GENERAL ASSEMBLY.

Globe, Volume IV, Issue 415, 11 October 1875, Page 3

GENERAL ASSEMBLY.

[By Electric Telegraph.] (Per Press Agency,) HOUSE OF REPRESENTATIVES. Friday, October 8. The Hons resmn d at 7.30. STAMP DUTIES BILL. T ie Ib'use went into committee on the Stamp Duties Bill, and on the motion of the Hon G. G. Bowen, several amendments in (he way of reducing the amount of stamp duty oo property of small amounts descending to lineal issue of deceased persons were made. Section 100 was amended by striking out subsection 3 relating to policies taken out in other countries. The Bill was reported with amendments. PUBLIC ACCOUNTS COMMITTEE, Mr Wood brought up the report of the public accounts committee, which stated that grave charges had been made against certain members of the Legislature by Mr Bridges, but beyond a certain point he refused to answer further questions. The report asked that the House should enquire into the matter. Hon Major Atkinson said the Government considered the matter of such great public importance that they determined to ask the House to order Mr Bridges to attend at the bar of the House, in order that the enquiry might be continued. It was quite impossible that the Government could allow the matter to rest where it was. He therefore moved—“ That John Bridges, director of the National Bank of New Zealand, be ordered to attend the House on Monday next, at three o’clock.” Agreed to. IMMIGRATION AND PUBLIC WORKS APPROPRIATION BILL. Hon Major Atkinson moved the second reading of the Immigration and Public Works Appropriation Bill, which was for_the appropriation of only such money as Government proposed to expend during the present year. The hon gentleman explained the different schedules of the Bill, in which the estimated cost of the work, the expenditure already incurred, and the amount which Government proposed to appropriate for the different services, and the available balance were given. It was the object of the Government to let the House see how the money was to be divided among the various works to be executed. Mr Johnston complimented the Government upon having supplied the House with the details of the proposed expenditure. This had not been done for years, Government having always had the money voted in lump sums, over the expenditure of which the House had no control whatever. The Bill was read a second time. NATIVE LAND PURCHASES. Upon the order that the House go into Committee of Supply, Sir G. Grey wished to move separately two resolutions, but the Speaker said they must be put together. The resolutions were to the effect that it was contrary to public interest that the native land purchasers for the Government should be allowed to purchase native lands on their own account or that of other persons. The other was that it was desirable to enact that all land so purchased should become the property of the State, the purchasers being reimbursed the cost of same. The hon gentleman quoted Lords St Leonard’s and Eldon to show that what he asked was only in accordance with the common law of the land, and all he asked was to affirm that law. No reasonable objection could be made to that. The hon gentleman pointed out that the Native Minister, who was virtually head of the land purchase department, had £700,000 placed in his hands for the purchase of a public estate for the North Island, and he believed this great expenditure had never been audited or accounted for. SirD, McLean replied that about £150,000 had yet been expended, and that all of it had been duly audited with the exception of £22,000. He agreed with the first part of the resolution, and Government were carrying that into effect, the latter part would simply be confiscation if carried out. He saw no reason why a person should not acquire lands as he had done from the Crown, that was under Crown grant, and he failed to see what there was in that to which hon gentlemen could take exception. Had he gone into the native districts and acquired land which had not passed through the ordeal of a court of enquiry, then he was prepared to admit it would not have been the correct course to pursue. It was not the intention of Government to push on any additional purchases during the year. They intended to make considerable reduction in the staff of agents which had hitherto been in their employ. He announced that Government would oppose the resolutions. Mr Fitzherbert said their legislative acts in the past were now coming home to roost. They should never have removed the pre-emptive right of her Majesty over the native lands—a principle for which he had striven in vain ; no man had more strenuously exerted himself to secure to the North Island a sum of money chargeable to the colony, as some reparation for the many acts of injustice from which the North Island suffered. It had suffered injustice in very many cases indeed, and had put up with such misfortunes as made him wonder there could exist such prosperity there at present. He regretted that the Native Minister did not touch upon the real points raised by the member for Auckland city west. The principle he laid down was that persons employed by the Government to purchase lands for the colony should not purchase for themselves or private individuals, and there could be no reason why the House should not assent to it. With regard to the statement of the Native Minister, that Government did not intend to purchase any more land for a year or two, he implored them not to stay their hands now, or they might find it a case of the sybil’s books; the longer they stayed the more they would have to pay. Rather stop some other great public service than that. All possible dispatch should be exercised in acquiring what native land they could, subject, of course, to ample provision to the natives.

Hon Major Atkinson said Government were not prepared to accept the resolutions of the member for Auckland city west. He hoped the House would be satisfied with the assurance that Government would see that no native land purchasers would be allowed either to purchase land for himself or for the public. Mr Tribe also thought every effort should be made to purchase what native lands they could.

Mr T, L, Shepherd hoped Government would bring down a Bill to restore the preemptive right of the Crown to native lands.

If they did that they could invest the £250,000 which remained to very great advantage. He opposed the resolution. Mr Sheehan said every member North and Sou'h would regret the intention of Government to cease the purchase of native lands, now after all they had overcome in competing against private speculators. He thought Government should do one of two things—either secure these lands under the Public Works and Immigration Act, or else stop the operation of the Native Lands Courts. The latter plan would be acceptable to the natives generally. Mr Rolleston thought that whatever evils might have resulted from the passing of the Native Lands Act, a great many more would arise if they endeavored to go back to their old position. He was surprised at Government resisting these resolutions which were brought down in the most temperate manner possible. There was nothing personally offensive to Ministers in the resolution. The Native Minister admitted that land (purchase officers should not purchase for themselves, and the Treasurer said they would not allow their officers to acquire land for themselves or the public. He would vote for the resolutions, as the present condition of the land purchase department was discreditable, Mr T, Kelly said if Government ceased their land purchasing, that would drive the natives into the hands of private purchasers. Government could not carry out the public works properly without the acquisition of a public estate in the North Island. He regretted the attitude of the Government in resisting the first resolution. The second he could not support. A division was then called for, and the resolutions negatived by 36 to 22. BILLS ADVANCED. The New Zealand University Reserves Bill was read a second time; Government Apprentices Bill was passed. After passing a number of estimates unaltered, the House adjourned at 12.40. MR BRIDGES AND THE PUBLIC ACCOUNTS COMMITTEE. (By Electric Telegraph.) (From a correspondent of the Press.) Below are some extracts from the evidence given by Mr Bridges, a director and acting general manager of the National Bank, before the public accounts committee with reference to the banking arrangements of the colony. The examination lasted several days, and the evidence is very voluminous. Mr Bridges having stated he was formerly manager of the Bank of New Zealand at Wellington, the examination proceeded. Question —And you are consequently acquainted with the banking arrangements between the Government and the Bank of New Zealand ? Answer —Yes, up to the time I left in January, 1873. Question —At that time were you aware of any arrangements that have been embodied in the return placed before the House. The agreement was made in August, 1873 ? [The chairman here handed witness the return, and requested him to read it.] Answer —I think there is no material alteration, except that the 1 per cent on interest in London has been reduced to f per cent below the current Bank of England rate. There was no arrangement previous to this.

In reply to Mr J. Shephard, the witness slated that the reduction in the rate of interest was only of a temporary character. Question Looking to that agreement generally, do you consider that a fair and reasonable arrangement exists between the Bank of New Zealand and the Government 1 Answer—No ; certainly not. Question—ln what way do you think it is not so. What are the points? Answer —There are two important omissions—one is as to the transmission of money from London to the colony. The present arrangement is a most unfair one. By it drafts are purchased here at i per cent discount for sixty days’ bills. Question —Do you think that an unfair arrangement 1 Answer—Yes, and any bank would deal more favorably. Question—What terms do you think any other bank would give ? Answer —At present in London the ordinary banking rate for the sale of drafts on the colony, which amounts to the same thing, is sixty days sight at par, and on demand per cent premium. The money would be paid here on demand at par, and if at sixty days’ sight, Government would obtain per cent premium. Of course they would lose interest for the time, but that would not be an equivalent. The 2| per cent interest is not so good as per cent premium for sixty days. Question—ln your opinion does the fact that Government keep their account in one bank in any way disturb the monetary transactions of the colony ? Answer—Yes. Question —Do you know as a matter of fact whether it has done so ? Answer —Yea. Question —To the disadvantage of the colony ? Answer—Yes, and quite recently. Question— Do you know of any case where the Bank has constrained the action of the Government to the disadvantage of the colony ? Answer —I do not know that. I can’t answer that question, because if I did so I might be guilty of a breach of confidence, but I may say that the fact of the Government keeping its account in one Bank must necessarily have that tendency, and Government must, to a certain extent, be in the power of the bank. Question —Then in your opinion, if Government gave its account to an association of banks, it would tend to avoid the creation of certain political power, which must of necessity be enjoyed by any one Bank which possesses the Government account ? Answer—Decidedly so. Question—Do you think the rate of interest received by the Government for money held in England—namely, f per cent below the Bank of England rate—a good one ? Answer—No; it is within my personal knowledge that the arrangement made with the Bank of New Zealand was a very bad one for the colony. I allude especially to the million and a half which was lodged with the Bank, and which it was understood they would have for a fixed period of six and twelve months.

Question —What do you think the Government might have obtained for that money from the Banks in London ? Answer —They would have got at least 4 per cent, The rate for twelve months’

deposits varies from 4 to 5 per cent. The best London banks give 4 per cent, and the colonial and Indian, banks flora 4 to 5 per cent. That is irrespective of the Bank of England rate.

Question —What is the actual amount the Government are getting now ? Answer—With the Bank rate as it is, only 2 ; [ per cent, in consequence of the fall of the Bank rate. From the associated banks they would have got from 3 to 4£ per cent. Question —Is the committee, then, to un derstand that you express a decided opinion that, supposing the £1,500,000 referred to in the loan papers, had not been placed with the Bank of New Zealand for six months certain, but with the banks in Lombard street, the Now Zealand Government would certainly have received something like 4 per cent for the fixed deposit. Answer —Certainly; at least 4 per cent. Question —But if the arrangement which the loan papers show to have been made was one which did not definitely fix a term, but only gave an assurance that, so far as then known, that amount would be left with the Bank for six months, do you still think that so large a rate of interest would have been certainly received ? Answer—No, not unless the money was fixed for . a term; but still a much more favorable rate than the Government is getting could have been obtained. Question —I understood you to say that you were aware, as a matter of fact, that in consequence of the Government banking with one bank caused considerable disturbance to the mercantile interest. Answer—Yes.

Question Could you state to the committee some facts ? Answer —Just before the loan was raised; and while there was some doubt whether it would be raised or not, the Bank of New Zealand found it necessary to put pressure upon the public, and a great many people were injured in consequence. They were members of the mercantile community of the colony. This was especially the case in Christchurch. It was a matter well known there.

Question —Only of notoriety? Answer—No. 1 could prove it. I would undertake to prove it. Question —I understood you also to say that you were aware that on one occasion the Bank of New Zealand has put pressure on the Government to the disadvantage of the colony.

Answer—Yes. Question Will you state the circumstances?

Answer —I would rather not, as it came to my knowledge in confidence when I held office as their manager.

Question—You say that you can prove that pressure was put upon the mercantile community in Christchurch 7 Answer—Yes. Question —Why should the Bank of New Zealand, under these circumstances, have put pressure on the mercantile community ? Answer —Because their advances were so large, that if the loan had not been raised, they would have been in a difficult position. Question —What is the connection between tho Government account and" the pressure put on these individuals 7 Answer—The Bank had made these heavy advances in anticipation of the loan being raised, and when they thought that it might not be raised, they put pressure on. Question— They calculated getting the proceeds of the loan 7 Answer —Yes. Bridges’ examination terminated there, but about a fortnight afterwards he was re-ex-amined. The chairman read to the witness the following letter—“ Bank of New Zealand, 28th September, 1875. Sir —I have the honor to acknowledge the receipt of your letter, dated 23rd instant, calling my attention to certain questions put to Mr Bridges by a member of the public accounts committee, together with the answers thereto, and requesting that the Bank will permit Mr Bridges to give the fullest and most detailed information upon the particular point referred to that the committee can desire. My directors quite concur in the opinion you ex press, that general statements such as appear to have been made by Mr Bridges, are prejudicial to the interests of the public service, and not only relieve Mr Bridges from any secresy. on the subject, but desire me to express a hope that you will compel him to make the fullest disclosures. I have, &c., D, L. Murdoch, Inspector. Reader Wood, Esq., Chairman Public Accounts Committee, Wellington.” Question—That therefore gives you full permission to state distinctly what you really referred to in this matter. Perhaps you would have no objection to do so now 7

Answer —No ; but previously I should like to ask you a question. There is an axiom in law that the greatest truth may be the greatest libel. Am I open to any action at law on the part of the bank 1 No.

The witness then entered fully into the transaction between the Weld Ministry and the bank. He then referred to the purchase of the Port Chalmers railway, and said that the purchase would not have been made at the price it was made, but though the pressure put by the Bank on the Government, the Bank being largely interested in it. The railway would, perhaps, not have been made but for the Bank.

Question The railway was a private undertaking, was it ? Answer—Yes ; the money, or a large portion of it, being advanced by the Bank. I heard Mr Bathgate, who was a member of the Ministry at the time, say he would not consent to such an exorbitant price being given for the railway ; and it was generally considered in the Bank that that was one of the most profitable operations the Bank had had.

Question What consideration did the Government get for giving this high price ?

Answer—That is a question of opinion. Question —You cannot tell the committee where pressure was brought to bear ; you have stated the fact that in your opinion Government yielded to political pressure. Gan you form any idea of how that political pressure was exercised 1 Answer—Yes. Question —What is your idea ? Answer—l shall decline to state that. Question —It appears to me that by your answers you would lead the committee to believe that your opinion is that by some corrupt attempt Government were induced by the Bank to give a higher price for the line than they otherwise would have given; in what way would Government have been damaged if they had refused to yield to that corrupt attempt ? Answer —I should have no hesitation in

answering that question, but as I stated at the beginning, I must be quite clear whether 1 am open to any consequences on the pan of the Bank or any individual, My answer to that would extend beyond the Bank.

Question—When you left yesterday you objected, I think, to give some specific information, because your answer “ would extend beyond the bank,” and you wanted to be quite clear as to the course the committee would adopt with reference to your evidence. . In that respect the committee have deliberated, and their opinion is that all the protection they have power to give you will be given. Answer —I understand; Ido not think that is sufficient to protect me, and therefore I have no further evidence to offer. Perhaps you will allow me to withdraw the last answer I gave yesterday ? Chairman —I cannot consent to that. Witness —In answer to a question put to me yesterday, what I meant was that pressure was used on the part of this Bank, but not political pressure. Pressure was used to obtain a higher price than the property was worth, the Bank being interested. The chairman —The committee desire me to tell you that they consider your answers to the questions that have been put to you of a very important nature, as they involve practically the character of some of our public men. The committee do not think the answers ought to rest where they are, and they consider it their duty to press the matter further, and to endeavor to obtain from you more precise answers than you have yet given to those questions. Whilst the committee are desirous of giving you all the protection that lies in their power, they must leave it to you to determine as to what the nature and character of that protection is ; that is to say, whether it is sufficient to cover you as completely as you wish to be covered under the circumstances of the case. Answer —No ; I have looked at the Act, and it appears to me quite unreasonable to expect that I should make any statement that should render me liable to a lawsuit. The chairman—At the same time the committee are of opinion that these answers cannot remain where they are, and that you must be more explicit. Would you state to the committee under the circumstances what the nature of the pressure is to which you alluded with regard to purchase of the Port Chalmers railway.

Answer—With all respect to the committee I must decline to answer any questions that I think would render me liable to a lawsuit.

A great deal of “ fencing” then ensued, the witness declining to give any further information unless fully indemnified, and speaking of the statements he had already made as matters of opinion as to facts. Ultimately he was ordered not to leave Wellington until discharged, and the committee reported the matter to the House.