Parliamentary.

Thames Star, Volume IIII, Issue 1732, 22 July 1874, Page 2

Parliamentary.

The Financial Statement. [By Tblegbaph.] . Wbllingxon, Tuesday. Tho Hon. the Premier (Mr Vogel) made his Financial Statement this evening. In the following abstract of it amounts are stated in round numbers :— Mr Vogbl said that the Statement would hot only be shorter than usual, but it would be unprecedented on account of the prosperity which it evidenced. The Statement was made at an earlier period than had been customary; a result for which he was indebted to the untiring exertion of the Treasury officers in preparing the accounts. Last year it was anticipated that the actual results of 1872-73 would leave a surplus of £3,800 with which to begin tho year; but it proved that there was a difference of'£6,ooo as compared with what was anticipated. This arose partly through under estimating outstanding liabilities, and partly from some assets not being realised; the result being -that instead of a surplus of £3,800 there was a deficiency of between £2,100 and £2,200. As to loans, it would be remembered that during the last session - an announcement was made that fire per cent, debentures to the amount of half a million Had been .sold* 1 at £2 10s premium. In January last the loan agents invited tenders for one million pounds at four and a-half per cent. He had been favourable to the change to 4 per cent, but he approved of the action of the agents, since they had inserted a condition that the debentures might be retired at any time after 5 years. The half-million borrowed at 4£ per cent, interest realised £98. Making allowance for redeeming the discount, this was tantamount to borrowing at the rate of £4 12s 6d per cent. It was originally calculated that money for the immigration and public; works policy would have to be borrowed at 5| per cent. It was gratifying; therefore, to know that the average rate of interest on the loan for those purposes yet negotiated, including allowance for recovering discount, amounted only to £4

14s lid per cent. It was right that he should say that the market for colonial loans was not so favourable last year >as seemed to be then promised. There was not then a demand for such debentures ; in the colonies. This arose through the demand for capital for local enterprise, but it had to be borne in mind in considering the question of the borrowing powers of the colony. The aggregate amount of the public debt, after deducting sinking fund accrued, was £12,500,000, and the annual charge was £777,000, of which £554,000 had to be paid by the colony, and £223,000 by the provinces. After explaining the position of the various loan accounts, Mr Vogel referred to the land fund. This, he said, shewed a remarkably progressive increase. During the year 1869 70 the receipts, exclusive of gold revenue, were £209,000; 1870-1, £209,000; 1871-2, £336,000; 1872-3, £889,642; 1873-4, £1,138,000. The Post-office Savings Banks' account showed an increase of deposits of £137,000. The total deposits in those banks being now 682,000. The revenue of the past year exceeded that of 1872-3 by £300,000; and it exceeded the estimated amount by £239,000. This result was very large when the proportion it bore to the whole amount of the revenue was considered. He could not state accurately the increase that had resulted from the substitution of ad valorem' for measurement duties, as there had not yet been sufficient time to classify the returns, but there could jbe

no doubt, that the new duties produced more largely than the measurement, duties. He waa glad of this both oh account of the result, and on account of the testimony it bore to the honour ;and truthfulness of the commercial classes of the country; Me; emphatically expressed the opinion that taxation had not > pressed harshly on the bulk of the' people, and that under the new system the duties had been more evenly distributed over articles of luxury 1 than was the case formerly. After deducting expenditure and liabilities, as well 'as allowing £20;000 for liabilities yet to come in, and, paying off £45,000 of Treasury:bills, there was a balance at the end of 1873-74 available for the service of the current year amounting to £207,000. After .explaining at some length the position of the railways, Mr Vogel said that the revenue of the country was increasing simultaneously with the introduction of immigrants and the prosecution of public works, that there could no longer be any doubt as lo the success of the policy, and the colony would be quite safe in taking over the main trunk lines of railway whenever it might be found convenient to do so, and in relieving the provinces from all liability on account of those lines. Apart from the revenue which it was now treating would ibe derived from the railways in excess of working expenses, the consolidated revenue of the colony had during the last two years increased by £412,000, or within a few thousand pounds of the total annual charge which the railways when completed from one ■end of the colony to the other would entail. It must be pointed out, however, that further authority for borrowing to complete the railways would have to be given. However successful the immigration and public works policy might be, it must be remembered that it was necessary to meet the colonial requirements before straining the credit of the colony for other purposes. Tbe consideration of the fact ot the railways being pushed on more quickly than was originally intended, and of the fact that

it was desirable to encourage largely the construction of other works, impelled the Grovernment to decide not to renew their proposals of last year as to provincial borrowing. The Government were prepared to allow a limited amount of assistance to the provinces, but such assistance to be rendered through the Colonial Government, and to be charged either against the amount for the settlement of immigrants, or upon the Consolidated Fund, but with power to tho Government to issue Treasury bills if found necessary to meet it. As to the assistance to be given to separate provinces, Mr. Vogc] said—First, in regard to Auckland the Government during the recess undertook to ask Parliament, to; allow the province to raise £50,000 to be ad* vanced from time to time, extending over a period of three years, for work's upon tho Thames, gbldfield. The security in this case, besides that of the province, .is of, a specific and la'ge nature, and the importance of the object to be gained is not to bo denied: The Government besides agreed, subject to the .approval of Parliament, to advance to Auckland, on Iho security of one-half of its lands revenue, to be impounded for the purpo?e, £40,000 in sums of £6000 every three months. The Government propose to ask Parliament to carry out. these arrangements. We do not . propose to ask for Auckland any further loan, beyond the power to devote some part of the immigration funds to objects directly proinotive of the settlement of immigrants Taranaki, with its splendid land, offers, a field for tho location of immigrants second to none in the colony, and we shall' ask for power, to advance money to aid so essential a work. Similarly we propose to devote some funds, to Weitland and to Kelson. In respect to these four prrvinces it is to be remembered that they have not as yet enjoyed so much of the direct benefit from the expenditure on emigration as they. should be supposed to hare the right to claim. Still for money expended .on works we propose conditions, for repayment I may~ add, also, that whilst we should require the approval of the Provincial Governments to any work undertaken, we propose that the works shall be carried out under the control or with the approval of tho Public Work* department.' What I have said, of these other, provinces in

respect to immigration applies equally to Marl borough. We shall propose for works in connection with the location of immigrants advances extending over two years, besides a loan of £4,000 to bridge the CJarence River. In regard to Wellington, hon members will no doubt hare observed from the correspondence that Government, during the rece'as, endeavoured to induce Provincial Governments to re-' duce the amount of borrowed money they desired. We agreed to submit for the approval of the Assembly a proposition to allow Wellington to obtain an advance of £66,000 on 80,000 acres of land, to be opened for the free selection of small settlers. We shall ask that this plan be •arried out, I may also mention incidentally that we propose to ask authority to construct proper Government buildings in Wellington. Nelson's case is the most difficult to deal with. That province has long lagged behind in the.race that other provinces have run. It x requires twofold works, of which it is singularly, destitute, and we propose to lend to it on specific se-, curity, £50,000 for works which tne Publio Works Department approve. From Otago, also, the cry for borrowed money has come* We cannot see our way to at present sanction the large sum that province asks for, unless by way of purchase of the - Winton and Bluff line. If the Provincial Government are willing, we will be.^prepared to propose to the Assembly to purchase that railway at valuation, the payment to bo made in four equal instalments on the Ist February next, and the

Ist February of three following years, the money to be devoted to the construction of branch railways; otherwise, in respect to Otago, and in, respect to Canterbury and Hawke's Bay, X .have only to say we propose to continue their trunk railways, and to aid them in locating tbe immigrants they so wonderfully absorb. * The: Government proposed not to undertake any further goldfields ' works until some of those already .begun had been' completed. They proposed to appropriate an additional £60,000 'for roads in the North Island, and to coni tinue the same .plan as formerly by. alloting to the Middle Island provinces a like amount —of the sums that would thus bo familiarly explained by the slaughter of the bird which lay* golden eggs. As a mere matter ;of policy it is wise, in the midst of the immense increase of .the colonial revenue, to specially remember some of the provinces which - contribute it, and which are at present at a great disadvantage as compared with other provinces. It is not wise to let parts of the colony languish under a^ seme of wrong, to allow them to feel they are still becalmed whilst the, favouring Breeze removes from their sight the vessels originally becalmed with,them. The condition of the three provinces of , Auckland, Westland, and .Nelson, as compared with the other provinces is , lamentable, and requires from the surplus of the consolidated revenue the attention of the legislature. Auckland's case is far the worst. It will take that prorince some yrars to work itself round and to enjoy the future which I firmly believe is still before it. Westland has proved a mine, of wealth to the colony. It is folly to desert it 1. The West Coast of Nelson is somewhat similarly .placed. Nelsqn will, however, now have a means, as it appears its rulers have the inclination to use those means to become a prosperous province.,. These considerations impel , us to recommend that out of the year's surplus a special allowance in addition to that already provided by, the scale of capitation allowances be made to Auckland, Westland, and Nelson, •# th« rate 1

of £25,000 to the first, £10,000 to the second, and £5,000 to the third. When hon. members study tho whole of the circumstances they will not, I think, begrudge tho proposed aid. Passing on to tho,-- expenditure for the current- year 1874-5 ho said that the essential principle of this budget was different from that of any previous one, in it« great object being to prevent the G©vernment recruiting lerenues by resort to borrowed moneys. In fact, the present budget had for its object to relieve loans at the expense of the consolidated revenue. He proposed this year to take over and to charge upon consolidated revenue all the cost of interests inclusive of interest upon works m course of construction, for which other provision bad been made; he proposed also to, bear oh the consolidated revenue half of defence expenditure and half the amount paid as subsidies to Eoad Boards. •Further, he proposed to pay off p additional. £100;000 of Treasury, bills. • >Takine^ into consideration .the number of officers of the Civil, Service who :were in- • dined to leave the service on account of opportunities to benefit themselves, and the hardship to which they were subjected through the incroased cost of living, the Government had decided to recommend, as a matter of expediency no less .than of justice, that a special allowance should this.year bo made of ten per cent to all officers whose salaries did not cxl ceed £150 a year, 7^ per cent, ta al officers whose salaries.exceeded £150 ' but did not exceed £300, and of 5 per cent, to all those whose salaries exceeded £300 but did not exceed £500. To do this would absorb £15,000 of the surplus. Adding these various items to the amount of the capitation grant, the special allowances to the provinces as well as the ordinary expenditure and permanent charges, the total expenditure for the current year would be £1,630,000; this would include &271.000 : to be devoted to the reduction of Treasury bills current, and to the payment of amounts which might, under existing authorities, have been charged t» loans, thus justifying the statement he had made, that the main feature of the budget was to relieve loans at the expense of the consolidated revenue. He should ex.plain, when he made his immigration -statement, the further votes that would be required for immigration and for railway, purposes. His colleague, the Minister for Public Works, would in a day or two .explain the various circumstances respecting the construction of the main trunk, lines. He must, however, state that what he meant to include, when he spoke of main trunk lines which the colony would be justified in accepting 43 colonial lines where those lines which had been already authorised,, together with such other lines as would complete existing gaps between Kaipara and Auckland, New Plymouth, Napier, and Wellington, as.well as those necessary to complete through communication between Pieton, Nelson, Hokitiki, North Canterbury, and the West Coast. The total revenue for the year, estimated with moderation, was £1,496,000, in addition to this the surplus with which the year was commenced, there would be a total of £1,704,010, and deducting the total expenditure, there would be a surplus of £66,000. It must be remembered, however, that that surplus was liable to be largely trenched upon by supplementary estimates. In conclusion Mr. Vogel urged that while the country was confidently pursuing its policy of -progress they should wisely husband its strength, and not have larger recourse to borrowing than was absolutely necessary for carrying out the policy which the House and the people had adopted. Progress was reported and leave obtained to sit again. The House adjourned at half-past 9.