THE QUESTION OF BORROWING.

Otago Daily Times, Issue 11199, 23 August 1898, Page 2

THE QUESTION OF BORROWING.

(Fboh Odr Own Coebesfondent.| WELLINGTON, August 22.. It is generally admitted that one of the ablest speeches made during the financial debats was that delivered by Mr Fraser on Friday night. As his views on the borrowing question are specially interesting, I have taken the following extract from a Hansard proof of his remarks:—"There is one remark that constantly occurs (id the Budget) about the,earning power of the people having increased. I fancy the Treasurer meant tlio spending power. Well, I do not dispute it for a moment.. But is the increase a real one —a legitimate one? Is the increased spending power of the people due solely to the increase of the produce of the colony, to the creation of an increased genuine wage fund? _ We know perfectly well that it is not. So it is beyond doubt that part of the increase of revenue from customs is due to tiio fact that we are distributing among the wage earners of the.colony, not only the surplus of our revenue, but hundreds of thousands of borrowed money every year. Last year we spent over £300,000 on various works throughout the colony, and I undertake to say that fully one-half of that sum has gone into the pockets of wage earners; consequently their spending power at any rate has increased.—(Hon. members: 'Hear, hear. ) Members opposite say ' Hesr, hear. Do; they mean to say we are to go on borrowing money for ever?—(A lion, member: Decidedly.') The hon. member for Masterton says decidedly. Well, as the hon. gentleman secured something beI tween £90,000 and £100,000 for Ins own district, I cau understand that interjection. I | dare say he hopes it will go on. But I ask I tne-House to. seriously consider 'this quesI tion, because it is a very important one. I , say now, as I have said before, that I do not j tninfc the tilmo has come when wa should cease borrowing. We cannot put a. stop J t -7at xonoe' We Ilave roads and bridges to make and railways to ! ccmplete; and borrowing muat go on. But i I think, and I hope, the Houso will agree i with me, indeed I believe they will, that bori frY n£ ? n, d"M.ets leads to waste. More than that, this borrowing in driblets is an incentive not only to. this Government, but to any Go- ; vernment, to keep repeatedly dangling the traditional bunch, of carrots before members. ; It enables them to do it. If you borrow from : year to year, a certain number of members I are bound hand and foot to the Government | and cannot call their souls their own. But j if a borrowing policy were brought down, extending over a number of years, and the ; money was allocated to certain works, then the temptation to sell a vote would not exist, because, the money being once and'for all allocated, members wouiu be free thereafter ; to vote as they chose.—(Mr Seddon: ' It in only fair that those who borrow the monoy should spend it.') The hon. gentleman is lot- . ting the cat out of the bag. Ho is bo certain j of going out of office at the next elections : that he does not want to borrow for his successors." Mr Fraser then gives some figures regarding the public works fund, and proceeds:—"Hence £557,065 is the total amount available for the expenditure from that fund for the ensuing year, or rather till Parliai ment meets again. Now, -let me warn the j House that if the Premier spends at the s?anie | rate as he did during the last 12 months tliero j will not be a penny piece left unpledged on ! • March 31, 1899. There will no doubt be a- ' .. credit balance in the public works fund at ; ! that date, but there will be an equivalent lia- '■ j bility. Let us hope the liability will not ex- j j cesd the credit balance. The result will be ] ! that when Parliament meets next year it will'i ; again have to face this question of borrowing.. j T suppose this sort-of thing will continue !as long as Parliament lasts, as it is evidently determined to give effect to the" wishes of the Premier. I regret that this mode of borrowing in comparatively small sums, is a mistake. It is the worst kind of ; borrowing; and no eponomical administration ,•• pan take;place while that is going on. THereis a tendency to fritter away the money on worts that should really be a charge on I revenue, and there is no finality; to such .a ; i policy.—(Mr Seddon:' Borrowing a large sum I I makes members and everybody else extrava- i ' pfant.')..- Sir, authority to borrow a. large sum j : need not involve the raising and spending i the whole of it at once, nor should you do j what has been done in the past by this Go- j vemment and former Governments—namaly, j divert the money so borrowed from tho pur- • pose from which it is authorised. Such a ' proceeding is decidedly wrong. I hope if j the colony some day does decide to' borrow j any large .sum, it will not, as in the past, j leave large sums in the hands of any Govern- ,; ment to dispose of. but that Parliament will j insist en placing the proceeds of such a loan in' the hands of . commissioners,, whose duty it would be to see that the* purpose of the i loan were adhered to. Of course such a proposal would not suit these honourable gentlei men, but I believe it _ would be a wise pro- | vision. You have sinking fund commissioners to prevent the Government of the day from touching the sinking funds.—(An Hoii. Member: 'They'did touch them.') Then why not have loan commissioners, who would not allow a single penny to be taken out of the loan fund without tho direct authority of Parliament. That is what I want—parliamentary control of loan money, not Governmental cdhtrol. I repeat you need not dread borrowing a large sum if it is allotted properly and adequately safeguarded from improper interference as to its objects.