MAJOR ATKINSON AT PATEA.

Hawera & Normanby Star, Volume I, Issue 98, 23 March 1881, Page 3

MAJOR ATKINSON AT PATEA.

Major Atkinson's meeting at Fatea was crowded. He was well received, and Mr. Sherwood waß voted to the chair. On rising, Major Atkinson said his first duty was to explain why he had not addressed his constituents during the last recess. He pleaded the fact that,, as a member of the Ministry, his time had been so fully occupied. He had accepted office, and in that year there were two sessions, and, as the Assembly was to meet again in May, the Government had but little time to prepare their work. With regard to what brought him there that night, he felt it would be difficult to give them a clear picture of the finance, Native affairs, and retrenchment. When the Government took office, the position of New Zealand finance had been unknown for fifteen or sixteen months. Even the best informed did not know accurately; and Native matters wore also unsatisfactory. The Grey Government had done nothing in Native matters but stir up difficulty ; except that they had increased the Armed Constabulary and made them effective. Then there was general depression and a commercial crisis. The Government first ascertained the position of affairs, and then stated it to the colony. They found that they would have to make good a deficit of nearly a million. That had arisen principally from the system of taking the Land Revenue as Ordinary Revenue. The land sales had fallen off, and hence the difficulty. They also found the Five Million Loan largely anticipated. It was evident then that there must be retrenchment. They had been spending, for two years, one hundred and ten thousand pounds per week. It was impossible to Btop that expenditure at once, but it had been reduced to between £60,000 and £70,000 per week. That was still large, but the requirements of the colony were exceptional. He thought the Government had never received sufficient credit, considering the great difficulties with which they had had to contend. They had had to reduce expenditure and put on taxation. They first had to eliminate land sales from ordinary revenue, and they did it ; on that followed the taking from the counties the 20 per cent, of the Land Fund. The measure was unpopular, but absolutely necessary; and the reason was that the 20 per cent, had been spent, not in opening up the country, but on works which should have been paid for out of the rates. Then came the question of how Government were to make both ends meet. They determined to inorease the Customs and put on a Beer Tax and a Property Tax. He would direct their attention to the principles of taxation, because taxation was likely to be moderately heavy. The theory should be — Ist, That every subject should contribute according to his means; 2nd, That the individual should pay it as conveniently as possible to himself; 3rd, That the tax should be certain, and not arbitrary; 4th, That the tax should be cheap in collection. He went on to show that those conditions could not be attained with regard to individuals; they must go back to classes. A tax was not necessarily to be looked on as a class tax, if other classes were taxed in an equivalent manner. The Government proposed to increase the Customs. He was sorry to say that the effect was xft>t to increase the yield, hub keep id at about the same level. That might seem to show that the Colony was exercising economy, or that the spending power was reduced, but he could show that their spending power was still higher than in the richest countries in the world. With the Beer Tax, they had the difficulty that it waß. disliked by both the.teetotallers and the beer drinkers. However, it was imposed, and his chief objection to it was that it might be considered the introduction of an excise or tax on- locally-made goods ; but it was impossible to avoid the extended basis of taxation, if their ' credit was to be maintained. As Tor /the objection he had pointed out, the Beer Tax fulfilled the conditions he had set out; it was certainly cheap in collection, and not arbitrary. If their predecessors had managed affairs properly, the tax would not^have been necessary. It was decided to put on a Property Tax, which waa practically unknown to the servants of the Crown, but was well known to our American cousins. The Hon. Major Atkinson then Vent into an elaborate comparison of the advantages of on Income and Property tax, and he showed in what respects the latter was superior to the former. With regard to the alleged inquisitorial oh'araoter of -the Income Tax, he pointed out that to some

extent it was so, but that the same objection applied to any tax on property, in any form, because it was absolutely necessary that the Government should know what a man had, before they could say what he should pay in the way of taxation. It had been said that the Property Tax discouraged improvement, but, so far from this being the case, the effect was rather the other way ; it really induced expenditure. Supposing a man had i>loo, if he allowed that to remain in the Bank, he was taxed on the full amount ; but if he built a house, say, with the money, the improvement, though actually costing would in all probability be' taxed at £80. It w s also said that it discouraged thrift, and that might be true, if the Property Tax was the only one. If two men had JIOOO each, and one of them spent the whole of it in the year, nothing would remain to be taxed, but he would have been taxed in his expenditure, and if the other spent but £500, he would be taxed through the Customs on what he had spent, and he would pay Property Tax for what remained in the Bank. He then alluded to the case of absentees, and contended that if it were considered advisable Parment could tax them in cases where they were not liable already. Then it was said to be monstrous to tax unproductive property, but it was evident that if a man held property he valued it, arid held it for the purpose of making a profit out of it at | some time. He at least valued it at what it would bring at auction, and he (Major Atkinson) thought that as the owner profited by the protection the State afforded him he should give something in return for the benefit. One advantage of the Property Tax was that it discouraged land speculation. Men who were liable to pay such a tax would hesitate to purchase large blocks of laud and hold them till prices rose. With an Income Tax, if he put his money into unproductive land he would escape the burden of taxation. The speaker then pointed out some of the disadvantages . which had been urged against the Land Tax. These questions had yet to be fought out, and an attempt might be made to substitute an Income for a Property Tax. — (At this stage there was some interruption, and a gentleman in the body of the hall rose and said the meeting did not come there to listen to a lecture on political economy, but to know what Major Atkinson had done in Parliament, and what he proposed doing. Another gentleman said the meeting wanted to hear their representative concerning local matters.) — Major Atkinson asked what were the really important local matters ? Were not such matters as education, the administration of justice, and the method and extent of education ? If he thought that they were principally interested about petty local matters, he would not represent them for another day. He would, however, tell them that their local interests had been well attended to, and in reality they had got more than their share. — (Some confusion.) — He bad scan in the local paper that he was to be given some hard nuts to crack that evening, but, although he had arrived at an age when he preferred rather to suck oranges than to crack nuts, he could assure them he was prepared to crack the hardest nut they had to give him. He then went at still greater length into the comparative merits of the Income and Property Taxes, holding strongly that the latter was the better and fairer of the two. These were questions which would have to be decided at the next election. It was proposed by some to levy a Land Tax and an Income Tax in place of a Property Tax, but he confessed he did not exactly know what those gentlemen meant, unless it was that the land should first be taxed, and then the income derived from it. That was a kind of double burden which he supposed the farmers would not be willing to bear. The Land Tax really meant confiscation. If land was to be sold burdened by a land tax, the purchaser would capitalise the tax and give so much less for land. The tax in perpetuity would fall on the seller, and the buyer would go free, and «this would continue until there was a fresh valuation of the land. If the four tests were applied to the Property Tax, it would stand them very well, and the Government now saw their way to a much cheaper mode of valuation, and, supposing the cost to be shared by the local bodies, he believed it could be done for 3 per cent. He did not believe in direct taxation in a new country, but there was no help for it. It was necessary to get a wider basis of taxation, in order to raise the revenue to meet their liabilities. However, the discussion of these important questions had had the good effect of awakening up the constituencies, and making them more lively and attentive to the doings of the Government. It was necessary that the people should habituate themselves to connect expenditure with taxation. The general results of the year have been pretty satisfactory. The revenue would, he believed, meet the expenditure ; whilst 18 months or even a year ago there was a deficiency of £900,000 to make up. It would be found that Government had done quite as much, or even more, than they had promised; it would be found they had retrenched £250,000, as they had told the House they would. The Session had not been barren, nor was it to be judged by the number of Acts which had been passed. There had been a good deal of discussion, - some of it, perhaps, useless, but discussion was the work of tiie Assembly, and when men might talk freely they sometimes talked . too ranch. But on looking at the Acts which had been passed they would bo found to be most important ; and if nothing had been effected but a- revision of finance, the Session could not be called barren. Withiregard to Public Works, very little freedom had been allowed to the Government. They were, to some extont, obliged to follow the lines of their predecessors. The Government wanted to deal fairly with the cojony, but to make the works which had been begun reproductive. T-hey, therefore, abandoned those which were least likely to bring in a speedy return, and, to put themselves in a position to complete the main lines, they were bound also to lessen expenditure,- and were compelled, on that account, to stop public works in many districts. He was not then speaking of local, but colonial works. They intended to pursup the same policy in the future, but could not be hurried. He had reminded them thafc the 20 per cent, of the Land Fund had been taken away. The local bodies had not been using it for legitimate objects. They had applied it to repairs, and not to opening communication with land newly sold. No one bleed rates, but still the

Laud Fund must be applied to opening Tip the country, and not to repairs merely! At the same time the subsidies were withdrawn. These were heavy blows, but if those sources of revenue to local bodies had been continued, there would have had to-be increased taxation. It was best to leave the district's to tax themselves. There had been no breach of faith. Tliq enormous extent of the public works lm.l rendered the action of the Government necessary, and the various localities had been at one with the Government on the matter. Major Atkinson then alluded briefly to the scheme which the Government had proposed for the assistance of local bodies. There had been complaints that local bodies were not effective, and that counties did not prosper, but the money must come from themselves. The Government scheme would have retained on very easy terms a good deal of what had been lost, but the scheme was not considered — there had been no time — and so half subsidies had been paid for the last year. With regard to the efficiency of the local system of government, he said that the objectors were not prepared to face the ratepayers, who, after all, had the matter practically in their own hands. The ratepayers should determine what form of local government — county councils or road boards — should prevail. The real difficulty was waut of money. If they were rich, we should hear nothing of want of change, and whatever changed were made under present circumstances we should hear the same complaint. Money meant taxation, and it was a question for the ratepayers how much they would spend. He would now speak of Native Affairs ; and in the first place he would express regret that Mr. Bryce had left the Ministry. He (the speaker) felt it very strongly. His own views and those of Mr. Bryce were identical on almost all matters. Mr. Bryce differed fi'oin the Cabinet in his views witli regard to immediately proceeding against Te Whiti. He (Mr. Bryce) was for more vigorous measures than the Cabinet were at that time prepared to sanction. The account given in the newspapers was substantially correct. There was nothing behind. Mr. Bryce left because he thought more vigorous measures should be adopted against Te Whiti. A great deal was to be said in favor of that view, and a great deal against it. The policy which the Government had followed, and would continue, was that there should be no pampering of the natives — that a tight hand should be kept on the reins, and that strict justice should be administered. Although the Government would not be hurried by outside pressure, still no fear of consequences would keep them back from doing what they considered to be right. They would pursue the same path. It had been successful. As a settler, he felt impatience that a few natives should disturb the peace of a district so long, but there was both difficulty and danger in disposing of the question. Some difficulties remained, but so far the Government had been successful. They had surveyed and sold a large quantity of land ; they had done all that was planned before the crossing of the Waingongoro ; they would continue till the law of the Queen was fully established. The Royal Commission had rendered great service. Sir William Fox was now engaged on most important work. The stories they might have heard about laud being given to the wrong men were without truth. Heal and substantial justice would be done, and when the work was completed there would be no outstanding grievance, except that the lands would not have been all given back to the Natives. When a little further advance had been made, an Act would give power to Government to deal with the Native Reserves, in the interests of both races. Of the Waste Lands policy of the Government, he said they had tried to promote settlement. Mr. Rolleston had opened up 240,000 acres under the clauses for deferred payment homesteads and agricultural leases, and since Ocober last 186,000 acres had actually been thus taken up. The system was an experiment, but he hoped it would succeed. He regretted that it had Leen found necebsary to stop immigration, especially nominated immigration, as increased population was necessary to lighten the national burden. The most important point in looking at the future waß the finances. He had no fear if prudence were exercised. Some believed that tho colony could not bear her burden. He thought she could bear it with tolerable ease, because the true test of capability was not the amount we pay, but the amount that was left after everything was paid. Last year's income was nearer £5,000,000 than £4,000,000. He was sorry- he had no late statistics of France and England, but in 1860, the income of England was £400,000,000, and the amount "the country had to pay for local and general government was £320,000,000. He did not reckon the interest of the debt, for it was paid with one hand into the other. They have there £14 per head over tho expenditure; in France there were £10; whilst in Naw Zealand there were £20. One item of the people's expenditure he would like to see diminished in New Zealand. Two millions pounds were annually spent in drink and tobacco, so they could not be so hardly pressed. He thought that in the coming session they ought to do very little in the way of legislation. He would like to see the House look well into nuance and retrenchment. He would like them to see that the finances were ou a proper basis' for the future. They ought to pass the Representation Bill, and the Charitable Aid and Hospitals Bill, and the Licensing Bill. If they did that, the session would not be barren. Careful administration was wanted to bring us out of our temporary difficulties. Public works should be carried on steadily, and as far as the I money would go, but should not be rushed. He thought that moderate assistance might be given to companies by grants of land. The Government should go on steadily till the arterial railway system was completed. He was firmly convinced that if they went on as they were now going, the future prosp rity of the colony would be greater than any- through which we had already passed.

A number of questions, principally re. lating to local matters, having been put and satisfactorily answered, a motion of thanks was put, and then an amendment of thanks and confidence was carried by a majority.

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see Foueth Page.