AN ANGRY OUTBURST

Dominion, Volume 6, Issue 1575, 19 October 1912, Page 2

AN ANGRY OUTBURST

AT ADVANCES INQUIRY. SIR J. G. WARD & THE CHAIRMAN. THE REMUERA LOAN AGAIN, SOIYIE VERY INTERESTING EVIDENCE. Witnesses from Remuera gave evidence yesterday before tho Public Accounts Committee of the House of Representatives which is at present conducting an inquiry into the administration of the State Guaranteed Advances Department, under past Governments. Mr. J. B. Mine presided. Also present were tlie Hon. Jai. Allen, Sir Joseph Ward, Dr. A. K. Newman, and Messrs. A. M. Slyers, E. I'. Lee, J. Craigie, and J. Hanan. _ The first witness called was Arnold AA'ilkius, foreman to the Remuera Road Board. He said that on December 13 tho chairman of the board, Mr. Cawkwell, addressed the employees of the board, anil as they got wet standing in the rain, they were told that they could go home for the rest of the dav, and that they would be paid. Mr. Cawkwell told the men that it was to their interest to support the then Government, as, if it went out of office, money advances were likely to be reduced. Sir John Findlay was the Government candidate for tho seat, but no names were mentioned. He knew nothing of a deputation having interviewed Sir John Eindlay about a loau to the board. It was not tho custom to pay the men when they stopped on account of rain, but on this occasion ho was instructed to put down the names of the men for pay. Mr; Allen: Did the men understand that the board would pay tlieni? AVitness: There was no question about that whatever. To Mr. Craigie: It ivas an unusiial thing for the men to bo paid for time not worked. He regarded it as an act of grace on the part of the chairman. The men had got wet listening to his address, anil he turned round to witness and said, "You have lost a lot of time lately. You had better let them go liomcj nnil pay them for the day." Air. Craigie: Do you see anything wrong in that?—"At the time I did not." Do you sec anything wrong in it now? —"I can't say that I do. It was an act of grace on the part of the chairman." To Sir Joseph. Ward: AVitness said that he knew very little aLout the loan anil tho purposes for which it was raised. He knew that the works upon which the board had expended money were useful and necessary. He remembered nothing more of Mr. C'av,Jewell's speech than that he told the men it would bo in their interest to support the then Government. "An Electioneering Speech." Dr. Newman: AVhat else did Air. Cawkwell say?—"l am not sure that I can repeat very much of it. It was an ordinary electioneering political speech. He urged (lie men lo consider the importance of "their votes and emphasised it by telling them that it was their interest to keep the (then) present. Government in power, because if they were thrown out it was probable that the present loan would be reduced. Sir Joseph AVard: AA'hich is exactly wliat has occurred. Mr. Allen: AA'hat a wicked thing for you to say! AVho put on tho .£SOOO limit? Sir Joseph AVard: We did; that was before tho election. Mr. Allen: You did not publish it till March. To Mr. Myers: AA T itness said he did not know how many of I'ie thirty men in his charge were electors ill Parnell. Dr. Newman: All these people were .electors in surrounding electorates, were they not?—" Yes." To Mr. Iline: It was not usual for the chairman to address the men. The whole of the spceeh was confined to political questions. The chairman advised tlie men to vote for tho (then) present Government, and added that in all probability if the (then) Government was ousted some restriction would be placed on tho lending Department. Mr. Iline: Implying, of course, that the men would then be out of work?—" Presumably-" AVitness did not know if the loan was then granted. It was a matter he took absolutely 110 interest in.

Paying for a Holiday. Hugh Munro Wilson, civil engineer, Auckland, was next called. To Air. Allen: Witness said lie was engineer to tho Remuera Road Board. He knew nothing about a deputation that had waited on Sir John Finillay before the election, except that a deputation had gone to Sir John I'indlay aljout tho loan. Oil December 13 Mr. Cawkwell came to witness's office and said that he had given the moil on the mountain a holiday. He had addressed them that morning, and given them a holiday on pay. AVitness replied that he did not like it, as the amount would be a charge on tho work. Ho asked Mr. Cawkwell who was to pay for this extra expenditure. Mr. Cawkwell said that it. would be all right. 11: would not bo charged to the board. Mr. Allen: Did he say who would pay for it? AVitness: It might have been in a joking way, but lie said that Sir John Fiudlay would pay for it. In further examination witness said that apart from the men on the works there were two others who were paid for tli.it day. Air. Allen: AVho paid them? AVitness: They have been paid by tho Road Board so far. Air. Allen: AVhat were these two men doing who were not working though they were paid? "Canvassing For Sir John Findlay.'! AA r itness: They were up there canvassing for Sir John l'"indlay. Mr. Craigie. ltow many men were on that work when they got tho holiday? AVitness: About twenty-five. Mr. Craigie: Tlicy got wet hearing tho address by the chairman; wlmt time was that? AVitne.ss: It must have been about ten o'clock in tho morning. Mr. Cawkwell eamo down to me about twelve. The men got wet listening to him?— Yes. Aud owing to that he gave them a holiday?—On wet days we put the men off. but they did not get paid. AVere these men paid by the Road Board ultimately r—Yes, I. understood that it would be kept iu a separate account and paid by Mr. Cawkwell. But as a matter of fact that holiday has been paid for by the board?— Yes. Mr. Myers: AVorlcing men generally take a great interest in elections?— Yes. AA'ould you think it anything unusual for them to wish lo get oif on election day?— This was not election day; it was a day or two before the election. Mr. T.ee: December 13. Mr. Myers: Sir John Findlay was a Liberal candidate?— Yes, Liberals are very popular with working men?— Yes. An Annoyed Engineer. AVas there anything unusual in working men taking an interest in the forthcoming contest?—l did not take any interest in tho election at all myself. All that concerned mo was that I had to build this reservoir for a certain price and T did not like the idea of charging this holiday to the board, f felt, annoyed about it. Mr. Myers: Naturally, as engineer, you would be. That was Ihe only lliiug you would lake exception to. To Sir Joseph AVard: AVilness said that the men at the reservoir worked ' one .hour on December 13 and were paid for • 81 hours. | Do you suggest thai Mr. Cawkwell ad- I dressing Ihe men and giving Iheni a holiday was done at the rciiuest of Sir John Finillny?—Xo. ! Have you ever known men lo be allowed ' to knock oil' on account of excessive rain? —Often: but we did lint pay I hem. Not under any condition?—Xo. At whose reifiiesl havo you come here? —At the re(|iiest of this Commillee. AVere you couiinnuicnled willi verbally or otherwise before you came here?—l got one telegram. Had any one spoken to you about it before you came.'—Xo. Did you take an.active part in the last general election F—No, . Mr- Myers; I kno.\v he .did not.

An Absent Witness. Mr. Allen: You know Mr. Cawkwell very well? Did you see liini yesterday? —I .saw him on Tuesday or AVcdncsday. Mr. Allen: Did you know that lie declined to give evidence? Witness said that, lip had heard about if in ringing up the oflire of 1 hit AVaitemala County Council. .Mr. Allen: Do you know why he did nol come down?—Xo. Did lip look ill?—Xo. Did he look as if he were snfl'erinß from influenza ?—Xo. Air. T-raigie:, Influenza comes on very suddenly. Another Board Official. Charles Somners Wilson, clerk lo tho Remuera Hoard Board, said that he knew I here were men paid by the board on December 15. , 110 merely received tho time-sheet from the foreman, and did not know what they were paid for. No money had been refunded to the hoard. Ho had heard no talk of its being refunded. • At Mr. Allen's request witness read the following telegram :— 9/11/11. Clerk, Remuera Road Board, Remuera. .£.12,090 water supply loan linally approved. Payment of .£IO,OOO will be made when debentures completed and returned. (Signed) "ADVANCES." To Sir Joseph 'Ward: AVitness said that so far as he knew the application for tho loan was sent direct to tho Advances Board, and the telegram which ho had read was in reply to representations made by the Remuera Board. To Dr. Newman: lie hod drawn about .053,000 of the JS-t.OOO loan, anil the Remuera. Board had about =tl!),t!00 nil lieposit iu the bank. A County Representative. Alex. Sclioles, chairman of the Waitomu County Council, was next examined. Ho said that his county had raised somo £>7,000 or iG2B,OUO from the Advances Department. The county had applied for .£SOOO more, but this amount was refused. Tlie loan was required for metalling. About half the amount raided had I>ccn spent. No political influence was used to obtain the loan. AVaitomo County was in Tauniarunui electorate, which Mas represented at the time by Mr. Jennings. Neither the member for the district, nor any Minister was consulted about tho loan. The expenditure of the money had been of great benefit lo the district. Under the old Loans to laical Bodies system tho money required for the development. of the district could not be obtained. There was a limit of .£SOOO under the old Act, and so small a sum was useless in roiiding a new district. The countv was unable to raise the money privafely. ami if it had not obtained nil Advances loan it would havo had to apply for Public AVorks grants, or let tho district remain in an unroaded coiuliII To Mr. Mvers: AVitness said that it had never been suggested to him that it was necessary to use political influence, in order to 'obtain loans from the Advances Department. He bail considered only the ratepayers.

Sir Joseph Ward on Oath. Sir Joseph AVard now said that he wished io give evidence on oath. He was -worn, and elected to make a statement, lie said that in 180!) he prepared a system and gave instructions to the law oincers to have an amendment made relatins to State Guaranteed Advances. Legislation providing a million a year for local body loans was passed through Parliament in 1909. llis reasons for asking Parliament to change the system were that ho found that under tlie old system public bodies could not obtain the money they required. Repeated applications had been mails to liini by all classes of local bodies lov advances iu exce.-s of tho limitations imposed under the old law. He was confronted by the fact that the country had lost two millions under the old system, anil that extending and expanding that system would havo involved imposing an enormous loss on the country. Ill' finally decided to repeal .the. old system" imd introduce a new one. Many mayors and chairmen of public bodies urged him to make arrangements under which they could raise money in England. In England he saw two leading members of the I.ondcn Stock Exchange, aud was satisfied as a result of interviews with these gentlemen that tlie proposal lo _ group local bodies for purposes of borrowing was not feasible. AA'hen ho returned lie went into the subject of State guaranteed advances. It was intended from the start that tho Advances Act should apply to boroughs as well as to counties. In the records of Parliament lie could find no division or statcmem .

suggesting tluit the Act should not apply to.municipalities. If the Advances Board had decided at the start not to advance a shilling to a borough, not one penny piece more would havo been advanced !.o country local bodies in the first and second year, because no loan application from a country local body was refused. Quotations from "Hansard." AVitness now quoted extensively from the "Hansard" report of the second reading debate upon the Advances Act passed in 1909. Air. Lee intervened to suggest as a point of order that the Committee was not inquiring whether or not it had been expedient to pass this legislation It had nothing to do with the scope of the inmiir.v whether tho reasons advanced in debate were sound or otherwise. 'The inquiry was as to whether the Act when passed had been properly administered bv tile board. The chairman quoted the order of reference, showing that the Committee was instructed to liquiro into the administration of the Advances Department. Mr. llanan said tiiat. Sir Joseph Ward was referring to the conditions before and after this legishtian was passed. Mr. Iline: AVe are not inquiring into that. ■ Chairman's Ruling Challenged. Sir Joseph AVard: I dissent from your ruling, and I will bring it before the House. He added that he had not many extracts to make. Tile issue before the Committee was a. very definite one. A general discussion followed, in the course of which Sir Joseph AVard said that Mr. Allen had agreed that what had been published in tho press should bo accented. Mr. Allen said that this applied lo reports and not to leading articles.

S:r Joseph Ward said that in the House a statement had been publicly made that money was squandered, that there was waste, and that advances were used for political purposes. When he brought the matter up- again, in tlxi House, Mr. Allen said that ho made no charge against the Board or against the -Minister. „ . Mr. Allen: I don't remember' saving that. Sir Joseph Ward said that lie had not exercised influence. The chairman said that it was immaterial to him what Mr. Allen said. The inquiry was into the administration of the New Zealand State Guaranteed Advances Department sineo its inception. They had nothing (o do with what took place in tho Housu boforo the ineeptiun of the Department. Sir Joseph Ward: Then if a statement was made that preference was shown to boroughs, and I wish to show that boroughs were included, can I not refer to that? The chairman again mentioned tho order of reference. Mr. Myers said- that it was quite evident that Sir Joseph Ward was reading a lot of irrelevant matter. Evidently lie had not had time to take out'that poition of his speeeli which was relevant — namely, that in reference to advances to boroughs. The chairman said that reading Hie speeches made at I he introduction of the Hill was out of order. Sir Joseph Ward: Then 1 am not to quote what I s.sid in the House? The chairman said he would not object to short quotation^. Sir .lo=eph Ward continued to ouote trout lian*anl. but presently the chairman again called liiin to order. "A Majority Aqainst." Sir Joseph Ward: Then you object lo my showing that local public bodies could not get the money they required, and that boroughs were included. I will d'. it in another way. I recognise that 1 must accept the decision of a committee n"ilh a majority against me. Mr. Allen: Wo havo not a majority here now. Ton are four men to ihree. That. is. u very unfair, suggestion to make. 'Ills members of tho committee present.

were Messrs. JTino, Allen, l.ne, Craigie, Myers, Hanan, and Sir J. Ward. Sir Joseph Ward said thai according 'o Hie statement placed before tho Jlouse by the Minister lor Finance lie had CI!)!),000 more in the Consolidated Fund Mini he had undertaken to pay into , the Public Works Fund. The I'ost Oliice was uol the only source l'roni which money could he obtained. Political Influence. As to political influence, the minutebook showed that loans had been applied for by districts represented by. men of all shades of polities. There 'had been no discrimination. A Minister could ,not atlend meetings of the Advance* Board and carry on his ordinary duties. The only suggestion he had made to the Hoard was that decisions about loans should be unanimous. Ho had never asked any member of the Hoard to further a lean. An attempt had been made to draw Sir John Findlay into the political arena ill connection with the lieniuera loan. lie proposed to call Sir John Findlay again, and he wanted Mr. Cawkwell, in consequence of stateinents made that morning. He also wanteel .Mr. I'oyiiton again. He had heard of these things for the first time. Tho Jtemuera loan was applied for in May, l'Jll, and provisionally approved by tho board when witness and Sir .lohn Findlay were out. of the country. There was uo suggestion that any Minister had attempted to inlluencc a loan to the lieniuera Hoad lioard. 'When Sir John Findlay was waited oil by a deputation about the lieniuera loan, he was a Minister of lire Crown. Witness sent on Sir John l'indlay's telegram of November 2 to Mr. I'oynton, marked "urgent." To the reply prepared by the Department he made the following addition in his own handwriting:—"Cannot advance >£10,000, but as debentures for amount of loan will be authorised. on Monday, that should lie quite satisfactory." He could not recall the circumstances, but with a considerable knowledge of what he would do ill tho circumstances now, he wanted to state ivhat he believed was the position at tho time. The Advances lioard could not make teiuporirv advances. The .£IO,OOO applied for could only havo been advanced by tlie Treasuiy. Ho could have advanced it against the amount of advances to ba made by the Advances Board. If anyone suggested political influence, there was the fact, that he refused to do the only thing that was going to be of any use to them in dealing with the reply to Sir John Findlay. More About the Round-Robin, Regarding tho procedure followed in connection with the Keinuera loan of ■Elli.OOO, when a lile was sent; round to individual members of the .Advances Board for approval. Sir Joseph Ward said that tliD-o was nothing unusual in this procedure. It was quite a common thing for papers to be sent from ono Minister to another between Cabinet meetings. He could name an instance in which an important piece of business was transacted in this way before he -came into oHice. Tire chairman objected, remarking that witness was making use of his intimate knowledge.of the machinery of Government, and going beyond the scope of the inquiry.

Sir Joseph M an! said iluit this was nonsense. What ho hail spoken of was done all the time. It was ilone by local bodies and by directors of commercial institutions. Tic would not have asked tile head of a State Department to ssnd round a file as had been done in the case of the Itemuei'a loan, and, as a matter of fact, was not aware at the time that it had been done.

The point was raised as to whether the loan application, after being sent round to individual members on- November 7, had been approved by. the Minister before 'or after it came before the board for filial approval. Mr. Allen: Won't you clear up this point about the rouud-robin? Sir Joseph Ward inferred to the file, mul sail that the application was approved by Sir James Carroll on November 7. Mr. Allen: Before it came before tno beard for final approval. The commitlco adjourn?d at 1 p.m. until 5.30 p.m., on the understanding; that Sir J. C 4. Findla.v and Mr. Povnton should be recalled, and that Mr. Cawluvell should be called.