The Daily News. THURSDAY, MAY 2, 1901. FEDERATION.

Taranaki Daily News, Volume XXIII, Issue 87, 2 May 1901, Page 2

The Daily News. THURSDAY, MAY 2, 1901. FEDERATION.

In a recent issue, when referring to the question of Federation, we mentioned that the financial aspect of the question was causing considerable uneasiness in Tasmania, and pointed eut that indapeudaetly of all other considerations, the financial losi to both Tasmania and Few Zealand would probably be very gre'tt, and was a matter requiring very careful consideration before this colony committed itself in any way. The Melbourne correspondent of the Auckland Star giyrs some interesting information in regard to Federation matters. Tasmania (the comsppndunt states) has been brought face to face with serious financial difficulties in its State aSaii s through the loss of control over its Customs and Excise du'ies taken over by the Oommonwetl'h Government. The position is this—that if the Federal Government adopt a medium tariff there will be a deficit in the Tasmaniau State bulance-f-he-'t, variously est'ma'ed from .£IOO,OOO to £150,000 ayear, whichmust be covered either by retrenchment or direct taxation, -unless tie State choices to appeal in forms piuperisto the Federal Qoyernment for help, which its leadiog statesmen are indisposed to do. This however, is not the worst of their difficulties, because even if the d- fic t cm be provided for, ab olutely nothirg remains to cirry on tie public work, and sjme prominect pubic men declare that it will bo a j.o?d thiDg f jr the roun'ry if further (xpenditu' e in th is direction is suspended for several years. Others fear corame'chl dis stir and stagnation as the reult of a> y sudden t-r----mir a ion cf a source oF employment on which a coisHerabla pe cen'age of ths population dependid. TheTaemanians ato viguely awa r e of the difficulties ahead of them when they joined the CoramoiweM, but as Austra'ii furnishet the cbi-f mnk t for their produre, th y h id liit'e option but to go in at »ny c® 1 , an! tht y hope to reap some co'iip?Dßation fiom the latter <r de openei up in this direction. New Zealand's probable financial loss biing« up a serious qu"st on, the estimate* made differing very widely as to the effect of surret,derir g the customs. Id an aiticle on the subject appearirg in the Sydney raily Telegraph, the writer, who is recognised as one of the principal financial authoiitiea in Australia, p'.acrs the amount at £350,000, which would have to ba mide good out of the pie«ent surplus or by d'reet taxation. This, however, in tha case of Tasmai i t woul<) leave New Zealand to make piovlsion fur all future State loans on the secuiity of direct taxation in some form. Tito fstima f e is bised on the following total* : REVBXUES TItANSFSPRED. Customs and Excise .. £2,190,000 Post and Telegraphs .490,000 Other (say) .. .. 20,000 Total £2,700,000 Expenditures Transferred. Defence £150,000 Post and Telegraphs ~ 390,000

Custom* .. .. .. 75,000 Property transferred (interest at per eenK ; up-kiep 1| par cent.) .. 110,000 Other (say) .. .. 75,000 £BOO,OOO Excess of revenue transferred £1,900,000 Toial .. £2,700,000 1 lie writer s'jts down the probable Commonwealth tariff (including New Zeiknd)at £10,600,000, and the return to New Zealand bassd on present figm ©a at £1,550,000, at under : - Proportion of £10,590,000 tariff eoll'C'ed in New Z aland .. .. £1,950,000 Less Commonwealth require- , mantsabove.. £290,000 Proportion of new expenditure.. 110,000

Balance returnable .. £1,550,000 Tho correspondent goes on to show the uneertiin condition of the ground that has to be trodden on. It is evident, he states, thitjfls the work of tha Commission proceeds, that its rep rt, will present tho question of New Zealand's r<d.it*on to the Commonwealth in some impirtant lights which have not yet been bt onght under the not'ee of New Zealand students of the subject. It seems doubtful indeed whether even the leaders of the Federal movement in Australia have any clear conception of how the financial clauses of the Commonwealth Act will work out in their bearing upon the finances of tho several States which differ very wide'y in their character and requirements.