The Timaru Herald. THURSDAY, JUNE 20, 1895.

Timaru Herald, Volume LVIII, Issue 1785, 20 June 1895, Page 2

The Timaru Herald. THURSDAY, JUNE 20, 1895.

A day or two ago we received a special copy of the British Australasian and New Zealand Mail, and on looking at the wrapper we noticed the stamp of the Agent-General's office. We speedily discovered why the paper had been sent. It contained a full report of Mr Ward's speech before the London Chamber of Commerce, and a leading article under the heading "New Zealand vindicated." The report of the speech is far the fullest that we have seen, and we naturally . turned to that portion of it m which Mr Ward referred to the unpledged securities held m London for the New Zealand Government at the time when he persuaded Parliament to consent to the levying of the land tax four

months before the proper time. Of course we had m remembrance the cablegram on the same subject and the reports furnished by the London correspondents of two or three of our contemporaries, concerning which we recently had an article. But m the British Australasian we at length had what might fairly be regarded as an official or at all events an accurate report, or it would not have been circulated from the Agent-General's office. We found the paragraph relating to the unpledged securities, and it was word for word the same, or nearly so, as the paragraph m the reports supplied by the newspaper correspondents. We republish it again as a text for a few further comments on its contents : — " Instead of being hard up for cash, at that time we had lying m London, and we have got "them still, some £3,000,000 worth of unpledged securities of New Zealand, against which at any moment we not only could have raised the interest falling due, but could have got twice or three times the amount, if it had been necessary to do so. Two millions of these securities were sent home by myself previous to the financial crisis which swept over Australia. I believed it was necessary to be on the safe side m London, and I sent those securities here m order that our position Should be rendered free of risk." We do not want to go over ground that we have traversed before, but it is necessary to repeat that of pledged and unpledged securities, the property m London of the New Zealand Government at the time when Mr Ward asked for the earlier payment of the land tax, the total amount was somewhat more than £2,000,000, and that of that sum all that was unpledged was about £470,000 of debentures guaranteed by the Imperial Government. As we have already pointed out more than once, Mr Ward was altogether wrong ; but since we last wrote on this subject, another and most important consideration has been brought under our notice. We confess that it did not strike us until it had been given prominence to by our Wellington contemporary, the Evening Post The point is that, m the securities m London, upon which, according to the Colonial Treasurer, money could be raised at any moment for payment of interest on the public debt, or indeed for any other purpose for which he might require funds for the service of the colony, he included securities pledged already to the Sinking Fund Commissioners, the Public Trust Office,- the Government Insurance Department, and the Post Office Savings Bank. In fact, though Mr Ward did not tell the London Chamber of Commerce bo, he assumed the right of using trust funds for the service of the colony. Take any one of the Departments which we have mentioned, and see how the matter stands. For instance m March, 1894, there were m London debentures representing £494,300, belonging to the Government Insurance Department. The Government had borrowed that sum from the Department, and the debentures represented the money. What claim could the Government have over those debentures ? And yet they were undoubtedly included m the amount which Mr Ward told the London Chamber of Commerce was available for payment of interest on the public debt. On the whole question the Evening Post forcibly comments as follows : — " Has it come to this, that the investments of the Government Insurance Department for example, are deemed by a needy Colonial Treasurer unpledged securities ? If so, all security m the Government Insurance Department will soon be at a low ebb. What insurer is going to trust his money to this Department if the Colonial Treasurer treats the debentures it holds as unpledged securities belonging to the Government ? If this statement of the Treasurer be not at once repudiated, the result must be very serious to the Government Insurance Department. Who would be safe m insuring ? Then the Public Trust Department is m an exactly similar position. Its funds are supposed to be invested. If its securities, bonds, mortgages, <fee, are all to be deemed m the eyes of the Government 'unpledged securities,' who would place any money m the Public Trust Department ? And the same will apply to the Savings Bank. These statements by Mr Ward are not only not true, but they must be injurious to the Government Insurance, the Public Trust, and Post Office Savings Bank Departments. We have already dealt with his alleged reason for the collection of the Land Tax, by placing m contrast what he said m London with what he and the Premier said m Parliament when asking authority to collect the tax. We do not suppose that anything Mr Ward said m London had any effect m floating our last loan. With millions m London seeking an investment, and £8,000,000 invested m West Australian goldfields, it is not wonderful to find a New Zealand loan run after. The fact, also, that the Bank of England undertook to float it secured its success. But if any investor had bought our bonds on the faith of Mr Ward's statements, the colony would have been placed m a very unfortunate and discreditable position!" Perhaps it would not be so easy for the Colonial Treasurer to " collar " the trust securities as the Evening Post appears to think ; but on the supposition that Mr Ward knew what he was talking about — knew that almost all the securities m London were pledged for full value — his statement to the London Chamber of Commerce is evidence of what he would be prepared to do m a case of emergency, if he could lay hands on those securities.