THE COLONIAL TREASURER ON THE FINANCES OF THE COLONY.

New Zealand Times, Volume XXXVIII, Issue 6611, 26 June 1882, Page 3

THE COLONIAL TREASURER ON THE FINANCES OF THE COLONY.

The following is the reply of the Colonial Treasurer, as reported in “ Hansard,” to the criticisms made by members of the House on the Financial Statement :

Major ATKINSON: Sir, I should like to say a few words before the question of reporting progress is put. I can quite understand my hon. friends desiring to have the question put now without a word from me, after the very ■ extraordinary speeches many of them have made, in every one of which they have shown their utter ignorance of the finances of the colony. After having made many bold assertions, not one of which they have attempted to prove, it is very natural that my hnn. friends should desire that the debate should close. It is very natural, indeed, and I have no doubt it would be very convenient to them. However, with the. permission of. the Committee, I shall say a few words. Sir, it takes time very often to reveal the causes which have made great men act. Until to-night it has been a Euzzle, not only to the members of this House, ut also to' the colony at' large, how it was that the hon. member for Auckland East failed to deliver a Financial Statement when he was Colonial Treasurer in 1879. I daresay hon. gentlemen who were in 'the House at that time will recollect the extraordinary scene that then occurred, and the new members will be very interested if they .turn to “ Hansard ” and read the short extract which says that the Hon. the Colonial Treasurer said a few,words which were not reported, and afterwards refused to furnish a report of what he said. That was the Financial Statement of. that year... Now, Sir, light is thrown on the subject. This House does not Eermit the use of a blackboard, an.i so my on. friend, not having that indispensable article, was unable to place his figures before the House, That is the explanation which has now been elicited. I have no doubt at all that it the use of a blackboard had been allowed to my hon. friend by the forma of this House—he being so used to dealing with figures, having dealt with them when I “ was in a cradle or in iny early youth,” he, Sir, would have made a Financial Statement not only such as a little boy could have made, but one of. which the colony would have' been proud, and all this has been lost to us because the House does not permit the use of a blackboard. Now for a few words to my hoh. friend opposite—the hon. member for Akaroa. The old members are well used to his style. His look, Sir, goes a great way ; his manners still further : and as long as he holds his tongue, we all think what a great leader he would make. My hon. friend says, “ Do not let ns have the Financial debate of the session in pieces. I cannot bear pieces. I like a comprehensive view of the whole thing. I cannot discuss the Consolidated Fund until I know about the Loan Account ; I cannot debate about the loan until I know the local government proposals.” I warn the House, Sir, that that means simply this: that no discussion on the finances will take place at all. We have had this every year, Sir —those very words from my honorable friend. It is always the same. “ Let us discuss large principles; let us consider the subject as a whole.” And the truth is that day after day goes by; Committee of Supply is brought up ; wonderful motions are brought on for the regeneration of mankind and the good of future generations ; and the question of finance is put off until the small hours of the morning. I venture to warn the House, therefore, that unless it is prepared to go on with the discussion on the broad divisions of our finance, taking the Consolidated Fund, the Public Works Fund, and borrowing and local finance separately, we shall have no useful or practical discussion at all, and no real consideration will be given to this important subject. Now, I submit that the Financial Statement —although it may have been capable of being produced by a little boy—does inform hon. gentlemen accurately of the state of the finances of the colony ; and all I have to say is that I do not know what greater compliment could have been paid me than that I have succeeded in getting the accounts and finances of the colony into such a state that a boy out of one of the common schools could place them intelligibly before .the House. At any rate, I do not feel ashamed of that, but take it as a great compliment to the Government of which 1 am a member. I am told that I ought not to have concluded my Financial Statement by a practical reiteration of a statement I made in 1879. Apparently it is thought that I may hurt the feelings of some hon. members. But I say this—and we have had an instance of it to-night from two or three members, as I shall presently show—that there is hardly a member of the Opposition who speaks upon finance, who does not either persistently misrepresent what I said in 1879, or who speaks without the slightest knowledge even of what I said upon that occasion. The hon. member for Fort Chalmers apparently knows absolutely nothing of what I stated in 1879. If he has ever read the Statements ha has misread them. My hon. friend the member for Parnell knows nothing about them either; he could not answer a single thing relating to them now, notwithstanding the statements which he has made. The hon. member for Fort Chalmers stated to-night that somebody said that the whole of the five millions was gone when the Hall Government took office. I asked him who said it, and he replied, “You did.” I said, “Show me the place.” Sir, he knows he could not: he knows that no such statement was ever made by me. He knows that what I did say was that the Government of which the hon. gentleman was a member, entered into engagements binding the colony to find enormous sums ol:_ money within certain dates, without even having had the authority of this House to borrow, and that after he had got the authority of the House to borrow, he went on contracting still further engagements amounting to something like three millions. The exact figures rrill be found in my Financial Statement, 1879. And I would beg members who are new to this House to read the Statement which I made in 1879. If they do so they'will see that the charges brought against me by the hon. gentlemen opposite have not a shade of truth in them from beginning to end. There is the broad fact, and I ask hou. members in justice to myself to read the statements and judge for themselves. I say that no hon. member has a right to address this House with a pre ; tension of knowledge on the subject who nas not even taken the trouble to master the common facts of the caso. Now, what did I do in 1879; when I .found the state of; the colony’s finances? 1 will first, however, Sir, tell you what was the state of those finances. We found, Sir, that the Treasury. was empty,

and the L 400.000 which the Government was authorised to raise on deficiency bilis had been raised and spent. There were ■ enormous liabilities coming in for immediate payment, and there was no money to pay them. We were spending L 70,000 or LBO.OOO a week, and the total amount in the Treasury when we took office was L 81,323. I laid a return cm the table of the House, signed by the Controller-General, showing the amount that was in the Treasury, ami I have it here (Appendix to Journals, House of Representatives, 1875, Vol. 1., 8.-X3), but will not trouble the House with it. That return also slewed the amount of money I left in the Treasury when I went out of office in 1877. I left L 571,525 in the Public Works Fund, and L 343.484 in the Consolidated Fund, and L 4440 in Suspense Account; in all a total of L 919,450. This is the amount left in the Treasury by the Atkinson Government in 1879, when the Grey Government came into office. Now, the first thing the Hall Government had to do was to get money immediately or stop payment. I telegraphed to the 'agents at Home. I should say that the L 5,000,000 loan had been authorised, and authority sent Hometo raise it. Itelegraphed to the agents to know whether I could draw for L 50,000 a month more than was authorised. They went to the Bank of England, having then five millions of debentures for sale or hypothecation, and the Bank of England said, “We will not advance you another L25,0000n any terms whatever,” and the Westminster Bank said the same. Now, what was the position I was in? I had to come down to this House immediately and propose to raise L 200.000 on deficiency bills, which were granted, and that carried us on until I made the Financial Statement, in which I indicated the remedies the Government proposed to adopt, and the house approved of those proposals. Now, every one of the speakers tonight—and I cannot tell the reason, for it cannot be ignorance—has mixed up the Consolidated Fund with the Public Works Fund. Mr MONTGOMERY.—I did not. Major ATKINSON : Yes, my hon. friend as well as others, mixed them up together. What did he say ? That I had stated that the colony was bankrupt, or very nearMr MONTGOMERY: I did not say so. Major ATKINSON : No, you insinuated it with that skill which you possess. The hon. gentleman insinuated that my Statement in 1879 was far too gloomy, or was not true—that it deceived the country. Now, I want to know what part of my Statement has not been borne out. ... , Mr MONTGOMERY : I did not say a word to that effect. . Mr MOSS : I am sorry to interrupt the hon. member, but the part I referred to he will find in “ Hansard,’’ page 229. I can assure him I correctly read it. Major ATKINSON : I have got the passage before me, and I was going to read it, I can assure the hon. gentleman that I know something of the Statements I make myself. I was saying that the Consolidated Fund and the Public Works Fund are always mixed up by those hon. gentlemen ; why I cannot tell. But now I am going fco divide them, and I am going to ask hon. members just to look at the two accounts. When the Hall Government took office we had no money in the Treasury except the L 81.323 to which I have already referred. IVe had immediately to get the authority of the House to raise L 200,000 extra deficiency bills above the L 400,000, which, as I have said, had been raised and spent bv the Grey Government. We then had advices from our agents at Home that they could not get another L 25.000 even on the security of five millions, and that they did not know whether they could float the loan at all for some time, but that they felt doubtful whether in any case they could raise more than half of this L 500.000 authorised. Hon. gentlemen can see all this in the Appendices to the Journals, and I can turn it up if any honorable gentleman wishes; for I desire to say this distinctly, that everything I am saying I am prepared to give chapter and verse for. I not prepared to flourish my spectacles and make statements which I cannot substantiate ; but I am prepared to show chapter and verse for everything. Are my opponents prepared to do that? No, Sir, there is not one of them that can support their statements by evidence ; but I am prepared to do so in every particular. Now, in regard to the Consolidated Fund, I showed, in 1879, that there must be a deficit of at least L 655.000, by the 31st March, 1880, which, added to the deficit nt the end of the previous year, of L 131.824, amounted to L796,88(i. But, as a matter of fact, when the year ran out —or rather the nine months—and my hon._ friend was very jocose about my cleverness in shortening the financial year in order to save the amount of deficit. . But I may say that any hon. gentleman following the hon. member for Auckland East in the Treasury would have found that he had a good many shifts to make, to get over the difficulty, caused by the financial shortcomings of the honorable gentleman. But no doubt that was all owing to the want of a blackboard, and was therefore perhaps not the fault of the honorable gentleman. When, as I was saying, the financial period ended on the 31st March, 1880, we had actually spent L 1,000,000 all but L 9.918 on the ordj-nai-y services of government above the consolidated revenue received ; and that L 1,000,000 is now standing as part of the debt of the colony, and we have to provide interest upon it every year. Can anybody dispute that ? The honorable member for Parnell does not dispute it, nor the honorable member for Akaroa. Very well, we have admitted this much, then : That so far as my Statement of 1879 related to the Consolidated Fund it was not “ gloomy” enough. We have now cleared up one important point, and I hope the new members, when they hear these statements made by my opponents about what I said, will remember that I have, upon the agreement of my opponents, cleared away all the questions which they have raised from time to time with regard to the Consolidated Fund. That is a great step in advance. Now, let us come to the loan. My honorable friends laugh. lam glad they can, but they do not like it; they cannot stand facts; they cannot stand _ authorities ; they never could. I said in my Financial Statement of 1879, page v.—

“The Committee will, therefore, see that, unless we can abandon some of our land-purchase bargains—for I fear none of the other engagements can be got rid of—the new loan is anticipated to the extent of aboutLS,3oo,ooo, without including the sum of L 154,791 payable to Canterbury and Otago on account of impounded land revenue.”

Now, Sir, that was my Statement, and what did I do ? I went to the Public Works Department and to the other departments which were loan-spending departments, and said to them, “ Make out a return showing how every penny of this L 3,300,000 is made up,” I hold that return in my hand now. Here it is—some forty or fifty pages in the Blue Book, E.-7, 1879. That return shows every authority and every contract that had been approved by"the hon. member for Port Chalmers and the other members of his Ministry, down to items of Is 4d. There is the exact return, and to it I refer hon. members who doubt what I say. They will find everything I said borne out by exact figures. When I made my financial speech in 1879, I was contradicted by the hon. member opposite. He knew no such things had taken place, no such liabilities had been incurred, and he said it with a twirl of his spectacles. But I produced the return, and then he twirled his spectacles, but said nothing. Mr MONTGOMERY : It was not so. Major ATKINSON.—No, my honorable friend was only looking wise. I refer to the hon. member for Port Chalmers. My honorable friend was too wise to say much just then. :He is rather apt to use other hon. gentlemen to pull the chestnuts out of the fire. However, I say here is this return, and it has never been explained away by any body, nor can it be explained away, because it is founded on the authorities given by the various Ministers of that Government. I may further inform hon. members that when my Statement in 1879 was challenged, I offered in the House to place the ’whole of the departments at the disposal of those hon. gentlemen, and to furnish any return they might wish for, but not one of them ! dared or attempted to take up the challenge. But I go further, and ask can anybody show a single statement of mine in which I said the loan was spent? How could I have been so foolish as to sav that it was spent when it was not even raised" ? But here is the explanation of what puzzled the hon. member for Clutha so much. These, undertakings of the Grey Government were engagements to spend, not expenditure made, and as I said in that Statement of mine in 1879, the Minister for Public Works of Sir John Hall’s Government was requested to use every exertion to postpone payments, and to extend the time of contracts as much as possible, so that we might not run through the 1,5,000,000 loan immediately, but extend the expenditure over some years. But we found such a pressure of work from engagements undertaken by the Grey Government that it was impossible to confine the expenditure to any small amount. In fact, ,we had to spend more in that nine months than ■has been expended in any year before or since, and it was only last year, with every possible effort on the part of the Government to reduce the expenditure, that we were able to bring the expenditure within reasonable limits. That is the explanation of our raising the loan, and spending it, for, as my honorable friend has said, for the first two years we have had to ride a dead horse. The loan, to the extent I have said, was forestalled. We have had to raise the money and pay for engagements entered into by the Grey Government. And now I will ask any reasonable man whether, with these facts before him, he will be content with the statement of any hon. gentlemen, whatever his standing in this House may be, that the five million loan was not improperly forestalled to the amount then stated. I have given chapter and verse for everything I said ; and further than that these figures are home out by the public accounts, and I • challenge any hon. gentlemen to come up and disprove one figure of them. Not one of those hon. gentlemen has yet attempted it in any spirit of fairness. There is my_ challenge, and I hope the sense of fairness among new members—indeed I am sure it will—compel them to call upon their leaders, as the hon. member for Timaru has done on many occasions, to come forth and disprove these statements, ami not to sit under such an imputation as grossly to misrepresent an opponent, or to be ignorant of the subject upon which they profess to teach. I, too, call upon them to substantiate their

statements, for my honor is at stake as well as theirs. I have given authorities for every word I have said, but they have not even attempted to give an authority for what they say. And, now, Sir, “In the name of the prophet, figs.” The hon. member for ihe Thames says that is the way my speech ought to have begun. My hon. friend must surely imagine that he is once more on these benches, for that is exactly the way the statement would have begun if my hon. friend had been here. “ Yes, Sir, see what we have done for the country. e have done all these great things. We have thought of the human race. We have legislated for all future time —or intend to—and we have not forgotten the little necessities of the present. It is our successful management that has done all this.” I want to know where there is a single word in any Statement I ever made that will bear such a construction as that. Read any Statement I have made, and you will find it is to the country, to its settlers, and to this House that I have referred all the credit of our present _ position, although I might fairly take a share in that credit. And I do now take my share in it. I say that the Government which could come down and face the difficulties we faced, which could dare to put on taxation to the enormous amount we did; which could say to the country, “If you want to go on in this way you must pay for it,” is certainly deserving of some credit; and I say we might have taken it if we had chosen, but we did not choose. We are not of those who cry, “In the name of the prophet, figs.” Sir, I like a broad view of affairs, but I venture to say that there is practically as broad a view in this Statement as ever was enunciated by the hon. member for Auckland East, but there are some men who take such broad views that there is nothing in their views but breadth. No other dimensions are to be found, and the consequence is that their views are lost in infinite space. The present generation cannot find them. Being without dimensions we cannot see them. I only trust that they may be of advantage to future generations ; but this I say, that so long as I am on these benches I shall feel it my duty, while taking as broad a view as circumstances will permit, to submit to this House the practical work of the country. My business, as Treasurer, is to show how the country can be governed year by year. That is our business at the present time. As I say, I enjoy broad views, but we have the business of life to perform, and we must not allow ourselves to he lost in immensity, or we shall get where we wore in 1879. I am told that if that hon. gentleman had remained in office in 1879 it would have been much better for the colony. That may be true : I cannot tell. I do not think the country believes it. I do not believe it myself, or 1 should not be here today. The hon. member for Auckland East thinks so; he thinks that it only he was on these benches —with such a Government as he would choose—the human race might yet be be saved by means of a progressive land tax. Well, Sir, that is a question tor this House to decide. If the House thinks another Government . is more capable, and should be put here in the interests of the country, then in the name of the country I say put them here. But I venture to say it will be many years before the country thinks of handing the Treasury over to my hon. friend, with his blackboard and his broad views. At any rate, I trust I shall not be the Treasurer to follow him if he ever does take that position again, for I say, and say it without egotism, that I do not think there is _ anything that would induce me to again go through the anxiety and worry that I had to go through during the first nine months after I succeeded him. No one can conceive it unless he had to undergo it. When our credit was such that the Bank of England refused to advance us 1.25,000, and when, at the same time, we had engagements to meet to the extent of from 12,0 0,000 to L 3,000,000, you can fancy what a Treasurer with a due sense of his responsibilities would feel upon such an occasion, The hon. member for Auckland City East (Sir George Grey) tells us that we might have expected a wave of depression in 1879. The hon. member for Auckland East says the wave ot commercial depression went over all the colonies. He asks did not the Australian colonics aiso suffer! Did not our Land Eund cease ? Was not this the chief cause of our difficulties ? Are we as a colony the worse for this ? If we have kept our capital still in our hands—that is, not sold our land—we cannot be said to have suffered much of a loss, because we have not received a land revenue. No doubt that is true from one point of view, for if we do not sell our land to-day we shall have it to sell to-morrow if we choose. I ask the House to remember that that hon. gentleman was during part of that year Colonial Treasurer, and during the whole of it Premier. Did he make provision for that wave of depression which he has told ns he knew was coming, or at any rate was to have been expected ? Did the hon. gentleman know, or did he not, that that wave of depression was coming? Was it not his duty to know it was coming; and if he did expect it, why did he not prepare for it? Surely the duty of a Treasurer is to look at least a year before him to see how things will turn out. I have the Financial Statement of the Treasurer of the Grey Government in my hand, the only Statement that was made during the time the Grey Government was in office, and I will ask hon. members to read it. It is said by the hon. member for the Thames that I was responsible for the financial troubles of 1879-80, that I left the colony in debt—that I caused all the evil that fell upon us in 1879-80. Mr SHEEHAN : No ; previous Ministries. Major ATKINSON: Well, be it so. I say this, and I am speaking with authority, that I left in the Treasury in September, 1877, cash to pay all outstanding liabilities within LIOO,OOO, certainly within L 150,000. I have not looked the matter up since that date, hut I say that we left in the Treasury money sufficient, at all events within L 150,000, to pay the whole of our liabilities. Immediately after Sir George Grey came into office, the hon. member for Port Chalmers came down with his wonderful Public Works Scheme, requiring, besides a loan of L 5,000,000, proceeds of land sales of not less than L 700,000 a-year on the average for five years. The Colonial Treasurer {Mr Ballance) had estimated the Land Fund for the year,at about L 1,200,000, the whole of which he used to balance his expenditure for the year. We are told now by the hon. member for Auckland East that no_ reasonable man would have expected anything that yearfrom the Land Fund; but here we have over LI, 200,000 of it brought into the Consolidated Fund, in aid of ordinary expenditure ; and, to cap that, down comes the hon. member for Port Chalmers with his railway scheme that requires L 700.000 more, besides the 20 per cent, to be given to the local bodies. So that the hon. gentleman required a Land Fund for five years of L 2,000,000 a year to pay their, way under their scheme. All this was seriously submitted to Parliament. And yet the hon. gentleman says that everybody knew there would be no Land Eund; and, knowing this, what did he do ? He sat upon these benches as Premier, and allowed his colleagues to make those proposals. These are all facts which cannot be gainsaid. Did not the hon, gentleman propound a scheme which was to pledge the Land Fund to the extent of L 2,000,000 a year, and to swallow up the five-million loan ? Did they not set to work to spend the money before they got it ? Why, before we came into office they had actually spent L 500,000 of tiie loan. I want those hon. gentlemen opposite to show, if they can, that anything I have stated is not accurate, and then I want hon. members to judge between us. Mr MONTGOMERY.—We shall have something to say hy-and-hy. Major ATKINSON. —I have no doubt. But I would just ask hon. members to read Mr Ballance’s Financial Statement, because I say that when I went out of office in 1877, we left the country in a flourishing condition, we left a* reduced expenditure, and we left everything in a clear and satisfactory state so far as the future was concerned, and enough cash practically to pay all outstanding liabilities ; ’and the proof of that is to be found in this very Statement made by Mr Ballance. The hon. gentleman says very distinctly that there was no time more fitting for making a fresh start in taxation than then, 1878, owing to the highly satisfactory position of affairs and the really prosperous state of the colony generally. That was the statement made by my opponent after being in office for one year, and having had full time to ascertain what was the actual position of the country. I think, Sir, that is an absolute answer to the statements made by the hon. gentleman the member for the Thames. Can these hon. gentlemen, especially my hon. friend the member for the Thames, get up and say such a thing again after that statement made by his colleague in this House? Can it be said again that we are responsible for the condition of affairs ? If hon. gentlemen can get up and say so, they are simply speaking without book, and I am sorry to say that many of them are rather given to that. I am sorry to have troubled the Committee at such length, but I have still one word more to say. The hon. member for Parnell says that we have not made any reduction at all in the expenditure. It is quite useless to argue with the non. gentleman. I do not wish to be rude, and would not be rude to any man. It may he my duty to speak a little plainly sometimes, and my hon. friends opposite are apt to consider plain-speaking, when it comes across their feelings, in the way of rudeness. I do not wish to be rude, but I must continue to talk plainly. I must let the House know what are really the facts of the case; and if in doing so as briefly aa I can I should appear to be a little brusque, I am sure my hon. friends will excuse me when they come to think the matter over calmly. I say I do not wish to be rude to the_ hon. member for Parnell, but I would ask him, at any rate, to read the Financial Statement for last year, and that for the year before, for he will there find set out—and the statements therein-contained can be borne out by returns if they are wanted—in distinct figures full statements of the reductions we have made, and he will also find set out in statements I have made, instances where the Government of. the hon. member for Auckland East increased departmental expenditure which he declares to have been extravagant, by LIOO.OOO. These statements and the proof are all to be found in the records of this House. It cannot be expected that upon the challenge of the hon. member for Parnell I am to get up and read through the Financial Statements of two years ago; but I ask hon. gentltmca to read those Financial Statements,

and then they will see exactly where the savings have been made, and howthey havetakeneffect. I say that is a complete answer to the hon. gentleman, and now I would say one word to the hon. member for Auckland East. He says if you had only let another Government into power—of course, he does nut mean himself—who knows but what we might have had a land tax and an income tax, and so have caught those big absentees who have escaped the property tax by living at Home. Well, the hon. member repeats that year after year until, as the hon. member for Clutha would say, he must have come to really believe it. I have examined the facts, and I will tell him the result. I have had taken out from property • tax payers 146 of the largest pro-perty-holders in the colony, X have taken a good deal of pains to find out what their income is, and 1 firmly believe that I have arrived at the result pretty correctly. I find this ; that under a land-tax of id in the pound, these 146 of the largest property-holders in New Zealand would have paid L 16,000. Under an income tax of 6d in the pound they would have paid L 17,000; under the property tax at Id in the pound they really paid L 42,000. To get by means of an income tax as much from these 146 large property-holders as. has been got from them under the property-tax, the people of New Zealand would have had to pay an income-tax of Is 3d in the pound. When the question of a land and income-tax agamst a property-tax comes to be argued, I believe X shall be able to show the House most conclusive reasons which will convince hon. members who are to be convinced that there is no tax which makes the large man pay so much as the property-tax. No in-come-tax that it is possible # to levy can get at them to anything like the same extent, and I include absentees—everybody who draws a revenue from New Zealand —in this statement. I make this statement fearlessly, and as one who went into this matter with a predisposition in favor of an income-tax, and not a property-tax. I am sorry to have troubled the Committee at such length, but I could not allow my hon. friends to disport themselves so cheerfully upon do not exist without saying a few words in defence of the late Government,