THE POMAHAK INQUIRY.

Otago Daily Times, Issue 10193, 30 October 1894, Page 6

THE POMAHAK INQUIRY.

BEFORE OF THE COMMITTEE,

ANOTHER INTERESTING REPORT PRESENTED, BUT NOT ADOPTED. The WasteLands Committee having concluded their inquiry into the circumstances attending the purchase by the Government of Mr John Douglas's Pomahaka estate, and presented their report to the House, we now publish the report as telegraphed by-ourWellingtou correspondent:— REPORT ON THE POMAHAKA. ESTATE PURCHASE INQTTIKY. Order of reference : Extract from the Journals of the House of Representatives, Tuesday, the 10th day of July 1894. Order: " That the whole transactions in connection with the pnrchase of the Pomahaka block under 'The Land for Settlements Act 1892' he referred to the Waste Lands Committee for investigation, with power to take evidence on oath and call for persons and papers, and toreport to the- House. ■ "Hon. J. M'Kenzie." B.EPOBT .The-committee to whom was referred thein«unyinto the whole transactions in connection With the purchase of the Pomahaka block from Mr John Douglas, under "The Land for Settlements Act 1592," beg to report as follows:The inquiry commenced on the 4th September snd closed on the 2nd October IS9J, and the evidence of 13 witnesses was taken. • _ It appears that when addressing the Waihemo. Electors during last election Mr M. J. Scobie Mackenzie spoke at Palmorston as follows :— "Let it be clearly nnderstood I am far from suggesting corruption in connection with my .opponent in this contest. I say again that I tdon't even include him {Hon. J. M'Kenzie) among the political spielers. I think his intentions are excellent ami that he is doing the best he can for all classes of settlers, but a man with unlimited nower ia apt to be acted upon unconsciously in all Boris of ways. Take this last Pomahako purchase far instance. I believe it to be a downright bad trarchaae— a much worse-one than Cheviot. I only inowtheland by repute, butitisa cold, ungenerous eofl. It is purchased en the eve of a general election. The owner of it is an influential man in this immediate neighbourhood. Ho employs a number of men, and may influence a number of YOtcs. His nephew is h«ad of one branch of the Minister's department. The land has been for sale lor many years. I heard it myself offered for sale at the same price, I think, 10 years ago. It has teen rented for a lonj; time nt fid per acre—a rent ■which is 5 per cent, on a capital value of 10s per ncre. I believo even at that rent the land was about to be thrown up. Now, all these things teay be mere isolated facts.: There may be no connection between them at all; but a Minister s mind may be influenced unconsciously by the pressure of hia friends, by the fear of his enemies, by 60 circumstances which have no direct coanection with corruption, but which lead in that direction. I want you to remember this: It has never been the policy of the English law or custom to invest any individual with unchecked jpower-over his neighbour.' , . , .. ■His opponent (the Hon. J. M'Kenzie) took these remarks to convey a charge of corruption against himself, and made a public reply at Pahnerston. Considerable discussion followed in the Dnnedin newspapers, and both Mr Scobie Mackenzie and the editor of tho Otago Daily Times demanded a Bearching inquiry, on the grounds that the ■purr chase was an improper one, and the price absurdly excessive. With the view of securing the fullest investigation the committee specially invited both these gentlemen to' attend the proceedings, and also asked them to name ;what witnesses they thought should be called, the committee offering to pay all expenses. The editor.declined to attend and said he had no •witnesses to name. He had written merely as a public journalist Subsequently, whilst the inquiry was in progress, this gentleman in his leading columns stated that the committee was only taking such evidence as would suit the Minister and the department, but that the evidence of those who "if properly examined could tell " the real story" was not being procured. Thereupon the committee asked him to name the persons who, as he had said, could tell the real Itory." In reply he mentioned Messrs Wright, Stephenßon,andCo.,ofDunedin,andthepaidagents of Mr Douglas. The committee thensummoned a member of that firm, and also the paid agents of Mr Douglas as named by Mr M.J. bcobie Mackenzie, and took their evidence. Mr Scobie Mackeazie attended the proceedings pursuant to the committee's request. He was accorded the right of being represented by counsel, which he The committee also decided that he alone of all the witnesses should be constantly -present, and that he should have the right to He exercised this right freely, and also called evidence himself, and addressed the committee. Dr Ktchett attended the proceedings, examined witnesses; and addressed ..the committee on behalf of the Department of Lands tai Surveys and the Board of LanoV Purchase Commissioners, who considered that their integrity was attacked. . ■ ■ '_.-■'.. '■\i.- I .'t.' Mr Scobie Mackenzie, whilst staiang that he made nocharges, urged that the evidence showed— (1) That the estate was purchased at a price far in excess of its value-, (2) that one main .factor in effecting the purchase was a petition falsely purporting to come from settlers, but in reality, got up by Mr John Douglas himself, urging the Minister to acquire the land for purposes of settlement; (3) that in Mr DouglasVinterest undue haste was displayed throughout the whole transaction; and (4) that in the same interest the purchase was effected in the face of a recommendation of the board that preference should be given. to another property, the Conical Hills With reference to the first point—wasths price a' fair one ?—the evidence consisted of :-(l) Previous sales"ti'nd subsequent sales of property in-the; Pomahaka and neighbouring districts; (2) opinion of witnesses; and (3) prices actually paid by settlers for the Pomahaka estate'when thrown < open by the Government. In ISB9 1140 acres of the same estate, and not the best part,of it, were Bold at £3 123 6d, and,for several hundred acres £3 was refused; moreover, between 1889 and 1893 there were negotiations for sale and lease of parts of the property at £& or thereabouts. This would seem to Bhow that the estate was worth more ■than the Government paid for it. On the other hand, within less than a year afterwards ;the !; Popotunoa estate of 10,147 acres, adjoining Pomahaka and undoubtedly a very fine, ■well sub-divided, well cultivated property, '■ was sold for an average of ■£2 2s. It was, however, urged on the committee that there were special reasons for these low prices, . admittedly much lower that the owner s value. The owner (Mr J. Logan) had recently died, and ins executors put all his property in the district (30,000 acres in all) into the market, thereby outrunning the demand for land and lowering the price. The opinion expressed before the committee by all the witnesses who spoke to the point except two was that £Z 103 was a fair price. On the other hand, of these two witnesses, one, iha inspector of the Union Bank, spoke of value ; for lending rather than purchasing purposes, and ■while stating that the bank called up an advance of between £8000 and £9000 on the security of the property, gave as his chief reason that it was not a banting security. The other witness, Mr Stevenson, said the land was worth between £1 to £110s per acre. Lastly, there is the practical ■test of value afforded by the rents paid by settlers

who have taken up sections. ■ The property was thrown open by the Government up to 24th July 1894; 5230 acres have been disposed of at an average rental of 3s 4d, or- at a capital value of £5 6s 6d per acre, leaving about 1800 acres still to be let, and it must be borne in. mind that these rents were given in spite of much depreciation of the property in the Otago papers and Mr Scobie Mackenzie's public statements that; the soil was cold and ungenerous, and that the rental for years had been 6d, representing a capital • value of 10s per acre. ' After giving careful consideration to all the evidence on the point, the committee are of opinion that the price paid by the Government was a fair and reasonable one. With respect to the petition, it was admitted that it was got up. by Mr Douglas, but it was signed by SOI Bottlers in and about the district. It was preBented m the ordinary way by the member for the district, who knew many of the signatures and had no reason to doubt its genuineness, and it could have had no possible effect on the price, inasmuch as it 3 existence was not known to the board at a meeting in Dunedin, when the pries was fixed. For these reasons the committee fail to see how it affects the matter. As regards the suggestion of usdua haste, the committee are of opinion that no impropriety is cHsclosed. Mr Barron was justified in hastening toe preliminary inspection of the property, as an adjoining estate (the Conical Hills) was alao under «ffer, and it was expedient that both should be before the board together. The telegrams about the board meeting are sufficiently explained by the fact that the Surveyor-general had left Wellington to attend meetings in Canterbury, Otago, and Invercargill, and to save his time it was of importance that the board business should be leady for him on his arrival at Dunedin. 'As to Che' suggestion that Mr Ritchie improperly induced Mr Barron (the Under-secretary - for landß) to instruct tfye preliminary inspection without the knowledge or authority of. his superior officer, the evidence was uncontradicted that Mr Barron was not exceeding his authority. Mr Bitchie, too, though a nephew of Mr Douglas and a Government officer, did not, in the opinion of the committee, interfere otherwise than as an outsider might have done, and there is nothing to show that he promoted the purchase or influenced the price. As bearing on the question of undue haste, it appeared that the offer to sell was made on the 21st August, the offer to buy on the 35>h September. Mr Donglns accepted on the 2nd Otcober, and the purchase money was not paid tmta after the 20th. With respect to Conical Hills, tie evidence clearly showß that the purchase was impracticable at Ihe time, and could not have been effected without beginning the whole negotiations de rumo. The offer was to exchange, and there was no statutory power to exchange. The board's recommendation was to exchange the whole or purchase a portion, whereas there was no specific offer to sell the whole, and no offer whatever to sell less than the whole. Moreover, there were not funds sufficient to pur-. chase the portion recommended, still less to purchase the whole. Mr Scobie Mackenzie dwelt strongly on the fact that the correspondence between Mr Douglas and Mr Ritchie was not produced. The explanation offered was that it consisted of letters and telegrams between uncle and nephew, and was therefore not preserved. With respect to a telegram from Mr Ritchie to Mr Barron, which was not on the file, the committee accept Mr Barren's explanation that unimportant papers are not always filed, and in this instance, as the telegram was sent Ion? after the purchase was concluded, it cannot have much bearing on the matter. Throughout the whole inquiry nothing has at any time been adduced to show that the Minister in any way departed from the strict line of his official duty, and indeed he appears to; have had j very little to do with the purchase except signing the ordinary official papers. Finally, and as the result of as exhaustive an inquiry as they could make, the committee find that there was no ground for the grave charges made by Mr Scobie Mackenzie, and that neither the Minister nor any member of the Lands and Survey department, or of the Board of Land Purchase Commissioners, is in any way affected either as to integrity or capacity. The committee feal it is their duty to refer to ane ©thei joint. In the course of his evidence, Mr

Scobie Mackenzie said that neither in his speech (quoted above) nor at any other time did he impute corruption to the Minister, and so far as lie knew no inferuuee of corruption was ever drawn from his speech or his subsequent correspondence in the Otago Daily Times. Further, that he was not responsible for the inquiry, and was merely there because the committee had iuvited him. The iwrnmittee regret that they cannot agree with him in their opinion. No reasonable man cs^n read the speech without drawing the inference that the speaker is intending a chare c of corruption. The effect of tha preliminary disclaimer is merely to put the charges i'a the form of innuendo instead of a direct'statement, and to serve as a loophole to escape the responsibility of having to prove them. There was :«tmple evidence before the committee that, are a liuatter of fact the inference was drawn, and tlbat Mr Scobie Mackenzie knew it and countenanced it. They are further of opinion that the charges of corruption, if made at all, should be madei plainly and specifically instead of by innuendo and suggestion, and that the person who mal tes them should, when challenged, either prove the mor withdraw them. Mr Scobie Mackenzie has d one neither.

There was not a. great deal of interest shown in the discussion of the motion by the Minister, for Lands—"rTh fct the report of the Pomahaka Purchase Committee be adopted and entered on the Journals ol! the House." The Minister opened the discusi lion with a speech, which was hardly equal to his usual vigorous style. He made very bitter, nttacks upon Mr Jamea Smith, Mr J. M. EStobie, and the editor of tho Otago Daily Times,, endeavouring to give force to his charges by the use of such words as j " shameful," " disa reditable." " disturbing," "falsifying," and thai like. Sir Robert Stout, who followed, admitted: that no charge of corruption has been made out against the Minister or Messrs Rj tchie and Barron. However, he thought iji very unwise that the babbles ot a heated c lection contest should be made.the.subject of' a parliamentary inquiry, especially when inquiries had been refused in such important matt ers as the charges made against the Railway C ommissioners and matters connected with clause 21 of the Alcoholic Liquors Act. He ref e^ :red to the rejection of the memorandum he had dj :awn up as the basis of the I report. That memo.^ had been placed in the hands of the commiiteti at 5 o'clock one eveni ing, and the next morning Mr Mills brought up I a printed memorandum, which was adopted as the basis of the report. The Chairman said he had authorised the' printing of, Mr Mills's report, and from this ; ifc appeared that either &lr Mills could ha'ra anything printed ho thought fit, being the .Government whip, or that he had Ministerial iianction.,..lf the memorandum had been di.'awn up by Mr Mills, he could only say that gentleman niust have been very much impressed! with the.speech of Dr Fitchett, the counsel for., the department. So much was this the case that in Mr Mills's report paragraph after, paragraph was identical in language with the speech, of Dr Fitchett. Sir Robert Stout gave several quotations in support of his assertion.' The language, ideas, and literary style ware in many instances almost. identical. Perhaps Mr Mills had one of those elastic ininds, which retained and= reproduced thef laali, impression like a> phonograph or sonie^auch instrument. Sir Robert, contended that' a' report' should be j ddicial in tone, and should > not adopt „ the language and literary style of'; the^counsel of i either party. \ He disagreed with the language of the report aridwith the evidence as : to value; there being only two witnesses not connected in some way with the purchase examined on this point. The language of the report was not judicial, some of the statements were not borne out by the evidence, and it was not the duty of the committee to enter into the political duel between1 the Minister and Mr Scobie Mackenzie. Mr. C. H. Mills followed Sir Robert Stout, and asserted that if his (Mr Mills'a) report was very much like a reproduction of the speech of Dr Fitchett, the report of Sir Robert Stoat resembled the speech of Mr Scobie Mackenzie. However, he did not follow the example of Sir Robert Stout in supporting this assertion by 'quoting passages. He said Sir Robert's report was too wishy-washy, and bore evidence d£ tryiug: to please both parties^ : Messrs M'Gowan and Meredith followed in commendation of the committee's report, the latter complimenting Sir Robert on the fairness af his speiech. j: The'debate was resumed on the-'°22nd, but degenerated into a farce, members reading the Committee's report and the speeches of Mr Sicobie M;vckenzie ■ and Dr Fitchett in order to get theai into Hansardi The motien was eventually carried on the voices. ; ■