GENERAL ASSEMBLY.

Globe, Volume XXIV, Issue 2603, 10 August 1882, Page 3

GENERAL ASSEMBLY.

LEGISLATIVE COUNCIL. Wednesday, August 9. The Council mot, but immediately adjourned, on tho motion of the Hon. Mr VVhitaker, until next day, Mr Whitaker saying no business world be gone on «ith until the want of confidence motion in tho House had been disposed of. HOUSE OP REPRESENTATIVES. The House met at 2 30. THE NO COI.FIDENOB DEBATE. The Hon. Major Atkinson moved the seoond reading of the North Island Main Trunk Railway Loan Bill. Looking at the great importance of the question of borrowing, he would depart from tho course ho might otherwise have followed on the Government being placed on its tiisl, end would give some explanation of the Bill itself. It would bo most convenient to tefco this and the New Zealand Loan Bf" together. In tho financial statement the Government gave reasons ahoaiag the necessity for fn-thtr borrowing, but it was necessary again to reitarate these, as he understood that wss what was to be called mto question. Tho Government had to corsider whether it was better to bring down one or two Bills, and, after consideration, decided on the hitter course. By that means the matter would bo simpVfied, and a greater amount secured for the main trunk lines. Thsy would be better able to resist undue pressure for branch and other lines. He understood everyone thought that the North trunk lino should be made, but tho amendment showed he was wrong in that view. A loan w£3 necessary and reasonable in the colony's best interest. The position of matters whon the Government had to decide whether further borrowing should take place was this: they had cither to decide in th e affirmative, or eltso break faith with those parts of the colony waiting their time for railway communication. He ventured to say that the public works scheme, so far aa it had gone, had been a decided success. The state of the colony in 1870 was very different from what it was now. The taxation, so far as tho Customs duties were oonceined, per head was less by 5s now than it was in 1870. The increase of taxation had been imposed on property, and did not affect the laboring dasnus. Supposing, for argument sake, that the Customs duties were inoreased, whioh he positively denied, its equivalent had been more than returned to the population in the shape of free eduoation. Again, wages were better now than in 1870 j employment was easier get, and an enormous saving had been effected in travelling and hauling. He estimated thut saving alone at between £BOO,OOO or £IOO,OOO. Then agsin they had settled 100,000 persono

in New Zealand from the old country. The condition of these people and their prospects had been vastly improved, and if they had done nothing more that was a great work. Suoh being the past there was nothing in the present oiroumstancea to make them shrink from furthor borrowing, so long at they spent it on reproductive works. They had about a million and a half expended on works that were as yet incomplete and unproductive works. They had a large number of men employed on these works, and a still larger number dependent upon these men, so that if they threw them out of work, as they would have to do if no money were raised, it would be facing a serious responsibility indeed. They had on hand only £435,000 to oontinue their expenditure on, and he hoped that broad faot would be borne in mind. With care it would oarry them on lor a few months, till the end, say, of next February. The total number of men I employed now by the Government contractors on Government works was about 3000, find with the number dependent on those, and the number required to supply them, there were at least- 10,000 souls to bo considered. Were these to be thrown out of work at midwinter f In view of those facts the Government had two points to consider: first, oould the publio works be oarriod on at a reduced rate of expenditure ; and second, whether money oould be raised locally to go on with. After oareful consideration they found sufficient money oould not bo raised in the colonics to carry on the work at even a reduced rate. Under these circumstances I they felt they must ro on the London money ! market. It was of course competent foi' Parliament to say all borrowing must cease, but before doing that they would be bound to say how matters were to go on. fAnd what would the case of the colony be if they ceased borrowing in February next, or about the beginniug of wintor ? A great number of men would bo thrown out of employment, and of necessity a large drain of capital would leave the oolony. As a consequence wages would be greatly reduced, and affairs otherwise would be paralysed, and a commercial orisis would ooour. They were told that if they delayed borrowing their credit would increase, and they would get their loans at a cheaper rate. The faot was, any such saving could not in any way compensate them for the serious loss sustained in the meantime. Another argument was that a better coheme should be devised for making this fresh burden fall on the class best able to bear it. Those who oontended thus should submit a scheme, and it would, if feasible, no doubt be readily adopted, and not attempt to delay progress as was proposed. Regarding the North Island railway, it was argued that the loan should not be authorised until the direotion of the

line had been decided upon and the difficulty with the Natives overoome. It was not intended to raise the money till this was done. He submitted that the proposal cf the Government as a whole made the apportionment of money ae between the two islands fair. If thoy did not authorise the North Islaad loan now, when they were asked to pass it at some future time the South Island would be putting forward additional olaims for auother two millions, and inoreased borrowing would have to be resorted to with tho view of satisfying these olaims. It had been objected that not more than half the money was to be employed on railways. This had always been the csee. He would ask them to go through the schedule of these works and say if there were any that they could reasonably sirika out. Tiiore was first the £200,000 for Native lands. They were already oommitted to that. Public buildings £300,000; that was to lost for three years. They had been spending £IOO,OOO upon school buildings, and it was well known every Board was pressing for moTe money than thoy got. Out of this sum £90,000 w'tts engaged for lunatio asylums. Members would see that their districts would be provided with Iseb than required. In these oiroumstanoes he asked members to say if these school and other buildings were not to be provided for out of loan. Immigration was also provided for, for without population their difficulties were bound to increase. A continuous and regular low of immigration did not tend to reduce, but rather to steadily increase tho rate of wages. It was nominated immigration that was provided for, which everyone knew was tho best class of immigration. He did not think anyone would object to tho provision made for opening up Grown lands, as that was reproductive. Regarding the gold fields provision, he thought that would be considered a reasonable proposal. Harbors were also en expenditure which could be defended on ooloniel grounds. Tho last item, telegraph extension, was also a proposal whioh did not require to be defended. The rule laid down with regard to railways was that they were to extend only the main trunk lines, and in the esse of branoh lines continue those alone likely to give the quickest return for their outlay. If the amendment had any meaning, it was that they were to have no loan at all, and that all public works were to be stopped for the present. Either it meant that, or meant a oraf ty proposal to get into office, and once in go on borrowing as before. If it was true, as bad been stated, that Mr Montgomery intended to continue the borrowing policy, then it was difficult to understand what the amendment meant. He hoped an explanation on that head would be given by the hon. member, and that he would speak plainly when ho moved his amendment. It was a matter of regret that tho notice of the imandment had been so long delayed. The financial statement and proposes of the Government had been before them for some months, and the Loan Bills were distributed two weoks ago. Indeed, the contents of these Bills were know., when the Publio Works Statement was delivered a month ago, so that thero was no excuse for not bringing down the amendment weeks ago. Either Mr Montgomery's amendment meant that they were going to borrow, or that they were not going to borrow. If the latter, it was easily disposed of ; if the former, thoa the question eimp'y was, who was to administer the loans ard spend the money ? Considering the unsatisfactory manner in which Mr Montgomery's friends administered the previous loan, there oould be no doubt of the verdict.

Mr Montgomery, in moving—" That the loan proposals of the Government were not satisfactory," combated the statement o£ the Treasurer that the Loan Bills had been distributed some weeks ago, whereas they were not distributed UDtil the Ist. That was a damaging statement, and ought not to have bean sent broadcast ovef the colony to the injury of the Opposition. In the Financial Statement there was no mention of two Loan Bi.'ls, oil that was said was about one Bill. The fist heard of two Billa was in tne Public Works Statement, and eit'.o then they had beon kept back, whioh wsb simply a practice of the Treaturer'a, who always kept baok h - > important measures until the very end of the session. He objected to the whole of the loan proposals of the Governmsnt, and not to auy one Bill, They had been told that it was on aft3r consideration that the two Bills wero decided upon. In the Financial Statement there was no ovidenoo of a eeoond Loan Bill, and, as a matter of faot, he did not believe that until meinbara had assembled in Wellington, and pressure had been brought to bear, that two Bills were decided upon. He denied that immigration would raiso wages. In 1878 9 thoy had a le?ge immigration, an*?, he asked, what wos the state of the case then ? Why did not the Treasurer compare it with that of two years ago, instead of with the present term ? They had to vote money themselves to keep these men in work. That Wrs not like immigration raising wages. What he wished to see was that the burden of these loans would be placed on the right shoulders. He had never given it to be undoi stood that he was against borrowing altogether for the extension of their public work*, nor had he ever objeoted to substantial justice baing done to the North Island. Common prudence, however, suggostad that railway routes should bo decide i upon before money was allocated for them. The North Island line was to be carried south from Te Awamutu, but nothing was said as to the direction in which it should be carried south. Again, in the S->uth Island, he saw a similar proposal. The line was to be taken from Blenheim south. Was bh*A oourso to be taken through one or two large estates only * Was not that the ultimsto intention, and if it wdg could it be said that these loan proposals wore to be considered satisfactory ? No provision whatever was proposed for the Middle Island East and West Coast line. This loan proposal meant £200,000 per year for intsrext, and it was very neoeesary indeed that they should know ihow and by what means that sum was to be provided for. The colony was fast getting its sead above water, and ib wus requisite that -his additional weighting should be carefolly looked into. Tho Treasurer sfcould hays

naked for a moderate amount, Bay half a million, to complete and carry on till next •eision railways well advanced, and then bring down a more elaborate proposal next year, when they were better prepared with their plans, and not have a proposal for railways along routes ot which they all appearod to have but little idea. If they desired the efficient carrying on of public works, it was most important that they should not give too muoh moDey into the bands of Government at once. He thought it would be far more prudent to delay the loan proposals for a year. In the meantime the feeling of the colony would be aoosrtained, and then next session they would be in a position to shape their course accordingly. Thn Opposition did not wish to waste time over this debate, and he hoped therefore, speaking for his party, that the debate would close to-night, or at latest tomorrow night. If they did not win, they would at least have the satisfaction of know-

ing that they had done their duty ; but ho was perfectly confident that they would win.

The Hon. Mr Johnston said that au opportunity had been given Mr Montgomery to express his views on the financial proposals, and since then his views on borrowing appeared to have undergone a considerable change. Ho did not now object to borrow, but what he took exception to was the amount. It was objected, *oo, that the lines of railway had not been defined. The loan already rained had been allocated in a similar way. Is waa to do a particulor work, the osurse to be followed being left for further consideration. The direction of these lines would be in the hands of the House, and would have to be agreed to beforo being os-rried out. He contrasted the proposals now before Parliament with those of the Government of 1878, drawing adverse conclusions to the latter/: and "cautioning tho House against trusting a Government formed from the Opposition with the administration of these loans. He congratulated the Opposition on having at length arrived at a determination to go on with the business of tho country with the least possible delay. Mr John Buchanan moved as an nd"i-

tion to the amendment the words—" Inasmuch as it is not expedient to authorise any fresh loan during the present session." If they were to have a loan at all, it was more prudent that they should raise it by instalments.

The Hon. Major Atkinson interrupted to say that the Government never intended to raise the North Island loan in a lump sum. The North Island loan would not be placed on tho market until the line was determined, and the Government was in a position to commence the work. As to the three million loan, it was only intended to raise tho money at the rate of one million a year. Clauses to provide for this would be introduced in the Bill.

Mr Buchanan expressed pleasure at this statement, whioh removed much of his objection, but he heard with surprise the reasons given by the Treasurer in support of the loan about the providing for labor for 2C30 men. He said thero was no need for carrying out the original plan of connecting the trunk lines. The country would be better served by branoh lines joined to the through lines already in existence. He should have liked to have heard more from the Treasurer as to the direotion to be followed by these proposed lines. He hoard with soma misgiving that they were to be taken through large estates, and that, he thought, would be a most reprehensible oourse, There was no hurry for carrying out many of these works, so that there was no necessity for going into the money market for auother twelve months, and if it was found necessary thou an early session to reoonsider the point might be called next year. The neighboring oolorios were all going in for loans, and consequently this was a bad time for New Zealand to raise money.

Colonel Tbimble argued that Mr Montgomery's objection to the loan on tho ground that it would largely increase the property tax next year was most illogical. He had argued that the taxation was most unequal, and that it boro on the laboring classes. In that case an inorease of the property tax would operate towards equalising the burden, as between the classes named. Mr Montgomery had objected to certain proposed lines, especially the one south from Blenheim and yet complained that no provision was made for the line from Christohurch westward. He referred to a public meeting held in Christohurch, which decided that the line introduced was utterly unsuited for a private company to take up; but it was admirably suited for the Government to undertake. Now, if it would not pay such a oompany with 30 per cent, of ooEt given them, why should tho Government undertake it ? He mentioned that to show the nature of the works Mr Montgomery would propose if he got into the Government. He defended the past administration of the Government, and argued that the loan would be safer in their hands than in the hands of any Government the Opposition oould form. The House adjourned at 5.30. EVENING SITTING. The House resumed at 730,

Mr Sutton was not at all satisfied with the proposals of the Government os a whole, but ho had never contended that the time had come when they could dispense altogether with borrowing. What he advocated was the properties receiving the benefit of suoh expenditure should be made to bear the burden of these loans. The proposals now before them would add £189,000 per annum to the debt of tho country, and he oould not deny but that while the artisan class would benefit to some extent by tho expenditure, the bulk of the benefit would be oonferred on property, and property ought to be made to boar its full share of the burden. He would have been glad to have hud no borrowing this year, but still he could not support the amendment. The real question was overshadowed by the amendment and its consequenoes. So far as ho oould understand the position, Mr Montgomery's proposals were as near to those made by the Government as they could possibly be". He never would support a motion having for its purpose the expuloion of a Ministry who had gained the confidence and good opinion of the country, in fovcr of an Opposition altogether destitute of a policy. He would support the motion for the second reading. I Mr Bathoatk combatted the idea that the Opposition should be a compaot body, ha-ving | no diversity of opinion amongst its individual members. Ho was opposed to the present Government, but he regarded the annexation of local self-government imperative to the gcod government o£ the colony, and tho prosent Mitmtry waa an embodiment of centralism. In the Stock Exchange, London, New Zealand was not in good odour. When he waa home a year or two ago, he was met on tH handa by the statement that—" You New Z-j&lsndevs are borrowing too muoh, and must now hold your hand." The feeling was aggravated by the gloomy state of affairs piotured by the Colonial Treasurer in 1879. In consequence of that statement he knew of many men of capital desirous of coming out to New Zealand who turned away in disgust and went to the United States about (his time. America inoreased in wealth by its immigrants to the tune of £IOO,OOO sterling, and New Zealond might have largely participated in that gain. He defended the Grey Government, showing that while it hed spent a certain sum of money, the Governinon now in power had, according to its own showing, spout a similtr amount. Moreover, tha former not had spent its money corruptly, but spent it in accordance with Parliamentary sanction. About tho time the Grey Government left office the Bank of New ZeaUnd intimated the termination of the contract, and when tho preuent Government got into office immediately afterwards not a trord more w.is heard of tho determination of that contract. It was his opinion that muoh of the administration and deliberation of the Government was decided upon in the back purlor of that bank. He went on to show th».fc in consequouce of the action of the bsnks at this time in suddenly drawing in three millions of advances, greßt oommeroial distress and panio was occasioned. After narrating his experiences as an immigration agent, and his own personal grievances nt the hacda of tho Government, whioh had actually treated him es if he were an ordiuary emigration agent, when he was working hard for the colony, ho went on to say that the reputation of the colony had not yet recovered from tho blow given it. He would not allow the Bill to pass, and have the leans rushed into the money market at a time like this.

Mr Isaac Wilson announced that he vould support tho loan, but in Committee <7ould move in the direction of certain alterations of the proposed schedule. Mr Conollt [supported the Bill, contending that there was nothing whatever in the argument aboui the lines of railway routes not being decided upon. 'Xbe starting

points, as also the termini, were indicated, I and it mattered very little whether the lines were taken by one route or another. With a line through the King Country as waa projected, a great step would be achieved towards finally diposing of the Native difficulty. The question whether they should borrow this session or delay it till the next, did not appear to him a point of great importance. _lt was admitted on all hands thai borrowing would have to be resorted to. If what they had heard was all that oould be said against these measures, it was extraordinary that anyone oould even have imagined that a vote of no confidence could be sustained against the Government. Mr DbLattiottb said that the Treasurer i

had been endeavoring to provoke an Opposition, and now that he had sucoeeded he did not appear to like it. The Treasurer had already offered to make concessions that virtually altered hia original proposal. Tho Opposition had this virtue, it would not be driven to raise an issue whioh did not exist. The Government were an incapable Government, and were trading on a false line, which did not exist amongst the Opposition. They were not a Liberal Government, but still there were exceptions amonget them. The head of the Government had shown himself a real Liberal in the past, bnt now with a Cabinet torn with dissensions, Ministers who would not speak to eaoh other, he was retarded by the incapacity of his colleagues in tho House of Representatives. If he was thus influencing that House, many on that side of the House would not be supporting the Opposition, All through the wranglings of the session who was to blame ? It was the duty of the Government to lead, and they had shown their utter incapacity. That incapacity had become intolerable, and he was glad this step had been taken, although they took it with tho greatest reluctance. There was nothing in the shape of an effective Government. With an admittedly intelligent Parliament, they could make no real progress with the bueiness. They were asked to agree to a loan of four millions of money, and now Ministers said they would be content to raise it at the rate of one million a year. If the Government remained in, they would convert the four million loan into six or seven millions. The Treasurer would borrow from one fund, and give a bill for it. That bill was negotiated in London, and by skilful manipulation he pooketed double the original amount of the bill. The consolidated fund spent the money first, and the public works fund spent the amount afterwards. He quoted ; from tables in the financial statement to show that under the authority of the five million loan tho Treasurer had spent seven and a half millions. There was nearly two millions of Treasury Bills to redeem, and whioh there was no prospeot of ever being redeemed. To proteot these, they would be asked no doubt to pass a Treasury Our. renoy Bi'l Extension Act, and they had no guarantee that he would not negotiate these Bills again for an additional two million. They were told that the taxation was equally divided as between property and the industrial classes. Now he found that one and a half million was pud on seven millions of imported goods, whereas seventy millions of property only contributed £150,000. He asked where the equality came in ? Then they wore told on the one hand that a saving of £215,000 had been effected ; on the other hand it was shown that £572,000 had been added to the permanent debt. That was the sort of congratulations they were treated to by tho Treasurer. They had been told that the loan was required to meet tho eliim of those who had been waiting their turn for public worki. Not a word was said about the utility of the works proposed. That was a sample of the Treasurer's political morality. Again they had free education epoken of by the Treasurer as a debt for whioh the industrial classes should be grateful, instead of eduoation being sot down as a right on the part of every child. The North Loan Bill was put forward first so as to catch the votes of Northern members, and having got it, they would be committed to supporting the other Loan Bill. The real intellect of the Government was removed from the House—being in the TJpp6r Chamber—and what remained was utter incapacity. He was quite certain the House was prepared to do full justioe to the North Island, but he objected to the Treasurer trying to secure this by a kind of triok. Sir John Hall obargod the previous speaker with having raised a cry of incapacity against the Government without the slightest attempt to substantiate it. If there was one cry more than another which required no answer it was that of incapacity. The country knew in what state the present Government found the country, and the state in whioh it now was. They were told that tho Opposition had tolerated the incapacity of the Government until it was actually driven to the step now taken. They knew that the Opposition had been straining every nerve towards the step »t whioh they had now arrived. They had been giving more attention to that than they had to the business of the eountry. Mr DeLautour had oonfused some of the new members, and perhaps some of the old ones too, with the mats of figures he quoted. The real facts about the Treasury bills was that the Treasurer had sold them to the Public Works Department, and when that department wanted the money they sold them to somebody else. In the financial.statement it was distinctly stated that the loans were to be raised by instalments, and yet Mr DaLautour would make them believe that was givon by the Treasurer as a concession. Mr Montgomery had submitted a motion, it was true, but he did not give them any reasons why they should vote for it. It was true the debt of the colony was large, but would it be prudent for them to pull up suddenly and cause a catastrophe. Would it not be more prudent to go about the thing gradually. Th9ir expenditure since 1878 had bean at the rate of two millions per annum. This Government, however, was not responsible for the expenditure. In oonsequenoe of the debts incurred by its predecessors the Government during the first nine months of its administration had to disburse one and three-quarter millions. They had gone on since then gradually reduoiDg the amount, and that, he argued, was the safest way to proceed. Io was objected that the burdens of these loans should be placed on a different class. There might be something in that, but this was not the time to disoues the point. They would have an opportunity afforded them for discussing the incidence of taxation, and that would be tho proper time to ventilate the grievance. Another complaint was that the lines of railways proposed were not fixed on as to their routes, but he had to remind them that the time thing had been sanctioned by the pre • vious Parliaments. Again, they were told that no money oould be spent under this Bill until full inquiries had been made into the merits of the proposed different routes, and the best and most economical decided upon. They had bsen told that these loans would inorease tho annual charges by at least £200,003 per annum. The expenditure would, however, be reproductive, and he was sanguine that the increased income would do more than provide for the increased expenditure. No doubt tho statement made by the Treasurer in 1879 affacted tho credit of the oolony. That was just what was to be expected, and although it had affected the credit of the colony ten times more, it ought to have been made; but the fact was that since then New Zealand securities had been gradually goicg up. The real question was — Is there to be a ohauge of Ministry P who ore the best mon to sit on those benches ? The policy of the Government in g&neral had been to r«duco their expenditure and otherwisa adjust their revenusa and expenditure. The late Government had largely increased the taxation on property. Men who let out their money on mortgage were now oompellod to contribute to tho taxes. The land lawß had been liberalised, so as to promote bona fide settlement. In the matter of tho railway administration, the rates on grain were more liberal than ever they had been before, and instead of paying 2J, the railways now paid four per cent. While others had talked about it, they had widened the foundation of political power. It was not only a question of ejecting certain men from office ; it was also & question as to who was to take their places. The proposal was practically to replaoe in power tho Ministry of 1876. They had still the member for Auokland Oity Bast, and the member for Port Chalmers. Both these gentlemen would be wanting a finger in the pie. Mr Weston spoke strongly against the Bill. Mr Bketham moved the adjournment o* the debate. Carried.

Considerable disoussion took plaoe al to when it should be returned. Ultimately tbi« was fired for 2.30 to-morrow, and at 12.45 the Home rose.