THE TAPANUI CONTRACT.

New Zealand Times, Volume XXXIV, Issue 5548, 9 January 1879, Page 3

THE TAPANUI CONTRACT.

TO THE EDITOR Olf THE NEW ZEALAND TIMES. Sir, —Mr. Stout is a gentleman for whom I have the highest regard, but have often been amused by many of his speeches, especially in Parliament, in which he at times displays a moat remarkable ingenuity in making the worse appear the better cause. In this respect he was quite himself the other day at Hr. Basting's banquet on the subject of the Tapanui railway about the questionable character of which contract so much has been said. To show the bona fide character of the whole transaction, he stated for the information of his audience, and the public in general, that there wore no less than five tenders for the work, and that the tender accepted was not only the lowest of the five, but was £2090 under the engineer’s estimate. This he assumed to be proof positive of the straightforwardness and legitimate character of the whole affair, and an evidence of the soundness of the system of constructing our railways on the principle of deferred payment. I would, however, ask Mr, Stout, for the fuller enlightenment of the public, If the engineers’ estimates of this line are not based on the terms and stipulations of that particular contract as to payment, and not on that of the usual progress payment for such work. Because —while the successful tenderer’s price may have been below the engineer’s estimates based on the stipulated deferred payment—it might have been far above estimates based upon ordinary progress payment. I therefore would like to know—and I think the public should 1 be informed—on what system of payment the engineer’s estimates referred to by Mr, Stout were based. If, as Mr. Stout would hare us believe, this line is being constructed at a less cost than it probably would have been under progress payment, it will clearly be to the advantage of the colony ' to construct its public works on deferred payments, It would considerably lessen the immediate need for borrowed money, and would thereby save the oulony large sums for interest. But if, as I opine is the case, both the engineer and the tenderers embraced in their estimates the item of interest ;on the necessary capital for carrying out the work, it will after all be found that the adoption of the principle is certainly not to the advantage and advancement of the public interest, but on the contrary a great additional and unnecessary drain on the public purse. Because the rate of interest so estimated would be far higher than the rate at which the Government could borrow money to the extent at least of t per cent, as against 5 per cent. This means a charge of an additional 8 per cent, on the public purse on the capital required for carrying out the work. And further, it throws such works entirely into the hands of large capitalists and wealthy companies, to the exclusion of the great mass of working contractors, thereby giving them a monopoly, with the necessary attendant evil of higher prices than would rule under more extensive and legitimate competition.—l am, &c., Enqwieeb.