WAR BONUS AND BONDS

Evening Star, Issue 16469, 6 July 1917, Page 8

WAR BONUS AND BONDS

UNAUTHORISED PAYMENTS. AUDITOR-GENERAL’S REPORT. [From Our Parliamentary Reporter.] WELLINGTON, July 6. Reference was made in the House of Representatives yesterday to the fact that the war bonus to members of tho Public Service last yevr was not properly authorised by Parliament. The matter came under notice when the Speaker read the following report from the AuditorGeneral;— The Controller and Auditor-General has the honor to report, for the information of Parliament, that, owing to exceptional circumstances, it was necessary for the Audit Office to sanction the payment of certain moneys out of the Public Account on the undertaking of the Government to introduce legislation validating the payments and indemnifying the Audit Office in respect to such issues. Tho particulars thereof are as follows: War bonus to officers of tho Public Service amounting to £586,184 18s sd. No appropriation for this expenditure having been made by Parliament, the

estimated amount (£4CO,COQ) appeared .in the Estimates under the heading of “Permanent Charges,” but as all such charges are provided for in respect to authorising Acts, they do not come up for consideration or for voting when the Estimates are being dealt with by Parliament, consequently the £400,090 had not been voted, nor was any appropriation for the amount made. Section 19

of the Appropriation Act, 1916, authorised the payment, subject to appropriation. The Controller and Auditor-General

also makes reference to the payment of interest (£18,839 2s sd) to the various banks doing business in New ZealAnd on their investments in the War Loan, which amounted to £4,C00,000, from the dat* stipulated in the Ibau prospectus, inst&»d of from the date of lodgment to tb« Public Account, notwithstanding the fact that the banks’ contributions were not actually paid into the Public Account on the date specified in the prospectus. This was necessary, in order to carry out the agreement made between the Government and the banks. The Controller and Auditor-General also reports that he passed an issue of £98,989 18s, debentures in London, under the Public Revenues Act, 1914 (section 8, war expenses), whereas the Act only provided for the issue of Treasury bills. This operation was also the subject of an undertaking of the Government to validate snch issue, as the Act quoted did not provide for the security being issued in debenture form. The Minister of Finance said that the payment of the war bonus had been provided for in the Appropriation Act, 1916. Ihe point raised by the Auditor-General was that in the Estimates named by Parliament the amount of the war bonus had been placed among permanent appropriations. Mr Wilford asserted that as a matter of fact the payment was made without the authority of Parliament. Sir Joseph Ward: “No; the money was voted by Parliament, but the vote appeared in the wrong part of the Estimates. It is a fine legal distinction.” The issue of debentures in London, explained the Minister, had been made in connection with the conversion of Treasury bills into a long-dated loan.