THE AUSTRALIAN DEBTS.

Taranaki Daily News, Volume LI, Issue 116, 7 May 1908, Page 2

THE AUSTRALIAN DEBTS.

I'IiOi'OSALS TO POOL THEM.

Melbourne, May (J. At the ITeminV Cowerence lute last night sir \V, Lyue tabled the Commonwealth liovernniem/s proposals relative lo ti'e taking over of the State | debts. Tile scheme prowde-.:— 1. All the debts of the SUles shall be taken over.

■I. A Council of Finance sliall bo ap- ' pointed to administer tin- deby raise new loans, and control the sinking fund. . ; 3, Each Stale shall pay lor a period of lii' l -' years annually to tlie Commonwealth the difference between ils share. o[ tlie £0,000,000 interest and expenses due oil ils transferred debt. At the end OI the live years' period such actual payments are to be reduced by a slid-, in" scale operating annually for thirty vears. At the end of that period the states will be absolutely free, of indebtedness as regards the loans transfcrrnl. 4..'lhe Commonwealth Parliament is to make an appropriation of an amount sufficient to pay the present annual interest and expenses on the debts taken over—say, £8,750,000. Such amount shall be payable lo tlie Council of Finance. o. The loans taken over by the Commonwealth shall he replaced at or Hear maturity by 3 per cent. Australian Consols, redeemable in twenty years after date of inscription or at the option of the Commonwealth at any time, li. A Commonwealth sinking fund . shall be established. ! 7. The States are to transfer to the i Commissioners the .present sinking . funds. , , I 8. After, the loan has matured . the difference between the present rate of interest and the rate pay able on the new loan, lo he paid by j the Commissioners into the sinking ■ fund. The sinking fund is to be under j tlie control of the Council, and to be used only for buying up .State and Commonwealth stock for redeeming:. ig loans at maturity. I). Future loans required by States slmll be made through'the Council; the e States to pay annually to the Council j. interest on each loan raised and one-' „ half per cent for sinking fund for tie 0 actual term; the liability of the States in respect of such loan to cease at the end of such term; the States to give an undertaking to pay tlie Council. 10. The Council of Finance shall decide the order in which loans shall he made. Loans for the redemption o|

State debts taken over are to have precedence over all other loans, 11. in the event of the total loan requirements for uny year exceeding the sum which, iin the opinion of the Council, it is unwise to borrow, the Council shall lie empowered to Settle in consultation with the State treasurers the proportion to be raised for each individual State.

12. In the event of the non-payment of the amount due by the State to the - Commonwealth or Council, the Commonwealth will have power, on receipt of a certificate from the Council, to impose a tax on that State. Also the Council shall have power to refuse to raise further loans for such State for a period not exceeding ten years. 13. In consideration of the States being relieved of indebtedness, transferred properties shall be handed by . the States to the Commonwealth free t of charge. Sydney, May 0. _ Both the Herald and the Telegraph regard Sir W. Lyne's scheme as impossible. As far as New South Wales is concerned, it would be likely to retard her progress and the development of her resources. Received 6th, 11.35 p.m. Melbourne, May 8. Mr. Dcakin attended the Premiers' Conference and answered a number of questions explanatory of the financial proposals. He said the powers of the proposed Council of Finance would be strictly limited to technical control, and would only have ultimate decision when the State treasurers could not agree among themselves. Received 7th, 1.3 a.m, Melbourne, May 0. Mr Deakin said he did not think the financial scheme would cause any hardships to the individual States, or make borrowing more difficult. By placing a big loan, instead of individual State, loans, the Finance Council would regulate. tlie placing of loans to the best advantage. '