HON. JAS. ALLEN.

Otago Daily Times, Issue 16052, 20 April 1914, Page 2 (Supplement)

HON. JAS. ALLEN.

FINANCES OF THE DOMINION.

A SURPLUS OF £40<W>00.

TEFJi DEFENCE QUESTION,

MELTON, April 15. The Hon. James Allen (Minister of Finance, Defence, and Education) addressed a large meeting of his constituents to-night in the Coronation Hall.

The • Hon. Mr Allen, after the applause with which he was greeted had ceased, said it was with very great pleasure that he again came to see his constituents in Bruce, especially those in Milton, where, for many years, he had had the confidence of the electors. It was especially pleasing to h'rm to come to them as their member in the Ministry. It was because of the confidence they had reposed in him for 20-odd years that he was enabled to come to them as a Minister of the Crown and vwitn a fuller responsibility as a Minister /of the Crown, and he hoped to bo, able to satisfy them that he had done his duty a* their member and as a Minister of the Crown. FINANCE. tie Pubfio Works Fund was on a sounder basis to-day than when tho Government took office, and so also was that of the State Guaranteed Departments. The position of the advanoea to workers account as at March 31, 1914, was:—Credits, £81,184; loan money to receive, £250,000; total, £331,184, with total commitments, etc., amounting to £187,000; whilo for the month ended March 31, 1914, the Advances Board had authorised loans amounting to £39,330. The Advances to Settlers account was also in a strong position, and the board authorised last month advances amounting to £92,335. The,advances to local authorities, instead of having a debit balanoe of £659,308, as at about the tane the present Government took over affairs, had, on March 31, 1914, a bank balance of £55,474, which, with, loan money available (£500,000) made a total of £555,474. The commitments at the same date amounted to £147,040, thus leaving a credit balance of £408,434. This

IMPROVED FINANCIAL POSITION had been attained whilst, at the isamo timo, the opportunities to those who desired to secure loans were widened. For instance, in the workers' branch it was correct that in tho time of greatest stringency (November, 1912) the Government had to reduce the amount that could be advanced to each applicant to £300, simply because there was only a very limited amount of money available. On May 15, 1913, the amount was rtised to £400, and on February 9 last to £450, which was the limit allowed by law. (Applause.) In the settlers' branch the previous Government, in April, 1912, before the present Government came into office, had reduced the amount to be loaned to a settler to £500, and had at the same time declined to entertain applications for the purpose of paying off existing mortgages. Now, he desired to show what improvements had been effected 6ince the present Government came into office. On May 15, 1913, it was decided to make advajpees to Crown tenants for the purpose of releasing existing mortgagee, this having been stopped by the previous Administration. On May 26, 1913, the limit was raised to £600; on June 30, 1913, to £750; and on February 1 9, 1914, to £1000; and he was pleased to announce that it had been agreed, as from April 6, to accept applications U P to t° redeem mortgages on freehold. If there were poor settlers who had properties mortgaged up to £500, ajid if these mortgages were becoming due and tho financial man wanted to impose heavy rates, those settlers could go to the Advances Office, which, if the security was sufficient, would advance up to £500 to meet the mortgage.—(Applause.) BORROWING. Their opponents .said that the Government had ■ pledged itself to reduce borrowing. Wbat it had said was that a more careful expenditure of borrowed money was necessary, 'but on the point of the extent of the amount of borrowing, as a matter of fact, they had actually reduced the amount. The Government had been in office about 21 months, and comparing the borrowing during that period with the borrowing for the previous 21 months, he found that his total wasabout £250,000 less, including borrowing for current expenditure and for repayment of advances and redemption of loans. Taking, however, the borrowing for current^ expenditure itself the total for the 21 months for which the present Government had been in power was close, on £850,000 less than for the previous 21 months—that was during the existence of previous Governments.

THE RESULTS FOR THE FINANCIAL YEAR,

ending March 31. As previously indicated, the full amount of £675,000 had been transferred from the Consolidated Fund to the Public Works Fund, and all Treasury bilk had been paid off before the end o* the year. Unexpected expenditure had occurred during the year of £23,701 on account of the smallpox, and £90,832 on aoeount of the strike, and there was therefore

practically an unusual payment of £114,523 to be made in the past year. The smallpox epidemic and the strike had ahseriously affocted the railwav revenue, the year yielding £178,000 leas than the estimate. He was not going t speak of the strike that evening, but he wished to point out the astounding folly of interfering with the services of the coun.try, and bringing about a loss of £178,000 in rerenue in one year. Notwithstanding 1 the oost of the smallpox and of the strike, ' "and the effect of these two on the railway revenue, and on the revenues of other de--1 ■partments, it was highly gratifying to him ■ to be able to announce that the SURPLUS FOE THE TEAR "' would be approximately £400,000.—(Loud ' applause.) And the present Government '"' could rightfully claim that the surplus was "' calculated on a sounder basis than any sur- '•'■ plu» 'of the previous Ministries. It bad been • ' the oustom to include as ordinary revenue th> proceeds derived from the cash sales ■• ,of land, and to swell the surplus by, this unsound finance. He was pleased to say .-"that the present Government had stopped ~.",.this financially unsound practice, and the *'"'.' cash from sales of - land was now trans- "'; ferred to the Land for Settlement account, -"'■"'. or" to the Native Land Settlement account '""''The practice, too, had prevailed under pre- - "vious Administrations of erecting buildings .'.:': out of loan money, making no provision =■■; for. their' insurance against fire, and ™e- ... ..erecting them if they were burned down '-. „ out of loan money "again. This he had ',■'!■ stopped immediately he assumed office, and "'""he had provided £10,000 per annum out ''trf the Consolidated Fund for the replace'.niehf'of public buildings destroyed by fire. '"-'.Had he adopted the practice of previous *'■" Governments, he would havo been able . '>; .. to- supplement the surplus this year by ■i':: .£102,000 from ©ash land sales (roughly, and ;... subject to review), and £10,000 for fire insurance money, these two items making .;, a total of £112.000. Before leaving this ''"'subject he wished to say that the public ~'works expenditure this year was, approxi- ■"' mately, £79,000 more than last year, this f: year, it having amounted to £2,458,000. I,l ';■ LAND DEFENCE.

.. He wished- to say something on the ques--1 tion of ordinary land defence. There were ' & great many people who had been criti'J ' ri cising the scheme of Territorial defence, '"' ' and some had been criticising it on the <"*■ score of expenditure, saymg that the Government had no grip over the expenditure, "-.'and that expenditure was mounting up by ~ leaps and bounds every year. He wanted ' to say how grossly unjust it - was for Sir Joseph Ward to say, as he had said, that the defence expenditure was mount- ' ing up beyond' what it ought to 'do, because Sir Joseph himself wa6 respon- ' " sible for the expenditure in the first few ' 'years, and it -was the expenditure of those '•• fiitet few years that was coming to book • bow. Nearly the whole of the equipment for which he had been paying during the ; last few years had been ordered before he '< came into office. The increases were only due to the increased numbers to be trained, , and Sir Joseph Ward ought not to shirk ' 'his share of responsibility in tho matter of ' defence. Be (the speaker) did not shirk his ehare of it—(Applause.) They knew that last year the expenditure had been ' £505,000 out of the Consolidated Fund, and close on £24,000 out of the Public Works ' Fund. The appropriations for the year just ended exceeded both these amounts, but what ' ' about the expenditure for last year? The ' expenditure" out of the Consolidated Fund - was approximately £22,000 less than it was 'in the previous year, and the expenditure '* '-out of the' Public Works Fund was approxihiately £7000 more than in the previous year. Could they say now that the Minister of Defence had lost control of the deportment, and that the officer brought out to conduct the scheme had lost his control of ' the expenditure? They had not, because the 'expenditure for the y«ar 1913—14 was less ttran that for the previous year. " ' IMPERIAL OFFICERS. " Owing to a remark of his some time ' "ago to the effect that he hoped that the day .' would come when they would be gradually able to reptoee the English officers by New Zealand officers, an article had appeared itt a newspaper in Auckland criticising in the most severe way the English offioers in New Zealand. That article was unfair 'and unjuet, and it was right for him ■9 Jlinister of Defence to say publicly and

openly that he repudiated every line of it. Taking them as a whole the officers who came out here were- an exceptionally fine class of men, especially tho general who had been advising them. Thoy knew his tact and energy and the ceaseless work he put into the scheme, and he was bound to say of his staff that, as far as ho knew them, thoy had given of their best, and that their best had been' a good best. They had been a credit to the English army and a credit to New Zealand and its scheme. For all that, however, they all hoped that they would be able to replace thorn in time by training up men of their own country. To-day there were training in the Military College in Australia some 28 young New Zealanders, who were getting a training that he was assured was the finest in the world. Ho hoped they would oome back fit and willing to carry on their duties. —(Applause.) OTHER DIFFICULTIES. He knew perfectly well that tho demand made on tho public by • tho scheme might often press on individuals and often nit them hard, but the essence of the whole thing was that they had tried a scheme of volunteering, and tho timo they gave was not sufficient for the training they ought to have received. Immediately they began to talk about increasing it. came the question of who was to mako sacrifices to equip himself to defend his country. Tho principle was adopted that, if the country wo* worth defending,' then it was right that all of a certain age should give exactly tho same sacrifice in the interests of their country.—(Applause.) That wae tho basis of tho scheme. Ho knew it was hard on some, but there wero some exempt altogether under the Act, and some could claim exemption on account of religious objections. Some, on whom eervice was a hardship, had the right to go before a magistrate and seek exemption, and he ventured to say that the alterations made in providing for detention instead of for imprisonment had been a big improvement upon the scheme.

NAVAL DEFENCE. The whole question with regard to naval defence had had to be reviewed. Tlicy would recollect that under tho old arrangement they had an Australasian squadron, and for years Australia and New Zealand were paying to tho Mother Country a subsidy which went into the common pot, so to speak, of the Admiralty, and was not allocated to any particular function—tho Pacifio or elsewhere. Australia had departed from that arrangement, and the subsidy schemes as previously arranged had also come to an end. Therefore there had to be a new arrangement. When Sir Joseph Ward was at Home in 1909 it was resolved that the Admiralty, Australia, and New Zealand should make a beginning with a Pacific fleet of the Empire That fleet was to consist of three units—one to be constructed by Australia, the battleship cruiser of the China unit by New Zealand, and the East Indies unit and tho re6t of the China unit by the Mother Country. What was the position to-day? Auet-alia had fulfilled her bargain, and more than fulfilled it. Tho China unit—where was it? The battleship cruiser existed, anrj New Zealand had fulfilled her part of the bargain, but the East Indies unit was still in the skies, and not a stick of lit existed. That part of the bargain had not been carried, out by the Mother Country. Further, the battleship cruiser which was to be in the Pacifio seas was now in the North Sea. There was no more earnest believer than he was in the necessity of a strong force in the North Sea, but it was also necessary to make provision for the defence of the Pacific and of the trade routes in these parts. Now Zealand was now face to face (vith this problem: was it to go on paying to the Mother Country £100,000 or some other sum every year, and have no voice whatever in tho _ expenditure of the money, no representation in questions of peace or war, and no say in diplomatic relations or other matters? No self-respecting people could go on under such a condition of affairs. There were responsibilities, and there was a trade to be looked after. In New Zealand there was private wealth, the value of which was estimated at 258 millions, and a public wealth of the value of 78 millions, or a total of 336 millions. Further, there was a value of 48 million's of imports and exports. All that was worth looking after. Would anyone be satisfied to have all that protected by a portion of the fleet m the North Sea? Or were we to depend for the protection of our trade and the protection of our homes on a treaty with Japan? The thing was not reasonable for a people who had now grown to manhood. Instead of banding over £100,000 a year to the Admiralty the Government would utilise, ihat money 'in training New Zealanders on a training ship, so that in time they would be in a position not only to serve Now Zealand, but the Mother Country as well—(Applause.) It was true that the Prime Minister had told the country that if the Admiralty- would not send something better than the Pyramus and the Psyche, he proposed to ask Parliament to supply a "Bristol' cruiser for our own waters. The question the people had to answer was this: If New Zealand was to adopt a policy of handing ovor Dreadnoughts to the Mother Country, wero we -adding to tho margin of safety of the Empire as a whole, or were we relieving the British taxpayer of the building of a Dreadnought, that otherwise he would build himself?— (Applause.) His (Mr Allen's) business at Home was to find an answer to that and other questions, and he had come back to tell tho people the position. Was the taxpayer at Home ready and willing and able to build enough Dreadnoughts to protect the North Sea and the Mediterranean? In reply, he said, emphatically that responsible men in England had stated publicly and otherwise that the British taxpayer was able to dq that and more. If so, why should we put our hands into our pockets to save him from doing that which it was his duty to do? It was ouv place to take our share of Empire defence, and it came to us in tho sphere about our own home, and we must do what was proper _ in protecting tho pathways of trade in the Pacific—(Applause.) No member of the Government had asked the country to

launch out into heavy expenditure, and nothing of the sort was contemplated. Ho did not look to the day when New Zealand would ever have to build battleshipcruisers. We did not want battleshipcruisers out here. Wo wanted something waspish—something that would sting out here, and would keep away any who thought of interfering with our commerce. Such a thing could t>o procured at much less cost than most people thought. That was their scheme.—(Applause.) It was our business to train some of our men for the

Imperial navy. Ho believed we would enter upon a consultation with Australia, and he hoped that that consultation would, step by step, embrace New Zealand, Australia, Canada, Africa, and the Mother Country, and would lead to centralisation of control, the.effect of which would be to protect our shores and keep ue what we hoped to be—a supreme nation. COST OF NAVAL DEFENCE.' Speaking on this subject, Mr Allen said that nothing could be gained in a discussion of such vast importance to theMothcr Country and the dominions by inaccurate or misleading statements en the part of prominent public men. He would deal presently with the cost—present and future—of the Government's proposals, and show that those opposed to the scheme had not only drawn on their imaginations, but had also made most palpable blunders in their statements as to the oost of the Commonwealth scheme, and, where actual blunders had not been perpetrated, they had made misleading statements, which, unless corrected, might prejudice the minds of the public. The debate on the Naval Defence Bill took place in Parliament on December 3 last, and Sir Joseph Ward, criticising the proposals of the Government, drew attention to Admiral Henderson's report, and to a report by Senator I'caice, on the cost of the Commonwealth scheme, and made the most inaccurate and misleading statements. Nor was there any excuse for him, because his speech was reported in the official journal, Hansard— a speech which ho had the opportunity to correct, and for which he was responsible to the public Ho (Mr Allen) rad. never read in the speech of a public man ar.ywhere so many errors as appeared in that speech. On nearlv everv page, from page 477 to 487, occurred blunders and rnisrepre--sentations. He had time to allude to only a few of them. On page 477 Sir Joseph Ward said: "He (Admiral estimates that the ordinary cost to Australia would be £25,290,000." Theso figures overstated Admiral Henderson's estimate by £2,000,000, the actual amount being £23,290,000, ,as shown in Admiral Henderson's report, at page 66.. There was also a misleading reference to the ordinary ccst. It was difficult to realise what the general publio would have in their mind when reading the ordinary cost, but he felt sure they would not know that Admiral Henderson referred to the estimated initial cost of the whole fleet, extended ever a period of 22 years. On page 478 of Mansard (December 3) Sir Joseph Ward said: "The annual cost for maintenance, alone of one cruiser of the Melbourne class runs into £100,000 per annum, without the cost of the personnel." This was entirely wrong. Sir Joseph Ward had not understood the difference between a .Melbourne cruiser and an armoured cruiser, like the battle-cruiser' Australia, and had quoted the maintenance of the latter Admiral Henderson gave the maintenance of a protected cruiser as £25,000 per annum, and not £100.000, as stated by Sir Joseph Ward. I The Melbourne cruisers were of this type, but somewhat improved. The most seri-

ous blunder occurred on page 481, in what purported to be a quotation from Senator Pearco's memoranda.. Sir Joseph Ward said: "The land military expenditure, under the heading of what they call 'Central Administration Votes,' amounts to £3,089,107, and the naval expenditure, as I have already quoted from Senator Pearco's report of the same date, amounts to £5,400,933—a total for one year of £8,490,040." This overstated the amount by £3,051,676, and the blunder Sir Joseph Ward had made was that he had taken three years' naval expenditure, and counted it as one year. Anyone referring to page 4 of Senator Pearco's memoranda would see the naval expenditure for 1912-13 was £2,349,257, and the figures Sir Joseph Ward gave as one year's expenditure included this amount and the exoondituro of two other years as well. But, oven if Sir Joseph' Ward had used tho correct figures, his remarks would have been misleading without the explanation that tho Commonwealth did not borrow monoy to construct its ships of war, but builf them out of revenue, and the estimate for 1912-13 — namely, £2;349,2s7—included not only maintenance and general expenditure, but the construction of ships as well. Indeed, he had been informed by Senator Pearco himself that, included in the £2,349,257. wore sums of £1,196,829 for construction, £208,050 for works, and £175,000 for tho naval agreement, leaving only £657,378 for maintenance, personnel, administration, naval compulsory training (thev had over 3000 naval trainees), and all other charges. He had by no means exhausted tho mis-statements made by Sir Joseph Ward in his speech, but he could not afford to waste more time over them that evening. Ho would tell them what tho scheme of the subsidy people was. At tho Imperial Conferenco in 191], Sir Joseph Ward advocated a levy of 10s per capita for naval dofenco alone. That was to say, New Zealand would provide ovor £500,000 for naval defence under the scheme. Further on in tho conference ho, urgod that tho British dominions should provide £6,500,000 a year to buy three battleships oaoh year. Then, on second thoughts, he hesitated about building three cash year out of revenue, and proposed to borrow 50 millions to construct 25 dreadnoughts within fivo years from 1911, and he also proposed that three of these 6hould be provided for Australia, six for Canada, three for South Africa, two for New Zealand, ono for Newfoundland, and 10 for the British navy. That was in 1911, but in the debate in the House in 1913 he again modified his proposals. Speaking on tho naval Defence Bill on December 3 (Hansard, pnge 485) he said:—"l should incomparably like to. see the Government come down with a fixed and definite amount and so let us know where we are, and say to the Old Country 'We will give you another Dreadnought at a cost to \is of £140,000 a year, including interest and sinking fund, or give still another at a further cost of another £140,000 with interest and sinking fund, and, thus be aware of the actual extent of our financial responsibility." Calculating this later proposal of (Sir Joseph Ward's, the expenditure would be found to bo: —On the present subsidy, £100,000; cost of the present Dreadnought, £140,000; cost of two more Dreadnoughts, £280,000; or £520,000 per annum, and in jthe wildest dreams of the present Government it had never suggested, and did not suggest, such an expenditure as this under its proposals. The Philomel would bo handed over to us in tho course of a few months, and the naval adviser who would command her would bo with us in the course of a few Weeks, vHe was pleased to announce that |4he Admiralty had selected Captain Hall Thompson to be commander of the Philomel. The appointment would be for three years, terminable on either side. Ho did not know Captain Hall Thompson, but he was informed that he was a comparatively . young man, and a man with a brilliant career and likely to do splendid work in New Zealand when he took command of the training ship. When the men training on the Philomel had passed it was arranged that other ships in New Zealand waters would be open to them for further' training. Tihe arrangement was , wider, as the whole of the British Navy was open to these men and the officers. New Zealand statesmen- must fee! that they had a right to take some interest in the expenditure of their own moneys. They had the right to know what was "being done with their own fellow countrymen who were being trained for the Imperial Navy. He believed that the policy which had now been adopted was a sound one. He commended it to them with more mature judgment than was possessed by those' who had been criticising their policy. . At any rate, it was a policy, and they would not say that of the suggestions which had come from the other side. He wished to say before closing that the Government's Jdeal was that there should be one Imperial Navy, to which New Zealand would contribute-its quota of men, and, by and bye, if necessary, of ships. '! . ,' A REPUDIATION. Ho wished to refer to tho gross impropriety of a'public man making such baseless and incorrect appeals to people as Sir J. G. Ward did at Greymouth on January 14, as reported in the New Zealand Times m Wellington on January 15, when he said: "They had carried a law to change the existing law, and the men and women of New Zealand were no longer directly protected by tho British Government." Who for one moment, pursued tho speaker, would believe that to be true? The Admiralty was perfectly willing to protect New Zealand, whatever policy she adopted. Not only was England willing to do it, but England deemed it to be absolutely her duty. He repudiated that kind of talk coming from a responsible public man. He had a firm belief in his own country and some sentiment with respect to New Zealand, and he 4Kd not think that it was to remain for ever simply under the heel of ' the British Admiralty. He wanted to feel that New Zealanders might have some say in Imperial concerns. There was no road to it unless they determined to utilise their own abilities and mind and brains as responsible statesmen ought to do.—(Applause.)

- CONCLUSION. There was much that he had to say, but he would return later on and expose the shallow' criticism of those who said that the Government did not fulfil its pledges. It was true, ae he had hinted, that everything they had promised had not been carried out. Time had not permitted it, but he ventured to assert that Mr Massey and his Government had utilised every moment of their time in the interests of the country At subsequent meetings he would deal with the strike, with education, and other questions. 'Mr Allen closed by thanking the people of Bruce for the many years of confidence they had reposed in him, and by remarking that ho-hoped that he had done n:s dutv as their representative. He had not shirked work, and, as far as he woe able to judge, work was doing him no harm.— (Applause.) . , A number of questions were asked ana answered. , Mr J. Lockhart proposed that a vote ot thanks be. accorded to the Hon. Mr Allen for his able and instructive address, and that this meeting expresses continued confidence in him as member for Bruce, and the Government in which he holds the responsible offices of Finance, Defence, and Education. Mr W. Hitchon seconded the motion, which the chairman declared carried unanimously.