The Press. MONDAY, JULY 15, 1895. MR. WARD'S DEFENCE.

Press, Volume LII, Issue 9157, 15 July 1895, Page 4

The Press. MONDAY, JULY 15, 1895. MR. WARD'S DEFENCE.

We have read very carefully the long looked-for explanation which Mr. Wabd gave the House of Eepresentatives on Friday night, and also the speeches in his defence made by the Premier and the Minister for Labour. We have endeavoured to approach the question with an open mind, regarding the matter at issae as one affecting

I not only the public honour and reputation of a Minister of the Crown, but also the good name of the colony, and therefore one which should be considered in a spirit altogether free from party bias. We recognise that Mr. Ward, when in England, was animated by an eager desire to do as much as possible for the benefit of the colony, if only for the sake of confounding his critics, who denied that there was any necessity for his going Home at all. Nor were his efforts in this direction without success. He has shown a good deal of ability in dealing not only with postal but financial matters, and was unquestionably successful in doing some real service for the colony during his stay in London. We should have been sincerely glad, therefore, for his own sake, and still more for that of the colony, if he could have shown that these services were effected by methods that were entirely upright and clean—by methods that could bring no after-train of reproach upon the colony's good name. We regret very much that, after weighing all that has been said on his behalf, we are forced to the conclusion that Mr. Ward has utterly failed to clear himself from the grave imputations resting on his conduct.

We will take first Mr. Ward's statement to the London Chamber of Commerce as to three millions of .unpledged securities lying in London at the time the Government insisted on the Land Tax being collected before its due date. By admitting the accuracy of the report of his speech, Mr. Ward was at once placed in the position of having made two diametrically opposite statements, both of which could not be true. He told the House of Eepresentatives on July 25th, 1894, that it was absolutely necessary the Land Tax should be collected before its time to meet payment of interest in London at the end of October. He told the London Chamber of Commerce on April 25th, 1895, that he collected the Land Tax "as a mere matter of routine," that the statement made in England that the Government were hard up for cash at the time was made by a man with " a diseased imagination," and that the same assertion was circulated in the colony by opponents of the Government for party purposes, and was in fact merely an Opposition " slap in the face." Further he committed himself to the specific statement that instead of being hard up the Government had actually lying in London " some £3,000,000 worth of " unpledged securities of New Zea- " land, against which (he added) we " not only could have raised the in- " terest falling due, but could have " got twice or three times the amount "if it had been necessary to do "so." With such flatly-opposing statements as these the question of course narrowed itself down to the very simple issue :—" Did Mr. Ward tell the House of what was untrue for the sake of getting authority to collect the Land Tax before its time; or, on the other hand, did he tell the London Chamber of Commerce something which wa3 untrue for the purpose of * booming' the 3 per cent, loan ?" By now pledging himself to the existence of the £3,000,000 of debentures, Mr. Ward has elected to take upon himself the shame of having deliberately misled the House of Eepresentatives to induce it to give him authority to collect heavy taxation before it was due. He has also made the Premier a partner in his self-confessed policy of deceit, since Mr. Seddon, following up Mr. Ward's appeal, declared most emphatically that all they had in London to meet the interest falling due was £470,000 of debentures, and that the special legislation asked for was '*• necessary to maintain the colony's credit."

Let us now consider the nature of these "unpledged securities" which Mr. Wabd maintains "were in actual i existence, and on which, according to his speech to the London Chamber of Commerce, the Government " could " not only have raised the interest " falling due, but could have got twice " or three times the amount if it had " been necessary to do so." Mr. Wabd gives a list of the securities and we do not question its accuracy. But of what do these securities consist? Incredible as it may seem, they are the securities belonging to the Public Trustee, the Government Insurance Department, and the Post Office. Needless to say these are Trust Funds which the Government have no right efen to think of in connection with pledging for the purpose of raising money to pay the interest

on the debt. They have no more right to use those securities for that purpose than a solicitor has to pledge [ the trust securities of his clients or a bank to pledge its customers'securities entrusted to its care and locked up for safety in its vaults. That a Colonial Treasurer should airily speak of securities such as these as " unpledged securities," against which " at " any moment we could not only have " raised the interest falling due, but " could have got twice or three times " the amount," actually makes one's hair stand on end. What would the London financiers have thought of Mr. Ward's statement had they known the real facts of the case ? The honourable gentleman certainly would not have received the cheers with which his unsuspecting auditors greeted his remarks, and could not have complained if they had refused to have any further dealings with him. It has been said that after all the British investors were not much influenced by what Mr. Wakd told the Chamber of Commerce, but that what really did weigh with them was the circular sent out in the name of the Agent-General prior to the issue of the loan. For this document the Government have taken the full responsibility. We have a copy now lying before us, and cannot help regarding it as in many respects grossly misleading. It is a highly significant fact that although the Government made a distinct agreement with the Opposition that the Agent-General's circular and not the Chamber of Commerce speech, should be discussed on Friday night, Mr Wakd devoted himself entirely to the speech, and made no attempt to deal with the circular, except to remark that it was too modest. Furthermore, the Premier flatly declined to allow the circular to be referred to the Public Accounts Committee for investigation and report. Although the Committee is one set up by the Government, and comprises a majority of Ministerial supporters, Mr. Seddon treated the proposal to refer the report to that Committee as a motion of want of confidence, and brought down the brute force of the Government majority to crush it. We are not surprised that he refused to submit the statements made in the circular to the careful scrutiny even of his own supporters. We have no space in this article to deal with all the points open to comment, but will take as one matter of crucial importance the way in which the public finance of the colony for the past five years js set out for the admiration of the British investor. Take, for example, the following statement: — The balances of revenue over expenditure for the lasD five years are aa folluwe :— * £ 1890-91 .„ .- »- 143,965 189192 .« .., ... 165 573 1892 93 .... ... ... 283.780 1893,34 550,458 1894-95 (the financial year just ended) ... ... ... 430,000 Now there is one point about these figures which apparently has not been touched upon during the debate, but which, in our opinion, makes them absolutely misleading, so far as the British investor is concerned. In each case the " balance of revenue over expenditure" quoted includes tlie balance brought down from the previous year. We repeat the figures again with the amount of the balance brought down and so included following in a separate column :— Balance ab Surplus, beginning of year. 18901891 .„ 143 965 36,568 18911892 .„ 165,573 43,965 1892-1393 ... 283,780 165 571 1893-1894 . M , 550.458 283 779 1895 ... 430,000 290,238 Our readers will see how the same "balance"is counted over and over again. It is quite on the same lines as the apparently interminable stage "army," composed of a dozen or twenty " supers," who continually circle round the stage. On the same principle, if Mr. Micawbeu in his young days had once managed to save £10 out of. his yearly income, he might have represented himself as saving £10 a year for the rest of his natural life, supposing that his actual income and expenditure exactly balanced each other. All he would have to do would be to bring down the balance of £10 at the beginning of eaoh year, include it in his income, and call it " excess of revenue over expenditure" at the end of the year. At the end of ten years, however, he would not have saved £100, as the Seddon Government apparently believe—he would have only the same £10, always providing it had not been worn out in the constantly-recurring process of bringing down. One might expect to find juggling of this kind in low-class company-promoting, but it is utterly out of place in a document professing to be an honest showing of the colony's position' for the guidance of investors. There are other statements in the circular equally open to question. It is said that " within four years the aggregate " amount of upwards of three-quarters "of a million out of revenue has "been applied in the permanent " improvement of the national landed " estate " —and this is put in such a way that the investor would be likely to conclude that the amount had been so applied..without trenching on the surplus balances set out above. Needless to say this is an absolutely false idea of the case.

Now we have no hesitation in saying that the public of New Zealand do not want their loans floated by such dubious methods as these. Our credit has not sunk so low that it is necessary for us to make bogus statements as to our financial position, or to speak of our trust investments as if they were negotiable securities available for payment of interest on our public debt. Mr. Wabd has been led—no doubt, by overeagerness to distinguish himself on behalf of the colony—into a fatally misguided course, which will tarnish his fame as a public man, and may prove highly injurious to the colony's credit and good name. We regret exceedingly that a politician of such acknowledged ability should have been so wanting in a. sense- of what is right. • , .