FINANCIAL STATEMENT.

Gisborne Times, Volume XXIII, Issue 1846, 29 August 1906, Page 2

FINANCIAL STATEMENT.

In Committee of Supply, 28th August, 1900 by the Colonial Treasurer, tne Hon’. Sir J. G. Ward, K.C.M.G. Mr McKenzie, in submitting: the nrst Financial Statement of the _ present administration, I am not unmindful of tlie obligations we owe our predecessors. When the Liberal Party took oiiice under the late Hon. Mr Ballance it was predicted by those opposed to lum, and feared by some of his friends, that his legislation would be reckless and his finance unsound. It was the same when the late lliglit Hon. Mr Seddon succeeded him, and in both cases these phopheeics and fears have been falsified by the event. The policy that Mr Ballance started and Mr Seddon so brilliantly extended has made New Zealand prosperous at home and noted abroad, as indeed I believe that in the secrctiveness of their hearts and consciences many of the hon gentlemen opposite were constrained to admit. Our former leaders have gone to their rest, and we have entered into their labors. It will be the aim of this Government to maintain the high traditions they established in showing that sound finance is not mconsistent with progressive legislation and vigorous administration. The abstract of receipts and expenditure of public account covering the transactions of the last financial year have already been placed before the Members, and they have been informed through the medium of the public addresses of my lamented leader, the late Right Hon Mr Seddon, of the successful operations of the past year s financial operations, so that is stale news to tell them of the very handsome balance at credit upon closing the books on 31st March last. The transactions for the year were exceptionally large upon both sides of the ledger, a total of over seven millions and half having been received and expended in ordinary revenue account of the Consolidated Fund. I don’t intend to detain you at any great length concerning last years transactions; but it as well to set them down in their sequence. CONSOLIDATED FUND 1905 6: ORDINARY REVENUE ACCOUNT. The ordinary and territorial revenue for 'hi year amounted to £7,184,359 and, oempared with the revenue of the previous year, Bbowed an increase of £301,489. The estimated revenue was set down at £7,402,600, the increase of the actual revenue against the estimate was therefore £181,759. Comparing the principal items of revenue, the one year with the other, I find that the receipts from railways open for traffio exceeded the previous year’s returns by £120.651; the Customs by £65,127 ; the stamp by £41,144; the Lands and Income Tax by £40,766 ; miscellaneous by £25,433, and other smaller, items by £19,831. There was a decrease of £ll 763 in receipts from oash land sales, A comparison of the actual rece'p's with the estimate produces also satisfactory results. The actual revenue from Customs, Railways, Stamps, acd Land Tax yielded £184,348 more than was anticipated, and some other smaller items £2063, making a total of £186,411 in exoees of the estimate. On tbe other band, income tax, registration, and other fees, and misoeL laneous, had been over-estimated to the amount of £4612. The result is a net inorease over the estimate of £181,759, as I have clearly stated. By authority of law £65,000, to provide for sinking fund payments, was credited to this account, as also some refunds and minor reoetpts amounting to £740. Taming to the expenditure side, 1 find that the permanent charges and annual appropriations totalled £7,122,340, in addition to which £500,000 was pa ; d over to the Publio Works Fuod, Comparing tbe expenditure of £7,122,340 with tho figures of tbe previous year (£6 635 902), an increase of expenditure of £496,438 is shown. Under permanent charges there was an increase of £199,136, consisting of £93,475 for interest and sinking fund, £59.988 for old age pensions, under special Aot £24 547 (principally for subs., etc. for subsidies to hospitals and payments for promotion of eduoation), and £29,125 distributed over oivil list and payments to looal territorial revenue. The expenditure under the annual appropriations showed a considerable increase, namely, £287 303; but I am sure that upon mskmg a careful examination of tbe inoicased expenditure of various Departments, hon, members will not fiad fault. Take, for instanoe, expenses connected with the General Election, tho Postal and Telegraph services, the oost of Education, the care of the mentally sill oted, the increased expenditure on Railways consequent upon increased revenue octniDg in, and lastly, towards the development of lands by sueveys, etc., and we sha'l find tbe whole of tbe increased expenditure aooounted for.

The small increases amongst tbo minor depaitmoots are counterbalanced by the savings effected in the Defence and Public Health Departments. Comparing the actual expenditure with tbe Estimates, it will be seen that tbo permanent oharges wero exceeded by £IB,SCO; while under Annual Appropriation asaviDg of £189,000

was effected. Tbo tables attached to my budgot gives full particulars, both of aotual receipts and expenditure, and also for purposes of comparison with 1905 6 balances. As I have already stated, the Revenue proper together with other receipts amounted to £7,650,099. To this amount the balanoo brought forward from the piewous year must bo added, namely, £761,036; making a total on tbe receipt side of £8,411,135. The expenditure, including payments of surplus revenue to tho Publio Works Fund, amounted to £7.622 340, which amount deducted from tbe £8,411,135 haves a balance of £768,795. This I consider a very com-

fortable sum to commencs the current year with, and I may mention that it is the lirgest balance brought forward at any time in the colony’s history. THE PUBLIU WORKS FUND.

My colleague the Miuister for Publio Woiks will presently have the opportunity

oi placing before hon. members a complete statement of tbe transactions in tho Public Works Fund. It will, tbe-efore, be tuffi« oiont for mo to briefly outline tbe fioaocial opentiors Wo opened last year with a balance of £861,670, aud received £850,851

of loan mocoys, and £265 and £2679 of miscellaneous receipts ; £500,000 was also transferred from tbo surplus of Consoli-

dated Fund, thus making a total of

£2,215,2C0 on tLe receipt side of the account. On tho expenditure side the annual appropriation absorbed £1,722.590 and other charges £Bll, making a total expenditure cf £1.722 901, aud leaving a balance available of £492,299 to ocmmence

tho current year with. In addition to this a balance of £182,086 of the 1905 loan of one million had yet to be received, which will give a cash balnnoe for pubilp worjiß expenditure of £674:385, irrespective of contributions which may be made from tbe Consolidated Fund during the preepnt year. Tno transactions in the aecoqots pf tho Paoroa-Waihi Railway, Hutt Railway and Road Improvement, Railways Improvement Authorisation Act, and the Cheviot Estate Act, are fully set out in the several separate ecoounts accompanying my budgot, aud do uot call for special remark,

THE LAND FOR SETTLEMENTS ACCODNT.

Tho acquisition of lands for oloso settlement was vigorously pushed forward during tho past year, with the result that tbo purchase money of estates and incidental expenses relating thereto represent a total outlay of £820,652, or very nearly doable the amount expoudod in the pro vious year. My collesguo tho Minister of Lauds has placed before you a full rrport upon the transaotioD. The position of tho account at tho clo3o of the past yoav stood thus : £ tlanoe brought forward, £716,698; loan and other receipts, £492 428; receipts derived from estates. £185.763, makiog a total of £1,894.889, The (xprnditu-o v,as represented hy the purohaso moneys as above, £820.652 ; minsg mmt expenses, £2445 ; charges and rxp"ns(S of raising loans, £4957 ; and £162.760 for interest, tusking in nil £990 814. thus leaving an available balance of £404.075 at the close of the year.

LOANS TO LOCAL BOBIRS.

Up to Ist March last the total amount of debentures created and carried into this account was L 2,568.100. The total net disbursements have been : To local bodies, 1.-,040,020 ; to the I,amis and Survey Department towards opening up blocks of land for settlement, L I 10,59;!. and to the Public 4\ orks fund 1,89,800 in exchange for debentures under the Roads and Bridges Construction Act 1882, or in all 1,2,.102,;! 10 The balance at credit of loans to local bodies’ account on ;J Ist March, 190,5, was L 5521. Debentures for Idol,ooo Vvcrc created and issued during the past year. I’ayments on aeeount of loans were made, to local bodies 1,116,980, and towards opening up blocks of land for settlement 1,08,801, leaving at the end of the year a balance of L 784 to the credit of the account Of the total amount of ! debts inscribed to the Ist February last (which does not include grants to the Lands department), the following figures indicate rates and amounts thereunder of loans granted : Loans at f> per cent rate, L 22.102 ;at 4.1, L 105,120 ;at -I, 1-110,582 ; at 01. 1,972,007. total L2 155,114. On 1

aeeount of the strain on the funds of tl

account caused by the constant domain

for loans, applications amounting I 1.70,105 wore declined in order that a'ssis

ance might be distributed amongst are; in the backbloeks where the nccessitot

condition of roads and bridges must claii priority in dealing with applications fc loam. lam glad to be enabled to repoi that the payments of half-yearly instal

monts in respect of their debts continue to be fully and punctually made by local authorities.

PUBLIC DEBT

On the illst March last the gross public debt stood at L 01,191,040 ■ At the close of the preceding year the amount was L 59,912,000, showing an increase of T,2,279,0-10 for the twelve months The net public debt shows an increase of 1.2,296,829 for the same period Over two millions and a quarter 'of increased debt for the year is undoubtedly a large sum, but 1 am satisfied that Hon Members, having the advancement and welfare of the colony at heart, will not find fault when additional loan items are explained to them, which I proceed to do. For public works we raised L 1,000,000, and for the improvement of our working railways 1,197.060 ; for the purpose of closer settlement, 1,607,750 ; for advances local bodies to enable them to improve their roads, build bridges, and attend to their hygienic requirements, L 151,000 ; for advances to settlers, L 210,000 The above sums amount to L 2,166,410, and with the exception of L 1,000,000 for public works the money borrowed should be deemed to be directly remunerative. Small items such aa Llll7 New Zealand Consols, L 65,000 for sinking fund accretions, and L 46.518 increase arising out of conversion operations, make up a further total of LI 12,630 public debt, reproductive and non-.repro-ductive as at 81st March, 1906.

Details arc then given Concerning the raising of a million loan for publio works purposes authorised by the Aid to Public Works and Land Settlement Act 1905, I may inform Hon. Members that after careful consideration of the state of the London money market, it was decided that it would not be wise to place a loan there. At the time it became necessary to augment the Public Works ways and means ; more especially as at that juncture valuable offers of assistance were received from prominent brokers and money institutions in Australia. As a result of these offers the Government was able to arrange for the dotation of a 4 per cent, loan of L 500,000 at a premium of LI 15s per centum. .Aflec giving the particulars previously published, the Treasurer olaim3 thßt the venture in Australia was a pronounced sueoess, and continues: A considerable business has btfen done in over-counter sales of 4 per oent debens tares at par, and these saloi have enabled us to supply funds for the purchase of lands for olosor settlement and for Maori land settlement purposes. The sales have been gradual, and very plainly indicate that our thrifty seithrs look on these BBOurit'es as a satisfactory means of invest mont of their savings. Out four par cent 3 presented an attraotive investment to our friends in the Australian States, and 1 therefore am now asking, and have obtained, a premium of £2 per cent upon all sales, whether in Australia or in this colony, but I do not anticipate doing much business in New Z island at the premium quoted. lam looking forward, howovor, in an early lowering of the Bank of England discount rate, whioh, when it takes plaos, will enable us to redusa our rate of interest on good issues, and this may have the effect of lowering the interest rates all round. The sale in London of £750,000 of par cent inscribed etook enabled us to provide for debentures amounting to half a million duo in August last, for the debentures due let Jauuary last, for £150,000 issued in settlement of tho Midland Bailway petition, aad for other loans falling dae early last year,

DEFENCE

As the command ant’d term of cffiea ia on the pO'.Dt of expiry, this oppcu/s to be a convenient time foe considering man; matters in oonneo'iion with the drfsnoe force, with a view to iooeeaaiog the < ill c’.enoy of tha earvioe, making it mcra popular, and devising means by wbioh tho oolony may got greater value for th 9 moneys expended upon d.fence. In England the oontro! and administration of tie army has been handed over t.) an army , oounoil. A similar c runeil or board has been established in Australia, arid the Government is considering the expediency of establishing a similar board in New Zinland for tho oontrol of deforcr affairs, but snbjict to the authority of tba Mnister of Defonco. The adult and oadet cjrpa will be eroouraged to taka greater interest in their work ; the cap t ition of the cadets will be increased ; steps will bo taken to boo that every adult vo : uoteer has a uai form overcoat, watorproif sheet, and rasas fin. Efforts will bo made to iodnce tho voluntrors and ra-mbers of riflr cubs to give groalor attention to riflr practice, and also to get tbo male p / 'pnla'ion cf tbo oolony to take up nfl i shoot ug ar a national pastime, as in the case ol f rorbali and oricket. TLo volunteer regulations will be altered so that tbo earning of the annual capitation sha'l depend upon the individual volunteer and not on bis oomrade. A sohool of instruction for effieors, non commissioned officer-, and men wi 1 shortly be established upon a sound basis, and a transport and supply aervioe will be inaugurated, A training ship is being put in commission wh : ch will acoommodate some 80 youths. From the numerous inquiries made and the interest evinced in ber, from all parts of tho oolony, it is believed that another and larger training ship will soon bs requ'r-d. Tho Government also looks forward to the establishment of a naval training college in connection with the training ship. It is proposed to in'orease the reserve in tbo oolony of small arms of the latest pattern ; also tho rrserve (f small arms and ammunition. ' NEW RAILWAYS.

With tho completion of ibo Non

Island Main Trank Railway at the end of 1908, and the formation works of thMidland Railway finished by the sanij period, together with fho fact that the .Otago Central Railway will have been our pied" to the preeentpoint of tfoppega by the pod of March next, hen members will see that throe of the largest railway works in hand at. present are now within s’ght of completion, at least so far as the greater portion of the expenditure for them are reqnired. With these three great works out of band, remaining lines can be pushed on with more vigor, and by an expopditqro

I of a much larger stun upon thorn indi vidnnlly than hitherto has been possible. Tho colony can only act aside a certain nuiouut for the prosecution of now railways yearly, and it will bo imprudent to iooreneo tho amount beyond what wo are now sponding. but I hope that tho next fow years vvi 1 see a greater iuipotus given to tho construction of railways, and there ought rot bo any ditlioulty in obtaining tho necessary amounts r. quirod for this purposo without going upon tho London money market. CHRISTCHURCH TO HANMI3R SPRINGS.

In view cf tho early opening of the International Exhibition, tho question of spoedior coimnunieUieti between Christohmeh and Hanmor becomes of importance, and it is proposed to establish a motor car socvico in connection with our railways.

ROADING IN BACK BLOCKS

No! wilh-'tanding tho uafavornb'o wos'taer experienced in many parts of Nnv Z a land, good progress has boon made, and there w.U hr provision in tho rnblio Works Estimates for continuing real formation in tho back b.'ooka aud newly so'tled districts. Hon. mombers are aw no that tho borrowing pow,rsof oouuties under tho Local B d'es Loaus Aot are limited, irrespective of tbo area and ratable value. Tho Goverument proposes to rxiood the power in tho larger counties which are at present restricted in fh.-ir op-rrations. RAILWAY CONSTRUCTION.

Tho wo k of oouttcuotion has been i.ndily proceeded with throughout tho • iir, expenditure on now works under io control of tho Public Works Department having animated ti £070*221. Ii • ddition to this a oansidarabla sum was xp irJod by tno working railways department on ad .iiiioos to open linns, and out ■>f tho Huts Iviilway and Haul Improvemons a id ITiilwny-i liup.-uvt-monis Auibo-ri-atioa Act accounts. Fu'l detail if girding iha woik will bo given in tbo Publio Woiki Statement, and in tho meantime it may bo rf inserort to bon. members io take a forward look as regards the m.aro irupoitani liius. 0 i tbo No-th Island Trunk rni way tha rail heads at tho north nod south end of tho lino wili advance during :ho orming summer to wishin 47 miles ol 0 ich other, and work on tho in 1 '- - vening stations wiil bo push d on. a coach road will alto bo cimplntod betwesu tho two rail hi ads, so that it w.ll bo possible to iravol overland Horn Auckland to Wellington by tho routo of 'tbo North Island Main Trurk railway. Too completion cf the formation, inc'uding the viaduc san 1 bridg-s on tho c.ntra 1 section, and the laying of railwiys th>reoo, may be looked forward to by ilia end of 1908. As regards the Midland ruilaay between Sp ingfield and B unnerton tho posiicn at dati is at undo- : Tho west coast tide of the I no is opsn for ttailij to Oiira, and the section between the Oci a station and the mm'li of the piopojed Arthur's Pass Tunnel is well i i hand. Tenders for the tunnel weto rroontly invited, but as the response wa* not satisfact iry, fresh tenders are now being called for. Too western side of the range is already open for goods traffic between Spring6-id and Siairo tse guliy. The aSuitoase siaduot is complete. Tbs Broken river viaduct is near oomplo

lion, aud tho rails between tho viaducts are no-v bemg laid, and iny oolloaguo, tho Miuis-.er for Kiilways, hopes to be able to ruo passenger trains to a temporary station as Broken riser in an hoar. Next a ooaoh road has b o 1 formed thence to the Pats as to admit of the through jourooy between Greymouth aod Christchurch beiog accomplished in ouo day. The formation works on the railway are well in hand from Broken rivoc onwards, and con be finished to the B-aley station by the end of 1908, so that the east and west coast portion of the Midland railway will be entirely fi .ished before tho tuaucl is ovailablo for traffic, Good progress has also been made with the O;ago Central

line, and the section between Omaku and Cbatto creek has recently been opened for traffic. The rails betweon this point and Alexandra are now being laid, and tho bridge over the Manuherikia river, near the Alexandra township, is nearing completion. The radwry will bs availab'e for traffic to Alexandra by November next, and to Clyde by the end of tho fiaarcial year.

OVERSEA TRADE,

I am phased to state that tbi3 Govornmoot, c w jointly with tho Gmail an Government, has coi c'uded a contract with E. A aad Oj., of Tacoma, for a direct bimonthly ci r go aerv ,: o bitween Naw Zealand and Canada The company’s steamers have already taken up the run niog, and it is antic patod that good results will follow, as tho opposite seasons of the two countries offar exea'lsnt prospects for th export of our bu ter, fruzin meat, etc. I' order !o facilitaie trade in iheao pco • '-.•h, nigitiationa aro now in progress for t substitution of boats Sited with rofrig-

i. ting plant in lieu of those at present employed in tho service, and arrangements tv i:i be made to prevent them frem com bioiug with any other line of (Learners trading to Vancouver, so as to insure the lowest possible rates being obtained for the produces of the oclooy. The possibilities of establishing export trade to tho f sr East is reetiving tho att; ntion of tho Govern* ru9ct. Is having beau ascertained that the Australian States bad developed a considerable trade with Japan, China, and Straits Settlement, our trade Oemmissioner was ordered to visit these countries, and it is now evident that our wool, fccz in mutton, and butter should there find a market. Enquiries have already been instituted in the direction of providing for a direct steam trade servlet from New Zedaod. The advantages of having a line of steamers trading fortnightly from Britain to New Zealand via Snz are considerable, and the High Commissioner will be instructed to rnter into negotiations in order to arrange them. Steamers whioh aro now being built to carry out the oon tract w.tb tho Commoowealth of Australia shall come direct from Adelaide to New Zealand. Should these negoiirtions result in tangible proposals, they will, 03 in all such carts, be sufcm tted to Parli.meat for ratification before the commitment on tho part of the colony ismtdr, Ths Trade Comini-si-ner, upon bis return from the East, will be directed to proceed to Canada in order to assist in the development cf trede from New Z.'aland to that country.

SITENTIFIC A 0 RIC ULTURAL METHODS. "Following up the line of scientific development and the application of the most up-to-date methods of agriculture, the Government intends to establish, at an early date, in connection with the dairy industry, a complete experimental station and school of instruction, in which the scientific lessons of other countries will ho analysed and investigated under New Zealand conditions of food, climate and soil, and the necessary modifications obtained and applied to the production of butter and cheese, and by Ibis course only can the top position be obtained and retained on the London market for our produce.

WORKERS AND TILE LABOR LAWS.

In the best interest of both labor and capital it is essential that the work of the Arbitration Court should be expedited, and for this purpose the Government proposes that the president shall be relieved from judicial work on the Supreme Court, In other respects the labor legislation has been working satisfactorily, though one or two improvements are contemplated. As the lima is approaching when some of tho principal railway lines in tho conrso of construct on will bo cimplcted, aud a consequent riduc'.iou in tho number of men omp'oyed on them will take pises, her. members will ogroo tha' eomo practical schema should bo devised to onablo those employed on tho works to secure homes for themselves and families. lAr this purposo Parliament wifi bo asked to set atido 20,000 cores of land along tho North Island Main Trunk line, the Oago Central, and tho Midland railway lines, which tho Lands Department will survey and cut op into suitable areas, and assistance will be given towards er-.eting suitable dwellings for those settling on this land.

NATIONAL PENSIONS

Hor. membora will recollect that the I Ji Premier propounded a schema of national pensions or annuities. Govern mont hope to bo ablo to circu’alo o Bill containing matured provisions for this laudable oljeet. I am doubtful whether there will be suffioioot tirao for it to be placed upon fho Btututo Bools this session,

Ie will, however, givo an opportunity to boo. momhera and the people of tho colony to eurcfuhy o-nsidor if, so that as soon aa possible legislation may he panned wbotoby nil cl ihjos in tho ojuntry may provide themselves wish an annuity for old ago, cr when through physio >1 disubilitios or nooldmt they aro eompolhd to coaso notivo labor.

PORTAL REFORMS,

My attention has for some lituo been given to po-til ratos u ider which inland letters are olia v ged eight limes as much e.a oommovcial papers and bosk packet?. Tho uiothcds of charging for fitters by j■' y> otagos is a survival of tho time when modern systems of traoupottation were unknowr, and there is no reason other th in tho traditional one why this should ouniinuo. I have decided, while no! interfering with tho .1 -z rate for book packets ami other articles nos over 2 z in w.ightand f r newt-papers, to abolish all ether disiirot on, and to fix a uniform into of postage on inland letters of Id for inch 4oz. It is estimated this moans an imtue diato concession to the public of £17,000 ptr annum. Experio: ci shows that ovory concession in postal rates creates a now o'ass of business, which ultimately results

in a profit to tho Po.-t Ollier, aud I have no doubt whutever this new class of busi noss insures a audio oat inoroasa in tho number of lettois to recoup a o nstdotablo portion of tho loss to the Departmu t in tho fi-st yea", after which wo oati safely antioipa'o tho deficiency will gradually disappear. It wil even bo oouoeivab'o th ett if tho oortces-ion would not insure ary new business, tho fact that tho number of letters ittoroased in 1905 nearly 7 percent, and tb it tho inoreaso for tho ourront year pronraoa to exceed la t year’s, makes it apparent that tho I'tuj is ripe for a reform whioh will rotnovo tho present

restrictions against transmission in closed envelopes of a ! classes of postal ma-t-r. Incidentally thorn wi 1 bn a siving of money to tho post otfiao in relief from tho examination of cprn pickets to dtsoovor whether the regulations arn being in-

fringed. It is iu’.ended to bring the cancession into force on November Ist next in (i ioimsmormioo of tho exhibition. M iking safe allowance for inoreaso for the financial year th >t it will ha in operation, I calculate tho resulting loss to the p stal revenue will not exceed £4O 000 to Ist March next. As the uo.v io.tu- tat-s will

be cheaper than the pre-out inland pa c

post I have under consul-ratioa tho desirability r.f reducing the latter. The qua

lion of reducing the commission on money ordo sis nlso being oousidered. I have also p'oa uro in announcing that the initial weigh! o’ letters from places beyond tho colony will ba raised to lez ; that post ago rates in countries wtreb do not yet

near p 6 our Id 1 tier- will ho reduced after tho first ounce ; t ui a leer for Germany weighing 2 z-. which at preeo t costs 101 will under tbe new nr.-angom;nt ho 4 1. The ohango as regards tho B.ilish

Domini in may ho hoped by mutual

aira-jgemont to oomo into foioj c-a-iy in the year, and bs reg irds foreign countries on October Ist fa'-l living. It torn lias for mo tossy one word more about tho stuff. Totre is a groat blcck in some of the grades owing to the enormous expansion of business, and the number of ctlior-rs

within each grade. Proposals to meet tho d flicu'ty will be submitted.

TELEGRAPH REDUCTION

Toe success of the eisponny telegram

introduced in 1893 being so marked I am j'isliGod in announcing u reduction on Ist November next of tbo rato eha-god tif-or tho first 12 words. It is proposed to reduce this from Id to h 4, m-.king a uni form rata of 4 1 per word, with a minimum charge of 61. The immediate va’uo to the public or this omcission will be about £lO 000. The normal inoreaso of inland telegrams in 1905 was almost per coot, and to make good tho concession now decided upon an increase of 12 per cent on last year's business will be required. I calculate that resulting loss to the revenue for the balance of this financial yearwill not be more than £60,00 if so much. I have little doubt but ail additional 3 percent may be looked for in the first year, and I expect ,to find that tho whole of the revenue will be made up within 12 or at tho outside 18 months. As every class in the country is interested in the efficiency of the service, I am confident these improvements will materially add to the benefits conferred by these two great Departments of State. In connection with these reductions it is intended that

thc present system of franking telegrams and letters of various Government Depart' ments shall cease from Ist of January From that date each Department will provide for payments of both letters and telegrams. .This change will at once l'C' suit in considerable economy, besides

freeing the telegraph wires at times to a marked extent, and better enable the wires to carry the increased work that the concession to the Id rate per word is certain to create. When the reforms I

havo sketched aro given effect to, New Zealand will have one of the most liberal and up to-datc postal and telegraph systems in the world.

TELEPHONES TO OUTLYING LOCALITIES.

After referring to the wireless telegraphy experiments, the Premier stated: As telegraphic and telephonic communica-

tion is of very great importance to our outpost settlors, who make great sacrifices in comparison with those who have the conveniences of town life, authority will bo asked for a special vote of 1,25,C00 to make provision for telephones in more remote parts of tho country. In cases whore the construction of telephone lines in the ordinary way is not warranted,

material will be supplied free to those tilling to undertake the work, Arrangcnents will also be made that places which

arc connected by telephone shall bo with', in communication of medical men both day and night all the year round.

OTHER MATTERS

Tho Treasuior strtod proposal would bo made for tho Civil eervieo classification and fuporannusti'in ; the whole of the Gon vernment D.parimeuts would be put under the Audit Dtparminr, all officers employed r.s auditors bring under control if the Aud t Officii ; a sinking fund of 1 per cent, per annum would bo provided in respect of the old war loan and for defeoco purposoi (£5 995,000), wh'ch should be extinguished abou' 80 or 40 years bene". A l ko rinking fund would bo made und.r tho Land for S.tt'cmonS Ac!, which should extinguish the debs in a like period ; £700,000 ontrtandiog Treasury bills not ncurnd by tho present paity should be e'eared oil, >nd he hoped to bavo n substantial amount rode emol ! y the end cf tho year and !o make fm tbsc redemptions until tho urnount win cleared off. Refer once was next made to the mining industry and State coal mines, In regard So endowments for education, old nge pensions, hospital and charitable institutions, the Trrasurer s ated : Governmtnl is strongly of opinion that in ibo interest of t o;o imnotiiit maters a spoeific fund shou'd bo earmarked fur them ir.sead of leaving them to b> wholly provided frr out of O'd nary appropriation?. For this pu-poeo wo propose to m ki a b ginning, sit ir-g aside as on endowment all ordi nary Grown lands now unsold or unleased. Tno not proceed) hereof or derived f om them wid be paid into an endowment fund within the publio account fund, and will be available solely for tho purposo o' education, old age pensions, and boiphal and charitable institutions, and of course only to bo drawn upon pursuant to appropriations by Parliament. Unt 1 it bicomes self supporting it will be supplemented by ordinary appropriations or be available in aid of them, It is confidently anticipated with tho expansion of tho colony ibo funds will grow until in time thoy will suffice to meet all tho charge?. In tho mean'.irno it is a first s'ep towards making ep-cific provision for these important services without disturbs g tho ordinary finance?. L-gialaticn will bo introduced to give effect to the proposal. REFORM OF LAND LAWS,

Government hss given careful consider--B‘ion to the impotiaut quos’ion of land tenure. On tha cue hand tho country cannot prosper unless settlers are prospering, and to that end must bold their land in moderate areas and under liberal conditions. O.t the other hand wa of to-day are the irusiec-s of those who ore to follow us, and wo aro not justified in recklessly s&crideirg the public rstite. The problem t 3 how best to reconcile these appat ontly oonll eting iutirests. Government aro of opinion that reform is neoessary on lines which I will briefly indicate; fall details will be given iu a Bill whioh my colleague.

tho Minister of Lauds, will submit in ordor Ito give client to our proposals. Hon. moiubors will rccollooS that us part of our schema of land roforrn all existing wasto lands of tbo Crown aro to bo sat osido ns nn ondowmont for education, old ago pensions, nud hospitals. Ho far as relates to land tonuro tho echomo extends lo all Crown lands, and whilst sacredly prosorvI ing existing contracts, will in tho main piiociplos bo as follows : a Salo of Crown lunds io bo discontinued, except in oasos spooillod bolow. is. Lease in porpotuity system (009 years) to bo discontinued, and a torm of (id yrirs substituted, with valuation for improvements nt tho end nf the t»rra. Too Imaul under (i(! years lease In have power In pay capital sums to I,he extent in all of not more Hum ill) per cent "f the total eapital value of the land, llto rent, being reduced by the. interest on sums so paid

i>. Will'll Til) per pent of tin' p;ipil;il lino Inis boon no paid all resti'ietivu oovomnts to bo roinovocl, mill Iho loimnt to mill tlioi'oiil'loi- on tonus of paving; tin; ibatoil rent. n. All oapilal sums so paid to bo reunited at tho Olid of tlio ti'nn. I'. At tlio ond of tlio term the land to bo lloi'od again for loaso, burdtinod with the value of iinpi'ovoniollts to bo paid by llic in coming to tlio outgoing tonanl. ('.. Tenants under 1)1)0 years leases (ineluding leases under '.L'lie Land for Settlements Act) to have the option of converting into the now, and this at oithor the anginal or (lie present value. 11. Tenants under old lease (Hot inclining leases under The band for Settlement Vet I to lan e the additional option of sur •endcring the leases, when tlio land nil )o sold by publie oonipel it ion. bnrdenei villi valuation for improvoinonts. tlio pro cods of all snob sales to be paid into the and for settlements account, so ao be soldi’ available for acquiring liproved land for disposal under the -and for Settlements Act. This meant iat a tenant of laud for settlement lease lay convert but cannot surrender. They ill receive value with their improvement.' when the land is sold Another modilica lion of the law will bo made enabling n person to add to his holding in cases whore its area does not exceed the statutori' limit. The Government is strongly of opinion that the aggregation of lurgi areas in single hands is not to the ad vantage of the State. It therefore proposes to tix a limit, say of I ,f>0,00() capita and unimproved value beyond which it shall not be lawful for any person to bold land, with provision fur the gradual reduction. say wit hin ten years, of areas now ui excess of the limit The residential -•onditions of tho Land Act arc essential o a satisfactory settlement of land, but Government thinks that they may be safely modified in favor of persons whose avocations coniine them to town, but are desirous of taking up laud as a provision for themselves or their families, -Proposals will be submitted for granting this conces sion under regulations carefully framed to prevent abuse I trust that in considering these proposals .lion, Members, whether favoring the leasehold or freehold system, will recognise that Government is making an honest, straightforward attempt to meet defects which undoubtedly exist. The necessity of reform is admitted on all sides. I am hopeful that, luivingregard to tho magnitude of the publie and private interests involved, the matter will be approached in the calm .and dispassionate spirit its importance demands. My colleague will place before you facts and details which L cannot be expected to give in this statement, and in the meantime I express my hope that the proposals will ho acceptable to the people of the colony, also to tho Grown tenants concerned whether they hold under Land for Settlement Act or otherwise

NATIVE LANDS,

Thoro are large arose of oitivo hud lying idlo, uuoultivatad. Ttiis ie cot on tirily the fault of Maori owners, who havo had groat drtlioulby to cjDtend with, though too olten they aro saddled with the bl m>. The Maori dare not cultivate laud un.h his ownership to it has boon ascertained What person would oultiyate land on ,he of! chance that he might aft awards get a title to it'? There are other oa.os w! e o a tiile has been ascertained, but the block has not been partitioned up to such point that each ow.iar can say where his own piece of land is, ora familycau feel assured as to the allocation oE their estate. The iodividualising of their title will mm : - fostly be bourficial to the Mao.i people, but experience has shown that siac, by ramifications of their genealogies, titles to small worthless blocks are overloaded with owners, it is not possible to effect this in overy case. Provision must accordingly be made at the proper stage, either to partition lands according to family groups, or to consolidate the holding by a Bystem ot inorporaion under an efficient management. The ohj:-at wi'l bo iu overy Ouse to pat natives in a position to deal wish their lands or uso them to the host advantage. To carry out such a schema an (lliaient, oomploto Native Land Court siaff is required, as also a sufficient number of surveyors to matk off individual or family interests or other partitions that may be necessary. It is not only desirable to settle native titles as quickly as possible, but also to devise some moans to bring iho land under cultivation. In the meantime to meet these points tho policy of tbe Government is I. To act aside sufficient na’ivc lands for tbe maintenance of natives, 2 To as far 83 passible give tho nativos a start to farm these lands, and guide thorn in making lands productive 3. To throw the balance open for settlement aad cultivation by the Grown purchasing at Government valuation, vesting it in boards for lease in limitod areas for terms not exceeding sixty six years, and allowing natives to lease it thamselvos for such term under the supervision of the board.

4 To settle all disputes iu native titles as quickly as possible by tho Land Court, 5, Where nativos cannot be dealt with individually by tho Crown on account of pending appeals, partitions, cto , that the Crown deal with them oollectively in the mem ion. and open their land for settlement so that when their eases are disposed of by the Court thoy will get the resulting revenue. In order to increase tho efficiency of the Native Land Court staff and to overtake large arrears of work, it is proposed to establish Native Land Court districts coterminous with tho present Maori Land Board districts, with a judge in charge of each, the judge to fix a circuit and attend oil the circuit at stated periods to dispose of eases, More over to constitute Appellate Court two ad ditioual judges arc required, whose duties will bo confined to Appellate Courts business.

GENERA!

The subject of reciprocal trade was mentioned and then the subject of public and private wealth was dealt with at length and approximate figures given to show the colony’s position, showing the

balance of assets over liabilities to be ,£255,005, 821. The success of tho advances to settlers system was referred to, and the treasurer anticipated it would not now bo necessary to find more than £400,000 per annum, which could bo arranged through the I’ost Office Savings Bank The cumulative authorities amount-

ing to £4,000,000 for borrowing purposes were almost exhausted, and a Bill would be introduced to have the amount extended to £5,000,000. It was proposed to provide for repairs and additions to public buildings as well as maintenance of roads upon the consolidated estimates, for which £35,000 would be required this year.

HANOI AL YEAR 1906 07 EX PENDIIURE.

Tho ostim ited expenditure for the flnan cial yea: endii g Slit March, 1907, I have sot down at L 7 575,096,_ Therefore as the ec'.ual fxpßndituto lost financial year animated to L 7,122,340 (not including tha transfer of L500.0Q0 to the Publio Works Fund), the. increase of expenditure for the current your 13 estimated at L 153 632. This is undoubtedly a la-ge em:uat, and I shall prooeed to explain bow it arises. Tboro is an increisi of L 48.812 in the charge for interest and sinking fund consiqusDt upon tho large amounts wo have raised by way of loan?, but as I hive already stated, the mej ;r portion of these lows wt i for purposes which wmld bo returning interest at e -en bolter rates than those charged, and therefore there will be no burden upon tho iaxpayais. Under special Acts there will ho found an incioa?od estimated charge

of LOG,0 I J2 represnntnd by payments to bo LUtulo to old ago pensioners. There is a not estimated inurui.aj cf expenditure under tho annual appropriation amount ing to £020,601, and the department el tho post ami telegraph (£3B 0311), oduoa tion (£85,217), and working railways (£85,247) aro anuwernblo for n total of £278,300. Tho coat of tho gjnoral olcoiiou has lessened tho Colonial Secretary's departmental expenditure by .£IO,OOO, and in tho Industrial aDd Commerce Department there is a reduction of estimated ex penditure of £'20,350, rcproeotitrd ohirffy by tho withdrawal of tho subsidy for tho South Afrioau Direot Steam Sorvico, Other departments aro represented by in-

eroa-os or savings of small ameunts ro -p o ivoly.

REVENUE Tho estimated revenue for tiro curron

joa-*, including sinking fund inernnser, may ho stated ra £7,807 000, or £227.041 iu excess of tho uciuul reooipts during tho previous financial j car, Suoh Ggures as these a-o tho tnoro sta-iling rvhon it is remomborod that our pnpidution dees not yet roach a million, ui d it is proved in overy direction that our rovenuo is pa'd by our people without being a burden upon thi m individually, as is ovidoneod by tho wonderful prosperity which exists from one end cf New Zealau d to the other.

After incidentally referring to criticisms the Treasurer explained Iho increases for the current year, .showing that providing for an estimated expenditure of 1.7,575,1)72 there would be a surplus of 1,291,028, which with tin- balance at the beginning of the year would make a total of 1,4,079,823, but as we voted 1,750,000 last year for transfer to the I,’ublie Works fund wo may estimate a similar transfer during 1 lie current year, which when made would reduce tho balance to J,320,823, and this amouiil would bo available for supplementary estimates and unforeseen expenditure

FURTHER LOANS l-’Olt PUBLIC WORKS PURPOSES.

We come now to Ihe question of the necessities of Public Works fund. It is our policy to vigorously puss on with the works in progress. The large undertakings in hand must be as rapidly us possible brought to a completion in order to reach i remunerative point. To enable, this to

ie done we must ask the Parliament for UL'llicr borrowing powers, which will, l mi sure, be recognised as necessary where be life blood of our country is so depen . lent upon the provision of rail ways, roads, olographs, telephones, and other- public anilities. Tbe timorous assert that we hould never spend more than our income,

but the practical colonist will agree tha where we can create an exchange for ou borrowed moneys wo are fully justified ii

raising lipids in aid of a vigorous policy of progression. Admitting this to be economically sound,’ further borrowing

is necessary, as it is not safe finance to depend upon surpluses The Government Inis therefore to ask authority to raise 1,1,000,000 in aid of public works. At the nunc time it is not proposed to go to London for the loan as there is little loubt, but that it can he raised locally at a ■easonablc rate of interest

CONCLUSION

The policy of the Government is a

•ogiessive development of what Inis ways been the policy of the Liberal irty, to advance, but on safe lines, sparg no effort to further the social, iuilusal, and commercial welfare of the

lony, and taking care to keep on lines

that are financially and economically sound. The proposals 1 havo indicated include, amongst other important matters, sinking funds to redeem uureuiuneralivo loans, earmarked endowments for education and other specified purposes, national annuities for the encouragement of thrift, reductions in postal and telegraph rates, and increases in postal and telegraph conveniences, vigorous prosecution of railways. roads, and other public works, reform of the laud laws, and settlement of .native lands. I feel confident that with the help of our friends on this side of the House, and not being deprived of the benevolent criticism of lion, members

opposite, these proposals will be given effect to in such a way as to further promote tho prosperity of New Zealand and llie happiness of her people.