The Daily News. WEDNESDAY, MARCH 2. CARPING CRITICISM.

Taranaki Daily News, Volume LII, Issue 328, 2 March 1910, Page 4

The Daily News. WEDNESDAY, MARCH 2. CARPING CRITICISM.

It will be remembered that some of the London financial papers some little .time ago devoted critical articles 'to New Zealand's financial policy and position. Tie latest English files to hand show that the Australasian World, a London publication, has championed the cause of New Zealand to some purpose. In its issue of January 17th, the London Financier indulged in a .rare debauch of carping criticism m •onoection with our Government finance, but, as the World points out, the critic seems to belong to the class, who, according to the author oi "Hudibras," are "willing to wound but afraid to strike." He knows that it would be puerile to attack the credit of New Zealand, so he treats the reader to an array of figures relating to the Advances to Settlers Department, and even dondescends to admit that '"a net profit for the year of £G3,B3s'' has really been made by the Department. Therefore, this policy "is evidently more than self-supporting." These figures relating to the policy of advances to settlers are strong evidence that the Government is making good use of its borrowings. Presently, however, he becomes imprudently aggressive when be refers to Sir Joseph Ward, the Prime Minister anil Treasurer of the Dominion, and the Hon. W. Pemuer Reeves, Principal of the London School of Economics, who is the financial adviser of the »ew Zealand Government in London. Here is a part of the afta-cF in the Financier:— "The financial methods of the New Zealand Government have of late come in for a good deal of criticism, both" m the Dominion and in this country. Sir Joseph Ward, who Is Treasurer as well as Prime Minister, has not only been borrowing pretty Freely—some say excessively—but the local governing bodies have now run up a debt amongst them of nea.-ly £13,000,000. The public debt of Now Zealand has been increased during the past 18 years by £32,000,000 — from £38,000,000 to close upon £70,000,000 —a pretty considerable load fo r a .population under 1,000,000. The financial stringency which made itself rather severely felt during 1008-9 lias now practically passed away, and the trade of the Dominion is in a much healthier condition. The exports have risen from £16,370.557 in 1008 to £18,700,158 in 1909. On the other hand, the imports have declined from £17,750,80S to £14,916,005, so that file Customs revenue lias suffered, though a check has been put to the rather reckless trading which was being carried on. The outlook is also distinctly brighter, an improvement having taken place alike in the pastoral, dairying and agricultural industries. In no other part of the Southern Hemisphere has more assistance been given to settlers. The annual r eport of the Advances to Settlers Department, recently presented to Parliament, states that the advances actually granted during the last financial year numbered 3042, amounting to £1,493,535. The Board up to March 31 had authorised 25,334 advances, amounting to £9,200,925. The money paid over during the year for advances to settlers and advances to workers totalled £1,792,019, and the Department shows a net profit for the year of £03,835. This policy, therefore, is evidently more than self-supporting. On his return to }few Zealand last year, after attending the Naval Conference at the Colonial Office, it was the proud boast of Sir -Joseph Ward that while in England he obtained a million of money, and had it sent out to New Zealand— £500,000 of this being required for the Advances to Settlers Department and £500.000 for Public VorKs. "This money," he said, "was obtained without the assistance of the Government bank in London. Frankly, it is this method of doing business that is not liked. Since the government of New Zealand borrowed outside the Crown A stents for the Colonies, the Bank of England authorities have Tieen their financial advisers. They have conducted the borrowing in this country, and are responsible for the management of the inscribed stock. But it appears that"when Mr. Pember Reeves resigned the High Commisisonersliip. to take up the post of principal of the School of Economics; he was made

"Financial Adviser, at a salary of £4OO a year, and what a good many people would likn to know is. whether he advises the Bank of England, and, if not, why the Bank of England should not continue to advise the Government through the medium ;.f the High Commissioner, and, further, upon whose advice is the money required by the Government being obtained through private channels? Naturally, the Stock Exchange does not care about receiving application to increase the amount of inscribed stock in the Official List by a million or a million and a-half without there being any public issue of the new stock, and, if what I hear be true, ■we are likely to hear more on this point."

The gravamen of the charge by the Financier, says the Australasian World, seems to be that the Hon. Pember Reeves "advl&ed" to obtain and Sir Joseph Ward did obtain moir'y "through private channels." But where is the Financier critic's evidence thar, the transaction was not carried out with the consent of tho Bank of England? We would also wish to be informed as to who are the ''good many people who "would like to know" whether Mr. Pember Reeves "advises the Bank of England, anu, if not, why the Bank of England should" not continue to advise the Government through the medium of tho High Commissioner." Surely there is not anybody connected with finance in London who does not know that Mr. Fember Reeves is the "financial adviser" of the i\ew Zealand Government and not of the Bank of England. Moreover, Mr. Reeves and Mr. Hall-Jones are very good friends. There is nothing more becoming in a serious financial critic than the cultivation of a dignified of writing. As to the allegation that Sir Joseph Ward has tieen borrowing "excessively,jSikds regrettable, says the World, tߣs|p§j ■critic in the Financier has not mMiPa more thorough study of New Zealand Government finance. The tendency some London financial critics to judge Government finance or a wealthy and progressive new country as if the borrower were a young profligate who squanders money on gambling and riotous living is to be highly deprecated. It is true that the public debt of the Dominion of New Zealand has been increased during the past eighteen years by £32,000,000, but the critic in the Financier seems to ignore the fact that the borrowed money has been put to excellent uses by the Government. Twenty-eight thousand persons have been assisted to become settlers and develop the country's rich natural resources. Advances have been made to these 28,000 workers amounting to £9,810,000. Railways and other reproductive public works are responsible fo r the remainder of the amount borrowed. The borrowing of £32.000,000 in eighteen years lias increased the public "wealth of the vigorous young Dominion from £300,000,001) to' £613,000,000! Wilf any level-headed business man, asks the World, venture to sav in the face of such a splendid result that the Government of New Zealand has borrowed "excessively"?