TUESDAY, JULY 14, 1903. THE ASSETS REALISATION BOARD.

Auckland Star, Volume XXXIV, Issue 166, 14 July 1903, Page 4

TUESDAY, JULY 14, 1903. THE ASSETS REALISATION BOARD.

While there is a genera! agreement throughout the colony that the Bank of New Zealand is now in a very prosperous and satisfactory position, considerable

uncertainty exists as to the prospects of the Assets Board and tho nature of its opera!ions. Last week Air Massoy protested in the House against the long delay over the realisation of the Assets estates, and it cannot be denied that (Utile apart from political feeling there is :t widespread conviction that the object for which tlie Board was created might have been mon" rapidly attained. See-

ing that the colony has financed the Bank ami the Board to the extent of over live millions sterling, and that the Consolidated Funds are liable for any liual deficiency, it is exceedingly important thai the work of the Assets Hoard should be done speedily and profitably, and anyone who examines the facts and figures must admit that in this respect the management of the Assets Board leaves much to be desired. An article in the Christ church "Press* last week contained a sweeping onslaught on the Assets Board. The Board, says the "Press," steadily ignores the objects for which it was founded— to convert the assets of the Bank of New Zealand into cash. In spite of the land boom and the "earth hunger," of which

we have heard so much, half tlie Board:-! properties are still left on ifs bands. It was never intended, the "Press" contends, Dial the Board .should nurse its

properties for an indefinite length of

lime, but that they should be disposed of at the first favourable opportunity, and that the affairs of the Board should be promptly wound, up. It: is charged against the Board that it lias not tried to push the sale of its estates, that it litis frequently put oil would-be purchasers, and lias generally failed to conduct its business in the way that would be chosen by any enterprising firm of land agents with valuable properties on sale. The conclusion of I lie -'Press' is that as the Assets Board guarantee expires early ncxl year Parliament should take steps to transfer the remaining estates to the

Bank of New Zealand management, and should get rid of the Assets Board as speedily as possible.

Tlie Wellington "Evening Post" deals with the situation on much the same lines. After an existence of eight years the Board, says the "Post.'-' still has on liantl properties to the value of £1.000.100. The total sales so far amount to £903,GTS, which is onl_v ,"'5 per cent, of the book value of the assets and 51 per cent, of the esiimated actual value. Considering the active demand for land throughout the colony, the "Post" considers it natural to ask whether the Assets Board is really doing its best to accomplish the purpose for which it was appointed. "Such institutions necessarily incur suspicion owing to the fact that the more successfully they perform their functions the sooner their extinction is brought about"; and it is now to be regretted that the Hon. E. C. J. Stevens did not succeed four years ago in bis attempt to get a Select Committee to report on the best and quickest way of realising the estates or utilising them under the Land for Settlement Act.

The successful management of the Bank of New Zealand has materially helped to improve the position of the Assets Board. To cover the difference between the book value and the estimated value of the properties taken over by the Board—about £820,000—the Bank offered two cabs on its shareholders, £50,000 a year out of its profits, and any surplus left after meeting its engagements and paying 5 per cent, to the ordinary shareholders. So prosperous lias the Bank been that it has nor only duly paid its £50,000 a year for eight years, but has made a further payment of £101,000, and finds £124.000

more this year for the same purpose. This is of course so much the better for the Board, but it naturally suggests that ■the Bank would probably manage the realisation of the balance of the estates more successfully than the Board itself.

On the other hand, the "New Zealand Times" has endeavoured to make out a case in defence of the Assets Board, and it must be allowed that its arguments carry some force. "It has to be remembered," says the 'New Zealand Times,' "that the estates which the Board was constituted to control and dispose tsf

were not 'tlie finest properties in tlie colony. Some of them were the worst." In tlie North Island especially, where most of the estates were swampy or light soil, it is only when the most attractive portions of the properties held by tlie Assets Board have already been taken up -that intending settlers have paid any attention 'to them. In the South Island, on the other hand, the purchase of estates by Government under tlie Land for Settlement Act has certainly impeded the operations and spoiled the chances of the Assets Board. It is some consolation for these long delays to learn from the general manager 'that ■•realisations have been made and continue to be made at values which are largely reducing the estimated deficiency." But the fact remains that while the outs-landing liabilities of the Board are over £2.000,000, the chief asset consists of the unrealised properties now set down at about £1,000,000. It has taken eight years to get rid of about £900,000 worth of estates; and it has become a serious question bow long this process of realisation is to take. The Bank has to make good any ultimate deficiency, and.in -the last resort the public funds arc liable for the Bank. Under these cir-

enmstanees, and seeing that the guarantees to Bank and Assets Board expire together in March. 1004, it will lie at once

necessary ft-r Parliament to consider ve-.y carefully what; steps should be taken to ensure the quickest and most profitable realisation of the estates in the interests of the Bank and the colony.