The Temuka Leader. SATURDAY, MAY 8, 1886. THE £4,000,000 A YEAR.

Temuka Leader, Issue 1503, 8 May 1886, Page 2

The Temuka Leader. SATURDAY, MAY 8, 1886. THE £4,000,000 A YEAR.

It is not in Terauka only that people are asking bow will New Zealand be able to pay tbe amount of interest it has to make up annually for its foreign creditors. Tbe London Times bas published tbe following letter, written by a correspondent signing himself “ Mercator,” and who is said to to » financier of the highest standing Sib,—The Colonial Treasurer of New Zealand has foreshadowed the intention : of raising a new loan of from £8,000,000 to £10,000,000 to construct, he states, three new lines of railway and to pay the interest thereon while tbe railways are in process of construction. I think, sir, you and the investing public will agree with me that the Colony is not warranted in doing anything of the sort. Tbe Government debt exceeds already £30,000,000, or £SB per head for every colonist, young or old, in the countryfour times that of Egypt, five times that of Turkey, and twice that of Spain—and the Colony enjoys the unenviable distinction of being the most indebted country under the sun. To meet its present engagements taxation has reached the tensile point. Customs duties are abundantly heavy, while stamps and legacies are not neglected, and over all there exists a property tax assessed on (be capital value, which in its ramifications literally embraces every kind or class of property, real or personal. It la true some of the land of tbe Colony is very good, but the good is very limited in extent, and is all alienated, leaving only the mountains and the disputed territory of tbe Maori King, a densely forest country, as an asset for the public creditors, Such, then, is the position of the Colony in its public capacity, and I regret to say that the internal economic system, if anything, is less encouraging. To borrow money and fatten on its expenditure has been a growing evil in the Colony for many years past, and I can safely say that there is not one city council, municipality, county council, road board, harbor board, or other corporate body which has not its own individual debt; and if to these we add the Government debt, the mortgages registered on private property (by no means modest), and the capital of banka and finance companies employed in the Colony, the aggregate reaches £65,000,000 which, at a general average of per cent, reaches the sum of over £4,000,000

of interest. And as only £12,000,000 is registered as New Zealand capital, nearly the whole of that sum has to go onnually out of the Colony to pay interest on public or private debts. In 1883 the exports amounted to £7,000,000, but since then the low price of grain and Indian competition have almost destroyed the cultivation of wheat for export, and the existing depression in the price of wool will reduce the total value of exports for the current year to little more than £5,000,000, which represents the purchasing power of the Colony and the wherewithal to pay interest on her huge public and private debts, administer the government of the country, and maintain her free educational system of £600,000. The question to be considered is, Can ehe stand the present strain ? rather than entertaining the idea of contracting new liabilities. Where there an influx of labor or capital to the Colony, as in colonies situated nearer to the great centres of European population, the burden, though great, might soon be relieved ; but at present labor has to be found by the Government for the unemployed, and the introduction of new capital by private enterprise has long since ceased ; indeed, it is no longer an open secret that much of the private lands have fallen into the hands of finance institutions for advances made in more prosperous times, and are' now farmed directly on their account. ''The picture is a desponding one, but it is true, and the future is shadowed indoubt. It is true there is at the head of ‘iffairs a gentleman of great financial capacity, Sir Julius Vogel, well known in London monetary circles, but his great energy and wisdom, I think, would be better employed in husbanding the Colony as he now finds it,'rather than in increasing a burden out of all proportion to the population and resources of the Colony. “ Mercator ” understated the total amount of our indebtedness by at least £10,100,000. We are far worse off than he thinks, and as for stopping borrowing it cannot be done, unless we change our way of doing business. It is not a pleasant thing to reflect upon, but yet it cannot be concealed any longer that our position is extremely critical. The great historian Mr Fronde has said in his book on Oceania, that New Zealand would have to repudiate in the end. We trust not, but at the same lime it looks very much like it at present.