The Poverty Bay Herald AND East Coast News Letter. PUBLISHED EVERY EVENING. Monday, December 1, 1879.

Poverty Bay Herald, Volume VI, Issue 964, 1 December 1879, Page 2

The Poverty Bay Herald AND East Coast News Letter. PUBLISHED EVERY EVENING. Monday, December 1, 1879.

At the present time there are one million tw-o hundred thousand pounds sterling which have been entrusted to the State for safe keeping. Of this sum .£750,000 have been placed m the Savings Banks of the Colony chiefly by the working and middle classes, while £243,000 stand to the credit of the Government Life Insurance Department. But the whole, instead of being ready, as it should be, at call, has been replaced by Government bonds which it is ad- i m'tted may not be ready at call. Mr. Stevens m the House, now asks ijiow it has come about that this '"money baa been so disposed that it will not be at command immediately it is wanted. The answer is anything but satisfactory. We find that the T investments on account of the Government Insurance Department consist of the Treasury Bills of the Colony, while the investments on account of the Post-office Savings Banks of the Colony, with some few and trifling exceptions, consistof the bonds of the Colony. Mr. Stevens, speaking on the subject, said, "The question of .how these funds were to be dealt with was one of an important character. He thought it was desirable that such a subject should be investigated by what might be considered a specially-qualified body j and it appeared to him that the Public Accounts Committee, which would be appointed m a few days, would be essentially the right body to whom to refer the question. He was very anxious to m no way prejudice the views of the Committee by discussing the matter at the present time, further than to convey to the House the opinion which he held that the sub- . ject was one which might be very advantageously! considered. If the House agreed to this reference he would invite tho Committee to con-

aider whether it was advisable that these funds, taking into consideration their peculiar charactei', -should continue to be so so largely invested in the securities of the colony. He should then ask them to consider, also, whether it would be advisable that the securities of other colonies or any other established institutions should be taken instead; and he would also like them to consider whether a different course altogether in the way of treating tliese moneys, either wholly or in part, should be adopted. " Mr. W. J. Hurst considered the House and the country owed a debt of gratitude to Mr. Stevens for having brought under notice this important subject, for it had been to him a subject on which he felt very seriously. He knew of no question which deserved more consideration at their hands than that of how the money people had invested was dealt with. He scarcely dared trust himself to picture tho disastrous res'tlta thnt might follow from the improper investment of these funds. Mr. Hall admitted that the question was a very serious one. The deposits in the Savings Banks now amounted to three-quarters of a million, and, under the present conditions it was open to the whole of the depositors to demand immediate repayment of their deposits. He did not think this should be considered necessary. If the depositors had the security of the State he thought they should be content to submit to such an amount of notice for the withdrawal of thendeposits as would give the State a reasonable opportunity of providing the funds to meet withdrawals. We assure the Premier that people who have deposited moneys in the State's Savings Banks loill not be content to svhmit to any sort of notice when they have all along been made to understand that the sums they deposited j were to be always ready at call. It will be considered as a great and unconstitutional breach of faith. Mr. Hall went on to say that the length of notice the Government might insist on. should be in pioportiou to the sum deposited. Say for instance over £20 should require a certain notice ; over £50 a longer notice, and over a £100 a still longer notice. Mr. Kelly speaking of the investments of the people being invested in Colonial Bonds thought there were fitter securities. He referred to county loans and municipal loans, for which the securities were the rates and real property. He understood that trust funds could not ai present be invested in such securities, and it might be desirable that the Public Accounts Committee should consider whether it would not be advisable to allow these funds to be invested in securities * of the character he had mentioned. He thought himself that they were better securities than Government bonds, considering the rate of interest paid. The security, being upon real property and the rates of the district, with a sinking fund, was of a firstclass description. At the present time it was very difficult to negotiate small loans where the interest was limited to 7 per cent. He thought a question of this sort ought to be referred tothe Committee of inquiry. We also think this, and we are sure that the impounding of Savings Banks deposits for however short a time after withdrawal is asked, will cause great dissatisfaction, and will be creative of a feeling of want of confidence in the good faith of the Government.