The Southland Times. MONDAY, APRIL 13, 1868.

Southland Times, Issue 933, 13 April 1868, Page 2

The Southland Times. MONDAY, APRIL 13, 1868.

THE ORETI RAILWAY COMPLETION. The subjoined official correspondence has been placed at our disposal for publication : Colonial Secretary's Office, Wellington, 7th Jan., 1868. Sib, — I have to acknowledge the receipt of your Honor's letter of the 17th ult., relative to the proposed completion of the Oreti Eailway, and to state that the Q-oyernor will, in accordance with the resolution or the Provincial Council of Southland, be advised to reserve sixty thousand acres of Crown land in that Province to pay for that completion. The Commissioner of Crown Lands will be requested, in concert with the Chief Surveyor of the Province (to wLom I have to request your Honor to give corresponding > instructions), to suggast what land should be reserved (regard being had to the desirability of the reserves being as far as possible contiguous to the line, and to each other), ' and to send tracings of the proposed reserves. — I have, <fee, <fee, (Signed) E. "W. Stapfokd. His Honor the Superintendent of Southland. Superintendent's Office, Southland, 17th Jan., 1868. Sic, — I have the honor to acknowledge the receipt of your letter, No. 16, 7th ' January, informing me that the Grovernor 1 would be advised to reserve, in accordance with the resolution of the Provincial ' Council of Southland, sixty thousand ( acres of Crown lands, for the completion i of the Oreti Railway. I have now to advise you that the Pro--1 viricial Council has passed the necessary standing rules and orders to enable it to pass at a session, to be called for that purpose, a Bill under the Provincial Land Taking Act ; and has in the meantime authorised the preparation of plans \ and specifications for the construction of ', the works. This is all that can be done i at present in futherance of the project, • and I will communicate with you concernt ing the necessary reseivesfor the purpose ! by the next steamer, as there is not time > to prepare the documents you wish for, itogo by to-day's mail. — I have, &c, &c. (Signed) " John P. Taylor, 1 Superintendent. ( The Hon the Colonial Secretary, Wellington. • Wellington, 10th March, 1868. 1 Sib, — Keferriug to your letter of 7th J January, acknowledged on the 17th of i the same month, 1 have now the honor to state that your request, that 60,000 1 acres of land to be set aside for the ' completion cf the Oreti railway should | be selected by the Commissioner of I Crown Lands and the Chief Surveyor, has been complied with ; and I transmit, herewith, a map shewing the land so selected in distinctive color (pink), , together with a copy of the Chief Surveyor's memorandum, which accompanied i the map. 1 On mature consideration, and after 1 consultation with the Engineer and | other competent authorities, I have come to the conclusion that it would be greatly i to the interest of the province could the ; works be constructed tor cash, and have no doubt that if the General Government would make over this land to the Province, or if this cannot legally be done, i consent to a purchase of it, pro jorma, to ! be vested in trust for this special purpose in Oreti Eailway Commissioners, arrange- , inents can be made if necessary with the i bank for an advance to them, and thus a great saving effected as compared with paying in land, and especially with the restriction as to its selection to a particular area. I have therefore to request that you will be good enough to take this proposal into consideration at your earliest convenience ; and, as I have come up to Wellington for the purpose of sa k lug time in the consideration^ of this matter, 1 shall be glad to be favored with a personal interview to afford any further information or explanation you may desire. I may mention that as the plans and specifications for the permanent way are already completed, nothing further stands

in the way of its being ordered from England in time to catch the vessels of next season, but the final decision, of the General Government. I have the ho^or to be, Sir, Tour obedient servant, (Signed) Jiro. P. Tayi»ob, Superintendent. The Honorable the Colonial Secretary, Wellington. Colonial Secretary's Office, Wellington 13th March, 1867. Sib, — I have to acknowledge the'roceipfc of your Honor's letter ofthelOtb. inst.,. submitting a new proposal with reference to the arrangement sanctioned by the Government, for the payment in land for the completion of the Oreti Railway line. The object of this proposal is by the transfer of the land to the Provincial Government or other persons to enable money to be raised on it, and to substitute cash in payment for the proposed works. The Government is advised that the existing law relative to the disposal and reservation of land in the Province of Southland will not allow of this proposal being carried into effect, and I have accordingly to invite your Honor, if the original arrangment is not to be adopted, to submit some other proposal for the consideration of the Government. — I have, &c, &c> J. C. Eichmond, for the Colonial Secretary. His Honor the Superintendent of Southland, Wellington. Wellington, 14th March, 1868. g IE> — i have the honor to acknowledge the receipt of your letter of the 13th inst., in reply to mine of the 10th inst., addressed to the Honorable the Colonial Secretary, on the subject of the Oreti Eailway, in which you inform me that you " are advised that the existing law relative to the disposal and reservation of land in I the Province of Southland will not allow of this proposal being carried into effect, and invite me to submit some other proposal for the consideration of the Government." I have now the honor to state more in detail a plan by which Mr Stafford's proposal for making a special reserve for that purpose may be carried out without, in ray opinion, encountering any of the legal difficulties mentioned by the Honorable the Attorney-General. Indeed without reverting to the original plan of direct land payments with free selection, which would undoubtedly be more costly than one based on cash payments, or to land payments with restricted selection, which would be very much more costly, I do not see how otherwise the proposal,, as stated in his letter to me of 7th January, can be made available for the purpose intended. The plan I propose aims at two objects, viz., economy of time and economy of money. In the first the General Government will not perhaps feel much direct interest, though it is of great importance to the Province. With respect to the second: since I am justified, from the tenor of the Colonial Secretary's various letters, in assuming that the General Government is anxious to assist the Province in completing this work, I must also assume that it is equally your desire that it shall be accomplished with as little sacrifice of the waste lands of the Province as is compatible with making them directly or indirectly the means of payment. After mature and earnest consideration of the subject, and after consultation with Mr Paterson, Mr Dundas, and other engineers, I cannot doubt that a very great saving in the contract price may be effected by offering cash instead of land payments, and more especially if we are enabled by this means to act on Mr Paterson's recommendation, to order the material for permanent way from England, or advertise for contracts for it there ; as a respectable manufacturing firm would hardly undertake to supply the necessary material at any price if payment were offered in land, and as this would be the largest item in the cost of the undertaking. I propose, therefore, in order to be enabled to go into the cheapest market, that the Provincial Government should itself purchase 60,000 acres of land in the name of Oreti Eailway trustees, to be named, if you think fit, by the General Government, and who should alone have power to make payments on account of the material and works on the certificates of the General and Provincial Government engineers. I have no doubt that, failing the realisation of sufficient land fund from the sale of other land to meet the payments as they became due, the trustees would have no difficulty, on the security of the lands so held in trust, in obtaining such advances from the Bank as would enable operations to be commenced and completed without check. With reference to the selections made by the Chief Purveyor and Commissioner of Crown Lands, as indicated in the map which accompanied my last letter, it was suggested at the interview with which I was favored yesterday, that it was objectionable to select the most valuable blocks of land for this purpose, as it was taking the cream off the security held by the public creditor for the payment of the Provincial debt. In reply to this objection, I would remark, first, that I inferred from a paragraph in Mr Stafford's letter of 7th January, directing that the reserves should be made " as far as possible contiguous to the line and to each other," that the intention was that the land selected should be thd most valuable; and the selections have been made according to the spirit of what I supposed to be the meaning, though not according to the letter of the suggestion. Secondly, that the selections have been made probably as much with regard to what would be likely to be first purchased, as with regard to intrinsic value. Thirdly, that according to the regulations, the Provincial Government has now the power to appropriate the proceeds of the sale of any laud whatever to make railways or other public works, and constantly does so ; that the chief object of the proposal under discussion is to enable the Provincial Government to proceed at once with

the finishing of the line without waiting for the sale of so itinoh land as toould be necessary to effect it, and in order to ensure the shipment of the plant from England by the earliest vessels next seaiion for New Zealand, and avoid as much as possible the additional rate of freight which a special charter would involve ; that the ultimate result to the creditors of the Province would be the same in either case ; that the only difference that waiting for the actual sale of land before beginning the works would make, would be the checking, ipso facto, of the sales themselves, and so delaying the work for a longer period ; and as both the payment of the Provincial debt and the carrying on of the Provincial Government depend in the present state of the Customs revenue, almost entirely on the sales of land, it is not easy to see how the interests either of the Geneaal or Provincial Governments could be furthered by ; any act which should tend to check them, i The present proposal will require a special appropriation by the Provincial J Council of £60,000, for the purchase of the land ; and on His Excellency the Governor's assent being given, the then Provincial Treasurer would pass his cheque to the Eeceiver of Land Eevenue, who in the usual manner would pay it in to the Consolidated Provincial Account ; and I should have to request that this might be passed, with as little delay as the requirements of the Public Eevenues Act admit of, to the credit of Provincial account. The trustees would be thus in a position (being entitled to a Crown Grant, which need not, however, be immediately issued,) to obtain from the Bank, on the security of the land so purchased, such advances as would enable the work^ to hs proceeded with without further del ay. It will, of course, be an object to the Provincial Government that the trustees should be as little indebted to the Bank as possible, and for as short a tame ; and as, without of course having any absolute ceatainty of it, I have every reason to believe that a considerable quantity of land will be sold before much money will be required to be disbursed for the Eailway by the trustees, the Provincial Government would find it to its interest to place so much of the proceeds of the sale of other lands than those held in trust to the credit of the trustees' account as was not required for the ordinary expense of the Provincial Government and the payments that would be. due under the Eevenue Act, 1867, to the General Government. I think I have now mentioned all the main features of the plan by which I propose to give the most economical effect to the conditions mentioned in the Honorable the Colonial Secretary's letter of 7th January ; my only other object in laying this before you, besides the economising of time and money, being to attain this end in such a manner as shall not conflict with the Attorney- General's objections to my first proposal, as shall be satisfactory to the General Government, and as shall afford the most perfect security that the proceeds of the lands so appropriated shall be applied solely to the object intended. I shall be happy to give personally or by letter any further explanations you may desire, or to receive from you any other suggestions for facilitating the accomplishment of a work which I cannot doubt the General, as well as the Provincial, Government have sincerely at heart. 1 have the honor to be, Sir, Tour obedient servant, Jno. P. Tatlob, Superintendent, i The Hon. J. C. Eichmond, Wellington. Colonial Secretary's Office, Wellington, 19th March, 1868. Sib, — I have to acknowledge the receipt of your Honor's letter of the 14th inst., submitting another proposal for enabling cash instead of payment in land being given for the completion of the Oreti Eailway. This proposal is in eftect that the sixty thousand acres of land to be reserved should be nominally sold by the Crown to the Provincial Government, and administered by them in the name of trustees for the purpose of paying with money realised thereon for the Eailway works. The Government regret that they cannot assent to this proposal. They are advised that it is technically inadmissible, but the most serious objections are on substantial grounds of policy. A fictitious sale of the kind proposed would be a precedent in accordance with which all Crown lands might be easily removed from the operation of the laws of the colony. Moreover, the Government are not justified in inviting Provincial Governments, either directly or indirectly, to increase their liabilities by Bank overdrafts. Under these circumstances, the Government cannot go beyond the clear authority given in cases of reserves of land for the cost of public works by the 36th section of the " Southland Waste Lands Act, 1865."— 1 have, &c, &c, (Signed) J. C. Eichmond, For the Colonial Secretary. His Honor the Superintendent of Southland. Colonial Secretary's Office, Wellington 25th February, 1868. Sib,— As the interest on the Southland Provincial Debt is at present running on at the rate of (£19,700) nineteen thousand seven hundred pounds per annum, I have to suggest to your Honor the importance of a part of the Land Fund of the Province being set apart each month for the purpose of providing for its repayment, as otherwise, when the Colonial Treasurer in England has completed his financial arrangements the law will necessitate arrears of interest and sinking fund to be stopped from both ordinary and territorial revenue for payment of the accumulated amount, and thus cause to the Province great financial embarrassment which the suggested precaution might I obviate. — I have the honor to be, Sir, /

Tour obedient servant, (Signed) E. W. Statfobd. His Honor the Superintendent, Southland,

"Wellington, 19th March, 18&8. Sib, — I have the honor, with reference to your letter of the 25th ult., instead of unhesitatingly accedingto yourreasonable request, to submit that as legal difficulties stand in the way of my last proposition regarding the raising of funds for the completion of the Oreti Eailway, that this desirable end may be attained if you will consent to capitalise the interest on the Southland debt up to the end of 1868; or, in other words, will issue debentures for the debt, principal and interest, as brought down to that date. Under the " Public Debts Act, 1867," which authorises an amount of £422,000 to be raised for Southland's debts ; this can be done, and this will be more than sufficient to cover principal and interest. By your complying with this request, the necessity for making the 60,000 acres j reserve which you have been so good as to promise for this special work, will not exist, and I should be enabled, by the mail of next month, out of the revenues accruing to the Province, to remit to England the cost of the rails and other requisite plant (about £19,000) ; as also to meet the freight on same (about £6,500), that ' would be payable from time to time towards the end of the year, as the several vessels arrived with portions of the material. When you take into consideration that during 1866, and . up to October 1867, Southland reduced her debt by about £180,000 ; that for the debt now existing, we have a real property to show ; that to finish this property (40 miles of Railway) the present request is made ; and that we have in round numbers, 2,000,000 acres of land unsold ; I feel convinced you will see your way to act in this matter so as to suit my views. — I have the honor to be, Sir, your obedient servant, Jno. P. Taylob, Superintendent. The Honorable the Colonial Secretary, Wellington. Wellington, March 19th XB6B. Sib, — I have the honor to inform you that the Government have carefully considered your proposal, contained in yesterday's letter, that the interest becoming due on the Southland debt up to the end of the present year should be capitalised Your Honor states that this is practicable under the Public debts Act 1867 which authorises the raising an amount of £422,000 for the Southland debt. By this means, you inform the Government, the necessity for the reservation of sixty ! thousand acres of land for the completion of the Oreti Eailway will be superceded. In reply I have the . honor to inform you that the Government are disposed to assent to the proposal on one condition, which I feel sure your Honor will see to be reasonable. The completion of a practical arrangement for carrying out the Oreti Eailway will, your Honor has on several occasions stated, give a great impetus to land sales. The Government agree that this will probably be the result. As a further consequence, the contribution of the land fund towards the extinction of the debt will be materially deminished; for as under present arrangements the land fund is only charged in any case with interest and a small sinking fund, the rapid alienation of the land will in all probability bring that contribution to an end before the repayment of the debt shall have been provided for. Should this be the ease it may easily happen that the rest of the Colony may have to bare a considerable part of the local burden. To provide against such a contingency the Government are of opinion that concurrently with the concession of the point asked by your Honor, the Provincial Government should agree to the Appropriation of one fifth part of the land fund for investment as an additional provision for meeting the local liability. On this condition the Government will readily assent to waive all further application for interest up to the end of the current year, and will issue debentures for a sufficient amount to cover debt and interest to that date.^ — I have &c, &c, (Signed) J. C. Kichmond for the Colonial Secretary. His Honorthe Superintendent, Southland. Wellington, 20th March, 186 S. Sib, — I have the honor to acknowledge the receipt of your letter of yesterday in reply to mine of the same date, in which you inform me that the Government " are disposed to assent to the proposal for capitalizing the interest becoming due on the Southland debt up to the end of the present year, the Province relinquishing the conditional concession of 60,000 acres of land for the finishing of the Oreti railway, but on a ' condition ' which you ' feel sure ' I shall see to be reasonable. The condition id that the Provincial Government should agree to the appropriation of one-fifth of the land fund for investment as an additional provision for meeting the local liability. I presume, of course, that you mean after the Oreti Eailway is finished and paid for, and not as you word it " concurrently with the concession," which would tend to defeat, or at least delay the attainment of our object. I acknowledge that the spirit of your proposed condition, thus understood, is quite reasonable ; though, were I to accede to it simply as it stands, it might not, under all possiblefuture contingencies, bu easy to carry it into effect without sometimes putting the Province into difficulties during a temporary falling-off of land sales. But I make this admission on the broad ground that the "Public Eevenues Act" and other acts are in fault, and not that the fears you express apply specially to the Province of Southland. Neither, in any case, and supposing the law to remain as at present, could the extinguishment of the local burdens of that Province through its own resources, become a greater drag on the General Government than that of several other Provinces, the payment of whose debts

uoes not even now, and cannot in thfc future, receive any or much help from the land revenue. I do not, however, think it is for the general good that the legislation on thi» subject should remain as it now Btands. in regard to the providing by the provinces for the extinguishment of their respective debts by the payment only of a small sinking fund, and that for the reason mentioned in your letter, the force of which cannot but be admitted } and I doubt not that any alteration of the law in the direction you indicate, somewhat modified however from the absolute form in which it is put in your conditions, would, if made equally applicable to all provinces, receive the cordial support of the Southland representatives in the G-eneral Assembly, as it undoubtedly would that of the Executive Government of Southland.. I trust that on reconsideration of this subject, of the doubt as to whether the Province is legally liable to make any provision for the interest and sinking fund on its debt before the Ist January 1869, either by monthly payments or in the lump sum at the date named, and of the certainty that no such liability arises according to the Act until the Home Agent has completed his financial arrangements with regard to the issuing of General Government debentures to cover the Southland debt, you will accede to the proposal made in my last letter without insisting for the present on the condition which your reply attaches to it. I would also submit that any such condition, even if accepted by me, would be inoperative, for as the land revenue is now by law the property of the Province, no part of it can be disposed of without a previous appropriation of such revenue by the Provincial Council. I feel sure, therefore, that the Government will at once see the reasonablness of my proposal and be satisfied with the assurance which I have given of the readiness of the Provincial Government of Southland most cordially to support any general measure introduced into the Assembly, the object of which shall be a more complete security than now exists for the due payment of iuterest and sinking fund of provincial loans colonially endorsed, and the final extinguishment of the loans themselves. I have the honor to be, Sir, Your obedient servant, (Signed) Jiro. P. Taylob, Superintendent. The Honorable J. C. Eichmond, Wellington. Colonial Secretary's Office, "Wellington, 21st March, 1868. Sib, — I have to acknowledge the receipt of your Honor's letter of the 20th inst., and on the assurance contained therein, of support of a measure to improve the security for the payment of interest and sinking fund of provincial debts, the Government will consent to waive the condition attached in my letter No. 170, of the 20th inst., to the acceptance of your proposal respecting the Southland debt. As the case of Southland is exceptional, and as the present proposal is in effect to increase the indebtedness of that Province so far as the law permits, the Government understands the spirit of your Honor's assurance to extend to a special provision in the case of Southland, should it be deemed right to make one. — I have, &c, &c., I J. C. EICHMOSTD. For the Colenial Secretary. His Honor the Superintendent, Southland. "Wellington, 21st March, 1868. Sib, — I have the honor to acknowledge the receipt of your letter of this date, in which you inform me that on the assurance of the support of the Southland Government of a measure to improve the security for the payment of interest and sinking fund of Provincial debt, the Government will consent to waive the condition. attached in your letter, No. 170, of 20th inst., to the acceptance of my proposal respecting the Southland debt ; but you add that you understand my assurance to extend to a special provision in the case of Southland, should it be deemed right to make one, since the case of that Province is exceptional, and the effect of my proposal would be to increase its indebtedness. In reply, I would submit that the law itself contemplated this increase to the extent at least of the accumulation of interest up to the time when the home agent should have completed his financial arrangements as far as the conversion of the Southland debt into colonial debentures is concerned, if not, and it •seems to me that this last was the intention, up to January 1869, before which time indeed it is scarcely possible that these arrangements can be completed to the extent of the paying up of the capita], until when no interest to the subscribers can be chargeable on the Colonial Government. 2nd. That when that time arrives the case of Southland will no longer be exceptional since, I imagine, that the land fund of each of the other Provinces will be also and equally liable, (ordinary revenue proving inadequate for the purpose) for the payment of interest and gradual extinguishment of their debts. 3rd. That under these circumstances such a special provision in the case of Southland as you assume my assent to, would reverse the position which in your letter of the 19th inst, you expressed a fear that that Province might be placed in ; and instead of the payment of its debt becoming a burden on the other Provinces, it would, should their resources fail, probably still have to bear its share towards the extinguishment of their debts after its own had been paid off. In such a position I do not for a moment imagine that yon desire to place the Province of Southland. 1 on the other had have no desire that the debt of Southland should, to the extent of a single farthing, become a burden to other portions of the colony: and should it appear to the General Assembly that such is likely to be the

ease more than with any other Province, X feel Sure that none of our representa. tivea will throw any obstacle in the way of such an arrangement as you propose. I repeat what I said in my letter oi yesterday, that an alteration of the kw in that direction is in, the present position of affair^, not merely desirable bu+ necessary for maintaining the credit of the Colonial Government; but then to be equitable it must be of general application. With these explanations and assurances I do not anticipate that you will any longer deem it necessary to burden your assent to my proposal with any other candition. — I have the honor to be, Sir, Tour obedient servant. Jno. P. Tatlob, Superintendent. The Honorable J. C. Eichmond, Wellington. Colonial Secretary's Office, Wellington, 25th March, 1868. Sib, — I have to acknowledge the receipt of your Honor's letter of the 21st inst., and to state that the Government are satisfied with the assurance conveyed therein, — 1 have, <fee, &c, (Signed) J. C. Kichmond, For the Colonial Secretary. His Honor the Superintendent, Southland.