MEMORIAL OF THE PROVINCIAL COUNCIL OF NELSON RELATIVE TO THE APPORTIONMENT OF THE NEW ZEALAND COMPANY'S DEBT.

Appendix to the Journals of the House of Representatives, 1858 Session I, G-05

G—No. 5

MEMORIAL OF THE PROVINCIAL COUNCIL OF NELSON RELATIVE TO THE APPORTIONMENT OF THE NEW ZEALAND COMPANY'S DEBT.

AUCKLAND: 1858.

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TO THE HONOURABLE THE HOUSE OF REPRESENTATIVES OF NEW ZEALAND, IN PARLIAMENT ASSEMBLED. The Memorial of the Provincial Council of Nelson Respectfully Sheweth, That by certain Resolutions agreed to by the House of Representatives in the fourth Session of the General Assembly, it was, (among other arrangements for disposing of the Public burdens of the Colony), provided that the New Zealand Company's debt should be borne by the three Provinces of the Middle Island, in equal proportion between each. Against this division of the New Zealand Company's Debt t your Memorialists desire to appeal to your Honourable House. They maintain that it is extremely unfair, and most injurious to the iuterests of the Province of Nelson. For while it can be shewn that under this arrangement Otago and Canterbury receive, (especially the former), a very valuable estate, it can be incontestibly shewn on the other hand that Nelson is required to pay an exhorbitant price for an estate originally of insignificant value, and still further impaired, if not utterly destroyed, by the large grants of land which she has been obliged to make to fulfil the liabilities of the New Zealand Company. Before proceeding to point out what they consider to be the true bearings and nature of the question, your Memorialists must be allowed to protest against what they believe to be an utter fallacy, but one which has some currency to the prejudice of the Province of Nelson, in the consideration of the question. They refer to the analogy supposed to exist between the three Provinces, founded upon the fact of the Native Title, with insignificant exceptions, having been extinguished within their limits. Hence it is argued by some that the three Provinces have received an equal amount of benefit from the New Zealand Company, and should therefore pay an equal amount of the debt. But, the two questions have really no connection whatever. The New Zealand Company's debt has nothing whatever to do with the extinction of the Native Title in the Middle Island. The Company never preferred a claim to a single acre in consequence of that extinction ; and, in point of fact, the funds by which it was accomplished, were supplied not from the subscribed capital of the Company's shareholders, but by the British Parliament. In order to place their views of the relation of the Nelson Province to this question clearly before the House of Representatives, your Memorialists feel it necessary to refer to the origin and true nature of the New Zealand Company's debt. They find the following fundamental proposition plainly laid down in the Report of the Select Committee of the Second Session of the General Assembly on the New Zealand Company's debt, a report which was adopted by the House of Representatives without a dissentient voice. " The debt to the Company," it is there asserted, " can only reasonably be regarded as an equivalent in money at five shillings an acre for a certain number of acres assumed to be surrendered to the Crown for the service of the Colony." Keeping this steadily in view, and your Memorialists believe it to be a position incapable of refutation, there are three principal points to be enquired into, and these are, first, " What was this estate ? " secondly, " Where was this estate ?" and thirdly, " Who got it?" To the solution of the three questions thus proposed, your Memorialists will now address themselves. In answer to the question What was this estate ? your Memorialists need not refer to any further facts than these, —that the claim of the New Zealand Company to 1,300,1)00 acres was admitted by Her Majesty's Government in October 1845 ; and that in the year 1847 when the final arrangement between the Company and Lord Grey was made, by which the amount of the debt was fixed, and which eventuated in the surrender of its charter by the Company, the estate was agreed to be taken as comprising 1,072,000 acres. This was the number of acres to which the Company was entitled after deducting what it had sold to its settlers, and had the Government not entered into an arrangement for the purchase of this land, the Company would have had the eight of selecting it in any part of the Province of New Munster, in Otago, Canterbury, Nelson, or Wellington ; always provided that the land so to be selected was to be taken in rectangular blocks of not less than 30,000 acres. It would therefore clearly have been in the power of the Company, to have selected some of the most valuable portions of the Middle Island, and to have offered them for sale on the best terms it could get. From this process, which might have most seriously crippled Otago and Canterbury, but not the Province of Nelson to nearly the same extent, because the choicest portions of that Province, had already been sold, the Middle Island has been delivered by the statesmanship of Lord Grey. The first question, " What was the estate 7 " is therefore answered categorically, by saying the New Zealand Company's estate consisted of 1,072,000, acres which was purchased at five shillings an acre, constituting a debt of £268,000. The second question " Where was this estate ? " is not so easily answered. For the fact is, that what the New Zealand Company chiefly held was an unexercised right of selection, or as we may say, so much land scrip. But the New Zealand Company had actually localized a certain amount of its estate. It had expended a certain amount of its scrip, and had received Crown Grants for the land thus selected. From the evidence of Mr. Dillon Bell before the Select Committee of the House of Representatives in 1854, it appears that the Company had selected 400,000 acres at Otago ; in Nelson, about 100,000 acres, in Wellington, about 300,000 acres, and in New Plymouth, about 30,000 acres.

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From these figures however, must be deducted the land sold by the Company to private purchasers. Thus from the 300,000 selected at Wellington, must be deducted the 127,959 acres sold, leaving a balance of 173,041 acres to that Province. In Nelson the land selected and the land sold by the Company were almost exactly equal. At New Plymouth, nearly one half of th c land selected was sold, or upwards of 14,000 acres. While at Otago of the 400,000 acres selected, only 6,567 acres were sold, leaving a balance to the credit of that Province of 393,433 acres. We can therefore put our finger only on about one half of the New Zealand Company's estate, let us say in round numbers, on about 600,000 acres. The remainder constituting a balance of 472,000, was in the nature of unexercised land scrip running over the whole of the Province of New Munster. Your Memorialists now approach the consideration of the most important of the three questions they proposed to themselves for solution, namely, " Who got this estate ? " It has been decided by the House of Representatives, and, we believe with perfect justice, that Auckland did not get any, and Auckland has in consequence been relieved both prospectively, and retrospectively from all contribution to the New Zealand Company's debt. The Province of Auckland may therefore be put out of the question. Of the land actually selected by the Company, we have seen that New Plymouth got about 15,000 acres ; Wellington about 170,000 acres ; and Otago 393,000 acres. But as regards the unexercised right of selection, or the land scrip as it may be called, how is it to be decided in what proportions it is to be allotted between each of the three Provinces ? Now your Memorialists do not seek to pretend that this is a point which it is possible to settle with anything like certainty or precision. A fair apportionmerit of an estate in posse thus surrendered must rest after all on surmise founded upon considerations of the probable conduct of men in given circumstances. But with this concession made to its fullest extent, it is still evident that something like a general rule may be recognised and acted on. Thus if a right of selection has been surrendered, running over the whole of this Island, it is a fair presumption that those parts of it which possess the greatest natural advantages, whether of soil or harbour, have been most benefitted by the extinction of the right, because they are the portions which in all human probability would have been selected. If an individual possessed a right of selecting land in a town, and in any part of that town, it is all but a certainty that he would select his land where commerce was most active and population densest, and if, with a view to purchasing from that individual his right, it was necessary to lay an assessment upon the town, it would clearly be fair and just that those wards or parishes which offered the greatest attraction to the holder of the right, should pay more than those other wards in which the land was less valuable. By parity of reasoning, it may fairly be held that Canterbury and Otago benefitted much more by the extinction of the Company's right than Nelson did. Because in Nelson the choice localities had already been disposed of, leaving little but intervening tracts of broken and comparatively worthless land ; whereas the Provinces of Can terbury and Otago, still offered to the Company's choice, harbours destined to become centres of trade, and extensive and valuable tracts of land admirably adapted for settlement, and certain before many years, to be eagerly purchased. But while your Memorialists consider themselves entitled to use the argument just stated as one perfectly fair and hardly capable of being successfully controverted, they are under no necessity of relying upon this or any other partially hypothetical view of the case to prove the unfairness of the division of the New Zealand Company's debt. They will assume that the acres to which the Company was entitled were equally divided among the three Provinces of Otago, Canterbury, and Nelson ; and upon this supposition they will proceed to work out the results. The original Company's estate, as has been explained, was 1,072,000 acres. Of this, as already shewn, Wellington has received 173,041 acres actually selected, and New Plymouth upwards of 15,000 acres. These two amounts must clearly be subtracted before arriving at the balance to be carried to the credit of the Middle Island ; and this being done, it will be found that there remains to be divided 884,000 acres ; a result arrived at upon the supposition that no portion of Company's scrip would have been selected within the Province of Wellington or New Plymouth. Of the 884,000 acres thus accruing to the Middle Island, Otago received 393,400 actually selected, Canterbury none, and Nelson none. There remain accordingly of unselected land, equally divisible between the three Provinces aforesaid 490,000 acres, which in three equal portions gives to each 163,533 acres. Upon this basis of division it appears that Otago gets of selected land 393,4" iO, and of unselected 163,533, or altogether 556,933 acres ; Canterbury 163,533 acres of unselected land; and Nelson 163,533 acres. And this is the answer to the question, Who got the estate ? Now, if this were the ultimate result, the only conclusion could be, that Canterbury and Nelson had, equally with reference to Otago, made a very bad bargain in the matter of the New Zealand Company's debt. But this is not yet the worst of the case as regards our province. For, from the 163,500 acres, which upon the supposition least favourable to Nelson we can be shewn to have received, must be deducted the value of £90,706 of scrip, which, by a return laid upon the table of this Council, it appears has been issued. With this scrip much of the best land in our province has been selected; and, assuming £1 of scrip to represent one acre of land, the number of acres coming to us after making the required deductions would be 72,827. Your memorialists, with the most perfect conviction of the truth and justice of their case, invite an inquiry into the accuracy of their figures and the results arrived at. As the representatives of the province in the Local Legislature, they desire to represent to your Honourable House the very serious injury, they had almost said the complete paralysis of their material interests, arising out of their being compelled to pay an enormous sum for such an inadequate consideration. It has been already their

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fate to see their best lands absorbed in the payment of debts contracted by the New Zealand Company. And they now feel, unless justice be done to them and a re-apportionment of the debt effected upon some equitable consideration of the value received by each province, that they are destined to lose the whole of their land, if not a portion of their Customs revenue, and to sink into that state of stagnation which must exist in every Colony where there are no funds for the construction of public works. Your Memorialists cannot look forward to land sales to any large amount in this province. Their available districts are separated from one another by formidable physical barriers; and without money to open the country up they may be considered as practically beyond the reach of settlement. Your Memorialists appeal with confidence to the sense of justice which they feel well assured resides within your Honourable House. They ask for a re-consideration of the question of the apportionment of the Company's debt between the three provinces of the Middle Island. They ask for an inquiry into the value of the Company's estate received by each, and that Nelson may have an allowance made to her for the land which she has been obliged to pay away for liabilities contracted by others. They have shewn that Otago has received 556,933, acres, and Canterbury 163,533 acres, in land out of which none, or next to none, has been selected; whereas Nelson has received no more than 72,827 acres, and this consisting of the remaining portions of blocks, out of which all the best land has been selected. If they were to estimate the land received by Otago and Canterbury at ten shillings an acre, it most undoubtedly would, not be too low a value for that which Nelson has received to assess it at live shillings. At this rate Otago would receive land of the value of £278,000; Canterbury, land of the value of £81,000; and Nelson, land of not more than the value of £18,000. Your Memorialists now leave this question in the hands of your Honourable House, assured that the same sense of justice which dictated the re-payment to Auckland of her past contributions to the New Zealand Company's debt, will lead you to recognize the perfect fairness of the claim now preferred by the Province of Nelson, earnestly trusting that the result may be the relief of the province from the pressure of a burden entirely disproportioned to her resources, and to the benefit received, and evidently, in the first instance, imposed, not according to any inquiry into the true merits of the case, but simply in accordance with an unjust and indiseriminating symmetry. And your Memorialists, as in duty bound, will ever pray. (Signed) J. H. Babnicoat, Speaker.