THE FINANCES OF NEW ZEALAND

Nelson Evening Mail, Volume V, Issue 308, 30 December 1870, Page 2

THE FINANCES OF NEW ZEALAND

(From the London Economist, \sih Octobei). The cloud of the Maori difficulty having passed away, the colonists of New Zealand seem to be desirous to make up for lost time, and to bring upon themselves in a mass all the perils of that financial audacity by the infection of which new countries are prone to be caught. For several years past New Zealand, owing to the wars in the North Island, the political emergencies theuce arising, and the subsequent misunderstanding with the Imperial Government, hag failed to progress either in population or resources at the rate which we are accustomed to expect from our new Colonies. We have been warned quite lately in the plainest language that unless this mother country of ours is prepared to show more kindness to the Colony which delights to call itself "the Great Britain of the South," a disruption would come to pass "with certainty, and soon. Mr. Bell and Dr. Featherston who came over, it is averred, with some message of this kind, succeeded, , as everybody knows, in obtaining from Earl Granville an Imperial guarantee for a loan of £1,000,000. If anyone dreamed: that this pitiful sum would content the large ambitions of those Colonial . statesmen, who were recently suing in forma pauperis for Imperial aid in the money market, he will be surely undeceived by the startling policy which the Fox administration have put forward with the apparent assent of the majority in every province of the Colony. The financial scheme propounded on the 28th of Juue in the House of Assembly, by the Hon. Julius Yogel, Treasurer of the. Colony, embraced plans that were utterly . new . to the mass of the people, and. that a year or two ago would have been scouted as wildly absurd. But the termination— as people, think— of the Maori difficulty has. excited ; the ' Colonial enterprise of' New Zealand ; and _the Assembly, j-qyerawed) by | ;-tb;e }j Ministerial threat of an'' appeal, to, the people, has consented^ to a crude, design 4or ; -encouraging, by methods absolutely opposed to all sound political and economicaluotions, the speedy, advance of the Colony... in population and production. To decree such progress is. beyond the power of most legislative '.bodies,, uor shall we thiuk highly of the way the New. Zealand Assembly has chosen when we come ■ to examine its details. With a population estimated for the present year at a quarter, of a million, with a revenue from all sources (Colonial and Provincial), amounting to £2,135,980, and with a debt of something more than £7,000,000, Mr. Yogel suddenly proposes a plan for constructing public works, and encouraging immigration to the extent of £850,0GOayear for the former purpose, and £150,000 for the latter. To this end the Ministry proposed to the Colonial Assembly to take powers for borrowing six millions sterling directly for these two objects, and at the same time to get leave to deal with the public lands so as to have control over the remaining four millions. The public works designated in this plan include railways and ordinary roads — the latter, it was urged, being especially needed in the North Island, and the former in the South or Middle Island. The fact is that the South Island has roads, and the North Island has none, while there are no railways worth speaking of in either Island, and no easy fund for supplying either one or the other want so far as the North Island is concerned in the shape of a public domain. A sort of balance is to be struck according to Mr. Vogel's proposition between the claims of North and South — the former getting £^00,000 for the construction of a trunk road, and the latter receiving the same sum in aid of its railways. As Mr. Yogel thinks his road in the North Island, the scene of the Maori disturbances, will rapidly settle the country and enhance the price of land, he proposes

that the Government should purchase land there to the amount of £200,000, and this point was, after much difficulty, and the threat of further complications with the Maoris, accepted by the House of Assembly. Several concessions, however, were made by the Colonial Government, although the opposition, having to face a general election, and a commuuity much disposed to enterprise, were not prepared to attack Mr. Vogel's schemes. Indeed, the extraordinary borrowing powers demanded by the Government were so mixed up with the plan of a protectionist tariff which was received favorably everywhere except Auckland (a settlement that imports its breadstuff's), that the free traders could no more than obtain a kind of respite. A compromise was finally arrived at; for although the Ministry voted for the protective tariff, they were willing to postpone its almost certain acceptance until after the elections to the new Assembly ; and a3 to the great loan scheme, they moderated their terms considerably. Instead of demanding

>dE6,000,000, they asked only for] £4,000,000 (including the £1,000,000 for which Lord Graiiville was induced some tim& ago to promise a guarantee); and the •apportionment of this sum — £2,000,000 for railways, £1,000,000 for immigration, and £1,000,000 for miscellaneous purposes • i(embracir.g the supply of water to the goldfields of Westland and the purchase of - Sands iv the North Inland) — is taking more out of the power of the Government than was originally intended. Thu important point is whether English investors will be williDg to back this strange plau for suddenly raising New Zealand from the iank of a second-class •colony to the position of a first-rate Australasian Power. Quite recently Mr. Bell aod Dr. Featherstou, the Commissioners who wrung the guarantee of £1,000,>000 from Lord Granville, were assuring the English money maiket that New Zealand would borrow no more, and now come 4fa«se imposing projects for raising millions afc a stroke of the pen. It is unnecessary So say that we condemn the mischievous notion that national prosperity is to be {promoted, and traffic created in countries sparsely populated and imperfectly (brought under cultivation, by the mere co«6truction of a railway through unpeopled and untilled regions. Railways can <fe» much when they accompany, nothing when theygo groping before, the advancing tide of population ; and a country like 3few Zealand, which with all its advantages can hardly hope to emulate the rapid progress of the Western States of America, would do well to pause before accepting the precarious policy of Mr.