THE NON-BORROWING POLICY.

Poverty Bay Herald, Volume XX, Issue 6691, 5 June 1893, Page 2

THE NON-BORROWING POLICY.

In an address to his constituents at Mataura last week, the Hon. Mr Richardson, ex-Minister of Lands, stated that the tapering-off policy commenced and carried out during the three years of the Atkinson Ministry terminated ou their leaving! office, and since then there had been a 4 ' piling on " policy. A3 regards charges upon the consolidated revenue, Mr Richardson said thab the expenditure under the control of the Government and tho House was greater by over L 20,000 last year than in the preceding year, whilst the expenditufeof the public works fund last year showed an increase of L 81.340 as compared with 1891-2, and an increase of L 137.815 over the amount in 1890-91, tho year in which the present Government took office. The member for Mataura said that he took his figures from tho Gazette, but he complained that the complete returns for the year were still withheld in defiance of the Public Revenues Act. Speaking of borrowing, he said that spacial powers had been obtained by the Government to borrow over L 700.000, and they had exercised it to his knowledge on two transactions alone exceeding L 600,000, and he hazarded the statement that moro 'than the remaining LIOO,OOO had been borrowed under the authority of other Acts. We will iff>t follow Mr Richardson in his figures, as the time is close at hand when the subject will be threshed out in Parliament. But it is not very comforting to hear from so good an authority as Mr Richardson that the Government has increased the public debt by L 700,000. Tho fact of tho money being raised in the colony does not materially alter the case. There is the br»ad fact that an additional liability has been placed on the shoulders of tho people. Porhaps, if wo are to borrow at all, it is better that tl_3 Government ahould not go outside the colony for the money, although there is something to be said about borrowing in the cheapest market. But, in any case, if there ia to be borrowing, the operations should bo carried on openly. This secret piling on of the national debt is highly objectionable. There are many shre.wd observers who believe that if the present Govern ment remain in power there will be a resumption of borrowing on an extensive scale within the next few years. If so, Ministers will greatly belie their professions. But Governments may always be trusted to adopt the most expedient policy, so future borrowing will depend upon the amount and kind of pressure that is brought upon the Government. There is danger in two directions. Ministers largely subscribe to the doctrine that ifc is the duty of the State to provide work for the people. Now, it 16 obvious that if there is any large glut in the labor market, works to meet the demand cannot be supplied oub of ordinary revenue, and the only resort will be the raising of fresh loans. The Government have already supplemented their means by raising money in this way. The other day the Post Office Savings Bank announced a reduction in the rate of interest on deposits owing to the difficulty of finding investments. The Government could easily remove that trouble. Maybe the reduction in the rate of interest is not altogether disconnected with certain financial operations Ministers have in view. Ib is well-known that the Labor party is not altogether agreed on the policy of non-borrowing. There is a considerable section amongst them who believe in a vigorous public works policy. We have always looked upon the professions of Ministers on the subject of non-borrow-ing as a concession to the other side in politics. But if the Government find that the great majority of the Labor party in the country are in favor of a more " enterprising " policy in tho prosecution of public works, Ministers are certain to do .he bidding of their masters. The other danger is the pressure from localities for railways and other works. At Duuedin a few clays ago, the Hon. Mr Ward was interviewed by an influential deputation, who urged upon him the great impDrtanco of constructing the Otago Central to completion. The deputation said they were not satisfied with an expenditure of L 20.000 to L 30,000 a year on the works, as at that; rate it would take too long to finish. The old argument was trotted out that the line would be of no service until carried to a certain point, and that when it was carried to that point the past large expenditure would be recouped. It was recognised that there would be difficulty in finding the money without raising a loan, but the deputation proposed that the Government should set aside L 20,000 yearly of pastoral rents, and ou this a capita] sum could be raised for the prosecution of the line. Assuming, the rate of interest to be four per cent, the rents sefc aside would be security for half a million. The proposition is decidedly cool, being nothing short of mortgaging the public lands to carry out the work. The Colonial Treasurer did not favor this idea. He told the deputation that the Otago Central would get a fair share of what was going. He said he could not promise more than that. However, ho recognised the importance of the object) and would make a personal inspection of the country to be served by the railway. The construction of this line could well be held over for many years to come. The present expenditure has been premature ; the farther the railway has been carried the worse it has paid. ■■ ■ ■ ■ - ■———