The Wairarapa Daily. WEDNESDAY, SEPTEMBER 17, 1884. THE FINANCIAL STATEMENT.

Wairarapa Daily Times, Volume 6, Issue 1790, 17 September 1884, Page 2

The Wairarapa Daily. WEDNESDAY, SEPTEMBER 17, 1884. THE FINANCIAL STATEMENT.

1b the. limits of our space prevent us from publishing the full Financial Statement delivered last evening, we give our readers the latter and more interesting portion of it, including the table of expenditure and the local industrial proposals. Sir Julius Vogel in it said " I must ask the Committee to allow me to make a diversion to another subject, that of local industries. The hon. member for Hawkes Bay, Captain Russell, the other day made a happy remark to the effect that this House should consider it possessed mow the charaoter of a Board of Works than of an Imperial Parliament-, • The efforts we make to promote the resources of the colony are'likely to bear better fruit than those we devote to testing' recondite, social or political experiments, It is of paramount importance that free play should be given to the industries suited to the capacity of the colony. It is a mistake to .suppose that the customs are the only vehicle by which resources can be stimulated. We want to produce not only for "ourselves, but for export. When Canada many years since was cut off from the American markets by the fiscal policy of tho United States, the Imperial Government placed one of Her Majesty's vessels at the command of Canadian delegates that they might search for other markets in other countries, A few weekß since, my old chief and friend, Sir Win. Pox, just as he was embarking from Queensland for England, wrote to me in that felicitoas language which comes so naturally to his brilliant pen, that he was convinced that New Zealand should make a great effort to seek out markets for its produce in the islands of the South Seas and in India. I believe with him that a great export trade is one of the objects we should keep in view. Let lis see some of the obvious products wo have to send away. The frozon meat industry is in its very infancy, and though now we only send it to England, do we not know that to India, and to the islands teoming with population in the Indian Ocean, New Zealand mutton would be an infinite luxury, but keeping sheep does not stop at providing food. Since I have been in New Zealand I have been struck with the singular beauty of the woollen fabrics which are being made in the colony and at prices which I am assured would enable those goods to ba profitably exported, New Zealand should aspire to sending away wool in only its manufactured state in the shape of fabrics. Do not tell me tho price of labor forbids'' it. Would America be what it is if the high price of labor had not stimulated the intellect: of the people to discover labor, saving machinery. . I ipet an eminent engineer a short time back who told me he conld' do work cheaper on the slope with wages at 10s a day than in India with wages at about the same price a month.-. Besides the high price of. labor brings to ub the feasi-, bility of one of the greatest elements of human progress—co-operation. Cooperative woollen factories open out a great prospect of enormous work here.' The laborer who adds to comparatively small wages a share in the profits will give good service, There are other obvious industries that will come to the front, Semi-tropical growths such as fruit, silk, tobacco, and, other allied products must take firm and profitable root in this island.. In the fisheries of the Colohy tjreat wealth remaics'to be •gathered, -Idonot refer, to mineral resources; % these we propose to makg the, special attention .. of a Minister, but we also propose that other industries should receive the closest attention. A Government; at little expense may do much in the way of lending a prestige to its country's products, To give us a knowledge of v what pro-

duce'rs and manufacturers: can do and the extent of the improvements they make we propose that an industrial exhibition shall, be held every one or two years, and that two geld medals, besides others of less value, shall be given to those who do most to develop the industries of the country by combining excellence with economy; We propose, that the .first exhibition shall be held at Wellington' next year when .Parliament is sitting, and that it shall be followed by. exhibitions, in other large centres alternatively in , each island. But there is an industry fiom which I believe great results will springj 'and that may be assisted indirectly by .the customs, I allude to sugar from beet and. possibly from sorghum.- - The ■ production of beet sugar iB now so perfected that it is made .economically 1 all over Europe even .without artificial restrictions. Civilisation conquers in the end. The ■products of cultured labor will excel those of the savage and the slave,' but this manufacture'wants a stimulus by assuring it some advantage in the shape of freedom from excise duties for a term of years. The assurance is not much to give. None of the colonies favor heavy excise duties, Few have any at all worthy of mention. The wine in Victoria and New South Wale 3, and sugar in Queensland are notable examples. Sugar has done-as much for Queensland, as its vast sheep and cattle lands. We propose to pass an Act declaring that sugar produced in tho colony shall be exempt'from excise duty for a term, of years, and that the present import duty shall not be reduced. It may also be necessary to give a bonus for the first few hundred tons made in the colony. RECEIPTS AND EXPENDITURE OF THE TEAR, I proceed with the statement of the estimated expenditure of the year with such alterations as I have described, and also I give a statement of the expected revenue supposing the revenue is raised on precisely the same terms as last year, including a three farthing Property Tax. The estimate of revenue is moderately stated, and I believe hon. members may count on the amounts set down being verified. Estimated receipts and expenditure of the consolidated fund for the financial year ending 31st March, 1883— ordinary revenue account RECEIPTS ORDINARY REVENUE. £ Customs ... 1,375,000 Stamps 527,500 ■ Property Tax 275,000 Beer duty ... 55,000 Railways ... .1,120,000 . Telegraphic ....' 94,000 Registration and other fees ... 37,000 Marine 16,000 Miscellaneous... 35,000 Total... £3,534,500 Territorial revenue, depasturing licences, rents, etc. ... 188,000 Total... £3,722,500 EXPENDITURE PERMANENT APPROPRIATIONS. £ Civil list ... 29,750 Infcerestand sinking fund ..; .1,559,115 Under special , • ■ Acts of Legiß-.■ lature ... 53,724 ' Total... ,£1,642,589. Annual priationsLegislative ... 67,518 Gol. Secretary.... 238,435 Col. Treasurer... 51,643 Minister of Justice 117,265 Post Office and Telegraph ... 259,322 Customs ... 79,081 Stamps 27,491 Education ... 328,102 Native 18,311 Mines ' 21,308 • Public Works... 740,660 Defence ... 183,427 Total ...£2,132,563 Grand Total... £3,775,152 The Committee will observe that this shows a deficiency of £52,652. Let us now see what we may do in the way of converting the deficiency into a surplus.

PROPOSALS FOE THE YEAH, Let me now gather up the thread of my remarks, We have seen that if we make no change we have a deficiency of £52,652, but if we are content not to reduce our debt this year we may rscover an expenditure of £244,000, leaving us a surplus of £191,348. But that there is an understanding not to press the question this session, I should recommend a rate (not a large one) to meet the coat Of charitable relief and hospitals, together with a few additions to the stamp duties and the total abolition of the property tax with its crushing effects upon the progress of the colony. As it is, we propose to reduce, the property tax by one half, namely, to three-eighths of a penny. Eliminating the balances of last year, the reduction of one half will amount to L 131,000. When we deduot this remission from the surplus of L 191,348, which I have just stated, we shall have a surplus of L 60,348 at the end of the financial year, which may be reduced' by supplementary estimates, .1 now come to the question of ÜBLIO WOEKB FUNDS, I will attempt to deal with it without forestalling my colleague, the Minister for Public Works, It is iny task to find the money, and his to spend it. I have already stated that we - shall want L 100,009 additional this month, and additional aid each succeeding month until the third million of the 1882 loan is raised. My predecessor had made arrangements for the disposal of another- LIOO,OOO of deficiency bills," for authority to issue wbioh he proposed to ask the HouseI am happy to say I shall not require to trouble the House to give this additional authority. I have made arrangements to obtain half a million, in anticipation of the million loan next year, to be'supplied to. us as we want it. What possible good can there be

in coming to for driblets of LIOO,OOO, when we know the existing liabilities require five times as much for their satisfaction, besides legislation is unnecessary. . About L 600,000 of' the three million loan will have been spent on open railways, and about L 50,000 will have been consumed on the charges of raising the ioan. In short, there will be little, if any, of the third million left when it is raised. I ,will refrain from exciting the susceptibilities of my honorable friend, opposite by commenting on the deplorable manner in which his three million loan scheme has broken down. We cannot afford to leave the roads unmade, the native land purchases '.incompleted, the goldfields neglected, and the fragments of railways scattered over the country to rot away, We must borrow more, and the question is what shall be the amount. The gentlemen who have doDe me the honor to think, or rather, 1. should say, to pretend to think that my only policy is borrowing, have circulated reports that 'I intended to propose ten or fifteen millions, indeed one gentlemen went as high as twenty-five million; but then he dwells in a lake and hilly district, where, amongst the wonders of nature, the imaginative faculty is said to be abnormally developed. This, sir, is I believe, the plank on which my hon. friends and well-wishers opposite, propose to return to office when they have heard what I have to state. I fear, like Edgar Poe's " Kaven," they will be inclined to murmur" never more." We shall ask authority to raise

AN ADDITIONAL MILLION AND A HALF out of which we shall replace the amount abstracted from the three million loan, Hon, members who have followed the remarks I have just made about the loan will see that the new loan is only partly for the current year. It is chiefly for expenditure atter the end of the financial year, and if they wish to avoid future fiascos they must not spend one year and borrow the next, but borrow as the expenditure has to be met, But it is important in view of the operations to which I have referrsd as now pending in the London market and the further operations that will be necessary in the direction of conversion that we should aa much as possible limit our borrowing just now. We may, porhaps, as 1 have already said, liberate a large amount of sinking fund which will bo available for the vote of the House. It is not feasible, however, to fix a time for this result. Conversion will have to be effected to suit the market, and the time it will take cannot be accurately fixed,. As regards borrowing we must in a great 1 measure be guided by the increase in our power of meeting annual charges; Depend on it we have the right to look each year for large natural increases in the revenue,. I present to the committee an interesting table showing the revenue each-third year over a period of twelve years, Ido nob pretend that it accurately presents the natural increase because there have been changes in rates and modes of raising the revenue, but on the whole it gives a good idea that there is a great natural. increase, and one which.reliance may be placed in if efforts are not made to dwarf the material progress of the colony, Without unduly forestalling the communications, my colleague will make in his Public Works statement, I must call the attention 6f the hon. members to somo points which have acquired peouliar interest on account of the reference made to them in the ■ Speech from the Throne. It is absolutely necessary that members should be reasonable in their demand for the' proeeoution of railways in the interests, I will not say of economy, but of prudence and common sense. Railway works must be carried on with some regard to obtaining early returns as the work progresses, I will now say a few words concerning the railways specially mentioned in the Royal Speech. We still adhere to the opinion that the

NORTH ISLAND TRUNK RAILWAY ' is of supreme importance and must be proceeded with as rapidly aB possible. In connection-with it we also recognise the necessity of obtaining large blocks of land along the line of route, and of making them the subjects of special settlements. We still regard some of the lines as of exceptional importance, amongst them I may mention the Otago Central and the short piece that will place the Napier line in connection with the line from Wellington north : wards. We shall introduce a Bill to authorise the Government to enter into an agreement with' a company or syndicate for the construction of the line between the East and West Coasts of the Middle Island. We shall make provision in the Bill for authority to enter into an agreement on the same conditions with the same' or another syndicate or company, for the extension of the line from Nelson to connect with seme point of the through East and West line, thus giving Nelson communication with both coasts. The conditions we shall propose will not be onerous on the Government, but they will be sufficiently favorable to enable, in our opinion, the contractors to procure the necessary capital in these and other future arrangements with private persons for the construction of railways. We shall keep in view that it' is desirable all lines in th'ecountry should be worked by the Government.

SUBJECTS INDIRECTLY BEARING ON FINANCE. ' '

Theie are several subjects indirectly bearing on fiuance about which I might have much to say, only that I have already greatly trespassed on the indulgence of the committee. I must, however, make a reference to the Mibjaot of LOOAL. GOVEBNMENT. The Colonial Government and Parliament may do a great deal' to push the Colony forward, but all their efforts will be incomplete .if they are not seconded by the self governing instincts and abilities of the separate localities., : In order that local Government should be efficient it must possess considerable freedom of aotion, a defined revenue, or means of raising revenue and inducements to exercise economy. Railways do not dispense with the necessity of roads and bridges to open up the country, On the con-1

trary; their own success depends on the energy with which the arteries to feed them are made available to their use. , There is more need than ever for opening uplands for . promoting settlement, and for constructing, means of communication in the shape of roads and bridges. For these works the country must chiefly depend on local efforts. It may assist and when it does'assist it should assist effectually; In connection with- the railways we. haye in' view special settlements within which a great number of families should be grouped. We want to see a large population located on the lands of the colony enjoying its free institutions and not in dread of the security of property being invaded. The present, system of local government falls short of what the interests of the country require. We heve determined to appoint during the recess a' Royal Commission to inquire int'o .and report on the-whole subject. ■ We will not consider the results of the investigation over private' property. ..They shall belong to Parliament, and to whatever Government is in office upon them, We hope that next session legislation will be founded which j will vastly improve the preseut system of local Government, Under a reinstated finance and diminished expenditere the Country will, we are convinced, rouse itself from apathy and spring forward with leaps and bounds of progress. It is a mistake to suppose that borrowed money is the cause, instead of the consequence of prosperity. Long before the borrowed ( money was being spent in any quan-, tity, after the policy, of 1870 was proposed, the colony was replete with progress. With common prudence we need have no more financial embarrassment or vexatious taxation. Wo may banish from our minds the philanthropic notion of insurance against pauperism, whieh might more correctly be termed insurance of pauperism. We must make our railways, as we are able to do so without undue pressure. We must look foVward to the time when the colonists \vill no longer dread additions to the population in the shape of suitable immigration. The North Island trunk railway must be pushed on with every possible expedi- ( tion. It will open to the colony a new world; it will be a? though it was increasing by one-third its territory. Let us encourage the progress of industries, whether they be agricultural, mineral, pastoral, or manufacturing. Still one thing remains.': the system of local government mustbe improved. The edifice cannot be crowned without we have a satisfactory system of local self-govern-ing institutions, My task is concluded. I wish I could have discharged it with more force and ability, Still, I shall not have striven in vain if I have succeeded in impressing hon. members with my own strong conviction that the finances of New Zealand are not in a condition of difficulty, that they are suffering only from mismanagement, that they are elastic and buoyant enough to satisfy the most exaoting financier, that oppressive taxation is not required, and tbat under good Government we may safely rely on a progressive improvement of the country's resources.

LOAN CONVERSION LAST-YEAR, The loan conversion last year,' as described by Major'Atkinson, consisted of • L 3,558,300 5,30 debentures, and L 1,832,000 short-dated debentures, But the transactions consequent oh these conversions are still not completed. . A considerable quantity of the converted short-dated debentures remains to be sold, whilst only a portion of the 5,30 issue has come in. Notice has, however, been given to pay off so much of the balance as carries 5 per cent., interest in January next; On the whole, the annual savings on the conversions of last year nominally amount to about L 30,000, and L6OOO more will be gained by the conversion of the balance of the 5 percent, 5,30'5, Another effect of the conversion has been the postponement of the payment of a sum of about L 50,000 for interest, from a date within the present financial : year to next year.

It is much to be regretted that the conversion was commenced with the 5-30's, instead of with-the consolidated loan of 1867-1870, which carries with it an accumulating drawing or sinking fund. The 5-30's could have been paid off at par at any time on six months' notice. This is really now what it has been found necessary to do with the principal part of the 5-30's bearing 5 per cent interest. Only half a million of them were brought in; the bulk of the 5-30's which came in bore per cent interest. They amounted to L 3,053,000, The profit on. them was comparatively trifling after payment of expenses and premium. But they Btand in the way of further operatipns, because of the large mass of inscribed stock that represents them on the market, They ought to have been about the last, instead of the first, securities operated on, The operation in connec-. .tion. with the short-dated debentures was more in the nature of a sale, than a conversion. They had never been placed on ihe English market, and the real object was to dispose of • the bulk of them. The difference in the rate of, interest between a floating and a funded debt can hardly be all called profit. That. •. is why I used the word " nominally" shortly since. THE FLOATING DEBT, Before proceeding further to describe the present position and future plans, I think , it .will be as well, whilst the subject is in the memory of honorable members, to deal with the question of the deficiency bills, They amount, as the committee are aware, to L 150,000 for last year's deficiency, £450,000: for current purposes on the year's Consolidated Fund account, and LIOO,OOO for Public ; Works ■'Account. 'There, are, besides, the £4oo,ooo'contingent,liability bills. • My friends, I dare say, will' think that I am rather, good natrired, not , to say stupid, to trouble myself with working out my predecessor's difficulties. " Fund," they ; will say, " by adding to the permanent debt, so much of this floating debt : as will leave you without any anxiety for the future, and start On a fresh career of manufacturing a new floating debt." I shall not do anythingof the kind., lain profoundly impressed with the conviction that it is intricate entanglement,

rather than real difficulty, with which New Zealand has to contend, I believe her finances can b9 put in order, and that we may count' from year to year on such •an improvement in revenue, that so much of the present floating debt as does not come within the category of mere aid within the year, can be discharged within a reasonable period, The £450,000 I shall .consider as strictly aid within the year and I shall ask. the House to increase : tlie amount by another £50,000. My. predecessor stated his opinion that the £400,000 was not sufficient, and actual experience has shown that the additional L 20,000 for which, he obtained authority; is still not enough, for, as I have told the Committee there is beyond all the deficiency bills a deficiency of a few thousands in 1 the estimate of the present month, I shall ask, then, for .authority to add L 50,000 to the' L 450.000. strictly for the purpose of anticipating revenue within the year, .The L 150,000 for last years deficiency I shall pay off within the next twa years or so. The LIOO,OOO for public works can either be allowed to lapse, or continuo to be used as a means of adjusting public works revenuo within the year. As to the contingent L 400,000 1 do not like the arrangement, and shall hope to be able to do away with it shortly. Thus I am not intending to propose that most unpopular of all financial operations, the converting floating into permanent debt.

After the Financial Statement last night, the Minister for Public Works said that the time when the Public Works Statement would be brought down, depended upon the discussion on the Financial Statement,

Major Aekinson differed, and contended that it was essential that the House should know the proposals of the Minister for Public Works before it agreed to the financial proposals of the. Treasurer., The Premier said that when the Financial Statement was discussed the Government would be prepared to bring down the Public Works Statement,and stand or fall by the result, He thought the- latter would be brought down in a week. The House adjourned at 9.10 p,m.