THE FINANCIAL STATEMENT.

Tuapeka Times, Volume V, Issue 244, 3 October 1872, Page 5

THE FINANCIAL STATEMENT.

[By Electric Telegraph.]

[In the following summary shillings and pence are omitted.] The House went into Committee of Supply. The Colonial Treasurer (Hon. T. B. Gillies) made his Financial Statement. His object, he said, would be to state clearly the financial position of the Colony, and the state of the several funds constituting its public account. He would endeavour, to do that, not from a sanguine nor from a despondent point of view, dealing with the figures only with a desire to render them valuable because accurate. Certainly he would not knowingly permit any feeling as to the position of parties in the House to cause him to injure the credit of the Colony or retard its real progress. The total amount of the Colonial Debt at the present time was L 9,985,936, but there was a sum of L 576,848 of Sinking Fund accrued. The annual charge , consequent upon the debt, and which must be provided out of the General and Provincial revenue, was L 616,895. From." a carefully compiled balance-sheet of the Consolidated Fund account, he concluded that, 'on 30th January {? June) last, there was a deficit of L 33,345 on that account to be provided for, and, noj; a surplus of L 10.562 with which to commence the current, year, as , was stated by his predecessor. The discrepancy, therefore, was L 43,905. He accounted for it thns :— He believed "the amount recoverable from the Provinces was L 28,917, 0rL5360 less than that shown in his predecessor's Statement. He could not treat as an asset any part of the L 13,6&0 for which his predecessor took credit as recoverable from the Confiscated Land account. The Government meant to grant a considerable portion of those lands to the natives from whom they were taken, and the balance would not do more— if , indeed, it would do so — than meet claims and pay costs ef management. His predecessor omitted from his calculations L 2311 ef interest. due on 30th June npon temporary loan debentures, deficiency bills, fee. He also omitted a liability of L 17,585, in respect of savings on the Civil List, the Native Schools Fund, and the Armed Constabulary Reward Fund. In addition to those four sums, he (the Colonial Treasurer) had ascertained that LSOOO of additional liabilities existed up to 30th June, a great part of the amount having been paid since that date. Thus the discrepancy of L43,9Q8 was accounted for, and the deficiency of L 33.345 on the Consolidated Fund at the commencement of the financial year was shown to exist. ■ Under the Defence and Other Purposes Loan Act, there had been placed up to June 30th a total of L 635.000, of which at that date there remained available for Defence services during the current year, L 106.922. His predecessor estimated the amount available to be L 158.24 7; so Out there was a discrepancy of L 51,324 to be iwonntid for. Ox tbit dwerepancy,

L 23.792 was acoounjbed for by the fact stated by his predecessor, that the LI 58, 147 said to be available was inclusive of then existing liabilities to that- amount. Therefore the sum available for the current year was reduced. Of ' the ' remaining L 27 ,531 of discrepancy, L 8358 was accounted for by his predecessor haying taken cedit for that sum in the Consolidated Fund Account as recoverable for Defence, but having omitted to debit it as a liability against Defence of the amount realised under Schedule 2. L 9563 was for the redemption of Otago Dock Bonds sot yet redeemed, and was therefore a liability against this fund which might have to be met any day. Still further, L 9373 of the discrepancy was accounted for by that sum, which was ' advanced on account of confiscated lands from the Consolidated Fund, having been treated as an asset — a course which he could not follow. Add to the amount already stated L 235, which represented the charges for raising the last 1/150,000 of this loan, but of which his predecessor was not, aware, and the discrepancy of L 51,324 was accounted for. There had been up to .'une 30 raised under the Immigration and Public Works Loan Act a total of LI, 600, 000, of which there remained on that day named L 845.006 in cash available for warks already contracted for, or which might be contracted for. As regarded this fund but little' discrepancy existed between the accounts of his predecessor and those now admitted, except that his predecessor, in stating the available balance of L 935.684, omitted to. take into account L 79.250 of liabilities then existing, and that his predecessor did not include the charges on raising the last instalment of the loan, the accounts of which had not at the time been received in the Colony. He need not detain the Committee by reference to the Trust Fund, the Land Fund, or— (?) because he believed the | statements made as to them by his predecessor to be substantially correct. He would next explain the position of the several funds included under the general title of the Immigration and Public Works Loan Fund Account. The date up to which his explanations as to those funds would reach was September 10— the day on which the present Government took office. First as to the Railways Fund. The amount authorised to be raised was L 2,000,000,, 000, 000, to which must be added L 37.202 as representing the moiety of Stamp Duties, 1870-71, less refunds. The total amount of accounts passed fer payment wa5L314,365. There were liabilities amounting to L 982.347 for rails and rolling stok on railways begun or contracted for ; and there there were further liabilities amounting to L 298,168, being the estimated cost of rails ordered or contracted for on account of lines not yet begun or contracted for. Thus of the L 2,037,202, 037,202 there remained L 451 ,321 in cash, and the rails last mentioned, so that on the 10th September there was available for railways not yet begun or contracted for, cash and rails representing L 740.000. The engineer's estimate of the probable cost of the railway authorised but not contracted for Bhowed a total of L 2,005,110, so that, deductiug the L 740.000, and considering all the facts and contingencies, it was fair to estimate that at least an additional million and a half would have to be provided before the railways authorised by the Assembly could be completed. But this position of affairs did not require to be dealt with at present. The 1 balance of cash on band (L 845,096) would enable works already contracted for to be carried on during the present year, and would also enable the Government to initiate and push forward others ef the works authorised by Parliament. The Minister for Public Works would inform the House what those works would be, and during the recess the Government would work with a full recollection of the fact that the policy of Railways and Public Works could not be reversed, and that, to be a benefit to the Colony, it must be carried on vigorously^ though at the same time with prudence, judgment, and economy. Of the one million authorised to be raised for immigration, there remained on September 10th, after providing for liabilities up to 31st December next, as stat-d by the late Public Works Minister, L 868, 714. Of the L3OU, 000 for thia Goldfields Water Supply, there remained available, after providing L 5 1495 for the Thames Water Race, L 231.855. The sum authorised for Roads in the North Island was L 400.000, and there remained L 225.084 available, after proiding for contracts and meeting liabilities up to September 10th. On the same date L 135 ,175 was available out of the L 200.000 for Land Purchases in the North Island. On the Telegraph Extension Account the L60,0Q0 appropriated had been overspenc to the amount of L 15.383. His predecessor proposed to meet that excess, and to provide for further extensions, by allocating for those purposes L 40.000 unapportioned of the Immigration and Public Works Loan, and the Committee would now be asked to consent so to allocate, for the present, L 30.000 out of the L 40.000. A very disturbing element in the calculations arose from the fact that the LIOO.OOO set aside for Road Boards last year was ordered to be paid out of the Public Works Fund, but was not directed to be charged against any one of the accounts included in that fund. A decision on the point must now be come to, and his recommendation, after very careful consideration, was that the LIOO.OOO should be charged against the Immigration portion of the loan. He did not purpose to again subsidise Hoad Boards out- of the loan, for he believed that the members of the Boards themselves considered that .by such aids they gained a merely temporary benefit at the cost>of constant future taxation. As to the estimate of revenue and expenditure for the current year, he should differ but little from his .predecessor, save in a few items. It was unnecessary for him to enunciate a general financial policy different from that of his predecessor, for the present Government were called into office on the one ground that the previous Government bad failed in the administration of the, policy agreed upon. His duty was to carry out the existing pelicy subject to such administrative reforms as he should' indicate. The Consolidated Fund revenue had on the whole been fairly estimated by his predecessor. His predecessor had apparently not taken into account as revenue about L9OOO which would be received from surplus interest on the Trust Fund and other . accounts. As he now proposed to provide put of the Consolidated Fond for interest, on «]J. the Colonial securities, including those held by the Trust Fund, it was but fair that tbe sur^lwj interest, on such. funds should be treated fe> revenue; therefore he added L9OOO to the item Incidental Receipts, and, with the exception stated, accepting the Estimates already before- the Committee, his calculations would make the estimated revenue for 1872-3 stand at L 1,085,000. As regarded expenditure— on the Consolidated, Fond there were three points on which his proposals; would differ from those of his predecessor. First, he did not propose to continae^to charge interest and sinking fund on the Immigration and Public Works Loan upon the loan itself, giving as a grant-in-aid one-half of the Stamp duties to a further contribution for the ' Consolidated Fund, instead of that plan, lie proposed to ckarge the interest and sinking fund in question directly upon the Consolidated Fund, as the law required. He would reckon on half the Stamp duties to aid in meeting the charge, first making the necessary alteration in the law ; and he would charge against the Public Work* Lou, for ijus ye*r oily, tuch hjlance

of the , interest and sinking fund as the Consolidated Fund could not bear. The cash result for this year would be much the same as that proposed by his predecessor ; but it would be arrived at directly, and not in an indirect and mis-, leading manner. Secondly, he proposed to increase the capitation allowance to the Provinces by recognising that the Maoris were large consumers of dutiable goods, and by substituting a payment of ten shillings a head on account of them instead, of giving au arbitrary allowance. Taking 15s per Lead as before for Europeans, 10s per head for Maoris, and continuing the special allowance of 2s 6d per head of Europeau population to Westland, the capitation payments would stand t.hus :— Auckland, L 59,866; Taranaki, L 4626 • Wellington, L 21.42 2; Hawke's Bay, L 6210; Nelson, L 17.53 8; Marlborough, L 4222 ; Canterbury, L 36.953 ; Westland, L 13.492 ; Otago, L 55.880. The total would be L 200.241. Thirdly, he proposed to calculate upon a reduction during the remainder of the year of LIO,OOO upon the Pafimates of ordinary expenditure, classes I, to VIII., as brought down by his predecessor. There had not been time to re-cast and reprint them, and to do so would confuse the accounts of the. Treasurer and the Controller. The gross estimated expenditure amounted to Li, 108,915. Deduct the LIO.OOO savings to be made, aud the {net expenditure would be L 1,098,915. There must be atlded the debit balance already stated of L 33.345, less L.15,222 on account of Civil List and Native School Savings which would probably not be required this year. Then there would be a total estimated expenditure of Consolidated Fund for the year of L 1,017,038, which amount included tbe whole interest and sinking fund on the Public Works Loan, amounting" to L 96.000. There would thus be an excess of L 32.038 of expenditure over receipts ; and he proposed, for this year only, to debit the Immigration and Public Works Fund with _L 34 ,500 of the interest and siukmt; fund on that loan. The difference between the two amounts would probably be required for Supplementary Estimates. If he made the Financial Statement next year, he would altogether oppose the charging any portion of the interest and sinking fund on the Immigration and Public Works loan to the loan itself. He would prefer to see {?), and to propose, if necessary, hereafter to augment the revenue by a change in the ineideuce of taxation, rather than the Colony should be deceived by the idea that it was getting public works' for borrowed money, while that money was merely being spent in paying interest upon the loans themselves. He believed that reductions amounting to L 25,000 a year could be made on the Estimates, and the Committee might fairly complain if he brought down Estimates next year without effecting such reductions. He recognised the important reforms instituted in the Treasury Department by his predecessor, and he hoped during the recess, f teed from other cares of any other office, to devote himself to reducing those intended reforms to a practical shape, such as would be beneficial alike to the department and to the public.