FINANCIAL STATEMENT.

Temuka Leader, Issue 1580, 12 May 1887, Page 2

FINANCIAL STATEMENT.

In Committee of Ways and Means, the Hon. the Colonial Treasurer, Sir Julius Vogel, delivered his Financial Statement on Tuesday night. After a few preliminary remarks, in which he stated that the ‘transactions of the year showed a deficit on the Estimates, he went on to speak of the EXPENDITURE FOR THE FINANCIAL YEAR, 1886-87. The expenditure during the past financial year showed a saving of £98,626 ®n the amount estimated. The savings of all kinds amounted to £129,890, the excesses to £31,254, resulting in the net saving before indicated. The largest items were—Rail'Vays, £65,511 ; public works (consolidated revenue account), £12,035 ; Education Department, £11,886; Customs, £10,839 ; Defence, £8,982, and Mines, £7411. The excesses in expenditure were principally £14,338 for services not provided for, and £10,023 for Hie Postal Service. The latter chiefly arose through additional cost of services because of large premiums earned, and through under-estimated exfcndiiure for the maintenance of telegraph lines. There was a saying on estimate for subsidies to local bodies, but the expenditure will come in during this year. REVENUE OF THE YEAR, 1886-87.

The revenue showed a less amount than estimated of £192,493. The following were the principal items of deficit : Customs, £124,235; stumps, £16,337; and 'railways, £157,813. As there was a sav. ing on the estimate of railway expenditure of £65,511, the net loss- on the railway estimate amounts to £92,302 The loss arose principally during the earlier portion of the year. Towards the end the traffic showed a marked increase. The loss on stamp revenue he attributed to diminiished business. The Post and Telegraph services were considered to have earned about £10,500 over the returns estimated, but is was difficult to exactly determine the amount of stamps sold for postal and other purposes. The depasturing licenses yielded £6206 more than was anticipated. The miscellaneous revenue showed a large excess on the estimate, £101,231. It arose in £his way. The accumulated sink*

ingfundon some of the English loans were much above what was required to meet the respective debt to which they belonged. He asked the Agent-General to call the attention af the trustees of the Sinking Fund to the Joan of 1863 to the fact, and they, ir conformity with the law, released £104,749 under the Act of 1868, being the excess accumulated up to 1884, and they released £39,755 under ihe Act of 1884 on account of the excess since that period. The amount set free under the Act of 1868 reverts to the consolidated revenue ; that belonging subsequent period is applicable to paying off the debentures created in the colony, and the amount has accordingly been so applied. As regards the debentures created here on account of the accrued Sinking fund, out of the amount already mentioned as released under the Act of 3884, and from the result of the drawings of the . bonds held by conversion, we have paid off no less than £302,600 of the debentures created. Out of a total of £750,900 created since 1884, they had paid off no less than £343,400. Statements had been put forth to the effect that New Zealand securities had fallen in value because of what had been termed the seizure of the Sinking Fund. There was not a particle of truth in the allegation. He then explained at length the matter in its tme light.

LAND FUND. The deficit in the Luid Fund had increased. THE PUBLIC WORKS POND, 1886-87. Last year it was decided to place under distinct amounts the residue of old loans and 'lie amounts to severally arise from the North Island Trunk Railway Loan and from the loan authorised during the session. He took credit in his last Statement for a balance of £768,780 remaining out of the old loans, and s»id that when recoveries were made on its account from the North Island Trunk Loan there would be more than £BOO,OOO to be voted as the House pleased on other purposes than railways, such as buildings, purchase of Native lands, roads and oilier works on goldfields, reading, etc. Altogether the amount of the old loans available for expenditure was £1,127,872. The expenditure amounted to £636,626, leaving a balance qf £491,246 available for expenditure this year. The Nor b Island Trunk Loan bad not been floated yei. There now stands charged against U £325,685, including an expenditure of £70,378 on the purchase of Native lands to serve as an endowment for promotmg settlement along the line. There was thns about £675,000 of it still available for expenditure. The loan of £1,326,000 authorised last year was negotiated at a little over £97, a price which was not satisfactory. When all the instalments pass to credit, as since the end of the year they have done, the balance left unexpended would amount to £713,765, the expenditure during the year having been £555,765. LOAN CONVERSION. Nothing further had been done during the past year in the direction of loan conversion.

FUTURE EXPENDITURE. The Government have constancy bad in consideration the question of reducing the public expenditure. There were three classes of the public service—First, the class exclusively engaged in collecting the revenue ; second, the class which renders services and receives in the aggregate remunerative payment for the same ; third, the class which undertakes useful duties for which little or no revenue is collected. The Customs aptly illustrate the first, the Post Office the second, and the Departments of Justice and Education two kinds of the third class. As regarded the first and second of the three classes, there was no possibility of abolition, though there might be economies consistent with efficiency. The third category depended on the will of Parliament. The following list cmie within the range of the third class -The Legislative, the Audit, the Electoral, the Lunatic Asylum Services, and those that come within (he Departments of Justice, Education, Native Affairs, Mines and Defence. He would be reluctant indeed

to have it supposed that he doubted the necessity of the services alluded to, for the peace, order, and stood government of the colony. The Legislative Department was in the bands of the Legislature, and the votes submitted were open toconsideration. The view of the Government was that reductions might be made especially by allowing officers who could be spared to follow other avocations during the recess, It is proposed to refer the subject to a Select Committee. The Audit Department, although included in the class of non-revenue departments, does benefit the revenue, and it also saved expend!, ture. He referred to the time before the present system was introduced. The Electoral Service was an essential part of the machinery of the Government of the country. The cost of the Lunatic Asylums did not require justification. The Justice and Native Departments were necessary. Be the Educational Department, the great majority of the people of this country regarded education by whatever means provided as an essential feature of the good government of the colony. Although the Minos Department only direct'y raised a small revenue, its importance was great as regards the indirect effect it bad both on the public revenue of the colony and the private revenues of the colonists. The Defence Department, excepting (he police, was one which at first sight appears capable of curtailment, but, before arrivin r at such a conclusion, it was necessary to remember that each time that a tolerably well founded rumor of war circulates, an irresistible demand arose for a thorough system of defence. The expense entailed by the hasty provisions demanded in times of emergency was much greater in amount, and less useful in result, than that which was necessary to employ and keep a regular and properly trained force. The Committee tvould, he thought, agree with bin* that the public service must be maintained at not less than its present standard of efficiency. The question was—■' Can the same efficiency be obtained at less than the present cost } The Colonial Treasurer then referred to the reforms effected in the Qivil Service during the past few years, to the Act abolishing pensions, etc, During the recess the Government had made reductions and laid the train for large savings of expense : in the future. In ten years time he believed the savings effected would be equal to a reduction of 20 to 25 per cent, sup- < posing, of course, the new conditions were < maintained. The reductions the Go- ' vermuent had made occur principally I

under the following heads:—A. Reductions on travelling expenses ; B. Doing away with offices and dispensing with officers ; C. Amalgamation of offices ; D. Saving in appointments to vacated offices. “ Departmentalism ” was a great bar In the way of amalgamation. The Government amalgamated under the one head of Treasury and Inland Revenue the several departments of the Treasury, Customs, Marine, Stamps, Property Tax, Lands and Deeds Registry, and Post Offici and Telegraphs. The chief officer of each branch and the Minister or Ministers will form a Board, which will sit periodically with the view to find means of -'enabling employees of different branches to act interchangeably. Government bad also decided to make a fairly graduated reduction all round. Salaries up to £l5O will uot be affected ; over £l5O and not exceeding £2OO, a reduction of 3 per cent; £2OO to £3OO, 4 per cent; £3OO to £4OO, 5 per cent ; £4OO to £SOO, 6 per cent; £SOO, 6£ per cent. The reductions in any one cass are uot to make salaries smaller than the last salary i n the class preceding. The plan will not apply to the officers in the Agent-General’s Deportment us they are subject to the English income Tax, neither will it inc'ude policemen or men int he Permanent M-litia, nor men on wages, whether weekly or monthly in any department, nor gaol or lunatic warders. It will not apply to persona whose salaries are permonently fixed by Acts, Ministers, however, accept it as regards their own salaries, It will rest with members to apply it to their honorarium if th«y see fit. They may desire that a percentage shall be deducted corresponding with that levied on similar amounts. The actual amount the deductions are expected to yield is about £20,000. The

Grand totals 4,071,304 4,111,223 4,012,568 After deducting the item of interest from both estimates, the votes submitted this year were less than last year by the large sum of £150,212. The amount for interest had increased to £IIO,OOO. The savings of interest during the year just p ist amounted to £11,624. The Government did not see their way to making the subsidies to local bodies at more than half the rate of last year, and with the same conditions as to payment. The full amounts due on the liabilities of last year will be paid, but included in them a reduction of £20,000 appears in the estimate of consolidated revenue, and in that of the public works. The subsidies altogether from both sources will he £IOO,OOO instead of £150,000. The estimate of Charitable Aid subsidies coming in for payment shows an increase of £14,000. In the permanent charges there was a new item under the Rabbit Nuisance Act of last session of £7500, but in the Stock, Rabbit, Sheep and Brands Acts, there was a reduction of £2OOO for a number of inspectors dispensed with. The Stamp and Deeds branches show reductions of nearly £BOOO. There are large reductions in the Treasury, Miscellaneous, and Property Tax estimates. The work of the Telegraph Department had greatly increased, and it would be necessary to increase the vote by £SOO. The parcel post system would be shortly introduced. A saving of £2 OOO had been effected on the conveyance of inland maila It was not proposed to renew the the Island mail service per the Janet Nicholl, costing £4200. He had effected reductions in the Post Office Department amounting to £5630. It was proposed to lay up one of the Government steamers till the end of the year. The Marine Department showed a reduction of £15,000 and the Justice £7OOO. The Education vote was about the same. The Public Library vote was reduced £2OOO, and them was a saving in the Native Department of £SOOO. In the Mines Department there was a s wing of £II,OOO. On the railway the estimated expenditure is £13,300 less than was estimated last year, The Government anticipated a better revenue from railways this year. The Defence Department’s estimate of expenditure was less by over £7,850. £15,000 of the cost of the permanent military will be charged to the Harbor Defence vote, instead of £12,500 as last year, yUTUBIi PROPOSALS.

There may not this year be much material natural increase in any item of revenue, whilst, with the same causes still at work quite independent of the prosperity of the country, there may be leas collected on some items, so that with estimates of expenditure guch as he had explrined, similar revenue, and without the £IO,OOO unexpectedly obtained, there was obviously likely to be a considerable deficit of the past year. The Customs revenue last year was £124,233 less than the estimate, and that estimate was less than the actual receipts of the previous year by some £4OOO, so that the Customs revenue for ’B6 87 was less by more than £129,000 than the receipts of 1885 86. In almost every

country and colony in the world there badbeen large deficits, which had been held over til the return of better times. He did not think it would be advisable for New Zealand to follow their example. At great length he went into the falling off in the revenue from spirits, etc., from the year 1882 to 1887, and also the falling off in the revenue from wine and beer,, t 'b'P"o and cigars, etc. People were in tiiu it.bit of comparing New Zealand with other colonies without remembering the difference in the position. It bad not the laud .revenue of those colonies, and It started in the race hadicapped with Urge expenditure' consequent upon native affairs. Some idea of the difference with regard to land revenue might be gathered from the following, a< correct a return as he could objtiin of the land revenue of the Austrian colonies during the last six years. Ney Zealand stands fifth on the list

An increase in the Customs revenue naturally brought them to a consideration of the system of direct taxation by means of the Property Tax. Had be, as Colonial Treasurer, a fresh field to start on, ho should recommend a Land T»x and . an Income Tax in lieu of a Property Tax, M though he was uot blind to the fact that there was a great deal to be said on each side. Speaking of removing the exemption, he explained at length how the largo property owner would be afected to u very email nx'enr, compared with the small owner. The Government proposed to increase the Customs duties, and also the Property Tax, but they did not, wish to raise the tax above a penny to anyone. The conclusion they bad come to was to propose that properties worth aot exceedmg£2sooshould enjoy the same exemption of £SOO as at present, and be subject on the balance to the present tax of thirteensixteenths ; but they propose that there shall be no exemptions allowed on proparties exceeding £2500 in value, that the tax on them shall be one penny, j ESTIMATED REVENUE. f With the additions they had asked to the Customs and Property Tax, the following was the estimated revenue for the year 1887-88, with the estimated and actual receipts for 1886-87^

Total revenue 4,158,134 4,074,920 3,882,428 RESULTS OF THE TEAK. The proposed expenditure being £4,071,804, and (he anticipated revenue £4,156,184, a surplus of £84,880 is the result. As regards the £92,800 defieieocy of last year, he hoped to be able to pay it off this year out of surplus and savings on votes, but would not undertake to do so. He proposed asking that it stand over until after the end of next session, w. THE LAND REVENUE EXPENDITURE. Speaking on the subject cf settlement** on the land, etc., he referred at length to the efforts Government had been and and were making to settle people oc the land. The leasing system involved not only a virtual suspension of cash sales, but also the necessity of spending much money in giving an impetus to sett eraent by roading, clearing, and general aid. TheGovernraent thought that for a leruWJ" years, until increasing revenue would permit otherwise, the deficiency between the land revenue and land expenditure should be made up by charges on the land sup* plied by such local borrowing as might be required. The rents arising from the land are Consolidated Revenue, and out of them it is proposed that the interest of any amounts borrowed shall be paid, and the ptin' ipai recouped by yearly alloca* tion. Under this proposal the cost of the Land Department, including roading and special aids, will go on the one side, mid the receipts on the other, and in a very few years they should be equalised. When the Bill was introduced he would be able to explain the details more exactly. PUBLIC EXPENDITURE. There was a balance cn 31st March, as already stated, to the credit of the old loans account, of £491,242. This amount might be swelled. Of the loan of last year there was, on the 31st March (including an amount s'ill to come in, and since received) a credit balanco of about £713,055, and there was left of the North Island Trunk Loan, after deducting the advances made on its account, about £675,000, which, ho wever, would be reduced by the cost of raising the loan when it is negotiated. The estimates were not finally decided, but he should not be much out when he stated that the proposed expendit* • (apart from authority to incur labilities out of (be North Island Trank Loan), will amount to about £IBO,OOO out of the loan of last year, and to about £487,400 as regards expenditure out of the old loans account. Members would, however, be able to con* dude from whst he had said that the Government consider that it is expedioot to limit the issue of loans in the London Market, and that for the present it isnpt desirable to undertake fresh railways beyond those already in hand. >. STATE OF THE COIONT. Speaking of the state of the colony, be denied that the deficit of last year and the extra taxation required were evidences of want of means on the part of the colony. The otoef cause of the deficit in the revSnlfc ' was the decreased consumption o!f intoxicating, drink and luxuries, and be took it that a large reduction owing to the more thrifty habits of the people. He asserted positively that its people are able, if required, to add to the revenue such an amount as may be requisite, That to have to do this is unpleasant goes without saying. New

Zealand is not so highly faxed per bead aa when it waa destitute of the great railways, roads, and bridges, that probably added an average of 25per cent to the value of its prodace to the producers. Smaller nominal profits even now represent in purchasing power the large profits of former days. Notwithstanding taxation the coat of living has materially decreased, and probably will continue to do so. The same nominal anm gives perhaps 20 to 26 per cent more purchasing power than foiznerly. He compared the state of things in New Zealand with that existine in other countries, in favor of the former. It would be contrary to all experience if the present depression was to last. la his opinion it must soon pass away. To him it seemed that the problem lay in a nutseell; either tbe whole world is to continue stationery and stagnant, which is an impossibility, or the favored countries must progress. That is all New Zealand required to know, for then it could rely on the unquestionable fact that in clima*te, iu fertility of soil, mineral wealth, in manufacturing capabilities, in Vast and varied resources, by land and sea, it pos sn d such a multiplicity of advantages . wore not excelled, if even •quailed by any p >rtion of tbe Globe. ME WEALTH OI THB COLONY. The value of all real property in the colony, exclusive of Native Lands situated beyond five miles of any road suitable for horse traffic, is £116,376,659, and tbe value of the personal property is £82,540,315, making together £198,916,974, which is exclusive of the raise of public works. The amount is thus thus represented Crown lands ... ... £13,675,516 Native land within five miles of a road suitable for horse traffic ... ... ... £6,847,105 Education, municipal, and other reserves, exclusive of Church reserves, which are included in taxable real estate ... £7,252,274 Taxable real estate ... ... £47,277,123 Non-taxable real estate ... £42,324,623 Total £116,376,662 Personal property ... ... £43,505,538 Nan-taxable ... ... £26,139,277 Allowed for exemptions at prebut which by our present proposals will be somewhat eliminated ... ... £13,895,500 Total £82,540,315

The gross returns show an increase on the 1882 assessment of £15,367,659 of real property, and of personal property of £18,540,315. He did not, however, consider that there bad been altogether this increase of wealth. The assessments, as be had said, had been more careful and searching. The taxable real property showed an increase on the assessment of 1882 of £2,277,142, and there was an increase on thsimilar returns of personal property of £3,50,538, ttogether making an increase of taxable property amounting to £6,782,680. Personal property in produce, agricultural, implements, bank deposits, and vessels (steam and sailing), amounting to £6,830,891, is no' included in the owners' statement. Public property to the amount of £19,377,985 wareeorded, but many millions expended on roads and bridges were altogether omitted. Ihe Government property making up ihe amount be bad first mentioned was as follows Hallway, cost ... ... £13,453,363 Telegraphs, etc., cost ... 623,727 lighthouses, cost 160,895 Buildings... 2,250,000 Harbors 2,500,000

Water supply on goldfields 500,000 There were 27,826 property tax payers, and as bo one paid who had less than £SOO it followed that there are that number possessed of £soq and over. He found that the 27,826 taxpayers included 5998 widows, trusts, absentees, and companies; the balanee of 28,828 represented the male taxpayers. There were 167,603 adult males in the colony by the late census, so that an average of ene male adult in a little over seren was tbe possessor of at least £SOO. He had a return yery carefully prepared showing tbe assets and liabilities of tbe colony. It did not include such works as roads and bridges. It above under tbe haad of assets—'Beal property, £116,676,359 j personal pro* party, £82,640,315 ; personal property, £82,540,315; Government property, £19,377,985; making a total of £218,204,959. On the other side, liabilities—Debt of colony, leas sinking fund, £31,688,349; debts of local bodies, £5,616,273; debts represented by mortgages, £31,821,109; indebtedness, exclusive of mortgages, £20,565,593, amounting in all to £89,491,324, and leaving a surplus of £128,803,635, or divided amongst the population, exclusive of Maoris, it showed a eurplus of £223 for each roan, woman, and child in the colony. Apropos of our agricultural capabilities, a few words should be said concerning the lately compiled statistics. They recorded an increase of 687 freeholds, 420 rented, and 502 part freehold and part rented holdings over an acre in extent, or what may be considered an addition of 1569 cottiers. The average yield of wheat per cere, also oats, barley and potatoes had in every case increased, excepting in barley. There was aiso a larger production of these articles, amounting in net value to £680,000. teß-ADJUSTMBNT.Or rHE TARIFF.

'•He had the honour to submit the following resolutionsßesolved : “That in lieu of the duties of Customs, now charged on the undermentioned articles, the following duties ot Customs shall, on and after the 11th day of May, 1887, be charged thereon on importation into New Zealand, or on being cleared from any warehouse for home consumption, viz. Acid acetic, Id per pound; acid tartaric, 3d per lb ; apples, dried, 2d per lb; candle*—stearine l|d per lb, parriffin or wax 2d per lb ; candles not otherwise enumerated, 2d per lb; cement 2s per barrel; choclate, confectionery, and aU preparations of cocoa or fihopolaie, cthc than for use as a beverage, 3d per lb; hah, ■dried, pickled, or salted, 5s per cwt ; fruit—pulp and boiled fruit, 2d per lb; '■ fish, preserved, l|d per lb; iron galvanised, plain, sheet, J.s 6d per cwt; maocaroni, vermicelli, saffo, tapioca, and semolina,2d per lb; maizona and corn-hour, lsd per lb; mustard 2d per lb; paints and colors ground in oil 2s per cwt; paints : and colors mixed ready for use 4s per cwt; rice, including ground, Id per lb; starch Id per lbvarnish Is per gallon ; eordage and rope, including house line, marline, ratline, bambrolina, spunyarn 7a fid perewfc ; pickles Is 3d per dozen pints; sauces 2s fid per dozen pints; glue Id per lb; barb wire (fencing) la fid per cwt; paper bags 7s 64 per cwt; honey Id per lb; doors, plain 3s each j doors, glased, 6a each ; sashes unglozed, 3a the pair ; sashes g'azed, 6s the pair; matches of all kinds la per gross of boxes containing each box 100 matches or under, and so on per gross of boxes for each additional 100 matches or part thereof; spirits, under proof, J.4s fid per liquid gallonj fruits (fresh), carriage «ad cart shaft*, spokes, felloes,

nod naves, and best carrriage timber, calico, (white and gray, in the piece) colored cotton and onion shirtings, cotton dress, the invoice value of which does not exceed 2d per yard, rough brown hollnud, gas pipes and machinery, water pipes, 5 per cent ad valorem ; vegetable, fresh sheep dip, leather (not otherwise enu ncruted), 10 per cent ad valorem ; aerated and mineral waters and wine of all 1< odfi, 15 per cent ad valorem ; basket and v. ickerware, boots and shoes, marble and saooe (unwronght), paper wrapping earthen drainage pipes, garden tiles and fire bricks, iron bridges and girders and columns for buildings, and other structural ironwork, iron castings forged or worked, iron of whatever shape or in whatever stage of manufacture not otherwise enumerated, ornamental ironwork and wirework, iron doors for safes and vaults, gates and gate posts, lamp posts, wheelbarrows of iron, crab winch cranes ami capstans, chaff-cutters, corn crushers, horse rakes, lifting ja; ! s, crowbars, picks and mattocks, pump ~ and other appliances for raising water, fittings for pumps, engines, and machinery, steam engines (other than for agricultural purposes), not exceeding 30 horse-power and parts of same, brass cocks, values, unions, lubricators, and whistles, calendars, show cards, and other pictorial lithographs and pr nts, perambulators, 20 per cent ad valorem; all articles not otherwise enumerated (which are not changeable with duty, 15 per cent ad valorem) 20 per cent ad valorem ; patent and proprietory medicines and preparations, 26 per cent ad valorem.” Resolved— ’* That in the event of any of the duties hereby imposed not being confirmed, or reductions being made in the rates specified above, the amounts levied, collected, and paid, in excess of the duties as may be imposed by the Customs Act based on these resolutions shall be refunded to the person who paid the same.”

Proposed Expenditure this year ie i as follows . — ORD1NAET REVENDE ACCOUNT. Estimated. Voted 1887-88 1886-87 Expended £ £ £ Civil list 29,750 29,750 31,015 Interest and sinking fund 1,764,793 1,654,500 1,642,876 Under epecial Acts 232,867 231,054 232,189 Totals 2,027,410 1,915,304 1,906,080 ti v o Departments 17,600 17,810 17,626 Colonial Sen. Department 130,615 . 163,236 162,940 Treasury and RevenueDepartment 407,838 457,323 455,609 Justice D - partment 110,170 118,084 118,671 Education Department 381,509 383,489 371,603 Native Affairs D epartmmt 17,817 22,830 26,836 Mines D e partment 28,983 40,104 32,693 Working Rbi 1 w a j s Department 7*8,000 761,282 695,772 PublioBuildings and Domain depts. 35,850 40,210 27,961 Defence Department 186,201 191,551 182,569 Totals ... 2,056,894 2,195,919 2,092,180 Grand totals 4,091,304 4,111,223 3,998,260 Services not 9 provided for — — 14,338 Deduct from salaries ... 20,000 — —

New South Wales ... £12,008,572 Victoria .. £41,699,714 South Australia ... £3,307,789 Queecslaud ... ... £3,290.168 New Zealand ... ... £2,860,492 Tasmania ... ... £385,710 Western Australia ... £362,071

Es'iEati* AotuaiJ Revenue. mated, mated, 1886-87. 1887-3S. 1886-87. £ £ £ Customs 1,460,000 1,410,000 1,285,765 8tamps,inoIuding Post and L'elegraph cash 615,000 617,600 601,163 Property-tax.. 885,000 312,000 310,897 Beer duty ... 54,000 55,000 63,494 Railways ... 1,100,000 1,060,000 992,187 B e g i itration and other fees 38,500 36,000 37,034 Marine ... 16,600 13,000 13,071 Miscellaneoous 38,000 44,000 145,232 Totals ... 3,707,000 3,637,500 3,438.842 D e p osturing licenses, rents, etc 191,000 186,320 192,586 Debentures for increases of sinking fund.. 258,184 251,100 261,000