THE EVIDENCE

Evening Post, Volume CXVI, Issue 144, 15 December 1933, Page 16

THE EVIDENCE

AUDITOR'S REPORT

THE NATIVE QUESTION

MINISTER'S OPINION

A QUID PRO QUO

Lengthy evidence was heard by the Public Accounts Committee of the House of Representatives on the report of the. Controller and AuditorGeneral (Colonel G. F, C. Campbell) in reference to the administration of the Native Department. In his report presented to Parliament recently Colonel Campbell said that there had been grave irregularities in the Department, and the House referred the report to the Public Accounts Committee which heard evidence from various officers of State. The evidence, which was tabled last evening, showed that Colonel Campbell had expressed the opinion that, in the interests of economy, sufficient staff had not been applied for in the Department, and also that no satisfactory results could be expected as long as dertain legislative powers Avere exercised in such a way that purely administrative acts were being put into operation by others than the executive head of the Department or the .Native Land Settlement Board. The Native Minister (Sir .Apirana Ngata) stated that the Maori settlers had Keen handicapped with a < lack of money, and many a time they had been almost at breaking point.. He maintained that the taxpayers had received a quid pro quo for the money expended on development work. Evidence was also given.by trie Public Service Commissioner and the deputy chairman of the Unemployment Board. The personnel of tho Committee was as follows:—Messrs. W. J, Broadfoot, J. Connolly, W. KEndean, K. J. Holyoak&, E. J. Howard, J. A. Nash, D. G. Sullivan, C. A. Wilkinson, Mrs. ,E. R. MeCombß,and the-Minister of Finance (the Rt. Hon. J./G. Coates). Mr. Nash was chairman. ' .Colonel Campbell stated that it was soon after the inauguration of the scheme for the- development of Nativo Lands under the. Act of 1931 that the Audit office experienced- difficulty in obtaining necessary information with regard to the authorisation of expendir ture. Queries on vouchers were innumerable, and the only answer from the Department in the majority of cases was that the expenditure had been approved by the Minister. He understood that the Nativo Department had been run as economically as, possible, and that sufficient staff' had not been applied for in the interests of economy. "I can only say," continued Colonel Campbell, "that my experience goes to prove if you have insufficiency of staff to carry out the administrative duties of a department then you are not acting in tho interests of economy at all." MR. FORBES SHOCKED. The witness said ho spoke _to the Prime Minister on various occasions describing instances where extravagances had occurred through lack of, a proper, system of organisation. The Prime Minister naturally was shocked to find that proper accounts had not been kept and extravagant methods of purchase had been in vogue. As a result of discussions he (witness) submitted a memorandum on the subject to the Prime Minister on October .4 last. The memorandum, which was handed to ,the Committee, showed. that the Auditor-General attributed the main difficulty "of Audit officers to the methods adopted for giving effect to the exceptional powers vested in. the Minis*1 terial head by ; thft ; Native. Land Act, 1931. He had been informed by the Public Service Commissioner that he contemplated making a change in the administrative staff of the Department. "I have expressed the opinion to him that while his proposals would be welcomed by Audit, no * thoroughly satisfactory results can be expected so long as the legislative powers referred to above are exercised in such a way that purely administrative acts are being put into operation, by others than the executive head of the Department or the board," said Colonel Campbell. The memorandum concluded by referring to the constitution of the Native Land Settlement Board under legislation of 1932, comprising the Native Minister (chairman), Under-Secretary of the Native Department, Under-Secire-tary for Lands, the Valuer-General, the Financial Adviser to the Government, Director-General. of Agriculture, and two other members appointed by the Governor-GeneraL After describing details of a transaction of a subject which, is now the subject of Court .proceedings, Colonel Campbell was asked by the chairman (Mr. J. A. Nash) if he had other similar evidence.. • '•" Colonel Campbell replied: "I have a great many cases reported to me of what you might call inefficiency in financial matters which contributes very much to vthe general ■- feeling of uncertainty about the whole of the accounts." • . LACK OP CHECKING. Mr. E. J. Howard: Any palpable dis.honesty? The witness: Just lack of checking. Witness gave the Committee details of one case in respect to the purchases" of stock where, the Audit Department found that the prices paid were considerably in excess of amounts received by farmers. The ' person who conducted the purchase was a farmer in the dißtrict who put 40 per cent, commission into his pocket. This, commented the witness, was a case of extravagance which could have been avoided had some other method of purchase been adopted. There was . another case of extravagance in connection with the purchase,of grass seed. Questioned by members of the Committee .regarding the special audit now in progress, the witness declared that he had npt the slightest doubt that his Mtaff would be quite capable of sifting the matter out thoroughly. A proper checking system was being organised at present by the Department. "I read with some surprise," continued the witness, "references ta the inaction of the Government. I may say that anything that I have represented to the Government has been given the very best attention always, and as soon as I told them that the matter was serious they acted promptly." ■ Mr. D. G. Sullivan: How does that square with your report? ANOTHER HEAD APPOINTED. Colonel Campbell: Perhaps I did not make myself clear. As soon as it was known that the matter was serious, or that it was a case of falsification of documents, then the Government immediately appointed another head of the Department, which 1 hope will be an.improvement,i-and the.matte? jras

most fully discussed and thrashed out in the presence of the Native Minister. And. I would like to say this, that the Native Minister was most frank in dis-. cussing the matter in every possible way and assisting by himself making suggestions as to how things could be improved. The witness produced a memorandum dated November 30 ; 1933, from the Nativo Minister (Sir Apirana Ngata) making reference to certain irregularities and stating "the information now revealed is of such a serious character that I hasten to request action on the following lines: (1) Immediate steps to be taken by the Controller and Auditor-. General to set up a compotent departmental committee of inquiry to investigate fully all matters connected therewith; (2) immediate direction that all requirements imposed by Audit, Treasury, or the Stores Control Board under legislation, regulation, or instruction to be fully complied with by all officers and eniploye6s of the Department; (3) The special statutory powers reposing in myself under section 532 of the Native Land Act, 1931, to be fully assumed by tho Nativo Land Development Board. In reply to the Chairman, the witness .stated that he did find cases where excessive prices wore paid for land. In one or two cases there had been no valuation made by a Government valuer, which was one of the safeguards he always tried to get the department to recognise. NOT ENOUGH MONEY. Tho Native Minister (Sir Apirana Ngata) gave very lengthy evidence to the Committee. He stated that in spite of the strictures of the Audit Department, the Native, Department had sought to specially stress in the service the idea of breaking in Native lands as cheaply as possible, and securing tho largest output for the money placed at' their disposal. The money had never been enough for the demand, and' they had tried to eke it out by cutting down the rates paid to Maoris for fencing and every activity. The Maori settlers who had been put on to these Native lands had been working under a severe strain during tho last four years. They had only been able to maintain it by the inspiration of the man leading them. Many a time they had been almost at breaking point. "Here you were asking these people to increase their efforts almost 100 per cent, and reducing the' remuneration for those services by one-third, in some cases 50 per cent. That is the position of the Maori people right through." In describing the organisation of Maori land development, Sir Apirana stated that above each group of Maori settlers there was a foreman whose wages were borne-entirely by the lands of the people he controlled. He was appointed directly by the Minister. The next rank of field, officers, including supervisors ' and surveyors, was appointed by the Public Service Commissioner on the recommendation of the department or himself. This involved a problem _of adaptation as between the supervisors and the people whose business they supervised. There was one case in which the Auditor-General referred to an unsigned voucher. The trouble, was that the community itself had uprooted itself from the scheme and gone back. The Native Department and the Minister, right at the very inception of its policy, were in danger of having the whole of it wrecked in the Waikato district. "WATCHING LIKE A CAT." "I want to say this to the Committee," continued Sir Apirana, "that the fundamental fault of tho Minister— and I tako full responsibility—is first of all tho obsession with the idea that the pakeha was watching the whole movement like a cat, to see that the money was mado to spin out as far as possible, and the only, evidence we could give him that we were doing that was by producing the results. Now, quite apart from the incident on the East Coast, if this Committee wants to get the best view of this problem and get a justification of the policy, no matter how it has been carried out, the thing is to go and see the work and put alongside each job tho money which the accounts show is, supposed to have been, expended on it, and then say whether a quid pro quo for the money that the taxpayers of the country put up there is in the field. We say it is. Now, the thing was bound to Wing in a lot of methods of handling that are unorthodox." Referring to the extensive powers of the Native. Minister,- Sir Apirana pointed out that they had been given in 1929 and confirmed in 1931 in consolidating legislation. He detailed the progressive steps taken to cope with rapidly-growing work, and stated that, in connection with Eotorua, which had given more trouble than any other district, "when you fine the irregularities right down they are of, the class that Colonel Campbell has told the Committee about, in the running of motor vehicles, checking up of stores, the distribution of posts and fencing material, the keeping tab over the hundreds of tons, of manure that were being distributed to the schemes, and so, on<" He had personally given a good'deal of attention to Eotorua for, that reason. PURCHASES OP STOCK. Referring to purchases of stock, Sir Apirana stated that .ho personally intervened in three of these transactions and secured a reduction of £1 per head on bullocks -and about 2s 6d for younger animals. In another case, relating,.- to " dairy heifers, the farmers were "going mad" on dairy stock which was selling at £9 10s to £10 10s, but he would not allow more than £6 a head as they were landing dairy stock, probably not of such good breed, from the Waikato on to neighbouring properties at about £6. He had impressed upon his colleagues and Government officials that the whole business concerned two races, and in the nature of things there must be some soft of compromise which should be reflected in the system, and anyone who/could devise something to satisfy regulations on one side, and Maori communities on the other, would achieve something which nobody else had yet done. . . ' COMMISSIONER'S SUGGESTION. Mr. P. Verschaffelt (Public Service Commissioner) produced a memorandum which he sent to the Prime Minister on October 16, 1933, in which he suggested reorganisation of the Department, including the placing of the Native Trustee under the control of the Public Service Commissioner, and that ati officer of the Public Service be appointed to carry out the combined positions, of Under-Secretary of Native Affairs and Native Trustee. Questioned by Mr. Sullivan who wanted to know why the witness only acted a few weeks prior to October 16, Mr. Verschaffelt stated that there was nothing of any serious nature in tho reports .that had been submitted.* It was not regarded as necessary to make a drastic alteration. He did not think there was a shortage of staff. Judge Jones,, of tho Native Department, stated that he wished to stress that he had not had the assistance from the Public Service Commissioner to which he was entitled. He-had made repeated requests for staff and accommodation and they had always been denied him. He appealed to the Minister, and failed. UNEMPLOYMENT GRANTS. Mr. J. S. Jessep (deputy-chairman of the Unemployment Board) stated that the board was at present dealing directly with 2659 Maoris, apart altogether from Native land development schemes. Once they handed tho money over to a department of State th^ latter handled the details. They exercised no supervision or control of anj; sort, Last

year they began to register all Maoris in a separate register, and notified tho Native Department that tho board wished to tie down the payments to registered Maoris unemployed as far as it was possible to do so. Tho object was that they might not have to handle under their own scheme Maoris who ingiht be assisted, under tho Native development scheme. In May, 1931, there was a grant of £10,000. In September, 1931, £8000. In May, 1932, £2-1,000. April, 1933, to March 31 next, £79,000 which tho board had arranged to contribute to the Native Department provided'they took as many Natives as they possibly could, the object being to get as many on Native land development instead of on No. 5 scheme. . "A SLIGHT LOOSENESS?'" Mr. Howard: In all your schemes for the pakeha you are very particular to the last penny. Thevo seems to be a slight looseness about the way in which you have passed over this large sum of money to the Maori settlement scheme. Witness: I do not think so. Mr. Howard: Would you be surprised to learn that it did not go to the unemployed, but that much of it went to rich independent people? Witness: I have no knowledge of that. " ' The Chairman: It is only right that you should know. That is the Audi-tor-General's report from Gisborne, as to what has been discovered up there. Witness: The1 same might definitely apply carrying out a 4B contract on any man's property, if you take it that way. Mr. Wilkinson: So far as the work being done on Nativo schemes with unemployed Maoris, you think we are getting good results'? Witness: So far as my observations have gone, and I have not been Up the East Coast where this particular portion is, I can say quite definitely that in some cases the money paid has been infinitely lass and the results have been greater.