PUBLISHED DAILY FRIDAY, APRIL 13, 1894.

Taranaki Herald, Volume XLIII, Issue 9977, 13 April 1894, Page 2

PUBLISHED DAILY FRIDAY, APRIL 13, 1894.

-•■ - — - It is now about eight years since we first suggested the "Consolidation of the Local Loans of the Colony." At that time the people of Oamarn, finding the rates, through the depreciation of the property in the town, were not sufficient to meet the interest on their loans, were seeking relief ; and the papers, from one end of the colony to the other, were loud ia the denunciation of the Borough Council of f\i „ irn for merely asking to be relieved of part of their excessively heavy burden by a reduction in the rate of interest. We were the only paper at the time, outside of Oauiaru, that defended the people there, and we suggested, at the same time, the consolidation of the local loans. For doing this, we were charged by several of our contemporaries with advocating " repudiation." and, amongst the papers which got rather hysterical over the subject, was the '• vening Post, who considered it most reprehensible on our part to even hint at such a thing. Knowing this, we must own we were somewhat surprised to see in our Wellington contemporary, of Tuesday last, the following paragraph: — "We are exceedingly glad to find the Dunedin Harbour Board endeavouring to impress upon the public mind the desirability of consolidating the loans of local bodies. We have frequently pointed out the great benefits which would result from such a proceeding, and shown how much greater and more generally diffused these would be than any which could attend the adoption of the harebrained Ministerial 'cheap money' scheme, while there would be none of the attendant objectionable and d : sad\antagcous features. The consolidation of local bans now offers the greatest achievement open in this colony to tho ability of the statesman and the skill of the financier." The last sentence is so strikingly like one we published on Octobci 20th, 1886, that we cannot refrain from quoting what we wrote at that date. We then said, " The question of consolidation of the local loans of the colony may form one of the future schemes of the Colonial Treasurer who may be in office;" and on October 26th added "It may be a very delicate piece of financing, but not more difficult to accomplish we should imagine than the consolidation of the Provincial Loans in 1867." From the year 18G3 — a year of " financial intoxication " as it was then called — the colony has been gradually building up a National debt. In that year not only did New Zealand go in for a special loan of its own to the extent of £3,000,000, but the Provinces had borrowed to theextentof £1,900,000. New Zealand was not looked on with favor in the monetary circles of London m those days and found much difficulty in raising money. This was chiefly owing to the war gaing on with the natives, and the generally unsettled state of the country. Loans, however, were obtained, but at a somewhat costly price, for in 1867 when it was proposed to consolidate the debts of the colony, we find that the total liabilities were £6,783,000 for which the annual interest averaged £7 3 s per cent. The outstanding liabilities at that time consisted of a Colonial debt of £4,482,000 and Provincial debts amounting to £2.229,300. To give some idea of what tho colony was paying for the use of the money we may instance a couple of Wellington loans amounting to £75,000, for which the annual interest was 8 per cent, with a sinking fund of 4 per cent ; and an Otago loan of £150,000, the annual interest being 8 per cent, and sinking fund 3 per cent. Of couisethe colony at the time denied its liability for the Provincial debt loan, as it does for the local debts at tho present time. In the bill brought down by the Weld Government in 1865, it was provided that the colony " should be effectually saved from loss and indemnified against all liability whatever on account of Provi icial loans "by requiring that before any Provincial loans should be brought under the operations of the bill, ample securities should be taken by the general Government from the Provinces. Further than this it even went, for it prohibited the Governi r from authorising the conversion if Provincial bonds- unless the xr General gave a certificate that the security set apart i y tlie Proviuces was sufficient to meet future payments for interest and sinking i'und. Tho Government was very conservative iv those days, and was the means of preventing the Provincial loans being quoted on the Stock Exchange in order that the non-liability of the colony for these loans shonld bo recognised at Home. It was found, however, that notwithstanding all these precautions, the colony could not borrow on better terms than the larger provinces, and the General Assembly had to Acknowledge at last, that to obtain loans on move favorable conditions it was necessary to go into the Money Market as a united colony responsible as a whole for the debts. The effect of tho consolidation of the General and Provincial Go vornment debts was a great saving — in fact £50,000 per annum was gained, and if the Government at the present time could consolidate the Borough and Harbor Loans, setting freo the sinking lunds and equalising the interest, it would not only give an impetus tj the colony, and be a large saving to the districts, but would tend to raise tho value of the land. It is not the first time by many during the last eight years we have advocated, not only the consolidation of tho loans, but the consolidation of the reserves of the colony. We, however, have not space to-day to go deeper into this question, but as the subject has been agaiu re-opened, we may have something more to say on it at an early date. Captain Edwin wired at IMb p.m. today :—": — " "West to south and south-oast gale with rain and heavy sea and much colder weather after 12 hours from now ; glass rise.'' There are only four cases set down for hearing at the Supreme Court sittings to be held on tho 18th instant. For tho socond time tho contractor for the earthwork at tho Liardot-stroet bridge has been delayed in his operations. The present difficulty is on account of the railway authorities having provided no wings to keep up tho embankments, consequently the earth rolls on to the line, and has had to be removed by a man with a wheelbarrow.