £1,226,000, but of that amount Sir Joseph Ward and Mr. Myers had already raised hy temporary' advances a. loan of £750..000 for public works, apart, from that raised hy debentures-. Mr. Myers's loan of Jsiiio 7, 1-912, provided only £476,000 for public works.

Position of Pubild Works Fund, That brought him to consider tho position of the Public Works Fund. On June 30, 1912, ten days prior to his taking office, the caali in tho public account of tho Public Works' Fund was only £78,000, advances' in the hands of tho officers of tho Department was £221,000, A considerable- portion of these advances were actually expended, but the amounts had not been allocated to tho various accounts. Tiro total loan money received was £477,000. Thtis- it would be .seen that tho liabilities of tho Public Works Ftincl amounted to £1,640,000, including, it was true, sonicthing on account of the JViidlnwl Railway. Thai; was tho positifln when the present (lOVPHiHicnt took office. As a matter of fart, cash in the Pnulie Works Account, loan money in neconnks, and advances in tho hands of the officers- ol tho Department wore just about enough to keep the Department going for three months, and it became .nooessniy for 'him to in-iiko arrangements. In his first Financial Statement lit* (ltd that by transferrins £750,000 from tho Consolidated Fund out of tho bakmoo at the beginning of tho year. At the beginninji, of-tho year the cash in tho Consolidated .Fund amounted to £770*000,' but bv Juno that had dwindled down to £188,000. What was tho position with regard to the local authorities branch r" Tho previous two Governments had committed the country to advances fr*s\.

that branch,' so tiiat on July 31 a fenweeks after tin; .; present Govprnnsoiit earae 'into;.''office, 'there were commitments amounting to £723,000, si net to meet those o.<im.imlmoi>ts thenwas a balance nf £6-1,0(10, or a debit of do-so on £000,000. Timt burden the Government bad bad to boar up to the present, day. It was no 'lifdit burden, . and though be claimed no. particular credit himself he thought Hie. Administration'tlm. country 'had had torthe last, two yours or so could claim credit for the i'acfc that all these liahilitics had been wiped off, and all tiro accounts had been put on a thorough sound basis. (Applause.) ',I'ho Public Works Fund wits on a sounder basis to-day than when the Government took office. The Advances to Settlors Ac* count was in n strong position, ami tho Board last month authorised advances amounting to £{12,000. The Advances to Local Authorities' Account, instead of having a debit of £659,305, as it had when the Government took office, had a balance on March 81 of £55,474, which, with the half-million of loan money available, matte a total of £555,474. The commitments at tlie same- time amounted to £147.040, leaving a credit balance of £40-3,434. The position of the Public Works Fund and Workers' Branch was also stronger now. It had been decided as from .'April 0 last to accept applications tor loans tip to £500 to redeem mortgages on free-holds, am] in regard to loans tit local authorities, tho Board was how in a position to consider applications from counties for £10,000, and from townships for £500,

Assisting Struggling Settlers. If there- woro poor settlers who had properties mortgaged up to £500, and if these- mortgages were becoming duo a»d tho financial man wanted to imposeheavy rfttos of interest, tiwso settlors could go to tho Advances Office, whioh 5 if tho security, was sufficient, would «d----vanco up to £500 to Meet the- mortgage. (Applause.) He. pointed out timt tmcxpocted expenditure had occurred in the shape of £23,701 on account of tho smallpox «p-idemic, and £00,832 owing to tie strike, and that these- two things had so seriously affected tho railway returns that the year yielded £178,000 less than the estimate, But notwithstanding all this it Was gratifying to into to bo able to announce that- tho surplus for tho year would be approximately £4GO,C'30 j —fej>plause)—antl: the present Government could rightfully claim that tho surplus Was cafculatod on a sounder basis than any surplus.of previous Ministries,

Cast of Naval Defence.. Speaking on tho cost of naval tiefence, Air. Allen said that nothing could be gained m a discussion of such vast importance- to the Mother Country and the Dominions lay ina ecu-rate cr misleading statements ufl tho part of promtttciit ptiWio men opposed to th-o (government. The selns-no had not only drawn on their imq-ginatia-ns, but th.ey had a'so mado most palpable* blunders in their stateruents as to the cost of tho Commonwealth scheme, and' whero actual blunders had not been per» pc-tratod- they had isis-do niisteauing statements which, unless corrected, might prejadic-e tlio minds of the public.

Sit* J. Ward's inaccuracies. The debate on the- Naval Defence Bill took place hi Parliament on December 3 last, and Sir-Joseph Ward, criticising tho proposals of tho Government) drew attention to Admiral Heiid'craon's report and to » report by Senator Pearco <*n the cost of the Commonwealth scheme, and mado tJio most inaccurate and Misleading statements; nor was thero any excuse for him, because his. speech -was reported in "Sansard/' a speech -which he had;the opportunity to correct, and for which'lre Wn's-'res.ponsiMft to'tho publie'. ' Ho '(Mr. Allen)' had never read in tlio speech of a public man anywhere so many orrors a-s appeared in that speech, Oil* nearly every" page from page- 477 to 487. occurred blunders and niisrepiftsentations. Ho had" time to allude to only : a. fow of them. Oil pago. 477 Sir Joseph Ward said; "Ho {Admiral Henderson) estimates that tlio ordinary cost io Australia wtrald be £25 ) a5&,00f1," Theseftgflros overstated Admiral Henderson's estimate- by £2-',(l00,009 t tho aotual amount being £23,290,000', a.s shoivn .in Admiral Henderson's report.. At pago 66 thero was also a misleaditig eiiflo to the ordinary «ost. It was difficult to realise what the .general public would have in their mind when reading the ordinary eost, but he felt sure they would 1 not icnow that Admiral Bender- 1 son' referred to tho estimated initial cost of tho whole fleet, -extended over a period of $2 years. On pag& 4-78 oi. Hansard, (December S), Sir Jgsejp'h Ward said: "The anjvual cost for «m% '■■ i en.ance nlouo af a cruiser of the Mel- ■ ■hourno class- runs into £100,000 per annum, without the eost of the per- ; sonnel.'* This was entirely wrong-. Sir. Joseph Ward "had not iinders'tood jtiic. differeitee between a_Melbourne- cruiser, and an armoured cruiser like the battle-, cruiser Australia, and had (fuotqd tho maintenance of the latter. Admiral Henderson gave the rnaintenairco of a pr<Jteeted o'uiser as £25,000 iter annum, and not £100,000 as stated by Sir Joseph Ward.- The Melbourne cruisers ff-ero of this typo, hut somewhat improved.

. ■"The Most Serious Blunder," The most serious blunder occurred on page 481, in ivMi purported -to he u limitation from .Senator l y earce'& memoranda. In bis remarks. Sir J. G. Ward overstated the. amount by fpSlJlti, »ud the blunder he had iiindo was utat ho kid- taken throe years' -expfyidilii'jfo and wanted it ivs one j;oa.r. Anyone »« ; ferring to pag« 4 of Senator PeftrcoV memoranda would see the naval expni: dittiro for 191243 wtis 1 237, and tho figures Sir Joseph Ward nave »s ano year's expenditure included this alao-tent and the expenditMro of tveo other years as well, but even if Sir Joseph Ward had used the correct figures, his remarks would have keii misleading without tlio «xpiaiiation that tho Cowhimiffealtjj did not borrow moaey to construct its ships of war, hut built tlioiii out of revenue, and the estimates for 1912-13, namely, £2,3-19)257, tfcltided not only ma-lntetonco and geAtei-ai estjcuditure, htifc the ronstruetio.il of ships as well. Indeed, he had been informed by Senator Fonrco himself that included in the £2,3<K1,&7 were sums of £1,196,30!) for wistrW; tiou. £208,950 for works, and ffluti,oM) for the naval, agreement, leaving only £657.378 for maintenance, personnel, administration, naval compulsory training ; : (thoy had over 300 naval trainee), and all.other charges. Ho had by no means exhausted 'th«s misstatements made by . Sir .Joseph Ward in his speech, but he ■ could not afford to wa&to more tuuo ovor . tljcm that evening. At the Imperial ; Couforcnco in 1911 Sir Joseph Ware ad- , vocated a levy of 10s. per capita .for ; naval defence alone; that was t<s say, New Zealand would provide over £-500,I (100 for naval defence. Under his scheme [further on in tin? conference- he urged that tho British Dominions would provide £6,500,000 a year to toi.y thi'eo battleships oaeh year. Then, on second thoughts, ho hesitated about building' three' each yenr <a«t -of rwem-te, and proposed to borrow i'iO millions to con- ; struct 25 Dreadnoughts within five, ypnrs from 11)11, and he proposed that three of these should bo provided for Australia, six for Canada, three for South Africa, two for New Zealand, ono for Nrnvforacilaiid, and ten for tlio British Now. That was in- 1911. But in (he Mate.in the Iloiiso in 1013 lie again modified ly's prepflSiils. Speaking oti the Naval Defence Bill on December 3 (Hansard, page 485), be sfiid ho would like to see the Government eonio down with a fixed amount, ami say to tlw Old Counu-v: "We will givo you aiwiihcf Dreadnought at n cost to us of £Htt,ooo a year, including interest and sinking, ■fund', or give you .still another at a further cost of another £140,000 .with ■ interest and sinking fund, and thus the ;

Dominion would- he awaw ai itJ financial responsibilities.". CaJcuia-liny this latter i»-oj».«ilot'Sir Joseph Ward's tho expei-idittirt would tos fcntiv.l to bo: Ob the pi-Mont subsidy £100,«0vl, cost of tlie present Preudsimight £i4.i.y.)'<'|o, cost of two mora i)r«idn()Ug'bts £280,000, or £320,001.) .per animm. "In the wildest dreams of the present fiovermuent it hutl never and did. not suggert srteh an expenditure! as ■ this. Under its proposals N* &n----laiul. was jioit face to I'aoe with, this problem: '.Was it to go on paying to • the ■ Mother Country £100,000 or some other sum every year and have no voico whatever in tho expenditure of tho money, m representation in fj.iicstl.oim nf peace or war, ,-uid. no say in -diplomatic rwlatjnnis or other ■ma-ttiirsr' Xi> si'lf-respccting people could go on liiider* such a conditiori: of affairs., find it must coiuo to us to liavo sottm direct interest in'tho expenditure of our own means in tltoso parts. There w-efo responsibilities and: there was' trade- to .ho looted after in Now Zealand. There was private wealth whoso value was estimated, at 208 mil* lion staling, and public wealth of tho vahio of 78 million, or a total of 836 millions. Further, there was a. valwe of 58 millions of imjwis and exports-. AH that was Worth looking after. Would any one ho satisfied to haw all that protected by a portion -of a fleet.in i.ti.oj North Se/i oi- by !>n alliance, with Japan? Were! wo to de-pwtcl for the protection «f our trado anil f.hci pro'toction of our homos on a treaty with Japan? T'hfs thing was not tcasmtate iW A- pooplo who had now 'grown to manhood, ami tho Government conceived iii duty to be this: Instead of handing ■over £10:0,0(30 a year to tiro Admiralty it. would utilise that uwmow in iraniing New Zenlawlft'K on A training K-li.ijn .feo that in tiimi they woiild ho in a position not only to servo New Zealand, but; the Metier Country as well. (Applause.)

"Baseless and Incorrect Appeals^' Mr. Allen also referred to tho gross impropriety of a public man Making such baseless and incorrect appeals t*i ttto people as Sir Joseph Ward did at Groymonth on January U -last, as ro-Dorte-d in tho "New Zealand Times-,' when he said: "They [the present Gw- : ■cMttimt] had carried a law to ohaivgft tho oxistwj; law, and tfio men and women of Now #oat*ml were lto longer directly protected by the. British Gov*' ■eminent." Mi-. Allen announced that Oaptam Hall Thomson, of tho Imperial Nsarjy had been appointed to coWnitttld thS Philomel, and to, act as naval adviser to tho Now Zeds-nd Government. , , The defence expenditure- for 1913-14 was £-480,000, as against £505,267 for tho previous year, slmvraß a deerenso !of £25,2(37, so that it was ovictent s i tight hand was being fenpt oil tfe c.w pendi.ti.iro, and no one Could Say the Kyfr» tew was running Way with tho auttow : ties. • ■ Mr. Allew also i>eferred to a few. q.ii.Cß*. 'tlons in a general way, and was heartily;' applauded on restrirarrg his seat. It was reserved: "That a Vo'to' . .of thanks bt> aecortled to' tlio Hon. Mr* Allen for Jiis able and instructive 'ad' dress, land that this meeting -expresses poati'iiaod eoiifeienco m Mm as member' for Brace, and in tlio Uoyerritnoiit, hi which ho holds tiio resp.o.ws : Me ojfes of .l?iji.anco, JMence,, and Education,"-