THE FINANCIAL SPEECH.

Waikato Times, Volume XIII, Issue 1140, 16 October 1879, Page 2

THE FINANCIAL SPEECH.

[BY TELEGRAni.] WELLINGTON, Tuesday. Ik the llouso of Representatives tonight, Major -Atkinson, m moving for leave to introduce tho Public lie yen nes Act Amendment Bill, ""Said tho circumstances wore of au exceptional character. Ho had to disregard the usual rule, that the .Statement of tho year should be a carefully prepared ono and submitted to the Government. The finances had not been dealt with at all for 15 months. Parliament was iv the dark for that time . He would now submit a broad outline of finance, so as to enable members to turn over iv their mindes what was best to be done. In 1879 the Treasurer estimated he would begin the year with a surplus of £10,408. The actual amount realised was £116,84-1. The expenditure passed Avas £4,210,000. Tho actual expenditure, as. placed before the douse that session by the then Treasurer, Sir George Grey, was £3,65*2,048. The aparent saving ol £558,000 was diminished by £348,219 oi liabilities. The payments for and made within tho year amount to a little ovei £4,000,000. The revenue for 1878-9 was estimated at 1:4,045,537, the actual sum realised being t'3,75i,598, leaving a deficiency of £233,939. At the end of this year they begun with a deficit ol £131,824. They begun the year with £116,000 te their credit, and ended a+'tei having taken credit for all assets and providing for liabilities, with a deficit oi £131,824. tie called attontion to the following items of expenditure, to show that they were not exercising any economy m the public service. They had not retrenched m any one way, and it would be seen that some very decided step would have to be taken to place the finances on their proper footing. In law, justice, customs, &c., for the year 1577-8 : the expenditure amounted to £860,000. That was an expenditure more than voted. In 1878-9 the same department got a vote of £903,000, whereas the actual expenditure was £956,000. The Native Department was next referred to. In 1879-7 the cost was £34,000, m 1877-8 £43,000, and m 1878-9 it amounted tc L_B,''oo. The salaries last year were 1_19,000, but m 1878-9 only L 15.321 was voted for salaries. The expenditure foi 1878-9, as estimated by the late Government, was L 3,974,42 0; but that did not include L 140,000 for contingent defence proposed to be charged to the loan, nor did it include L 122,000 of looal revenue wliich the Government merely, collected and paid. The expenditure, as stated, included L 1,325,373, 325,373 for accumulated interest and sinking fund, Li 3,400 the 20 per oent. of land revenue, and L 259,527 the amount of subsidies, 'lhe estimate of revenue by the late Government was L 3,442,000, made up— from taxation, L 1,580,000, 580,000 ; for services rendered, L 1,362,000;, 362,000; from land, L 500,000. But deducting this revenue from the stated expenditure, there was left a deficit oi L 530,034, and added to this the deficit for 1878-9 of L 131.824, there was left the deficit to be met of L 663,858. But, m fact, he feared, with the experience of which this Government had had of the receipts hitherto, the estimate made by the late Government of the current year's revenue would not be realised. Revising the estimates as carefully as he had been able to do, he feared the receipts would not escped £3,193,00, ' made ... up. of— taxation, £1,512,300; ou account of services, £1,301,000; and from land, £388,000. This would increase the deficit already stated by £120,000, and would leavo a total deficit to be provided for this year of £911,000. It was not his business at present to suggest a remedy or to give reasons why ho anticipated such results, as the House would only expect a broad statement of rpsults. When he took possession of the Treasury the public accounts stood thus : Tho receipts during the quarter had not come up to the estimates made by a sum of £330,000. The late Government had issued £400,000 deficiency bills, and used the whole of the proceeds. No provision had been made I for paying the subsidies now due, or to meet other payments which it was absolutely necessary for them to make. To provide for these they proposed to take power to issue a further £200,000 of deficiency bills, m order to enable them to carry on the necessary services of the colony up to the month of October or November, and by that time he hoped the House would have determined how the deficiency was to be made up. It would be improper for the Government to do more thau submit a mere temporary remedy, so as to enable the Bouse to Lake time to determine as to how the matter was to be generally disposed of. That was his reason for asking the House to pass the Bill. Regarding tho position of the Public Works account, they begau the year with a credit to the department of £507,000 nominally, but of this £300,000 was due for outstanding debts, so that m reality it was no better than so much money paid away, so that they only actually began the year with £207,000 to the good. The expenditure for the last quarter was £712,000, so that the late Government had actually spent to the fourth September last, half-a-million of the £5,000,000. Then again he found, upon inquiry, that their ongage ments entered into to the 30th of Decernder next, amounted to £733,000 more, and further engagements on which they, would have to pay on tho 30 th June next, £921,818 more ; m other words, up to the 30th June next tho public works they were already committed to without any new ones being undertaken would amount to £2,160,000 out of th 0£5,000,000. He was much startled when ha found the amount so very large, fie had taken pains to see that it was correct, but ho found that it was not possible to reduce the amount below what he had stated. Included m this £2,160,000 was a sum of £200,000 for the purchase of native lands. But L 360,000 had been spent already, and further engagements entered en up to the end of this year to spend L 54,000. They had a further liability on these lands which apparently they had engaged to fulfil amounting to L t )57,000. In round figures a million more had to be provided for to complete the purchase of these lands. They also had contracts on public works on the 30th June amounting to £1,281,815, so that one million would be required by the end of next June, What he desired to point out to the House : was this, they had actually spent up to ■ the end of September one quarter of a million, which, together with their engagements, would amount to a total sum of 2,000,000, and that before they knew whether the loan could be raised, not the slightest intimation having yet be n received on the subject. He deprecated m strong terms the impropriety of pledging the credit of the colony m that way. He did not know how far the loan would go off. Fortunately the credit of the Colony was good ; still that was no excuse for the course pursued m the matter by the lato G overnmenb. Such, then, was the financial position of tho colony at the present time. He wished the tale he had to tell had beeu n little more cheerful. It was clearly, liowever, the bouuden duty of hon. member.*; tv face tho whole question of colonial liuancc at once. The position was undoubtedly a grave one, and would demand j immediate at'fcyufciw. It appeared fro liim

that ib was absoltibely necessary that at the present, time ther. should be a Government not only capable, but likewise sufficiently strong, to legislate for tho interest of the colony and net merely for that of a party. It was llurr boundou duty, he submitted, to dispen*'o with party tactics, and turn their undivided attention immediately to those serious ■ difficulties, and m some way devise a scheme to got the finance of tho colony ( placed m a sounder and better position than it stood m at present ' Sir George Gery said the assertion that i a Financial Statement had not been made i for the last fifteen months was not quite correct. The accounts had been published quarterly, and anyone could have made up ■ a statement similaV to the one giv _, as ■ well as the Treasurer. Ib was not the L fault of the late Government that a Financial Statement was nob made last session. The unconstitubional proviso of > . the Governor m granting the dissolution ; on the nb-confidence motion being brought L forward prevented them from going iuto the financial position of tho colony. They : had a Financial Statement ready this - session, aud but for what had taken place | it would have been down before this time. tfogarding the deficiency, it was brought - about by exceptional circumstances. There > was a largo falling off m the land revenue L of the country. It was from its very l, uaturo a commodity which must yet be m \ demand. It was a good security for any -" money they might have to raise for im--5 mediate purposes. Had they remained m " office they would have brought down a 5 bill similar to the one proposed by the ■^ Treasurer. Had they been allowed, m July last, to conduct the business as they | ought, provision would havo been made • for the deficiency, and funds would have 1 been coming* m for the taxation they in- •* tended to have imposed, and that on men ■ well able to bear it. Tho course proposed ° by the Government was a worse one, and ' one which they would not havo carried r out 1 had they been left m office. If they i carried out the course of taxation the late Government proposed, they would be entitled to their support ; bub if nob, then ■■ they would not get that. ! Mr Hall said no doubt the accounts had > been gazetted, but very few mon m the > colony could arrive at -_y comprehension • of the true bearing of those accounts. It 1 was true that the proposed new measure ' J of taxation, taken by the labe Government 5 from its predecessor*, might provide 3 £200,000 towards the deficit of £900,000, • but no provision was made for the balance. ' The purchase of native lands heretofore •* had always resulted m a dead loss to the ! colony. The most gloomy feature of the ' present prospect was the utter inability of ■ the Opposition to realise tho position. Mc Ballance threw blame on the Oppo- ; sitio- last Ressiou for keeping the colony ! m the dark as to the financial condition. They used their majority at the com- ! mencement of lasb session to intercept *■ any consideration of financial matters, by > bringing down a vote of want of confidence at the commencement of the session. ' He admitted that the purchase of native lands had not resulted m a direct Treasury •* gain, but had proved profibablo m pro--1 mobing setblemenb through the North ■ Island. One of the legacies left by i Atkinson's Government to their successors ' was having to draw against the loan | before it was raised, and that had been the ■ common practice with previous Go ver n- ; rueiits. He defended the lato Government ! from the charge of departmental extrava- • gance, and referred to other matter of L detail m Major Atkinson's statement. ' He contended that tho real deficit last > year was only £60,000, and that, cousider- •* ing all the facts, the results of tiie finance • last year were by no means unsatisfactory, > The expenditure on the Kopua meeting !• was as justifiable as any expenditure mii ourred m the colony, resulting* as it did m Sowi's adhesion, wliich would be highly ■ beneficial iv various ways. No doubt the House had to face a deficit, but not so i* serious a one as stated. Probably it -. would be about fc'soo,ooo to £600,000, "' chiefly through the falling off m the land s revenue. It would be a great hardship , to endeavour to make this up at once by I extra taxation. Major Atkinson had under- estimated the revenue. The posis tion was by no means so gloomy as do- ' picted. Mr George McLean thought much of . the present evil was duo to v)r Ballance. ■ He also blamed Mr Ballauce for leaving > the late Government without meeting i Parliament. He coutended that the 1 prospects wore even more gloomy than predicted, for under the present pressure 1 for money, the revenue was sure to fall i off. The country could not bea* increased 1 taxation. Tho late < 'overumeut had allowed everything to drift. In time of great monetary pressure, they had put ' most unfair pressure on local institutions by draining them of money, aud so causi ing a financial crisis. They should havo called Parliament together to devise moans • to reduce the pressure instead of increasing it. i Mr Moss defended tho late Ministry. Mr Header Wood thought the deficiency i of L 600.000 would be a chea - expenditure if it really induced the House to look seriously at tho financial position of the colony, and led to putting an cud to the system of corruption and extravagance whioh had so long prevailed. He feared, however, it was hopeless. Mr Wakefield contended that Sir George Grey's statement about being prevented from making his Financial Statement wan not correct. The fact was he was utterly ignorant of the state of the colonial finance. They had been told that it was impolitic to curtail the public expenditure during a time of depression. It might be unpopular, but he denied it was impolitic. Tnen, again, he told them that the conditions imposed by the Governor m the granting the dissolution prevented him from bringing down a Financial -Statement, lhe fact, however, was that finance was excluded from that condition. Then, ag*ain, he took the entire responsibility arising from that "dissolution, and ho was according precluded from attempting to shift it on any other person. He believed that too much reliance had been placed on the land fund. That fund ehould be the very last relied upon. It belonged to ttie public creditor, and should be left out of the calculation altogether. Ho concluded by stating that if one thing more than another could induce him to believe the Government should be left unmolested for the present it was the Financial Statement just made by the Treasurer. Mr Pyke said there was no objection to the motion, and yet the whole question was being debated as if the motion was being opposed. In the view of that fact he charged the Government with unnecessarily delaying* the business of the country. He would say there were not ten men m the House who did not know as much as the Colonial Treasurer himself. Mr Turnbull spoke m the interest of the Opposition, and gave it as his opinion that the fiuanoial position of affairs would not turn out so grave as had been predicted. Mr Montgomery thought the Statement of the Treasurer had been unnecessarily gloomy, and such as would tend to damage the credit of the colony. Ho contended that it was a common practice m previous Governments to anticipate loans. Such being tho case, he thought it was wrong m blaming the late Minister for Public "Works for having followed a similar course. Major Al'uusoii said tho Opposition seemed to bo altogether out of harmony among themselves. One section of them said tho financial stato of affairs Avas not by tiuy means so serious as had been, represented, aad the other fully admitted

'* — ■ — — !T^ the gravity of the position. He admitted that a large portion of tho fivo million loan had been anticipated, but that was before he joined the Government, and at no tune during his connection with that ■0 overnment was any portion of the loan anticipated. His estimate of what would be roquired to meet ourrent engagements had been questioned by the Minister for Public Works. He had caused an estimate to be prepared by the department, and found that between the 10th October current and 31st December would amount to a total of t-556,000. He had not thrown blame on anyone, but would do so at tho proper time.Tbo motion for leavo to introduce a bill to ameild the Public Pveaervea Act, 187S, and to suspend tho standing orders for the purpose of passing the bill, was thou put and earned The bill was then introduced, passed through all stages, and adopted. Mr Hall moved the adjournment, which was opposed by Mr -sheehan Bpeaking to the adjournment. •••r Hall said that if the Opposition woul . agree to allow thorn to stato their policy, thoy would take tho no-confidence motion as a first order of tho day as early,, as possible. If not, they would tal-aT measures to get their polioy submitted/. i.fore the motion was allowed to be taken up. -•it 1 5 a.m. the -ouse was still discussing the motion for adjournment.