THE COLONIAL TREASURER'S FINANCIAL STATEMENT.

Grey River Argus, Volume IV, Issue 257, 5 September 1867, Page 3

THE COLONIAL TREASURER'S FINANCIAL STATEMENT.

. Tlie Wellington correspondent of the " Lyttelton Times" furnishes the following synopsis of the financial policy of the Colonial Treasurer, as set forth in his budget speech : — The estimated income for the past year has proved wonderfully coriecfc, and. naturally gave occasion to Mr Fitz-V-herb'ert for a little self-glorification. * The ..large sum of L 900,000 calculated to/be received from customs and stamps feHpfshort of that amount only by I «leven hundred pounds. The receipts .„. and expenditure, ordinary and extraordinary, for the past year amounting to about L1',350,000 balanced each other •within about L2OOO. Of the receipts, J51,060,000 in round numbers, were raised by taxation, and L 320,000 from loan, the greater part of which latter sum has been expended to meet liabilities connected with • the militaiy settlements in the North Island. It T .. -was mentioned that a sum of L 17,00.0 »Li/ had been received from confiscated lands, but that the incidental expenses bad entirely swallowed up the receipts. Your readers will probably remember that when the colony wjis asked to assent to the Three Million Loan, Mr Header Wood held out the hope that something like two millions would be recouped by the sale of confiscated lands. The result of those false expectations can now be exactly summed' up." The colony will get nothing from the sale of confiscated lands, and it is proposed in the present scheme to hand the •^estates over as a gift to the- provinces. I believe that this course is necessary, and the best that can be adopted ; bu*. it b a huge disappointment, and witlou 1 remely. Considerable surprise will be felt throughout the colony at the stnll returns received from the stamp dues, and much of chis will be due to i thexaggerated hopes held out by those t 1 -vfh- founded erroneous calculations • upi the fact that, because a large siujy of stamps was issued in the first <7 4 insnee to the various offices for sale, 1 tKmnual income would prove propors iaofce to that issue. Apart from this : mike, however, it was generally « ; fchrht that the Treasurer's estimate wp be, exceeded. This has not ' tuil out to be the case, the receipts lia> proved less than the estimate by ne one-third. I revenue for the coining year is * ' calted at L 1,084,000,, 084,000, and the cxi we-ire, exclusive of the provincial apriations, at X7 44,000. No incr< of taxation is proposed, nor ■is ainpe of decrease held out.. In fat is difficult to see how in the presesition of the colony either course isdcable. The public burdens are y£ ( • -ask as can be borne, and yet every K faj is required to maintain the ■ 4 „ ' ejj order of things. It will be a : tijisk for those provinces which ffo land tund to meet their obligatit of the share of revenue to be alto them, and the estimates of wneral Government show the si margin wherewith to meet ' \cOT^H^incies. . The estimates for Defence are not included in the ordinary expenditure, . -wiry, it would perhaps be difficult to r say, unless it be. admitted that the colony cannot provide the means out of ordinary revenue. The Government tells the colony that peace prevails, and . that the armed constabulary force . -which it proposes to raise and for which . it asks a sum — for this year— of fe jjl 09,00(i, is necessary to maintain that \ state of peace. And yet the cost of its ? % maintenance is not charged against the %ordinajr) revenue, but is to be provided Ifbrby|l^n. A further sum of L 40,000 ■.tU'askjpl to provide the means of meeting %iy coningencies that may arise to dislirb wU state of armed peace, and this Ipaa a!js<t is to be raised by loan. The

cost of the militia and volunteers amounting to L.28,000 is to be charged against the provinces. As a set-off against these demands the Treasurer pointed out the enormous diminution that has occurred in the cost- of the 'Defence' department. At the same time he declared that the Government must and would always be prepared to defend the peace,, and as we may supj pose the present estimates show the lowest cost for which this state of preparation can be achieved it is evident that an annual sum of LI 10,000 is the least that the colony can hope to be charged with for keeping the native population quiet. When to this is added any unknown sum you please to meet the contingency of disturbance, the people of the Middle Island can now calculate in some degree what they will have to pay in the future. for the protection of their ' brothers -in j&e North.' . '* The new schemes of financial policy comprises several matters of importance which may be summarised under the following heads :— ! 1. Consolidation of provincial Loans. 2. Redistribution ''of Revenue. 3. Consolidation of Public Revenues. 4. Settlement of Outstanding Claims, | &c. 5. Borrowing more Money. The consolidation of the Provincial Loans is to be effected .by raising from time to time a new Colonial Loan, and devoting the proceeds, to the purchase .of existing Provincial debentures at fixed rates and within a certain limited period. Those Provinces which have not yet used all or any part of their borrowing powers are to have ' the money raised for and paid over to them. The interest and sinking fund paid by the General Government will be charged against the" Provinces which have received the proceeds of the loan.' The consolidated revenues — that is, the whole ordinary revenues of the colony \ — will be the security given to the foreign creditor, but the Colonial Government will hold the territorial revenue of each Province liable to meet the interest of its loans, should its share of the ordinary revenue not prove sufficient. Any profit that may accrue from the conversion of the loans will be handed over to the Provinces. The redistribution of the revenue between the General and Provincial Governments is a measure which has long been of obvious necessity. Hitherto the Provinces have been in the receipt of an uncertain share of the general revenues. Now, they are to receive by law one-half of the consolidated revenue of the colony. Against this share will be written off the cost of those services which are specially charged by the General Government against the Provinces, aud the interest and 'sinking fund of the debts which the General Government has endorsed. The surplus will then be handed over to the Provinces month by month, and all the difficulties and delays which have arisen from uncertain appropriations and un- | settled accounts will, for the fntf^e, be avoided. As a matter of course the Surplus Revenue Act will be repealed. A new Act, called the Public Revenues Bill, is to be introduced, to consolidate all the laws respecting the receipt and coutrol of public moneys. The proposed measure provides re gulalions for the novel financial,.arrangements between the General Government and the Provinces. Several important aud sweeping changes in matters of account are to be effected by the General Government. The most important of these is the total abandonment by the colony of any claim for -that portion of the three million loan which was allocated against the Provinces of Auckland, Taranaki, Hawke's Bay, and Wellington^. -It \vill be remembered that certain portions of that loan , were expended upon objects specially connected with Provincial interests, and that a sum amounting to about a quarter of a million was allocated between the Provinces of the North. Island. It now' appe#r|;?bhat, with the exception of Wellington, none of the other Provinces have paid the interest of their debts, and despairing, I suppose, of ever seeing either interest or capital again, Mr Fitzherbert proposes freely to forgive them all. In addition to this, you will perhaps remember that some eighteen months ago Auckland obtained LIOO,OOO from Mr Stafford on the plea of taking over the management of the confiscated lands in that Province, and after spending the money suddenly gave up the task. This sum also is to be forgiven, an act of liberality which you would appreciate more keenly, perhaps, if it were not performed with your own money. In addition to releasing the Northern Provinces from their debts, and handing over to them the confiscated lands, Mr Fitzlierbert proposes, on the part of the General Government, to give up all claims for advances made to the Provinces in excess of sums actually due to them under existing arrangements. The amount, thus wiped out is L 183,000. By the process of adjustment proposed, which seems to be just in principle, some Provinces will have to pay over to others the sums received in excess of the average. In this way Otago will have to pay Auckland about L 25,000. Canterbury will be delivered from the obligation of having to pay L 36,000, and will, in fact, receive a few hundreds instead. To provide for the cost of defence, for the extension of the telegraph to Auckland, for the payment of aii old debt to Taranaki, and for building one or two more lighthouses— amounting in all to L2s9,ooo— the Colony" will have to raise more money. But MrFitzherbert

does not propose to bring in a new Loan Act, only a further Loan Appropriation Act. In other words, the Government do not propose to borrow the money in straightforward mauner, but to adopt a shift which appears to me neither particularly honest nor wise. The Loan Act of 1863 is said to be capable of being strained to mean that power was given to the Colony to raise three millions of money. Well, of course that has not been raised, because the discount has amounted to about L2G0,000. It is proposed now, under the power of the Act, to make up the amount receiveable to L3,000,001> sterling. But in doing this Government is flying in the face of custom, and adopting a dodge I which will do as much to injure the credit of. the Colony as the consolidation scheme will do. to- improve it. It is really a pity to see men, who are capable of conceiving large and wise measures, become so blinded as to descend to suo& pettifogging contrivances. It would be a thousand times better to borr^^^ie money distinctly, nor would this cause any inconvenience a,t a time when the Colony is about to enter the market as a borrower for the purpose of conversion and consolidation. .Of the ultimate fate of.. the financial scheme I cannot form any decided opinion. Reasoning from analogy, and observing that most of the ''.sturdy claimants," as Mr Fitzd.er.bert terms the Provinces, are gainers iv some way or other, I should say it would pass without material alteration. But it is impossible to conceal the fact that thpugh if may be well for the Govern- j ments, ie is not well for the people. r .^he public debt is increased, taxation is not diminished, and while the revenue is estimated at the highest point yet reached in the history of the colony the expenditure leaves no margin for contingent misfortunes, or claims of any kind. And to add to this, we are asked in a time of peace to inaugurate the nucleus of a permanent standing army.