NEW ZEALAND'S POSITION.

New Zealand Mail, Issue 1199, 22 February 1895, Page 34

NEW ZEALAND'S POSITION.

SIR WESTBY PERCEVAL'S VINDICATION. Tho following appears in tho Statist of December 22, in reply to an article in that journal's issue cf December 15 : Sir, —Under this heading in your last week's number an article appeared, which, in my opinion, is unworthy of place in a paper . which I have always understood occupies a high position among financial journals in England. This is strong language to use, but surely it is not too much, "to expect that a financial paper seeking to guide public opinion shoixld adduce facts and proofs in support of its statements, even when tho administration and policy of a colonial Government is attacked.

In New Zealand, as in other places, one of the methods of political controversy is for tho Opposition for tho time being to attribute all the evils of the time, from depressed trade and values down to prevailing epidemics and earthquakes, to the perfidy of tho unfortunate Government of the day, and it is quite possible that statements as extravagant as those contained in your pages have appeared in colonial papers ; but it is a matter of surprise and regret that the Statist should have taken the violent fulminations of partisans as a basis upon which to construct what was doubtless intended to be a fair and judicial criticism of New Zealand's position. Your journal has been active in its efforts to consolidate the Empire and promote Imperial trade, so that I feel I am appealing to a friend in asking for space to correct some of the errors which you, unwittingly I believe, have submitted to your readers. Your contributor, in his article, makes assertions of tho most denunciatory character, which he either does not attempt to prove at all, or in respect of which he brings forward statemonts and figures which aro directly contrary to fact, and it is no excuse that others, both here and in the Colony, have made similar false statements before. First, I will deal with the most definite statement made in the article, in support of which figures are quoted. The statement is as follows: — " The surplus of £290,000 shown in the last Budget was simply a paper one . . . only manufactured by including as ordinary income upwards of £500,000 of released sinking funds—in other words, the Colony was actually living last year on this one item alone, over £200,000 above its income, and was spending in excess of tho income being made." This is a startling and damaging statement, but one that is entirely untrue. In the first place tho reloasocl sinking fund for the year was nothing like £500,000, but what is all important is that not one shilling of the released sinking fund was used for tho purposes of ordinary revenue.

The fact is that all released sinking fund has to bo disposed of in accordance with the provisions of an Act passed by the New Zealand Legislature so far back as 1.884, for tho purpose of carrying into effect tho policy which was then adopted, and of which everyone claiming the right of criticising the "public finances of the Colony ought to make himself fully cognisant. Before a surplus could bo manufactured as yourj.corrospondent insinuates, namely, by diverting any released sinking fund from its legal allocation, tho Treasurer and tho Auditor-General (an officer made independent of the Government by statute) would have to conspire togethor to ovorrido tho Act, which is an impossibility, lot us hopo, in a British colony. The credit balance of receipts over expenditure for tho year shown by the Budget was £266.678, to Avhich was added £283,779 carried forward from the previous year, making a total of £550,457, of which £260,220 had been appropriated for public works, leaving tho declared surplus of £290,238. Long tables of figures are attached to the Budget showing in detail all the financial operations of the year, and political foos as woll as friends have congratulated tho Colonial Treasurer on the clearness and business-like character of his statement. Few more satisfactory results of a year's working have ever been presented in any colony, and seeing they were at a time when produce was phenomenally low, and financial disasters were prevalent in tho neighbouring Australian colonies, it is somewhat irritating; to say the least of it, that the Colony should bo credited with a deficit.

Your contributor assorts further that " the personnel of tho Government is distrusted," and goes on to state in support of this that the Hon J. 0. Ward, the Colonial Treasurer, was very active in endeavouring to force on an amalgamation between the Colonial. Bank and the Bank of Now Zealand, insinuating, if not actually asserting, that this was because he, or a company he was connected with, had business rotations with the first-named bank. This is a most unjustifiable and cowardly attack on the character of a Minister of the Crown, who is too far distant to bo able to defend himself.

Twolvo months back the Colonial Treasurer was one of the only throe candidates for Parliament who were returned unopposed, tho Premier being another. So far from the Treasurer being active for the amalgamation in question, he it was who imposed conditions to the proposals made by the two banks, to which the Colonial Bank declined to agree, and it was the Colonial Treasurer who passed a Bill through tho House making amalgamation impossible without tho previous consent of Parliament.

The last time Now Zealand came on to the London market for a loan was in 1888, which is surely long enough back to prove that loans are not essential to the maintenance of our financial equilibrium. Until very recently wo were praised for our selfreliant policy ; now, forsooth, <ve are accused of borrowing on the sly. When we do borrow we are blamed, and when we do not wo are accused of doing so covertly, There is no pleasing some peoplo. Your readers may rest assured that an Australasian Colony is tho last < place where anything of importance is likely to be done on tho sly. It is the practice for all colonial Governments to let all their proposals and actions be known to tho public. Somotimes they aro too candid, perhaps, and would do better to keep their own counsel; but the practice effectually prevents anything like concealment. The rest of tho article is too general to call for more than general remarks. No doubt prices.aro low, and, as a consequence, agricultural and pastoral properties are depressed. New Zealand is not singular in this. I have heard tho same complaint of similar properties in this country. In spite of low prices, tho settlement of new country, and consequent increased production, goes on steadily, enabling us to supply our own wants and pay our way with no difficulty. What country is expected to do more? As for the finances of the Colony being straitened, it is absurd. I give one fact in proof. New Zealand has for many years past kept at the Bank of New Zealand a nest-etrg of ,£BOO,OOO of debentures guaranteed by tho Imperial Government, which are as good as Goschens, and could bo sold to-morrow for close on a million. Since I havo been Agent-General I have for a few weoks on, I think, two occasions borrowed a few thousands against these debentures ; but at the present time, and, indeed, for the last twelve months, I have not borrowed on these debentures at all. The existence of this nest-egg may prove consoling to your readers, as it not only makes finance in London a simple and economical operation, but effectually refutes the assertion that the Colony is in any sort of financial embarrassment.

It is tho fashion just now to adversely criticise tho publo finances of tho whole of the Australasian Colonies, and nobody objects to fair criticism ; but in too many instances writers show a lamentable ignorance of the financial operations and conditions of the colonies they attack. Is it too much to ask that before a writer assails the credit of a colony he should first give some little study to the subjoct he discusses ?—-1 have the honour to be, sir, your obedient servant, W- B. Perceval, Agent-General for New Zealand. 13, Victoria street, Westminster, S.W., December 20th, 1894.