NEW ZEALAND PARLIAMENT.

Hawke's Bay Times, Volume 19, Issue 1441, 28 September 1872, Page 2

NEW ZEALAND PARLIAMENT.

FEIDAY, SEPTEMBER 27. SPECIAL GOVERNMENT TELEGRAPHIC SUMMARY. FINANCIAL STATEMENT. ["NOTE.—Iu the following summary, shillings and pence are omitted.] The House went into Committee of Supply. The Colonial Treasurer (the Hon. T. B. Gillies) made his Financial Statement. His object would be to state clearly the financial position of the colony, and the state of the several funds constituting its public account. He would endeavor to do that not from a sanguine, nor from a despondent point of view, dealing with figures only with a desire to render them valuable because accurate. Certainly, he would not knowingly permit any feejing as to the position of parties iu the House to cause him to injure the credit of the colony, or retard its real progress. The total amount of the colonial debt at the present time was £9,985,936, but there was a sum of £574,848 of sinking fund accrued. The annual charge consequent upon the debt, and which must be provided out of generai and provincial revenue, was £616,895. From a carefully compiled balance sheet of the consolidated fund account, he concluded that on the 30th January last there was a deficit of £33,345 on that account to be provided for, and not a surplus of £10,562 with which to commence the current year, as was stated by his predecessor. The discrepancy, therefore, was £43,908. He accounted for it thus: he believed the amount recoverable from the provinces was £28,917, or £3,360 less than set down in his predecessor's statement. He could not treat as an asset any part of the £13,650, for which his predecessor took credit as recoverable from the confiscated land account. The Government meant to grant a considerable portion of those lands to the natives from whom they were taken, and the balance would not do more, if, indeed, it would do so, than meet claims and pay costs of management. His predecessor omitted from his calculations £2311 of interest due on 30th June upon temporary loan debentures, deficiency bills, &c. He also omitted a liability of £17,585 in respect of savings on the Civil List, the native schools fund, and the Armed Constabulary reward fund. In addition to those four sums, he (the Colonial Treasurer) had ascertained that £5,000 of additional liabilities existed up to the 30th June, a great part of the amount having been paid since that date. Thus the discrepancy of £43,908 was accounted for, and the deficiency of £33,345 on the consolidated fund at the commencement of the financial } ; ear was shown to exist. Under the Defence and Other Purposes Loan Act, there had been raised, up to June 30th a total of £635,000, of which, at that date, there remained available for defence services during the current year £106,922, His predecessor estimated

the amount available to be £158,247, so> that there was a discrepancy of £51,324 to be accounted for. Of that discrepancy £23,792 was accounted for by the fact stated by his predecessor, that the £158,247 said to be available was inclusive of then existing liabilities; to that amount therefore the sum available for the current year was reduced. Of the remaining t £27,733 of discrepancy, £8,358 was accounted for by his predecessor having taken credit for that sum in the consolidated fund account, as re--coverable from defence, but having omitted to debit it as a liability against defence. Of the amount raised under Schedule 2, £9,363 was for the redemption of Otago dock bonds not yet redeemed, and was therefore a liabilityagainst this fund, which might have to be met any day. Still further, £9,373 of the discrepancy was accounted for by that sum, which was advanced on account of confiscated lands from the, consolidated fund having been treated as an asset, a course which he could not follow. Add to the amount already stated, £235, which represented the charges for raising the last £150,000 of this loan, but of which his predecessor was not aware, and the discrepancy of £51,324 was accounted for. Tbere had been, up to June 30, raised under the Immigration and Public Works Loan Act, a total of £1,600,000* of which there remained on the day named £845,096 in cash available for works already contracted for, or which might be contracted for. As regarded this fund but little discrepancy existed between the accounts of his predecessor and those now submitted, except that his predecessor, in stating the available balance at £925,684, omitted to take into, account £79,250 of liabilities then existing, and that his predecessor did not include the charges on raising the last instalment of the loan, the accounts of which had not at the time been received in the colony. He need not detain the committee by reference to the trust fund, the land fund, &c, because he believed the statements made as to them by his predecessor to be substantially correct. He would next explain the position of the several funds included under the general title of the Immigration and Public Works Loan Fund Account. The date up to which his explanations as to those funds would reach was September 10, the day on which the present Government took office. First, as to the Railway Fund, the amouut authorised to be raised was £2,000,000, to which must be added £37,202, as representing the moiety of Stamp Duties 1870-71, less refunds. The total amount of accounts passed for payment was £314,365; there were liabilities amounting t0£982,347 £982,347 for rails and rolling stock on railways begun or contracted for ; and there were further liabilities amounting to £298,168, being the estimated cost of rails ordered or contractedfor on account of lines not yet begun or contracted for. Thus, of the £2,037,202, there remained £451,321 in cash and the rails last mentioned, so that on the 10th September there was available for railways not yet begun or contracted for cash and rails representing £740,000. The engineer's estimate of the probable cost of the railways authorised but not contracted for showed a total of £2,005,110, so that, deducting the £740,000, and considering all the facts and contingencies, it was fair to estimate that at least an additional million and a half would have to be provided before the railways authorised by the Assembly could be completed. But this position of affairs did not require to be dealt with at present. The balance of cash on hand, £845,096, would enable works already contracted for to be carried on during the present year, and would also enable the Government to initiate and push forward others of the works authorised by Parliament, The Minister for Public Works would inform the House what those works would be, and during the recess the Government would work with a full recognition of the fact that the policy of railways and public works could not be reversed, and that, to be a benefit to the colony, it must be carried on vigorously though, at the same time, with prudence, judgment, and economy. Of the £1,000,000 authorised to be raised for immigration, there remained oa September 10th, after providing for liabilities up to 31st December next, as estimated by the late Public Works Minister, £868,714. Of the £300,000 for Goldnelds Water Supply, there remained available, after providing £51,495 for the Thames Water-race, £231,855. The sum authorised for roads. in the North Island was £400,000, and there remained £225,084 available after providing for contracts and meeting liabilities up to September 10. On the same date, £135,175 was available out of the £200,000 for land purchases in the North Island. On telegraph extension account, the £60,000 appropriated had been overspent to the amount of £15,383. His predecessor proposed to meet that excess, and to provide for further extensions, bf allocating for those purposes £40,00$

anapportioned of the Immigration and Public Works loan, and the committee would now be asked to consent so to allocate for the present £30,000 out of the £40,000. A very disturbing element in the calculations arose from the fact that the £IOO,OOO set aside for Road Boards last year was ordered to be paid out of the Public Works fund, but was not directed to be charged against any one of the accounts included m that fund. A decision on the point must now be come to, and his recommendation, after very careful consideration, was that the £IOO,OOO should be charged against the Immigration portion of the loan. He did not propose to again subsidise Road Boards out of the loan, for he believed that the members of the Boards themselves recognised that, by such aids, they gained merely temporary benefit at the cost of constant future taxation.

As to the Estimates of Revenue and Expenditure for. the current year, he should differ but little from his predecessor, save in a few items. It was unnecessary for him to enunciate a general financial policy different from that of his predecessor, for the present Government were called into office on the ground that the previous Government had failed in the administration of the policy agreed upon. His duty was to carry out the existing policy, subject to such administrative reforms as he should indicate. The consolidated fund revenue had, on the whole, been fairly estimated by his predecessor. His predecessor had apparently not taken into account as revenue about £9,000, which would be received from surplus interest on trust fund and other accounts. As he now proposed to provide out of the consolidated fund for interest on all the colonial securities, including those held by the trust fund, it was but fair that surplus interest on such funds should be treated as revenue. Therefore, he added £9,000 to the item incidental receipts, and, with the exception stated, accepting the estimates already before the committee. His consultation would make the estimated revenue for 1872-3 stand at £1,085,000. As regarded expenditure on consolidated fund, there were three points on which his proposals would differ from those of his predecessor. Firstly, he did not propose to continue to charge interest and sinking fund on the immigration and public works loan upon the loan itself, giving, as a grant in aid, one-half of the stamp duties, and a further contribution from the consolidated fund, Instead of that plan, he proposed to charge the interest and sinking fund in question directly upon the consolidated fund, as the law required. He would retain onehalf the stamp duties to aid in meeting the charge, first making the necessary alteration in the law, and he would charge against the public works loan for this year only such balance of the interest and sinking fund us the consolidated fund could not bear. The cash result for this year would be much the same as that proposed by his predecessor; but it would be arrived at directly, and not in an indirect and misleading manner. Secondly, he proposed to increase the capitation allowance to the provinces by recognising that Maoris were large consumers of dutiable goods, and by substituting a payment of 10s a-head on account of them, instead of giving an arbitrary allowance. Taking 15s per head as before for Europeans, 10s per head for Maoris, and continuing the sp' ctal allowance of 2s 6d per head of Ei,r.mean population to Westland, the cavitation payments would stand thus : Auckland, £59,866; Taranaki, £4620; Wellington, £21,422; Ilawke's Bay, £6210 ; Nelson, £17,338 ; Marlborough, £4222 ; Canterbury, £36,983 ; Westland, £13,492; Otago, 55,880. The total would be £200.241. Thirdly, he proposed to calculate upon a reduction during the remainder of the year of £IO,OOO upon the estimates of ordinary expenditure, classes 1 to 8, as brought down by his predecessor. There had not been time to recast and reprint them; to do so would confuse the accounts of the Treasurer and the Controller.

The gross estimated expenditure amounted to £1,108,915; deduct the £IO,OOO savings to be made, and the nett expenditure would be £1,098,91-5. There must be added the debit balance already stated of £33,345, less £15,222 on account of civil list and native school saving, Avhich would, probably, not be required this year. Then there would be a total estimated expenditure of consolidated fund for the year of £1,117,038, which amount included the whole interest and sinking fund on the Public Works Loan, amounting to £96,100. There would thus be an excess of £32,038 °f expenditure over receipts, and he proposed for this year only to debit the Immigration and Public Works Fund with £34,500 of the interest and sinking fund ou that loan. The difference between the two amounts would, probably, be required for supplementary estimates. If be made the Financial Statement next

year, he would altogether oppose charging any portion of the interest and sinking fund on the Immigration and Public Works Loan to the loan itself. He would prefer to see, and to propose, if necessary, hereafter to augment the revenue by a change in the incidence of taxation, rather than the colony should be deceived by the idea that it was getting public works for borrowed money, while that money was really being spent in paying interest upon the loans themselves. He believed that reductions amounting to £25,000 a year could be made on the Estimates ; and the committee might fairly complain if he brought down estimates next year without effecting such reductions. He recognised the important reforms instituted in the Treasury Department by his predecessor, and he hoped during the recess, freed from other cares of any other office, to devote himself to reducing those intended reforms into a practical shape, such as would be beneficial alike to the department and the public.