FINANCIAL STATEMENT.

Marlborough Express, Volume XVI, Issue 156, 7 July 1881, Page 2

FINANCIAL STATEMENT.

The Eon, Major Atkinson (Colonial Treasurer) delivered his Financial Statement m the Bouse last night. The following is a condensation :— Mb Sbymovr,— I have btfore me this evening a much more pleasing and satisfactory task than that which fell to my lot when I last had the pleasure of addressing you. As, however, the statement wbich I am about to make is far mora intimately connected than usual with its predecessors, I mast ask permission to recall to the mind of the Committee the financial position of the colony m November, 1879, and at the close of March, 1880. This is necessary, because our condition m 1879 was so unsatisfactory as to require very vigorous treatment on the part of this House, and it is to the results of the action then taken that I have to call your attention to-night. Iv November 1879 I estimated that the consolidated revenue, including the receipts from Lands sale, for the nine months to 31st March, 1830, \ the date proposed for the termination of the financial period then current, would not be sufficient to meet expenditure chargeable against it to that date, by the sum of L 796.886, and m confirmation of that opinion I pointed out that the revenue between the 30th Jane 1879 and the time at which I was speaking had already proved inadequate to meet the expenditure by about _L 600,000, which sum had been raised by deficiency bills, and these bills it was hopeless to expect to rodeem out of current revenue. The causes of this deficiency were not far to seek. Ie arose chiefly from the great falling off ip the sales of land, and fiom a lavish and rapidlyincreasing expenditure at a time when New Zealand, m common with the rest of the civilized world, was suffering great commercial depression, but although the difficulty was serious and embarassing at the time, a comparison of the revenue of 1878-79 with that of former years, proved conclusively that our receipts from " taxation" and for ''services" rendere- had been steadily and proportionately increasing year by year, and that the check which we wers then experiencing was temporary only. This House no sooner understood our real financial position than it took immediate steps to equalize expenditure and revenue. A determination was made to rely no longer npon the proceeds of land sales as ordinary revenue, a vigorous Bystem of retrenchment was initiated, and measures were at once adopted for the imposition of additional taxation to cover the charge for interest, amounting to nearly L 300.000 a year, payable upon the new loan and Treasuryjbills cieated. As, however, one half of the Financial period of nine months had already passed it was, of course, impossible to meet such a large and unexpected defioit as £796,886 by means of fresh taxation or retrenchment during that period, especially as every item of revenue was either declining or stationary, the only cou/se open was to place the amount upon loan, which was accordingly done by passing " The Treasury Bills Act, 1879," m which provision was made for LBOO.OOO, but the actual deficit on the 31st March, 1880, instead of L 796.886, as estimated proved to be nearly L 200,000 more, and it was found necessary to obtain further aid by the issue of deficiency bills for that amount. A sum by "The Treasury Bills Act, 1880," was also added to the publio debt. It must be remembered, moreover, that this deficit has entailed upon the Colony an additional expenditure of at least L 50.000 a year for I interest, until this sum of L 1,000,000, 000,000 is repaid. THE FINANCIAL PERIOD 1879-80. The Committee will remember the proposal which I made m 1879, that m future the receipts within the year should be dealt with as the revenue of the year, and the payments made within the year as the expenditure of | the year. The deficit to 31st March, 1880 was L9C1,445, being the difference between the credit balance, of L 38.555 and L 1,000,000, the amount of the treasury and deficiency bills issued m aid of the revenue expenditure of the ordinary revenue of the year 1880-81. In the statement which I had the honor to make to the committee last year, I estimated the cost of the services for the year at L 3,423,709, and the amount which would come for payment m the ordinary course of business within the year at L 3,248,709. On the passing of the estimates, there sums were modified to L 3,348,889 and L 3,123,889 respectively. The actual expenditure was L 3,168,183, or L 44.294 more than I thought would come m course of payment during the year. The Committee will not, however, look upon this fact with disapprobation, but rather, I venture to think, with satisfaction, when I tell them it means simply that I took advantage of the opportunity of paying the amounts which I bad estimated would remain outstanding at the end of the financial year, thus reducing these from L 225.000 to L1u'5,514. I may add the total amount voted for departmental services of last year, inclusive of lands and surveys, was L 1,929,807, and the actual expenditure was L 1,704,041, or L 175.766 less than voted, and if from this we deduct the outstanding liabilities, we find that the services of the year have been performed for rather less than the votes, a result which, considering the searching revision to which the estimates were subjected by this Committee, will probably be thought very satisfactory. ORDINABY REVENUE OP THE TEAR 1880-81. I now come to the estimated reveoue, as compared with actual receipts for tha year. The estimated revenue was L 3,238,000,, 238, 000, while the actual receipts amounted to L 3,123,961, being LI 14, 039 less thaa any estimate. It will be seen that tne receipts from railways were less than the estimated amount by L 111.377, but notwithstanding thia fact it will be gratifying to the committoe to know that, through the economical management of my friend the late Minister for Public Works, they have yielded about 34 per cent, upon the L 9,228,000, 228,000 spent m their construction. The propn.v uk yielded L 80.283 less than I hn-i'PS'Mmafril, bit of this sum L 42,000 has yet vj uuau iii, being the amount outstanding and collectable on the 31st March. The remainder, L 20.000, is accounted for by the alteration of the schedules which was authorised during the session, and L2o,(iooas an over-estimate. The tdegnphs a'so yielded L12,5G2 less than estimated. Ou t : i ■ mher band, tbe Customs and Stamps (iv the latter I include land and deeds) produced more than was estimated, the former by the sum of L 57.634, the latter by L 10.886. The increase m the Customs and Stamp duties is, I think, a subject for congratulation, as showing that ttie commercial depression under which we have been suffering is passing away, and the spending power of the community is gradually resuming its normal condition. LAND FUND OF TUB YEAB 1880. The estimated revenue from land sales was L 200.000, but through the successful handling of affairs on the West Coast of this island by my honorable friends the late and present Native Ministers, we have had most satisfactory sales of land m that district, which has brought up the receipts to L 299,166, the expenditure having been L2(iQ,993, leaves a credit balance of L.32,373. The liabilities, outstaadingat the close of the year amounted -t0L37,4G1.

THE PUBLIC DEBT. The gross public debt of the Colony on the 31st March 1880, amounted to L 27,422,611. On the 31st March 1880 it was L 29,165,511, or deducting the acciued sinking funds L 2,057,241, the net publio debt was L 27,108,270. The net inorease of debt during the year exclusive of the increase by conver- 1 sion into inscribed stook was L 847.700 but inclusive thereof it was L 1,742,900 which has to be added to the gross . debt on 31st March 1881. The total gross publio debt when all securities are disposed of, will amount to L 30,097,441 or deducting the sinking fund, accrued to the 31st of March, 1881— L2,057,241— the net debit will be L 28,040,170, m respect of which the annual charges will amount to about L 1,543,000., 543,000. THE PUBLIC WOBKS FUND ON 31ST MABCH, 1881. The total ways and means available, subject to liabilities, was L 3.778.173. During the past year special receipts and recoveries amounting to L 43.174 came to the credit of the Fund, making at the beginning of the year a total of L 3,821,347. The expenditure amounted to L 1,960,974,, 960,974, thus leaving an unexpended balance of L 1,860,373 at the close of the year. The liabilities outstanding on the 31st March last, including 1i997,725 for land purchase, amounted to L 1,585,512., 585,512. Setting the amount of these liabilities against the unexpended balance of L1,8G0,373 there remains to be appropriated for new services the small sum of L 274,861. Honorable members will observe that L 97.725 is set aside as a liability on account o£ lands purchase. Should, however, the policy m reference to such purchases enunciated by the Government be carried out, the sum which it will be necessary to ! reserve out of the existing balance will not exceed L 200.000. The available balance for future appropriation will then be L 1,072,586, | instead of L 274.861, as just stated.

FINANCIAL RESULTS OF THE TKAB 188U-8L

I have said that the expenditure within the year was L 3,163,183, and the receipts from revenue L 3,123,961, exclusive of land sales, I but including the balance of L 38,555, brought forward from last year's account. The receipts amounted to L 3,162,516,, 162,516, bo that upon this division of the account there was a deficit of L 5.667. The expenditure from Land Fund was L 266,793 and the receipts L299.1G7, the surplus on this account being L32J373. The total expenditure, therefore, of the Consolidated Fund was L 3,434,976, and the total revenue L 3,461,862, thus leaving a surplus balance of L2G,7O(i upon the actual transactions completed within the year. Now, if honorable members will compare the position as just stated with the stale of things m March, 1880, they will at once see that the view taken of the financial position of the colony by the Government has been borne out by facts, LOCAL FINANCE. I now come to the consideration of that difficult problem " local finance" a problem difficult of solution, chiefly because of th<. restless pushing energy which still demands more local works to open up the country and this notwithstanding the fact that we have already borrowed so largely for these purposes that we are compelled m our general taxation to trenoh somewhat upon the funds wbioh we should like to see left free to supply lecal wants, while at the same time it seems to be entirely forgotten that the localities themselves have largely benefited by the public works scheme and Jtbat by the bridges at the charge of the Colony they have been permanently lelieved of much expenditure. | It is indeed quite certain that if we are to people the Waste lands and make the country progress, as we have determined it shall progress, we must find the means not only to keep m proper repair our roads and bridges already constructed but also to extend our road system throughout the colony step by step with advancing settlement. I propose to-night to apeak only m relation to the financial aspect of the question without reference to the organisation or powers of the local bodies. Of these I shall speak at large at an early date, I now take it for granted that the local bodies will be charged with the duty of making and maintaining the roads within their jurisdiction and that upon these works the bulk of their expenditure will be made. - The local bodies have other duties to perform, but if that part of the problem relating to roads and bridges can be satisfactorily solved the rest will follow without much difficulty. This then is the great question for solution— How are funds to be provided for the construction and maintaipance of our roads and bridges ? and the question naturally divides itself into two branches— first, maintenance ; second, construction. But before proceeding further, let me say what, m my opinion, are the requisites of a sound local finance. These are : that local finance should be as distinct from and independent of our general finance as possible, and that the funds should be sufficient for the maintenance of roads and bridges. First, then, let us consider the means at our disposal for the maintenance of roads and bridges already constructed. With very little consideration it will be evident, I think, to everyone that our roads and bridges muet be maintained for the future, with perhaps one or two exceptions, by local rates. The landed property m each district must, as a rule, maintain the roads and bridges of the district. This being so, it is evident that, all land n-usfc pay rates. The Government, therefore, propose that Crnwu lands and nativo lands shall be rated, with certain exceptions, with which I need not now trouble. This proposal is the same as that which I had the honor to submit last year, with one or two important alteration?. The proposal is, shortly, this :— That within boroughs the property of the Crown, with certain exceptions, and of Maoris shall for the future be rated under " The Bating Act, 1876." The Maoris ueing m this case placed on the same footing as European holders of town property ; and that country lauds, both Crown and native, shall be divided into two classes— agricultural and pastoral — and shall be rated at LI an acre for agricultural land aud i' a Bil an acre for pastoral land, which amouut for rating purposes will ba taken as the value of the fee simple. Honorable members will observe that while last year it was proposed to estimate native land at one-halt the value of Crown land, it m now proposed to value them alike ; and I cannot but believe that upon consideting all the circumstances of the case, the committee will think this fair and reasonable. If the Crown and native lands are to pa} rates, the question arises, who is to be responsible for their payment to local bodies ? And out of what funds are they to be paid ? We propose m every case that the Colonial Treasurer shall be primarily liable, and shall pay the rates to the local bodies. The rates on Crown property within boroughs we propose to charge against the Consolidated Fund, the rates on country Crown lands against the Land Fund aud the rates on country Native londs, we propo&e to advance out of money appropriated by Parliament for the purpose, but to remaiu a ohargo against tho Native land. There are two other important matters to which I must refer : the limitation of selfrating to one shilliug m the pound, and the coat of the yearly valuation. It ia well known tbat m some parts of the colony a shilling rate is insufficient to maintain the roads. The Covernment are unable to see upon what grounds of either reason or justice the local bodies can be called upon to maintain the roach while at the same time they are denied the power of raising enough money for that purpose ; we shall therefore propose to increase the rating power to two shillings m the pound, a power already possessed by Beveral of the local bodies, believing that that limit will be approved by the country, and lie found ample for the duty imposed. With

regard to the valuations, experience has shown that they are required by law to be made much oftener than is necessary, and to save them from an unprofitable expenditure of probably not leas than L 16.000 a year, we aball ask the House to permit all local bodies to nee for rating purposes the valuation nnder the Property Assessment Act, with annual correction. CONSTRUCTION OF ROADS AND BHIDOES. There are three distinct classes of roads with which we have to deal under this branch of our subject. First, there are the main roads, through Crown lands, not yet settled. i Secondly the main roads running through the settled or partially settled districts, and thirdly, district toads, both m settled an unsettled districts, We will first consider the qnestion of how money is to be provided for roads through Crown lands not yet settled. My colleague, the Minister of Lands, will this year submit a scheme involving the expenditure for this purpose of L 150,000 out of loan, the expenditure to extend over a period of three years at the rate of 150,000 a year. This work, wherever practicable, will be done, as hitherto, by the local bodies. We purpose that after the land has been surveyed, and the roads marked out, an estimate of the cost of forming and metalling the main road through the block shall be prepared by the local body having charge of the district, end that to the fixed upset price per ncre of lanJ to be served by the road shall be added a, sum according to situation sufficient to cover the cost of construction, and that the money so obtained shall be set apart and paid over to the local bcdy under proper safeguards, to be used for that purpose only, and we farther propose that when half the land m any block is sold, the Government shall advance the money to complete the main road through the block, recouping itself from time to time as the rest of the land is sold. We now come to the roads of the second class, those unconstrncted main roads running through settled or partially settled districts. It is now proposed that a Soard consisting of the Minister for Public works and three members to be appointed by this House, shall be created m order to provide for necessary work. I shall ask the House to make a grant to the Board of L 150,000 out of the Loan and to cause to be paid over to it yearly a further sum not exceeding L 150.000 out of the balance of the land fund. The result of the proposals I have to submit will not be to reduce the proportion of the land fund locally expended, but m most cases and for some time to come to increase it materially and to expend it under Such safeguards as will ensure its application to the colonizing nses to which this House desired to devote it. ESTIMATED EXPESDITURE FROM ORDINARY REVENUE, 1881-82. The estimates for the twelve classes of Depai tmental services laßt year amounted to L2,108,b'13; the estimates for the same services are for this year L 1,774,612, 774, 612 only, or m other words L 334,001 less than those of last year. The tptal proposed votes for the year, inclusive of liabilities, which now appear m the ordinary votes, is L 3,270,532,, 270, 532, divisabte into two parts, pet manent charges amounting to L 1,570,719, and annual appropriations amounting to L 1,699,612,, 699, 612, m -which latter division aloue can reductions be made at preaeat. The Government believe that they can, during the present year, effect still further reductions m this division. ESTIMATED EXPENDITURE FROM THE LAND FOHD 1881-82. If the scheme which I have submitted should be adopted, the Government will propose that any balance there may be left from Laud sales after payment of the charges it is intended to place upon them, shall by law be paid into tbe Public Works fund, but without prejudice to the public creditors. The estimated expenditure chargeable against land sales is as follows : — For charges fixed by acts of tbe General Assembly, L 84.96 6; for the Crown Lands and Survey Department, L 134.58 4; for rates to local bodies, L 27.000; for roads and bridges, a sum not exceeding L 150.000, to be paid to the Roads Construction Board. i

[To BE COHUNUED.]