THE New Zealand Herald AND DAILY SOUTHERN CROSS. MONDAY, AUGUST 23, 1926. ENDOWMENT LANDS.

New Zealand Herald, Volume LXIII, Issue 19413, 23 August 1926, Page 8

THE New Zealand Herald AND DAILY SOUTHERN CROSS. MONDAY, AUGUST 23, 1926. ENDOWMENT LANDS.

In the Land Laws s Amendment Bill now before Parliament there are provisions to allow leaseholders on national endowment lands the right to acquire the freehold in a similar manner to tenants on other varieties of Crown land. This legislative move uncovers certain very interesting questions. It carries the mind back nearly 20 years, to the time when there was a - battle royal over the reservation -of the great area now classed as national endowment. The contest then was not really between Government and Opposition, though the Opposition of the day resisted the measure with unanimity. Lined up with it, voting with it even on the motion for second reading of the bill, were prominent members of the party in power, who entered the Opposition lobby because they were convinced supporters of the freehold policy. In fact; one who was then considered a promising young stalwart of the party, Mr. T. M. Wilford, in his second readingi speech, said something which is interesting in the light of what is happening to-day. He promised, when the bill was in Committee, to move an amendment "in the direction of allowing the Government to sell any part of these endowment lands, and to invest the proceeds in the purchase of other lands—l would suggest within a radius of ten miles of some city or borough of, say, 7000 inhabitants--and that those lands, when acquired, should become a part of the national endowment." This, in effect, is what the Government now proposes to do. Where land is to be sold, the 'interest on its purchase price is to be used as t»he rents of the leases have been, the purchase money, as it accrues, is to be invested in some sound security, so that when the process is complete,; the endowment will still exist, but will have changed its form completely. Whatever lhay have been the exact motives behind the National Endowment Act of 1907, there is no need to go further than that supplied by its title. It was to establish a reserve of property vested in the Crown, the income from which was to bo used for two purposes, j education and old age pensions. It happens that the property was in the form, of < land, principally undeveloped rural land. Crown land up to a maximum of 9,000,000 acres was to bs proclaimed as endowment reserve, alienation being forbidden, selection to be by renewable lease. The bill now before Parliament is not the only measure introduced to vary the nature of that reservation. In 1920 returned soldiers who had taken up endowment leases, and certain licence-holders on small grazing runs, were given the option of obtaining the freehold. The pros and cons of this move were debated at great length then. Arguments were heard about dissipating the heritage of the people, filching away what belonged to. the children and the aged poor, and other statements designed to make it seem that one of the fundamentals of the Constitution was being destroyed. Very little attention was given to the points which were really relevant. The questions which should have been pressed hardest were, first, whether proceeds from the sale of these lands wero to be reinvested in permanent form so that the income derived could be used as was the rent from the existent leases; if so, was the new investment likely to be I more remunerative than the old. On ! those lines the real principle of the ! measure could have been intelligently debated. It was not the.n. If it is not now; if comment on the bill is confined to an outcry against alienation of the Crown estate, the principle and conception of the national endowment will have been ignored in favour of argument about land tenures. The old freeholdleasehold controversy is a very different subject from that of the national endowment.

The Crown estate proclaimed as national endowment - is within verylittle of the 9,000,000 acres contemplated in the original legislation. According to the last Official report, an area of roughly 6,740,000 acres was held on lease or licence, returning in rent £137.185. The rent is 5 per cent, of the capital value. The return is roughly 5 per cent, of £2,800,000. That is to say, the 9,000,000 acres is worth as an interest-bearing investment, £2,800,000. This cannot be classed as a wonderful return from so huge an area of land. It is not conceivable that it represents the true value of the land. When it comes to the disposal of it, the original Act, the Land Act, 1924, provides that the proceeds from the sale of any endowment land is to be paid into a special trust account and utilised in the purchase, by the board administering the fund, of other land on behalf of the Crown. Pending utilisation of the money in that fashion it may be invested in Government securities, or in any other way proper to trustees. Regarded from this angle, the new proposals fall easily into their proper perspective. The capital reserve" set aside to provide income for certain specific purposes, having proved to be a very poor investment, is to be liquefied and changed in form. Every step in the process has been regularised by law. Until land promising a better income can iibe found and acquired, it is to bo invested temporarily in sound securities, so there will be no'loss of income, .The .outcome jnay. .well be

that the blight of leasehold will be removed from large areas of rural land which have never prospered under it. A sound investment will be made in urban, or semi-urban land, where the leasehold tenure is objectionable. The funds to be assisted will benefit, and the development of land now, by general consent, prejudicially affected by the leasehold tenure will bfe expedited. These things are clearly to be discerned, even if they will not be admitted by those who still urge the outworn theory of State leasehold for rural land.