8.—6.

IX

provision for declining years and gives security against want, but in the present it serves as a healthy check upon the disposition to spend money in various forms of indulgence which are far from beneficial to our people. The Bill will be introduced again and will contain provision for voluntary contributions to a fund for the establishment of annuities. REPLACING GUARANTEED DEBENTURES. As already stated, the £800,000 Imperial-guaranteed debentures matured on the Ist June last, and in due course will be cancelled. It has been the practice to obtain advances on the security of these Imperialguaranteed debentures for the purpose of replenishing the Public Account whenever required. The fact that this power existed was one of great value in dealing with our finance. These debentures were practically available for the purpose of meeting any possible unexpected financial contingency that might arise. The question then presents itself as to what is the best course to follow to insure the financial stability of this country in London now that the Imperialguaranteed debentures are no longer available. It is absolutely essential that we should be in the position of having available securities to lodge from time to time, as may be required to maintain a strong financial position in England, and I therefore propose to submit authority to issue debentures for £800,000 to take the place of Imperial-guaranteed debentures. This sum is to he used exclusively for security purposes as occasion requires, under the control of the High Commissioner, so that in the event of a financial crisis at any time arising we may have available the necessary security to lodge to provide for any financial necessities. I desire to point out that under this proposal the public indebtedness will not be increased. As it is not possible to invest this amount in Imperial-guaranteed debentures, it will necessarily require to be invested in gilt-edged securities in London, which, in times of emergency, may be available as an undoubtedly sufficient security for advances from the Bank of England or other financial houses, even though extreme financial pressure was existing at the time on the London market. LOANS TO LOCAL BODIES. The work carried on by local bodies is recognised as of the greatest value to the people whose interest they serve, and I am satisfied that in the carrying-out of that work the system of Government loans has proved of great service. That it has been largely availed of is shown by the fact that in all £2,194,138 have been advanced. It is only right that the people in the several districts who have shown a disposition by local taxation to help themselves should have an advantage over those who have relied entirely upon Government assistance for carrying on local works. To meet this position, preference will be given in proportion to the amount of rate levied by local bodies, and legislation providing a scale to meet this will be submitted to Parliament. ROADING BACKBLOCKS. Good progress has been made with roading, and opening up by means of bridle-tracks, lands recently taken up for settlement; but, notwithstanding that the work done during the year just passed has exceeded in quantity that done during any previous year, the settlement of new land has been so extensive as to render it impossible to provide access to the whole of it as quickly as is desirable. However, with sustained perseverance and energy, and the provision of sufficient funds for the purpose, it is hoped that the roading will before long overtake the needs of settlement. In addition to roadworks in new localities, a considerable amount of assistance has been given in the way of grants to local bodies for works in the oldersettled parts of the country.

ii—B. 6.