I.—llA.

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J. G. WAlil).

The Chairman: We are not inquiring into that. I rule that Sir Joseph must confine himself to the order of reference. Witness: Then I will not say any more on that point. I dissent from your ruling, and 1 will discuss this point in the House. The issue put before the House and the country and before this Committee is a very definite one. The Chairman: I will read the order of reference :" It is ordered that the Public Accounts Committee be directed to inquire fully into all loans paid or applied for or provisionally or finally approved for local authorities under the New Zealand State-guaranteed Advances Act since its inception. The Committee to report on the losses made, if any, since the Act came into operation, the commitments;, and the available means and unexhausted loan authorities as at the 31st March, 1912, and the 16th September, 1912. The Committee to be open to the Press. Also that the letter of the Superintendent of the New Zealand State-guaranteed Advances Department of the 30th September, 1912, to the Minister of Finance be referred to the said Committee. The Committee to report within ten days." Mr. Hanan: Do you rule that you cannot, in discussing this question, deal with the questions that operated before the Act came into operation, with the conditions that have operated since it came into operation, and with the new conditions now in vogue ? Witness: Mr. Chairman, it was agreed at the start of this Committee that the Government made no charges against any one; nor have I. I asked whether we should have a full investigation, and in the early stage of the proceedings Mr. Allen agreed that what was published in the Press should be accepted. Hon. Mr. Allen: No, I do not think I ever said so. Witness: This is what was agreed to : " Mr. Allen : All I wish to say in regard to what Sir Joseph Ward has said is that I do not know that those things are in the order of reference, but any statement that is made, whether made in the House —and I do not know whether those are the only things —we can deal with, but 1 want the statements proved first of all. I do not want a hunting expedition into generalities, but let us have the statement inquired into in accordance with the order of reference. ... lam quite satisfied to take either the report of the Dominion, Times, or Post of the debate which took place on Friday night, when Sir Joseph was not present." The letter of the Superintendent and the reports in these papers are matters that are before this Committee. Now, in the House, speaking to the point of order, the statement was publicly made that money was squandered, that there was waste, that the advances were used for political purposes, and when I brought the matter up in the House again the Minister in charge of the Department, Mr. Allen, said that he made no charge against the Board, and also no charge against the Minister. Hon. Mr. Allen: Ido not remember saying that. Witness: Well, leave the Minister out. The Chairman: But you must remember that 1 emphatically stated that what was before the Committee was the order of reference from the House and the Superintendent's letter, and I must control it to that extent. It is immaterial what the Hon. Mr. Allen said. Mr. Hanan: What do you hold the order of reference covers? The Chairman: An inquiry into the State-guaranteed Advances Department since its inception; but no dates before the inception, and nothing to do with what took place in the House before the institution of the Board. Witness: Then if the suggestion is made that we are inquiring into the statement that the State-guaranteed Advances Board has shown preference to boroughs —and I pointed out in the House when introducing the legislation that boroughs were not excluded —I cannot quote what I said? The Chairman: You are able to quote it. Witness: But you stopped me. Mr. Lee: I thought the honourable gentleman had got a little wide of the mark when he got on to this point, and I think he will see it. Witness: I do not want to take up the time of the Committee unnecessarily, and I do not want to quote more than I should. The Chairman: I think you should confine yourself to any short quotation to emphasize any statement to the Committee; but to go outside and quote what other members have said, I rule out of order. Witness: I can quote what I said myself, because I can show I pointed out to the House everything that has been said about the loans on the introduction of the Bill. The Chairman: You have already done that. Mr. Myers: It is quite obvious that Sir Joseph Ward is reading a lot of irrelevant matter, but he has not had time to pick out the specific portions of his speech that deal with that aspect of the question —namely, advancing money to boroughs. The Chairman: But it does not come within the scope of the order of reference. I rule that anything in regard to the introduction of the Bill is out of order, and I rule that he must confine himself to the operation of the New Zealand State-guaranteed Advances Act since its inception. Witness: Then I am not to quote anything of what I said in the House? The Chairman: Ido not object to your making short quotations. Witness: I then go on to say, "There are a number of them that would like'to obtain a larger amount than the law now allows, and, unlike the advances under the existing Loans to Local Bodies Act, this proposal would allow the Department to borrow, if necessary, up to a million a year for the local public bodies throughout the country, provided the securities are right and the requirements are legitimate. For legitimate purposes the amount may be considerably beyond that sum." The Chairman: I must rule you out. We have nothing to do with the limitations. Witness: Then you object to my saying that every member of the House knew that local bodies could not get the money they required under the old local bodies system?