Parliament Out of Session.

Star (Christchurch), Issue 5551, 24 February 1886, Page 4

Parliament Out of Session.

THE COLONIAL TREASURER AT AUCKLAND. [Per Presb Association.] AUCKLAND, Feb. 23. Sir Julius Yogel addressed a meeting of citizens at Auckland, in the Theatre Royal, this evening. The Mayor presided, and there was a crowded audience. On the platform were members of the Legislature, the civic bodies, and a number of leading citizens. The Hon J. A. Tolo, Minister of Justice, was also present. On coming forward, Sir J. Yogel was well received and greeted with cheers. Sir Julius commenced by saying that he looked on the present year as a very important one. In what he was about to say to-night, FINANCIAL QUESTIONS would mostly crop up ; his object had been to restore equilibrium between revenue and expenditure, to relieve loans of some of the expenditure cast on them. The borrowing for non-productive purposes had been excessive, the railway expenditure had only been ten shillings in the pound of the amount borrowed, the expenditure on roads and bridges out of borrowed money had largely increased for the three years ending March, 1885. The expenditure on roads and bridges out of loan money had been .£856,000, whilst out of the consolidated and land revenue it had only been, for the three years, a total of £10,212. His desire had been to adjust revenue and expenditure so as to enable him to say " now the Colony is in a position to vigorously pursue its public works." He proposed an increase in the CUSTOMS TARIFF, which, for the portion of the year yet remaining, would have yielded about £700,000, or at the rate of about a hundred thousand pounds a year. They would see this was reasonable when he told them the Customs revenue during the last few years. In 1881 it was .£1,421,000, in 1882 it was .£1,515,000, in 1883 £1,414,000, in 1884 £1,503,000. An additional £100,000 would only have brought the Colony back to the revenue it was receiving in 1882. More than correspoding additional taxation was proposed on property in the shape of increased stamp and succession duties. It had been proposed the Property tax should be three farthings, which was the same as two years previously ; finally another eighth had to be added, in lieu of raising the tariff, and reductions made in other taxing proposals. In the absence of the increase to the tariff, it was not possible to provide for paying off part of the deficit left by their predecessors. The extra stamp and succession duties enabled a subsidy to be paid to local bodies, and defrayed the growing additions of expenditure caused by the increase of population and settlement — such as those for education, postal, &c There had also been an increase of £60,000 on the interest paid over the previous year, apart from the interest of new loans that £60,000 was an amount of interest which was consequent upon the operation of conversion, and was thrown forward for payment a few weeks into the year 1885-86. It was, therefore, saved from payment during the previous years. There was the interest of the new loan negotiated. Loans not spent on railways meant heavier charges on revenue, though not necessarily increased taxation. It had been attributed to his colleague, Mr Stout, that he had said every additional million borrowed meant £4o,ooo of additional taxation. There were two newspapers in the South that about three times a week quoted this remark with approval. They must be very stupid not only to agree with it, but to suppose Mr Stout ever said it. What Mr Stout did say wa3, that every million expended on purposes which were not reproductive meant an additional charge on the revenue. Before he (the speaker) would proceed to justify the increase proposed in the Customs' revenue, he would ask— was there any other means of saying expenditure? A great deal was said about RETRENCHMENT. He would expose the humbug of those who raised the cry. Numbers who joined in the cry of retrenchment were amongst the most prominent of those who pleaded for additional expenditure within their districts, and for additional payments to officers whose piteous cries had come within their knowledge. The cry was a sham. All the year the Government were exposed to the bitter complaints of officers who, after years of service, received no increase of salaries. Good officers were constantly leaving the service because of inadequate payment. He contended that, whether compared with the salaries paid to public servants in the other Colonies, or to the salaries paid in this Colony for private salaries, the salaries of the Civil servants were, as a rule, underpaid. First he would take the high class officers. He proceeded to give several instances which showed that the salaries in New Zealand were from 25 to 50 per cent less than those paid to similar officers in New South Wales and Victoria. Then he instanced the Secretary to the Treasury, whose duties are of a most responsible character, who was getting less than half what he would receive if he had a private appointment of less importance and less responsibility, and requiring less ability. As regards lower paid officers, there were dozens of most distressing cases of officers twenty or thirty years in the service whose salaries hardly sufficed to secure the means of living. There might be changes made to save the growing expenditure, but there were no present materials for reduction of any moment. Then there came the question of whether any additional revenue required should be obtained from Customs or Property tax. If the Property tax were decapitalised at six per cent, it would represent for seveneighths of a penny in the £ in capital value a charge equal to one shilling and fourpence of the annual value, and three farthings represented one shilling and a half-penny in the pound of annual value. He would not go into the question of changing to Land and Income tax. He thought with land yielding so badly, one shilling in the pound of annual value was enough. More would stand in the way of settlement. He would show, without going into the question of Protection and Freetrade, that the Customs tariff required to be raised. The average annual Customs duties per head from 1870 to 1884, both inclusive, was £2 13s sd ; the highest year was £3 4s lid, the lowest of those years was for ISB4, the last of the series, £2 63 6d. But 1885 was even lower; it sftmounted only to £2 5s 7d. The duty on wines, spirits, tobacco, and cigars, averaged 47 per cent of the whole, equal to £1 5s per head ; so that, exclusive of thr>3e duties, the average per head for other duties was £1 8s sd. What the Government had asked, was only equal to 3s 4d per head, and that would have raised the Customs revenue to les3 than the average for 15 years. IN NEW SOUTH WALES, a Colony professing to bo guided by Freetrade principles, the Customs duties for 1884 averaged £2 a head, and would average more for the present year, if the anticipations of the Colonial Treasurer should prove correct. There was not much difference, and besides, New South Wales had an immense land revenue. Education was free here, but lie believed they charged fees in New South Wales. He was sure those who used the schools did not wish them charged on property. They did not wish it to be said that the property classes educated the non-propertied. The Customs tariff, to which all contributed, was the FAIREST SOURCE from which to take expenditure. The Customs tariff was substantially the only tax to which the Maori race contributed. It w.ißnotdcsirableto make Protection versus Freetrade the question upon which to goto the country. He only desired to make up the rovonue without discussing unnecessary abstract questions. He dreaded anything which would divert attention from the one great question, the Public Works Policy. CAPTAIN RUSRBLI/s RESOLUTION'S rendered impossible all previous practice o taking votes. No Government would now be

I safe in incurring expenditure for part of a I railway. To give an example : — If the Government could be satisfied their railway would proceed, they would at once largely increase machinery at various workshops throughout the Colony, and save the loss of inadequate workshops sending work to long distances. The time had come when THE PUBLIC WOEKB POLICY should bo settled. He would say what he thought that policy should be. First, a vigorous prosecution of railway works ; 2nd, a reduction of proportion of expenditure for other purposes ; 3rd. Works begun to be rapidly completed to a paying condition ; 4th. Loans to be so tied up that they could not be diverted from the purpose for which they were borrowed. He wished to impress upon them that the Colony was so knit together that if any one district succeeded in being prosperous, it could not continue so unless the rest of the Colony participated. During the last 18 months, the reputation of Auckland's prosperity had gathered to it the unsucces ful from all parts of the Colony, causing overdoing in many trades and departments of labour. He did not wish to conceal anything, and he avowed himself distinctly in favour of the East and WEST COAST RAILWAY. He did not think they had heard arguments in its favour. There had been great attempts made to prevent its discussion. The Committee to examine into it was refused the liberty that was to be given to the Committee. He contended that Auckland would specially benefit by communication being opened from Nelson, to all parts of the Middle Island. Railway systems were undertaken on the basis of trunk lines being completed. How could there be a trunk system if Marlborough, Nelson, and Westland were not connected with the rest of the Island ? It was no new idea of his. In 1880, when he was about to cease to be Agent-General, he placed on record his opinion that the Government were pledged to. complete the trunk system. Mo3t careful investigations of the Public Works Department showed that the line would at once yield two per cent, and greatly aid existing lines in doing so. The railway would open to all some millions of acres of land of various kinds. It would also lead to the discovery and increased production of gold, coal and timber. One block of 60,000 acres alone was said to be worth half a million ; the population to be directly benefited would be a third of that of the whole Colony ; it would unite several great districts which would exchance agricultural produce for gold and coal, on the Canterbury Plains and Christchurch. Sea-carried coal could not compete with the coal the railway would bring. At the same time, it might be worth considering whether, as the cost would be large, a portion of it, without delaying the railway, might be devolved on the immense landed estate, which could specially hypothecated, and part of the cost charged against it, instead of against the consolidated revenue. He had dwelt on the railway because objections had been made to it, and he quoted the Hon Mr Bowen's statement, showing briefly, but clearly, its advantages with regard to public works generally. He contended that when labour was plentiful, and material cheap, was the proper time for making. RAILWAYS Were the greatest aid to the prosperity and comfort of a country. They saved consumers in country districts expenditure, whilst by giving access to markets, they increased their gains. The railway yielded over three per cent in cash, but that was not all they did. The services they rendered to the Post Office and other departments might be reckoned at .£30,000. They were not worked to yield as much profit as could be got from them. He found District Railway Companies had been charging double the rates charged on Government lines. If Government lines were in private hands, or the Government charged heavier rates, they could be made to yield two hundred thousand pounds more a year. They would, in fact, yield more than 5 per cent without reckoning their collateral advantages. Were they going to confine the Colony to the large holders ? If the public works were stopped, there would be a great exodus. He was not speaking without book ; he would take the example of New South Wales, and reply, at the same time, to the disgraceful article which had appeared in the Sydney Herald. The Colonial Treasurer of New South Wales, in a late budget, had stated that during the last few years the Colonists have lost gigantically from droughts and the reduced price of wool. This authority estimated the lo3s of stock alone at five millions sterling, and other losses at a vast amount, but it was nevertheless the case that, notwithstanding these disasters, the Colony had greatly progressed and its population increased. He reason was to be found in this — that instead of allowing the Colony to suffer by the dearth of employment, they set themselves to construct railways from the end of 1880 until Dec. 11, 1885. They had the authority of Sir Patrick Jennings, who was forming & Government for Sydney, that from the end of 1880 to Dec. 15, 1885, the Colony had borrowed twenty millions seven hundred thousand pounds, in five years what New Zealand had borrowed in fifteen. Besides that, they had during the five years ten millions of land revenues, enormous Custom revenue, and one million and a quarter deficit. In the latest Sydney Financial Statement it was stated that they were spending borrowed money at the rate of JM60,000 a month, and intended to borrow again in June or July. New South Wales had now more population than Victoria. The increase during the last few years was more than double the previous five years. The writer in the Sydney Herald was either ignorant about his own Colony or treacherous in blaming New Zealand for a fractional exercise of what New South Wales was doing on a gigantic scale. He (Sir Julius) was nob reflecting on the Sydney Government. On the contrary, they had shown consummate skill in averting a crisis, and converting what might have been a most disastrous period into one of progress, giving people time to recoup their losses. They all agreed as to a borrowing policy. It was also obviously their policy to ridicule and attack New Zealand, and keep the field for themselves. People here who fell into the trap were fools. Every tourist who came here — from the distinguished Sala to the leasb distinguished visitor — expressed amazement at the way in which New Zealanders fouled their own nests. Eeferring to 1880, he (Sir Julius) without expressing an opinion as to lines selected, thought if Mr Macandrew's policy had been carried out, New South Wales would not be so nearly having a million people now. Thousands of farmers were then ready to come out, and were literally frightened away. Were they going to bo abused out of following the example of New South Wales ? They did not know what to do in the same gigantic scale. Instead of nearly five millions a year, he thought a million and a-half should be spent on railways, and a moderate proportion only on other purposes. If they spent ten shillings I in the pound unproductively, the railways would have to yield 8 per cent to cover the interest ; if they spent only five shillings in the pound on unproductive purposes then the railways had only to yield 5i per cent to meet the interest on expenditure. He asked (for he was convinced it could be carried out) for a Customs duties not exceeding £2 10s a head, and a Property tax not exceeding three-fourths, or, at most, seven-eighths of a penny. nniKiuATiox j expenditure was required only to pay part ' of the passage money of farmers brin^inf ' out capital with them. They must°see that the Inan money was applied to purposes for which it was borrowed. A three ' million loan was a sham; it was not dedicated to the purposes for which it was borrowed. , It became four millions and three-quarters, and yet the objects were not satisfied. j They ought to have known expenditure would be required in open lines. Constant demands were still coming in. He then complained of the position of the North

Island Trunk loan. He could carry on until October without negotiating it by j borrowing on short - dated deben--1 tures. He referred to the danger lof allowing funds to be exhausted. During the late Eussian scare, other Colonies and this Colony were subjected to great anxiety. Victoria agreed to borrow off her banks .£150,000 each, at 5 per cent. New Zealand was told, if war broke out, they could neither negotiate the million cind a-half loan nor get advances in England. The north trunk loan was safe from expenditure, unless with Parliamentary sanction, but unless a new loan was authorised, every Imprest Act would authorise expenditure out of trunk loan, regardless of purposes for which it was voted. They must ear-mark loan in future. It could be easily done by a preamble and by appropriation. No House would repeal an appropriation and a former dedication of a loan. The inisfsrtune now is, that no repeal was wanted. Money was available for any object the House from time to time chose to select. He then referred to tho rOSBIBLE DISSOLUTION before the session. Ministers had not determined about it. They had not discussed it in full Cabinet, nor had they tendered advice to His Excellency on the subject yet. The reasons in favour of a dissolution were that the people should be ' consulted about the policy of Public Works, ' and this being the last session, if a dissolution took place after the session began, a second session would cost .£25,000. But this was the least argument in its favour, the most important hinged upon the question of time. If the dissolution took place first, Parliament could meet in May, as he ' believed the financial exigencies would make it necessay to do. By the end of June it ought to be decided if there was to be a new loan; if not, all public works must ' be stopped, except those for which engagements had been made. The North Island trunk line wonld about meet these, but without a new loan the House would not be j usti--1 fied in voting much, and then only out of North Island Trunk Loan. If a dissolution took place after the House met, authorities for raising the new loan could not reach England until nearly January, as was the case in 1884, when every expedition was used apart from enormous risk of being confronted with a bad market by waiting until the last moment. There was yet greater consideration that delay in settling about a new loan would mean an immense amountof misery in the Colony. Every hour was important, and a dissolution taken out of the session would be very mischievous. There might be a way out of it, but he confessed he did not see it. As regards the POLICY FOR NEXT SESSION, he did not profess to bind Government, but he knew generally the views of his colleagues, and he knew his own. He thought the decision of the Public Works Policy was the principal question next session. Thft local government question presented many difficulties and he did not believe it could be finally settled. A substitute for the Roads and Bridges Construction Act must be provided. That Act should have expired of itself. Pt showed revenue that did not exist. Under it there was no inclination on the part of the country districts to tax themselves, or to be joined with towns. The speaker then dealt with the question of control of expenditure. When the question of LOCAL GOVERNMENT was finally settled, they could not leave out of consideration powers of land, Education, and Charitable Aid Boards. He believed a final settlement would have to be delayed, but meanwhile something must be done both as to continuing subsidies and as to affording a substitute for the Eoads and Bridge 3 Act. The Hospital and Charitable Act wanted amendment, but not in many particulars. He indicated the chief points requiring amendment, amongst them being making more easy payments from the Treasury, and enlarging tho encouragement to private donation?. The requirements of the goldfields must receive attention. He expressed a modified approval of the proposal to purchase large estates for cutting up. There was a great difficulty in protecting the Government from pressure. He gave a list of the areas of lands, holdings, aud the number of the same, and said the land was clearly in too few hands, but the matter required to be dealt with very cautiously. He was favourable to trying on a small scale loan 3to farmers, who were subjected to great disadvantages at present, as they had already said. He thought the increase in the tariff should be made without raising the question of Freetrade and Protection. He had come to the conclusion, from a careful calculation he had made, that upon the duties imposed depended, for the items of candles, boots and shoes, drapery, furniture and woollens, the increase or reduction of local production to the amount of between one and two millions. No Customs duties would mean, as Major Atkinson had said, a departure of nearly half the people. The small farmers would be absorbed, and property taxed to six or seven shillings of the annual value. Farmers and settlers must not suppose Customs duties injured them ; if they had not local markets they would soon fall into the hands of large owners. With the duties abolished or decreased, their local markets would be co restricted that one by one they would fall in. They could not depend only on the contingencies of distant markets. Unless immediate provision was made for public works there would be great distress, but with this provision they made a favourable start. He anticipated a small surplus, which, he was afraid, would disappoint his friends who predicted a large deficit. The conversion operations would be expected to give some relief. The Colony could start favourably ANOTHER PUBLIC WORKS POLICY, and New Zealand, before the end of this century, would be the premier Colony in this hemisphere, excepting Victoria. This Colony had the heaviest population to the square mile ; New South Wales had six people to the square mile. They would understand, then, the policy he advocated to push on railways whilst material was cheap and labour abundant ; to make railways that must be made, and not to begin them whilst to limit very much borrowing for other purposes than railways ; to tie up the loans so that the expenditure must be for the purpose for which the money was borrowed ; and to promote in all directions settlement on the lands, and the prosecution of local industries. IN CONCLUSION, he was prepared to map out a financial policy within the limits of the Customs duties at £2 10s a head per annum, and a Property tax not exceeding three-farthings or seven-eighths of a penny. There were other subjects to which he could not now i refer. He had refrained from making an attack on anyone. He believed the lines of parties would be much altered. He asked them, in conclusion, to think out the whole [ subject and calmly determine if the views he had expressed had their approval. Sir J. Yogel concluded his speech amid , cheers, having received the most attentive ■ hearing and favourable reception, he has as ; yet obtained in Auckland. A vote of thanks to Sir Julius Yogel for his interesting address, and also of confi- . dence, was carried by a good majority. An amendment that a vote of thanks only be . accorded, and to protest against further j borrowing till the incidence of taxation , is adjusted, was lost on a show of hands. , Sir Julius Yogel proposed a vote of thanks . to the Mayor for presiding, and the meeting separated.