The Financial Statement.

Bruce Herald, Volume X, Issue 959, 20 November 1877, Page 5

The Financial Statement.

[Br Tex-egraph.] , . : , V ; WELttK^TOif, November 19.' ,;■: The Financial Statement was delivered this evening by the Colonial Treasurer, the Hon W. . J. iVf, Larnach, .-, ■: \ - ::.■}.};■ -. ■ .;-■ .• .. -V ■ '- j iVlr, Larnach ;* ; ;Mr^Speakers-Sir -~ The Hon. the Premier a few evenings ago, in his statement of .proposed future policy of the Government, inforined the House that it was our desire to consolidate the administrative system of the ! olony and to iutrodijee a c)gftr» gomprehensive, economical, and stable , pjan pf j|na»»Bp •,Th?«? §\Yi\s % work, oii the advisability of syfyicij, J think, all hoobiirable members must agree, and all Will, HP iU>ubt| agr?e, tjiajt a WP% of sucb>u»|ti»r^J

cannot properly he accomplished without full jonsideration. Under, these circumstances there are two courses open to us— Firstly, to ask the House to vote supplies for a period of three or four months to adjourn to 'meet '..again': at .an ea'-ly' date next 3 r ear, when we should be enabled to place all our plans oefore you in a matured form, and then to take your verdict xipou them ; or, secondlyto take up the estimates of the late Governr ment, make such modifications in their pro posals as we might deem necessary, and occupj' ourselves during the recess in fully reorganising and consolidating the present fi; nancial and departmental system of the Colony. Sir, the latter is the course which /we f<a*e determined to adapt, at th •• same'titne, whik we resolve to do this, the House have a right to expi-ct we should at least indicate our views upon the present financial condition of the Colony, the character of the changes we., pro- ; pose to inako, and the necessity— iv our opinion-^th'at exists of making-tho"e cbanges; The late -Colonial. Treasnrer has laid before the House ah elaKo'ate Financial ' Statement; furnished with all the tables ,6tV returns that usually accoriipany such an important document: I therefore, sir, feel myself somewhat relieved of the duty of entering to any great extent into minute details. I will at once admit, sir, that it would be impossible for me to attempt to place more clearly before this House than the last Hon Colonial Treasurer has done all details in reference to the different loans which this Colony has from time to time contracted, nor hav&l time or the means, at this very late period of the session, to revise them. The Goveruinent has ho other course to adopt but to accept them. So also with regard to the expenditure. 'Anxious as we are to effect changes of system. by ■ means °f :. re-arrangement. economy, and consolidation, yet as more than one-third of the financial year has already elapsed, and as much patient enquiry is re quisite to prevent changes and re-organisa-■tiou of this kind becoming mischievous and even dangerous to the public service, I feel that I have no other course open to me at the present time than to accept the estimates of expenditure nearly as they appear in the tables recently submitted by the iate Treasurer. If, however, by the circumstances of the case, I am precluded from dealing with details, t ask the attention of the House for a short time, whilst I endeavour from my point of view to indicate briefly the tendency of our present system of finance, the evils to which it is rapidly leading, and the only available remedy that I can see possible to enable this Colony, without imposing enormous burdens upon the people, to 'maintain its credit and bring to a successful issue the great policy of immigration and public works, to which the Colony is pledged by the contracts it has entered into in relation to the works that are in progress, besides the promises of works to be initiated. Earlier meetings .of Parliament are necessary. One striking defect in. the present system of conducting the public expenditure is, that the General Assembly frequently meets after' the commencement of a new fiuaiiciul year. : After the meeting of Parliament, a period o(' several mouths sometimes elapses, tiefore ttje Act of Appropriation passes the Assembly. UiiuVr such a .system, the expenditure is conducted without any appropriation having been made and is incurred solely on the authority o"f Imprest Supply Acts which direct the monies to be charged in the inauuer thereafter to be expressed in the appropria'ion of the year. From this it resqlts |h^t the Gjoyeinmeut is abl v« to incur any experuliture it pleases by simply placing on an estima-e any aniount for any service which it thinks proper to undertake, and the duty of the Assembly resolves itself 1 vathef -. jnjfl the p^rjficafiqn of expenditure incuvred during several month)* of the year, than a careful - vvatching of amount.s which it is asked to vote. To cure this system, one ■ f the duties of the present Government will be either to alter the time of the commencement of the financial year, or to take care that the Assembly meets at an eariier perioil, say not la;er than the first weeks in June. Regarding Treasury Bills and other floating debts:— ln the financial year 1874-75 there were outstanding Treasury Bills, that is, loans raised to meet deficiencies iv the revenues of previous years and c)jargeab]e o>i the Consolidated Fuud to the extent of £400,000. The amoqnj; was due and payable in that year, but the Consolidated Fund was unable to bear so large a charged It was, however, hoped that this sum might begraduajly reduced by |h0 p»yipent cut of revenue of £100,000 per annum until the whole amount was extinguished, if that sanguine expectation had been realised there would be outstanding now only £200,000 of Treasury Bills, of which sum a moiety would vanish concurrently with the present financial year. But the . present | tendency is in an Opposite direction^ for \\\^ aifjPHHt. Qf Tf^s/ury Wh \n exlstencn is npw above niore than double the original sum referred to. of 1874-75, and instead of there having occurred any decrease in this, particular form of the Colony's indebtedness, the original sum may now* gafely be multiplied by two. Not only have we been unable out of the superfluities of the present to pay off the deficiency of the past, hut the necessities of the present have show, themselves to oefar greater than beforehand n'o>y becoinf so' large tha'£ to iiieet theseTreijsury bills out .of the fund upon \yhich they are by Jaw -a proper charge appears to n/ie hopeless' In the year 1875-76, a 'further issue of Trea sury bills was requisite in aid of the revenue to the amount of £172,000. In the last year.a further issue of £260,000 became necessary , and tlje |ate Cojonial Treasurer proposed reneafa similar temporary borrowing 'this year •• as a receipt in aid". ;. but for this occasion the fund upon Ayhich the advance is to be secured is UQt IJje Coiispliclated F 9 n.d or |hP f?"<]}nary revenue of the Colony, but the land fund of the Provincial District of Otago A similar loan would have been raised on the security of Canterbury ha-1 it not been foijnd pqasihle to take £s§,d^Q |n i»a§h from it's territorial revenue. Such a condition of affairs as this is not considered by us in any way satisfactory There appears to be a sad want of that equilibniHT), thaf eyenijess of hajauqe, in our 'financial system which, b'efbrp all things, must exist if we intend to maintain-on, r position as a solvent State, our reputation as prudent careful colonists, arid, above all, bur credit in the English muney. market. Nor, Sir, ig thig allf -jf ]t werg. per-^ps it would nqt be so difficult to seen.re an even balance between our means and our requiremfciits as I f?a r ra.ay possjbly be the case, or, to yse homely phrase, to' learil to make both ends meet Last session this House finally "determined to abolish the provincial system, and in sp dojn^ bad to make all Provincial liabilities Colonial liabilities, lot- whlcl^ this H/ouse has to make provision: The burden which has been undertaken by that policy is, in my opinion, greater than >ygg gver aiitjcJpatea. dif^culty pf ascertaining the amount, of Proyincjal liabilities seems to bp Very g rt -^t ftpd tba^ pf ftndjng; WOJf w^ejfe'wUl* vtp-

liquidate them when aweer ained< seems to me to-be still greater Up to the 90th June last thc-6um of £237,500 had been advanced from loan to meet payment of Provincial liabilities ; and there existed on that date overdrafts at the Bank on the Provincial 'account to the sum of £105,888, or an aggregate sum of £343.388, which total m.sy oe reduced by £45 888, being the amount of balance of Provincial- "accounts, tims leaving still unsupported the sura of £207,500. fco much I have said for the peiod up to the 30th June last, and from that time I may be be allowed to travel upon a different and perhaps more uneven track. There are known fo be, at the date on which I am now speaking, still further liabilities oil Provincial accounts to the amount of £279,766, reiluceable -by about £30,000 due from Land Fund and other sources, leaving a total to be provided for in some nianuer of £249,768, and the House I think will agree with me \ that., still further liabilities in' this direction will yet modt surely present themselves In the statement of the liabilities, which I found iv preparation for the late Treasurer, they appear to reach a total of £660,000. There is a sum of £104,000 to be paid in January next to the Wellington Trust and Loan Company, for money lent to carry on the important reclamation improvement undertaking on the foreshore of the harbour of this city. 1 1 is true that the works contracted for promise undeniably to be ; reproductive The land is security for the outlay, and very good security too ; but still, Sir, the works are not yet finished, and are not likely to be before or on the date upon which the payment becomes due, and it can hardly be expected that sales to any extent of sections can take place for some time to come. The moneys no doubt, can be re-borrowed on the security, perhaps even on better terma than originally, and if there Were no greater difficulties to face than this, my task would be much easier than [ apprehend it will be. From the statement of the late Colonial Treasurer, the House \ will have seen that there remain no available balances from loans upon which we can pretend permanently to charge any of tbese^ payments, but, on. the other hand, it is absolutely necessary to go intp the money market under disadvantageous circumstances to borrow still further, and to attempt to do so upon anything likely reasonable terms we must be prepared to show a state of finance characterised by soundness and stability. He then referred to the unstable character of recent Co onial finances, as follows ;— I ask, Sir. has there been exhibited any stability in the finance of the Colony during the recent past? By the Abolition Act, a financial arrangement supposed to be of a very different and permanent character was arrived at in reference to the Lund Fund. This grand arrangement, promising durability and stability.-,-. never even, saw the daylight' of its existence, but fell still-born, and great difltculties would have arisen from this cause had not certain provisions in the Financial Arrangements Act of last session come to the rescue of Colonial finance. These are the very provisions the late (TOV£rnm,er't proposed again to ftj^r fhja y«iu', thus removing' every trace -of fixity and finality 'from the finance, of the Colony. Now, Sir, to meet all the exigencies, to make the large payments .on account of interest that this Colony has periodically to malcp, to pay salaries and to provide, for the. immeasurable other matters. that have daily to he met, wha;^ J ask, is the present state or the .Treasury chest. I: have bet-u accustomed, sir. to deal, and I prefer to deal, with cash It is very much more satisfactory and more convincing to deal with cash .thip . with mere br6ker?ige aQQO^Mt 8 : W'.th the la! ter it is not difficult to nianipqlate balances, with the for--' rner it is not easy to show two sovereigns where in reality only one exists. Regarding the state of the Public Accouuts on my entry into office, on the |3th_ day of October last, the day on which the Government assumed, office, there stood to the ere, d.\t p.f the Colony aUugei'ner, fts" shown by its Bauking a.ccoun'ts, the sum of £762,312 Is 3d. Sqrely, sir, with such an overflowing Treasury as this the House will wonder what need there is for any financial difficulty. I shall at once proceed, sir, to show the House of what this balance chiefly consists To the credit of the Consolidated Fund there was £-1. 0.5,363 7s 8d ; to the" credit qf the I^nd Fund,. £544,548 1 Is 6d I shall now lay hefore the Mouse a full statemement of cash balances in the hands of the Bankers on the day which X have".refer--reel to, also a similar statement for comparison qf the J6th instant, with the amount of the balance of each oue of the numerous departmental accounts. The whole of the Land Fund is appropriated by special "enactment The Government has no power, however large in any one year that fund may become, to. touch one shilling of *c for any purpose whatever beyond that amount which the law places at its disposal. The whole oi the residue is to be distributed iv certain defiued proportions to the counties of the respective Provincial districts in -which it is raised. An .accumulate sud excessive Laud Fund, under the present laws of this Colony, can never be used by the Government^ even temporarily, in aid of a deficient Colonial Treasury. The Land Fund this year, I feel pleasure in saying, will be largely in excess of th- sutn estimated hv the late Government. The estimate was 4f 4-3 QOQ. September 30, there had actually be/n paid into the Treasury the sum of £542.231 Is 4d Ido not mean to say thai I anticipate four times that sum as the laud revenue for the year, but I think it is quite reasonable to suppose that the respectable total of one million will be realised, i after '■ paying; all SHusiriies to municipalities, vfiad boards, etc As provided by law, the residue, however large, has to be paid to the County Councils, I beg to call the attention of the House to the tact that while the Land poncl receipts have, on ilu» whole, been largely in excess of the .Estiuwtej that excess entirely arose from the large suras realised in the Pruvinoial District of Canterbury ; while |n the '.'ther provincial districts the amount realised has been under the Estimate. Proposals regarding future 'disposition of I^aud Fuijd '.— Sir, although the Land revenue bits nom.iua.liy heeiv regarded and treated as Provincial revenue; yet in poiafc of fact, and actually, it has, hy various enactments during {\\e past years heen gradually encroached upon and absorbed to such/ an extent that in reality the idea tha* a large proportion is ay^ilivhle for Idealisation is a delusion only calculated to mislead the mimis of the people as to the real pbsi ion of affairs, such proportion'not. being fpr the most part derived from act^aj land sales, bufc from Treasury Bills such circumstances, it is desirable that the subject should be placed upon ft more certain and satisfactory footing, with which Y?e W, 8fi«l far the purpose pf simplifying the public accounts, we propose to do openly (and straightforwardly that which our predein office have hitherto been doing in directlyjand disingenuously. Sir, we mean to make: the L.and Fund Colonial revenue, subject to all the obligations which the , Cft}^^ has u»def tj&eij iv reppecV tbere^ ti\cU

cost of administration, cost of survey, immigration, interest on -Provincial loans, &c. It U our intention, however, that .20 per cent of the land revenue shall be localised by law for the purpose of being expended by the local authorities on roads, bridges, and public works within their respective districts, and further, we shall ask Parliament to agree to one uniform Land Law whereby the public estate, subject to classification, shall be sold at uniform prices throughout the Colony, whether on a system embracing free selections, deferred payments, or otherwise. Sir, I wish it to be understood that if administrative reforms and reductions of expenditure can be effected to an extent which may allow of any increase of the proportion of the 20 per cent referred to, such proportion shall have the benefit of it. accordingly.

[We are compelled to hold over the balance of tbe Statement X