EVENING SITTING.

Hawke's Bay Herald, Volume XXI, Issue 5546, 25 November 1879, Page 3

EVENING SITTING.

The House resumed at 7.30. ' DEBATE ON THE FINANCIAL PROPOSAS. On the motion for going into committee of Supply, Mr Macandraw said that he desired to move to the effect that the financial proposals were unsatisfactory, as the expenditure would fall short of the revenue by £800,000. He was no adept at6nance, and he would leave it to others to supply details. He would only say that while a., reckless statement was made on the 16th of October, that two millions out of the £5,000,000 loan were pledged the assertion was radically wrong, and its effect in the Home market would be to prejudice the finance of the colony; Taking it for granted that there was a deficiency, all that the Government seemed to be able to do was to make up that deficiency by increased taxation. Ho would have been better pleased if the proposal had, been' to reduce- the expenditure. The J House wonld no doubt be told that the- estimates were those of the late Government. . That was not the case ; they were the estimates of the.departmehts. The present taxation was as much as the : country could bear, and under no circumstances would it be right to increase the burden. Nothing but a financial reform would meet the requirements of the colony. They would have to rely more upon the pruning knife, and that was the principal instrument they wo\ild have to employ. It was an ungracious task; still, it wouldhavetobe done. In Otago a similar difficulty had arisen, and he as the Superintendent of that Province had to apply the pruning knife, and he cut down the expenditure by a sum of £15,000. The salaries were reduced 30 per cent., and the offices were amalgamated. It was most unpopular, and he had Buffered as a public man in consequence. Some years ago he had proposed a similar reduction, and in walking the Wellington beach the finger of scorn was pointed at him. What"he would say in the way of financial reform was that they should find the money first, and have the salaries afterwards. A prudent man when he found himself getting behind would curtail his establishment, and that was what New Zealand was called upon to do, and no financial proposal that had not that aim would do for the colony. They were now called upon to make the choice, and it had to be faced. He would make the counties support the police, and as for education it was a mistake to make it a charge on the consolidated revenuv of the colony. Those that raised the money should spend it. He had said sufficient to show that the financial proposals were unsatisfactory. He complained that the. Government had done wrong in not bringing the. Public Works Statement down. He did not

blame the. present Government for the . financial condition of the colony. If any -. Government was to blamed it was the " Coiitiriuou's Government.", Kjcst the public works policy had Ideen administered altogether "different from what Sir Jnlj(i3, Yogel intended, aiid then they had destroyed th^. best system 1 of. local self-go-vern nieiit that 6o'iild hb #c vised* He would simply move that Ibis financial proposals of, the Government were •unsatisfactory, and would leave the question in the hands of the Bo'uSe. Mr Oliver said that if the financial proposals were unsatisfactory they were left as a legacy by the late Government. The present Government had been accused of creating heavy burdens on the working classes, but their proposals showed the contrary, and they were desirous of making the burden fair and equitable. They might have proposed a beer tax, but that would have been directed against the working classes. They had adopted the estimates of their predecessors, and after giving theni all tile cdilsideration possible they had put them forward. The late Government had committed them to large liabilities, and the resources had been pledged for that purpose. The liabilities of the colony had nearly absorbed the whole of the £5,000.000 loan. If the late Government had kept in office six months longer they would have had to resort to the policy of repudiation. He agreed that in the educational scheme they had been far too extravagant, and he felt that the time had come when it would be necessary to resort to a different system to that already in vogue as one remedy towards removing the difficulty. Mr Montgomery contended that the blamo cast upon the late Government for the financial difficulties was not deserved. He quoted financial statistics, from which he argued that it was unfair to say that the present difficulties were attributable to the late Government. The fact was that they had not resorted to taxation soon enough. He did not defend the late Government. Ilad they imposed a fair- share of taxation they would not now have had to face the difficulties with which they were met. Kegarding the estimates now before the House, he objected that they did not foreshadow a policy of economy. Colonel Trimble said that between the Government and the Opposition the difference was this — the one said that they ought to slur over the difficulty, and the other proposed to meet it boldly. By following the latter course he argued that in the money market the position would be accepted much more graciously. The difficulties had been going on for years, and no attempt had been made by the mover of the motion (Mr Macandrew) to meet those difficulties by increased taxation. Mr Thomson said they were just reaping the fruits of the. course they had been pursuing for years past. The debt of the colony would very shortly be between 28 and 29 millions, with interest and sinking fund to the tune of one and a half millions per annum. The time had arrived when it was absolutely necessary for them to consider their prospects. They had spent at the rate of one million per annum, and the tendency was to increase it to two millions. The situation was a critical one, and one which it behoved them to consider carefully. It was absurd to say that the late Government was responsible for the state of affairs into which the country had been brought. He believed in direct taxation, and to that extent he belived the proposals of the present Government were acceptable, but they had not considerd the matter as they ought to have done. They ought to have studied retrenchment, and thereby have reduced the taxation to be imposed for making up the deficiency. Had that been done, the tax might have been made a half-penny instead of a penny as proposed. Professional men ought to have been asked to contribute something, and the unimproved lands ought also to have contributed something towards the taxation of the country. Sir George Grey contended that the Government ought to have initiated a system of retrenchment, and by way of making a commencement they ought to have begun by reducing the salary of the Governor, and then the salaries of Ministers. The land was the source of all property, and as such it ought to be the principal item for taxation. The system of taxation proposed had no fairness in it, and was not suited to the conditions of a new country. The proposal was that everything was to be taxed — everything that pleased the eye or improved the understanding. In America, the example of which it was stated they were to follow, books and the fine arts were exempt from taxation. He hoped the country would not commit itself to the proposed taxation. By ajudi- ; ciously arranged income tax quite sufficient for all requirements could be raised. Then, again, by a reduction in salaries a great saving might be effected. By those means the colony could save its credit, and show in a bold manner that it was prepared to meet the exigencies of the case. In this, as in other countries, a different system of land law must be enacted, so as to prevent the acquisition of large tracts of land. By the mere increase of population a great value had been acquired by those lands, and they should be made to bear the greater burden of the taxation. He had heard that night a proposal to take from the population what was needed to make up the deficiency, the education of the rising generation having been specially indicated as one of the means of doing so. Those who occupied large tracts of country were the fair and legitimate objects of taxation, , and yet they were told that the land tax was to be merged into the property tax. The two things were quite distinct, and he felt that they were entitled to say to the Government that their proposals were unsatisfactory and that another system of taxation wl\s demanded. ■ DrWallis moved the adjournment of the debate. 'Major Atkinson described the attack made upon the Government as a most meagre one. Sir George Grey had said that it was proposed to take away the system of free education. The Government had had no idea of altering the system of education as it existed. The proposal came from the leader of the Opposition, and also from the late Minister of Lands (Mr Thomson), and the Government simply proposed to adopt that proposal. They had been told by the Opposition that the deficiency could be reduced, but they had not been told how it could be reduced. The leader of the Opposition had proposed a reduction by making the police a charge on the counties, but how could that be of any benefit? As to taxing the land, what the Government proposed was that not only the land but that other sources of income should be taxed. They had been told that this was a tax on improvements. Now, in an income tax the -taxing of improvements was altogether indispensable. He quoted from the Financial Statement to show that there was a well defined intention on the part of the Government to retrench. When the present Government came into office they found the estimates read)' for the consideration of the Cobinct, and he was bound to conclude that they had been carefully considered by the individual members of the late Ministry. A sum of £1, G00, 000 for new works was set down in those estimates by Mr Macandrew to be proposed to the House, and yet he talked about the exigencies of the situation. The Government quite agreed that their proposals were unsatisfactory, but they were the very best that could be made in the circumstances. No more satisfactory mode of dealing with the finances had been proposed. The proposer of the motion (Mr Macandrew) ought to have told them howhe proposed to make up the deficiency on I some counter scheme, else it was the duty.

of the House to have nothing to say to the ' motion. The late Treasurer, (Mr Ballanc'e) and the then Minister for Public Works (Mr Maoandrew) had misled the country in the matter of finance. In 1878 one of them led the country to believe thrtt he would have £100,000 to the good; and the other three-quarters of a million. These' gentlemen Were culpable to me laat detree Whett they found they had miscalciilated hot to hate retrenched expenditure and have, called parliament at price together. He held those gentlemen to be responsible for the difficulty', and aS flufeli it rested with the late Government. Mr Moss argued that there was an increase of 50 per cent proposed on the ordinary requirements of life, which he held to be an unfair burden to be imposed on the working classes. He contended that any attempt to increase taxation would lead to disastrous results. He conjured the Government not to add anything to the Customs revenuei Let the Government bring down the property tax, but let the Customs ditties remain as they were. The cjue'stiori wris then put that the debate be adjourned, and was negatived on the voices. Mr Turnbull spoke in favor of the motion. Mr George moved the adjournment of the House. Major Atkinson hoped tho House would come to a conclusion at once. Mr Shrimski spoke in favor of adjournthe debate to afford Mr Ballance au opportunity of replying. Mr M'Lean urged the necessity of bringing the debate to a close. Mr Stewart spoke in favor of adjournment. Mr Montgomery appealed to the Government to adjourn the debate till the following day. At 1.10 a.m. an attempt was made, on the motion of Mr Hamlin, to count out the House. The bell was rung, and a quorum having been collected, the debate proceeded, and had not concluded when our message was despatched.