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No. 33. Royalty on Coal. Extracts from Correspondence. The Under-Secretary of Lands to Coalfields Committee. Sir, — General Crown Lauds Office, Wellington, 26th August, 1889. I have the honour to acknowledge the receipt of your letter of the 13th August, inquiring what checks exist as to the output of coal. ... I transmit herew-ith for the information of the Committee copies of memoranda on the subject from the Commissioner of Crown Lands, Nelson, the Assistant Controller, and the Railway Commissioners. . . . I have, &c, H. J. H. Eliott, Under-Secretary. „

The Under-Secretary of Lands to the Crown Agent, Nelson. Can you give any information as to this question ? Please reply as soon as possible. . . . 14th August, 1889. H. J. H. Eliott.

The Crown Agent, Nelson, to the Under-Secretary of Lands. I have taken it for granted the Audit Department compared the royalty payments with the railway receipts; the only other check would be periodical inspection of the works. There is no reason to suppose the statements of output furnished are false or incorrect. 15th August, 1889. Alfred Greenfield, Crown Agent.

The Under-Secretary of Lands to the Audit Department. Can the Audit Department furnish the Committee with any further information on the subject 17th August, 1889. H. J. H. Eliott.

The Assistant Controller to the Under-Secretary of Lands. The audit of the railway accounts having been taken out of the hands of the Audit Office in December, 1885, the department has now no means of checking the tonnage upon which royalty is paid. The Audit Department takes care that either dead rent or royalty is paid, the payments being alternative; but the output on which royalty is paid, as given by the Receiver of Land Revenue, is accepted as correct. An examination of the company's books was made by the Audit Department in 1884, in connection with a settlement of accounts to the 31st December, 1883, then being arranged (see A 84/51, with L 84/814), but no subsequent examination has been made by this department. C. T. Batkin, A. C. and A. 19th August, 1889.

The Hon. the Minister of Lands to the Chairman, Railway Commissioners. Can the Commissioners furnish any further information for the Committee ? 19th August, 1889. G. F. R.

The Chairman, Railway Commissioners, to the Hon. the Minister of Lands. Please find Mr. Maxwell's memorandum herewith. It will appear that there is really no check on the actual output of the mines, the statement of the mine-managers having been accepted without challenge. J. McKerrow.

22nd August, 1889. Memorandum. —The audit of the railway accounts does not affect the question, as far as I can judge. Section 6, " Revenues Act, 1885," preserves to the Controller-General the right to inquire into all matters as provided in "The Public Revenues Act, 1878." The traffic-regulations which I issued provide for retention of the railway w7ay-bills at the respective stations for twelve months, after which they are forwarded to store, and are finally destroyed, but until they are destroyed they and all other documents are available for the Controller's investigation at any time. In 1884, and before that, I suggested that, as the railway carries all the coal, it was the proper department to attend to the checking of royalties. This suggestion was forwarded to the Land Department, but it seems to have been thought inexpedient for the railways to undertake the work : for this reason we have never compiled the railway accounts to show the coal independently of the other minerals carried, or to keep separate statements of the output of each mine. J. P. Maxwell. 22nd August, 1889.

No. 34. Mr. M. Kennedy and Mr. Seddon's Evidence. Sir, — Grey Valley Coal Company (Limited), Wellington, 29th July, 1889. I have to thank you for the printed report of Mr. Seddon's evidence before your Committee. There is only one passage I wish to make any remark on —viz., my disagreement with Union Company, and my surprise to.Jind the markets all supplied. This must be one of many jokes in circulation thereon, for I never had any difficulty in obtaining steamers, and ever since the Newcastle strike took off always had a difficulty in finding a market for our coal. Assuming the Committee do not want me before them again, I now beg to say I purpose leaving Wellington in a day or tw 70. Yours &_., M. Kennedy. The Hon. W. J. M. Larnach, Chairman, West Coast Coalfields Committ

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