NEW ZEALAND SPECTATOR AND Cook's Strait Guardian. Saturday, March 27, 1852.

New Zealand Spectator and Cook's Strait Guardian, Volume VIII, Issue 694, 27 March 1852, Page 2

NEW ZEALAND SPECTATOR AND Cook's Strait Guardian. Saturday, March 27, 1852.

In our previous observations on Mr. Fox’s work we think we have clearly shewn, by indisputable facts which we have brought forward, in opposition to the wilful misstatements made by him in his remarks on the settlement of Auckland, the Pensioner villages, the natives, and the general Government, that his character for veracity is completely destroyed, and that his statements will not bear the slightest

examination or scrutiny. If any one feels disposed, notwithstanding what has already been said, to entertain the slightest doubt on the subject, that doubt will be speedily dispelled by referring to his statements with regard to the currency and intestate estates. Here he no longer rests satisfied with insinuations, or contents himself by endeavouring with studied sophistry to perplex his readers, and by throwing out base and unworthy insinuations against the views and principles of those he tries to injure in public estimation, but boldly throws off all disguise and gives utterance to the grossest and most unfounded falsehoods; that this is no rash assertion we will shortly be able to prove by facts. With regard to the subject of currency Mr. Fox says, (p. 131)

“ In 1847, Governor Grey was directed by the Colonial Office to pass an Ordinance creating a Government Bank, and which was to embody the following leading points:—1. The business of the Bank was to be limited to receiving specie and issuing paper in return. 2. The notes to be payable in cash on demand at the Bank of Issue. 3. To be legal tender for sums above £2. 4. Specie equal to one-third of the issue always to be retained in hand. 5. The balance of specie received to be invested on certain specified Government secutities. 6. All other Banks and private parties to be prohibited from issuing paper money.

“ The Ordinance passed, however, differed most materially from Lord Grey’s instructions—and, on one point of vital importance. The whole foundation on which the plan rests is, that the specie received shall be invested only on the best securities, and always be forthcoming when wanted. Lord Grey had taken some, though perhaps insufficient, precautions on this head, but bis instructions were disregarded, and power retained for the Governor to invest or use the Bank funds as he might please.”

Now, Mr. Fox is guilty of stating a deliberate falsehood when he says the Governor was instructed to embody the sth point, which he gives. Earl Grey in his despatch of 2nd February, 1847 (published in the Auckland Government Gazette of 23rd July 1847, No. 14) gives no definite instructions to the Governor in reference to the Paper Currency Ordinance; after entering into the question of the recognized principles upon which a paper currency ought to be regulated, Lord Grey says “ I would suggest that a law should he passed authorising the issue of a colonial paper currency,” he then goes on to state his own views in reference to the inode in which this suggestion could be acted upon, and with regard to investment he says:—

" The issue of the new paper currency being complete, it would be advisable that one-fourth of the specie received in exchange for it should be retained to meet any demands for payment that might be made, and that the remainder should be invested so as to produce some return to the Colony, with this view the best arrangement would probably be that it should be transmitted to Sydney, and deposited (on sufficient security) with one of the principal Banking establishments in that Town ; the interest which it would produce should go, in the first place, towards paying the expences of managing the paper currency, and the surplus if any, towards the general expences of the Colony."

There is not the slightest allusion in the despatch to the “ balance of specie received to be invested on certain specified Government securities,” and Mr- Fox publishes a deliberate falsehood, as it would seem, for the sole purpose of throwing out malignant insinuations against Sir George Grey.

The Ordinance did not differ most materially, as Mr. Fox asserts, from Lord Grey s instructions, on the contrary it was framed in every respect after the suggestions made by his lordship, and with regard to investment it was enacted that the residue of such cash, or so much thereof as the Government shall deem expedient shall, from time to time, he invested or placed out at interest on good and sufficient security, by or under the direction of the Governor for the time being.” Possessing this power the Governor might, in Mr. Fox’s opinion, indulge in private speculations at the expense of the public revenue“ by a little ingenuity he could even discount private paper, though not at the banking house.” Of course, there is not the slightest doubt the Governor must have had this in view when he departed, as Mr. Fox says he did, from his instructions “on one vital point of importance ;” and of course the Governor’s intention to use the Ordinance for carrying on a little private discount business “ did not escape the eye of the Lords of the Treasury when the Ordinance was referred home for confirmation.”

We will now see what Lord Grey and the Lords of the Treasury did say on the receipt of the Ordinance. In his despatch, Ist August, 1848, his lordship says:

“ Having referred that Ordinance, together with your explanatory despatch, to the Lords Commissioners of the Treasury, I transmit to you for your information and guidance, a copy o f a letter from the Assistant Secretary f 0 t | le Board, pointing out those modifications to which their Lordships consider that the Act should still be subjected. You will propose to the Legislatj,, Council the alterations there suggested ; but a 3 they apply rather to matters of detail than to the general principle of the Act, which is entirely in accordance with the recommendation of my despatch of Feb. 2nd 1847, No. 35, I have not thought it necessary to defer submitting it t 0 t ] le Queen, for her Majesty’s confirmation ; and I have now the honor to inform you that her Majesty Las accordingly been pleased to confirm the Ordinance. You will observe that the Lords Commissioners of the Treasury have recon mended that the investments of the Bank should bo made in the public securities of this country, instead of by means of loans in the colony.” In reference to this recommendation the Assistant Secretary in his letter alluded to by Lord Grey, states that “my Lords observe that the provisions of the Ordinance are in general accordance with those instructions (contained in despatch of 2nd February, 1847,) but it has appeared to my Lords to he desirable that in the respects hereafter specified, those provisions should in some respects be modified and improved,” and for altering the mode of investment, the reasons are given in the following words: — “ My Lords understand that the transactions of the Bank are to be strictly limited to the issuing of notes in exchange for specie &c. They cannot, howeter, approve of the genera] discretion regarding the mode of investment given to the Governor by the 20th clause, which would seem to constitute the Bank a general Loan Bank, and to devolve on the Governor the responsible duty of selecting the mode of invest, ment, and the invidions task of approving or rejecting applications for loans, and deciding upon the sufficiency of each security that may be offered.”

What now becomes of the lamentable tale which Mr. Fox gives about Sir George Grey having disregarded his instructions in a point of vital importance illustrating thereby a prominent feature of colonial misgovernment:—“ A Governor disobeying his instructions without rebuke.” We have shewn that the provisions of the act were framed in accordance with Lord Grey’s despatch; hut supposing for the sake of argument that the Governor had in view, when passing the Ordinance, the practicability of using for his own ends the funds of the Bank, we can only say that he signally failed by placing a very important check to such an object, for by the 23rd clause the Manager of the Bank cannot part with tho ■ custody of the cash applicable for investment, or any part thereof, “ except under the authority of a written warrant, hearing the signature of the Governor for the time being, stating the sum to be paid, the name of the person to whom the sum is to be paid, the name and place of abode of the person to whom the sum is to be lent, the nature of the security, and the rate of interest to be received for the same.'* This Mr. Fox will say is no check, for the Governor and Manager of the Bank, in fact Government officers in general are all rogues together. As according to Mr. Fox’s statement the Governor disobeyed his instructions from disreputable motives we are surprised that a clause was inserted enacting that the Ordinance should not come into operation until it had received the Royal confirmation.

In introducing the Paper Currency Ordinance the greatest publicity was given by Sir George Grey to its provisions:— as a preliminary step he laid before the public Lord Grey’s despatch already referred to, copies of the draft of the bill were forwarded to the different settlements, its progress through the Council was delayed in order to give time for his Excellency and the Council to be placed in possession of the general opinion of the public on the subject, and finally it was the very last measure to pass the Council. There was no attempt to hurry on the measure, each clause was carefully discussed, its provisions thoroughly silted, one member protested against the passing of it; having passed it was still further to be tested by the experience of men in England, in fact every possible precaution was taken, every care was bestowed upon it, and both Lord Grey and the Lords Commissioners of the Treasury stated that its provisions were in accordance with the recommendations given to the Governor. The Ordinance was brought into operation on the understanding that the investments were to be made in the public secuiitics at home, and that ”ne-third instead of one-fourth of the specie was to bo retained in the colony. The Ordinance was subsequently amended to the above

effect, and the two Banis —one at Auckland and the other at Wellington—have been in operation since the 3rd June, 1850. And what have been the results ? In Wellington, the Bank had scarcely been opened to the public six months, when the manager was in a position to recommend that the sum of £2OOO should be invested through the Commissariat in public securities in England, and at the expiration of another six months, he was able to recommend a further investment in like manner of £2OOO, so that we find in twelve months from the date of opening the Bank at Wellington, the Government had invested out of its funds £4OOO. The circulation of its notes has been steadily increasing ; since the early part of December last the amount of its circulation has not been under £7300, and in our summary of the last Government Gazette, published in our previous number, the amount of the circulation on the 6th inst., is shewn to have been £8526. After the Ist October next the Union Bank of Australia is restricted by law from issuing its own notes; at present its circulation islimited to about £9OOO, when these notes are withdrawn the Bank of Issue will probably more than double its present circulation. The Auckland Bank has not so widely extended its circulation, this we believe arises in agreat measure from the existence of the regulation by which the Sub Treasurers at New Plymouth and the Bay of Islands are allowed to draw bills on the local Government when requiring aid, instead of getting remittances in notes of the Bank of Issue; still we believe that the Northern Bank has invested £2OOO in public securities through the Commissariat.

After what has been said with regard to Mr. Fox’s remarks on the Paper Currency Ordinance, our readers will not be startled at the flagrant dishonesty of his statements about the Intestate Estate Funds. He says (p. 135) — “According to the original practice established in New Zealand, all intestate estates vested in the Registrar of the Supreme Court, who was obliged to give a general security for their safe kerping; and if he had an unusually large amount in hand he was required by the Judge to find extra and special security. The funds were thus in the safe custody of the Court, and under the control of the Judges, who were in the habit of exercising great vigilance in the matter.

“About three years ago Governor Grey took these funds out of the hands of the Registrar of the Supreme Court, and directed them for the future to be deposited with the local Treasurers and Sub-Treasurers of the provincial Government, in common with the general proceeds of the colonial revenue. This was done against the protest of one at least of the two Judges.”

With regard to the original practice Mr. Fox betrays gross ignorance, not that this ignorance is real, for it suited his purpose to state it in the manner he has done in order that it might contrast strongly with the passage which immediately follows. It was the practice according to the rules of the Supreme Court to pay the balance of an estate into the Bank ; the Instructions are contained in the following words: —“and the residue (if any) after payment of such debts he (the Registrar) shall cause to be paid to the New Zealand Banking Company, or to a branch of the Union Bank of Australia.” This practice was found to be inconvenient for many reasons, among others, that after a time there was no Bank at Auckland; —at all events whatever reasons existed they were deemed sufficiently cogent for Chief Justice Martin and Mr. Justice Chapman to decide upon a new rule by which the Intestate Estate Funds were to be deposited with the local 1 reasurers of the Government. This new rule was subscribed to by both the Judges in the early part of October, 1845, before Governor Grey had even left South Australia; he did not land in New Zealand until the 18th November, 1845, and on the 17th December, 1845, Be approved in Council the new rules .submitted to him by the two Judges. V/e earnestly direct the attention of our readers to the above facts, for we feel it impossible to add to their weight by any •observations of our own, the facts speak for themselves, we wish only to ask our readers to consider the facts as they stand, and compare them with Mr. Fox’s statement wherein he says, “ about three years ago (July 1848) Governor Grey took these funds out of the hands of the Registrars of the Supreme Court.” In what light is society at large to regard a man who can deliberately publish such a wilful falsehood, is such a one to go forth as the self-styled representative of the people of Wellington — ought he not rather to be branded with their reproba-

tion ? And what must be thought of those who attempt to aid and abet Mr. Fox in his efforts, who try to bolster up his character and lavish their adulation on this Patriot ? Why did not Mr. Chapman—whose name, together with that of the Chief Justice, is appended to the new rule—publicly contradict what his friend Mr. Fox had said about the new rule having been brought into existence “ against the protest of one at least of the two Judges.” Mr. Chapman could not have forgotten that he agreed upon the new rule before Sir George Grey even arrived in New Zealand; and yet he leaves the colony for his appointment in Van Diemen’s Land, preferring, it would seem, that the falsehood should remain uncontradicted, than that he should in any way be the cause of damaging his friend!s reputation.

Mr. Fox’s false statement is the ground work for insinuating that Sir G. Grey’s motive for getting hold of the funds was to devote them to other purposes. Now by further regulations the Governor’s warrant even is not sufficient authority for the Treasurer to part with any of the Intestate Estate Fund. This fund is not “in common with the general proceeds of the Colonial Revenue,” as 'Mr. Fox says it is: it is an unavailable deposit, and can only be paid out on the production of the Judge’s order. The Treasurer is made personally responsible for the amount, and if he should act so irregularly in meeting the demands of a warrant as to encroach on this deposit, he does it at his own risk —in fact he alone is answerable. Mr. Fox gives an instance of how the Intestate Estate Fund was misappropriated at Nelson, and leaves his readers to infer that it was Sir George Grey’s doing. We perfectly recollect when the circumstance occurred to which Mr. Fox alludes, and which he most grossly exaggerates, he was then the Editor of the Independent, although he was at the same time the New Zealand Company’s Agent, receiving a salary of £l,OOO a year, and he did not fail to make use of this circumstance for heaping abuse on Sir George Grey—while it was believed at the time that he derived his information from Mr. Chapman. The circumstance referred to occurred, we believe, on this wise. A sum of money had been promised to the Nelson Government for carrying on road operations; it should have been sent by the same vessel which took over to Nelson Mr. Justice Chapman, it was expected by the Superintendent who had already commenced operations with the funds at his disposal in the treasury, and the Sub Treasurer encroached on the Intestate Estate Fund. For some reason best known to himself, Mr. Eyre did not send over the promised amount in the same vessel with Mr. Chapman, and the Sub Treasurer, instead of receiving the remittance as expected, received the Judge’s order for the Intestate Estate Fund. We are not going to excuse the Sub Treasurer’s conduct; for we consider that he should have been more ready to assist the Government with his own funds than have touched the unavailable deposit: but we wish to direct attention to the fact that Sir George Grey was many hundred miles away when this circumstance occurred, that he was in no way directly or indirectly the cause of it, and indeed was not aware of the circumstance until after some months had elapsed.

If there had been any tangible reason for taking severe measures against the Sub Treasurer, we presume Lieutenant Governor Eyre would have taken the necessary steps : indeed if the case had been as bad as was represented it would have been Mr. Chapman’s positive duty to have brought the matter so forward as to have caused the Sub Treasurer’s removal. This he did not do, but seems to have furnished Mr. Fox with information, who has used it in such a way as would best suit his own purposes.

When we anticipated, in referring to the Memorial in our last number, that two hundred additional signatures would be received to those already attached to that document, our estimate was greatly below the probable amount, since we find we are able to announce that the actual number of those who have already signed the Memorial amounts to more than seven hundred, and that such a ready disposition is exhibited in every quarter to sign it that fresh names arc received in such numbers as to leave no doubt that there will be at least eight hundred signatures to the Memorial, all either landowners,

stockholders, or householders and heads of families. Two hundred settlers have signed the Memorial in the Hutt district alone, and the proportion of signatures to the inhabitants in the other country districts is equally numerous : indeed so numerously signed a Memorial has never yet been adopted in this settlement, and is a decisive proof of the very strong feeling which prevails in this settlement in favour of the immediate issue of Crown Grants.

Fjse Arts. —We understand that the drawing for Mr. Barraud’s Art Union of Paintings and Engravings is to take place this afternoon, at Mr. Alien's Auction Room, on Lainbton-quay; after the drawing is completed a very interesting collection of Engravings will be offered for sale, by Mr. Alien, by Public Auction.