FINANCIAL DEBATE. MR MOSS'S AMENDMENT. MR BALLANCE'S SPEECH. Wellington, August 13.

Te Aroha News, Volume VIII, Issue 394, 17 August 1889, Page 5

FINANCIAL DEBATE. MR MOSS'S AMENDMENT. MR BALLANCE'S SPEECH. Wellington, August 13.

The financial debate was opened last; night> when Mr Moss's amendment condemning the property tax was brought up with the second reading of the Property Tax Assessment Bill. There was a fairly good House, bub the speeches wero very mediocre ; Hon. Mr Ballance being much below his usual form, while Mr Saunders wa3 seldom interesting. During his long speech Mr Verrall as usual spoke on his pec hobby. The House adjourned at a quarter to 12, and will resume again ab 2 30 this afternoon, when the debate will again go on, it having been announced that no questions will be taken. Ib is now several weeks since all the questions on the order paper wore clearod off, and if things go on as they have started it will be considerably longer before we do. Mr Ballance, in opening the debate, referred to the Premier's ineffectual attempt to convert the people at Auckland, Napier, and down South, and oxpressed surprise that under the circumstances he had nob thought ib worth his while to make a speech when introducing the Bill ; Sir Harry having announced Iris intention of doing this when all the speakers had aired their views. The proposal to free machinery from the property tax Mr Ballance thought was probably done to prevent anything like a general expression of opinion from the public with leference to the tax. Speaking of the Financial Statement, he declaied ib was largely made up of padding about the progress ot the colony. The expenditure on tho coalfields tended only to the benefit of a monopoly. The improvement in the colony was due to the fact that there were nob nearly so many people ab Home running New Zealand down now as formerly, and that a more cheerful tone prevailed amongst colonists. The revenue last year, he showed, had fallen short of the estimates by £107,000, but it was made up to the Treasury by windfalls— a non-expenditure of votes, which went largely to make up the alleged surplus. If it were nob for the funds in the Post Office Savings Bank, we would be unable to meet the demand which might come some day. This and other trust funds should come under the most careful scrutiny of the House ; and the House should insist upon their proper investment. Talking of the surplus, he showed that out of the supposed £70,000 that was over there had to be taken the £46,000 raised last year by the imposition of a primage duty, and so was also £54,000 saved in subsidies to local bodies which was not paid this year. The fact that there was an apparent surplus was certainly gratifying, and would have a good effect on the colony's credit at Home. He showed that it was to do this that last year the Opposition had done all they could to meet the Premier and give him all the revenue they could. Speaking of the tariff, he advocated at least a three years' trial before any judgment was passed upon ib. He quite approved that colonial industries should receive some assistance. He objected to the stress that had been laid upon the increase in the education rote, which after all was only due to the increased attendance, and he thought that increased saving might be effected in this department. He denied that there had been any great increase in settlement, in apite of land having been made cheaper. The increase was made, he declaied, by including some 209 settlers who had been on the land for some years, but were nob included in previous returns, and showed that a large part of the land taken up was taken up by settlers already on land, who were increasing their holdings. He objected to the great expenditure of £14,632 on the unemployed, and denied that the village settlers were paupers. On the contrary, they paid 5 per cent, more than any other class of settlers. He deprecated any indiscriminate encouragement of immigration, but condemned the Government for not encouraging the better class of farmers, with money, to come out. The reduction in immigration was not due to the reduced public works policy, but to the want of sympathy shown by ,the Government towards the wage-earning class. Their whole policy was to place large areas of land in the hands of wealthy men who shut out the working class. He then referred to the scant encouragement given to Mr Reess scheme. The result of their native land policy was that speculators had obtained large blocks, and there had been no colonisation ; but; he was glad that the Government were now returning to the policy of land purchase. He declared that the expenditure of £400,000 on this purpose along the North Island Trunk Railway quite justified the extension of that line for another 10 or 12 miles, altogether apart from any question of route. The Otago Central proposals were, he thought, quite sound, if the line proved what the Ministers claimed it would. He referred to the Puhipuhi forest tramway, Helensville, and Te Aroha lines, which he showed to be constructed from the proceeds of kauri forests »r the sale of native lands ; but he was afraid they would not prove successful. The other railways of the colony were lef erred to, and he said that all the lines of the colony should be completed to what was shown to be a paying point with all despatch, and the Government should bring down a proposal for another loan, but see that ib was properly earmarked. Going on to the property tax, he disapproved of the proposal to exempt machinery, as it made no distinction between profitable and unprofitable settlers. Improvements, he thought, should be exempted and speculators made to pay heavily. Any proposal for remission should be general in its effect, but should not be harassing. Mr Saunders spoke at some length. He showed that the surplus was only an imaginary one, and that really there was a deficit of £649,000, which was received with laughter.' He strongly advocated the di3franchisemenb of Wellington on the score of saving to the colony. As Mr Ballance would probably increase the expenditure, he would support the Government on the principle, " better the devil you knotv than the one you don't." Mr Verrall advocated a State bank, and then the House adjourned.

Wellington, August 1.4 Dr. Hodgkinson resumed the debate on the Financial Statement yesterday afternoon, dealing at length with the Government and their policy, and with the Opposition and their tactics. The latter, he said, were an extremely discordant crowd. There was no harmony or union among them. The only bond that united them was the desire to oust the Government and to take their places. He condemned the property tax, but deprecated disorganising the finances of the colony, declaring that the Opposition had nothing to substitute for it. Dr. Hodgkinson spoke for an hour and forty minutes. Mr Cowan, who followed him, considered that this abstract question had been raised

as a no-confidence motion. Any tax was unpopular, but; especially the property tax, which was disliked from the North to the South, and he advocated in its place a land and incomo tax. What the country wanted was a continuance of the policy initiated by the Government and a further reduction oi expenditure. He deemed it unwiso, until they should have a better Government, to change the property tax. In conclusion ho supported the present Government as tho best under the circumstances. Mr Taylor followed Mr Cowan, and spoke until the half past five adjournment, arguing for Mr Moss's amendment, and defonding the Hon. Mr Ballance for his speech of the previous evening, which had been attacked by the other speakers. At half - past seven he resumed, and after making a short; personal explanation and declaring his intontion of supporting the amendment he resumed his seat.

THE PREMIER IN REPLY. The Premier thon took up tho running, and after chaffing Mr Taylor, complimented Mr Ballance on his speech for its moderateness, but said ho could not compliment him upon its strength, tor he had had practically no fault to find with the Covernmont. He showed that Mr Ballanco had made no reference to what he proposed to substitute for tho property tax. He certainly had not declared for a land and income tax. In fact, ho had declared for a property tax with some amendments. The only difference between Mr Ballance and tho Government was that he would except from the operation of the property tax certain improvements which tho Government could not see their way to adopt. He censured Mr Moss for bringing forward his amendment, thus spoiling what should have been purely and simply a financial debate. He declared that the danger from the Opposition was ' their entire want of a sense of responsibility, and likened the conduct of the members of that party to thac of lairikins. He declared the debate on the amendment to be a foolish one, and ridiculed tho amendment, saying it might be applied to each and every item of taxation. Going on to deal with Mr Ballance's speech, he took his objections severally. A surplus was the amount that remained after the books and accounts for the year had been closed, and no liabilities were taken into account. The inclusion of

PRIMAGE DUTY IN THE SURPLUS was quite justifiable as being included in the revenue for the year under the Customs Duties Act. Though it had been taken to reduce the debt, he mentioned that besides the primage duty he had used some £4,000 to pay off the debt of the colony. Mr Kerr here gave him the Customs Duties Act, and pointed out the clause that provides that the primage duty is only for the redemption of our debt. Sir JET. Atkinson declared that was exactly what he said, but it was still allowable to include this primage duty in the surplus. He then went on to leetuie the Opposition for what he said was depreciating their country and was unfair to their fellow settlers. Referring to the money Mr Ballance had spoken of as not having been paid to local bodies, and which was included in the surplus, he declared that that amount was also a part of the surplus, for it was a matter of difficulty to get local bodies to apply for the moneys due to them. Dealing with the trust funds, he said it was very wrong for people to keep speaking about the investment of the trust funds. The depositors did not rely upon these investments, but upon the general fund ol the colony. If there was a run upon the Post Office Savings Bank to-morrow he (the Treasurer) had secured in London.

£324,000 OF REALISABLE DEBENTURES. That would meet any demands to that amount. He referred to the leader of the Opposition's approval of the Otago Central Railway, and said of course now the House was sure to pass the Bill dealing with that. He stigmatised Mr Ballance's policy as one of moderate borrowing, from which it was easy to go turther. All his (the Premier's) political life had been taken up in restricting moderate borrowing (shrieks of laughter and applause). He would not go on to prove that now, although he could do it easily (laughter again). The proposal of the leader of the Opposition was to borrow when the money on hand was spent, so as to be able to spend about £300,000 a year, and he would have the money on hand spent as rapidly as possible. Mr Ballance had advocated borrowing and earmarking the loans, but this the Premier showed had been already tried with little success. The colony could not go in for moderate borrowing. Nothing bub the pledge to totally abstain would keep it in the right course. The Premier then went on to show what his Government's policy was. The House was pledged to a reduction of expenditure and to no more borrowing, and those pledges had been faithfully carried out. The Government had come to a decision that the public works of the colony could be brought to a moderate state of working order if they were allowed to

BORROW TO A LIMITED EXTENT,, And this they had faithfully carried out. He showed that their proposals regarding the Otago Central, Puhipuhi forest and North Island Trunk Railway were all component paits of their policy, which all tended in the direction of preventing further borrowing. If that policy was not adopted, then they must have recourse to further borrowing. It the works proposed by the Government were carried out they would render further borrowing or desire for such among the large communities of both Islands quite needless and quite unnecessary. The policy to borrow the money for these lines instead of raising it in the direction proposed by the Government he strongly condemned.

THE NEGLECTED NORTH. The North part of Auckland was a part of the colony which was worty of attention. Three Ministers had visited it and after careful inquiry the Government had come to the decisio* that a tramway constructed through the Puhipuhi forest would more than repay expenses and would leave a surplus that could be devoted to the North Auckland Trunk Railway. If the timber with which it was proposed to pay for the tramway was not taken away in two years it would be lost. The settlers in the North of Auckland, he declared, had been neglected, and it was only fair that they should be given a share in the policy that was constructing works in other carts of the colony. He defended the survey of the line for the North Island Trunk Railway, it being done to see if the House could wisely alter the route. It would be a long time before the line could be constructed, and the Government thought that the best use that could be made of the money on hand was to complete the Auckland end of the line to the tunnel and thus opening end to a large block of land continued with a road* to connect the Auckland end with Stratford. This he showed was something complete. He would ask the country with the utmost confidence to decide as to his policy. He laughed at Mr Ballance's statements about the land settlement, and asked the House to withhold its decision on that point until they had heard the Minister of Lands defend bis figures.

PROPERTY TAX. He then proceeded to deal with the Property Tax Assessment Bill, and what would follow if the amendment waa carried. They would discredit the Government. There would be no new land and income tax, for that would not bo proposed ; and no relief would bo given to thoso harassed by the property tax. The amendment, abstract as ib was, was simply to discredit the Government, and he asked the House how they could expect the Government to sue- ' cessfully carry on the groat work they had commenced, iE slurs like this were cast upon them. The work given j by the House to the Government to do, however imperfectly it had been done, was yet done to a certain extent satisfactorily. What did a land and income tax really mean ? Members of the Opposition did not know, if they were turned out, who would carry on the great work the Government were doing. Mr Ballance would lead, and he was not so able as Sir R. Stout or Sir J. Vogel ; and yet when in company with those statesmen they did not 'dare to take off the property tax though they were pledged to it, and tor why ? Because they knew it was absolutely impossible to raise sufficient money without it co make both ends meet.' A land tax of a penny in the £ and Jd of an income tax besides would raise about sufficient money. If ever such taxes were imposed, he ventured to say that the country would rise in revolution against it. The idea was that the land tax would break up the large estates, but he would point out that they already had a land tax of a Id in the £ on all unimproved land in the colony. They wanted now

TO TAX IMPROVEMENTS, bufc he was suro the country would no stand a progressive land tax. They wanted to have the people settled on small farm?, but if they were going to tax them, then the land tax would be a penal one. It was quite true that no man had a right to own large estates to the detriment ot the country, but ho had never heard any arguments given that any lai'ge landholders were acting detrimentally to the country. Whon he heard such he would take steps to break up their estates. People, he declared, confused a revenue tax and penal tax. lie was dealing with a revenue tax. He was responsible for the revenues of the country, and

COULD NOT LISTEN TO ANY PRO POSAL FOR A LAND TAX. Why should a man with sovereigns in the bank or with drapery goods not have to contribute to the levenue as well as the farmer or landholder? He had ascertained that large land - holders paid more under tho property tax than under any land and income tax that could be collected. Speaking with the authority of his office, and with a sense of the responsibility upon them, he declared that it was impossible to raise sufficient revenue fiom aland and income tax, except at&ucha rate that no one would pay it. A land and income tax would nob encourage bonajide settlers, and it was the bonajide settler they wanted, and no Government had done more for him than the present Government. He regretted the amount of the property tax, but without it the finances of the colony would have gob into inextricable confusion. It was too high, bub they had to geb the money from the House. TheStout-Vogel Government had been unable to change the bax, and the Government felt that it waa the best possible it one or two modifination& vreie introduced. In spite of the wretched work the Government had had to do, the majority of the House and the majority of the country recognised that they were doing that work satisfactorily. The colony was now just escaping from a cloud that had overhung them for a long time, and this was nob the time to disturb and re-model their taxation. When they had a certain surplus, when the country had settled down to its changed conditions, and when they had a really fair margin, then would be the time to consider what change could be made in the taxation. He himself was perfectly open to conviction, and had been

INCLINED TO AN INCOME TAX, and unless he had to raise revenue, ho was quite willing to accept any reasonable pro posals for amendments ; but such abstract amendments as that proposed he could nob accept. If carried, the responsibility would be thrown on the shoulders ot the Opposition, and lie warned the House thab the proposals of the Opposition would land the colony in difficulties, leave them in deficit, and retard the colony several years. Tho Government would oppose such proposals. They would adheie to their public works policy, and they would have no more borrowing if they could help it. They wanted to be put off the benches in a straightforward manner, or else allowed to £0 on with the business of the country in a business-like way. Sir Harry then resumed his seat amidst loud applause.

MR WALKER RETURNS TO THE ATTACK. Mr Walker, on the Opposition benches, rose to reply to him. He defended JVlr Ballance from the Premier's attacks, and showed that his leader had not advocated moderate borrowing, but preferred it to the policy of borrowing from the trust funds adopted by the Government. Mr Ward deprecated the Premier's bifeter attack on the discipline of the Opposition. He was sorry that the Premier had not brought) forward figures to support his statements about the land and income tax, figures that would have enabled them to judge between the alternate forms of taxation. He considered the property tax was injurious to the interests of the colony, and that it would have to be either amended or abolished. Though he disapproved of a progressive land tax he would like to see a tax placed upon unimproved land. The statistics furnished by the Property Tax Department showed that out of the 28,000 payers of the property tax 9,547 were of the farmer and grazing class, besides those who must contribute through the loan companies. Farrnera were thus very much larger contributors than any other class of people. The land tax he claimed had been a success in Victoria ; and against the property tax he brought^ a long series of indictments to show how' it handicapped induBtry of all hinds. He strongly supported Mr Moss's amendment, whatever its consequences. On the motion of Mr Tanner the debate was then adjourned at a quarter to 12 until to-day at 2.30. *

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