DUNEDIN.

Tuapeka Times, Volume III, Issue 144, 10 November 1870, Page 3

DUNEDIN.

(From our own Correspondent.) As I predicted in my former letter, Mr. Fish has been returned for the city of Dunedin to the Provincial Council by a majority of twenty-five votes over Air. ißathgate, who polled 370. The programme of these gentlemen was essentially the" same. They both condemned the action taken by Mr. Birch, the other candidate, in the General Assembly in respect to the Regulation of Hundreds Act, 1869, amendment Act, 1870. Mr. Hirch polled 150 votes. Those who voted for him, did not vo^e on any principle but for their man. it was the man they wanted, not measures. Give them their man, and he could, if he liked, practise anything without any principles. It is satisfactory, or very unsatisfactory — depending on circumstances — to know that 765 voteers in the city of the Dunedin have condemned all legislation on public lands affecting this province during the years 1869 and 1870. That is, they have condemned the Regulation of Hundreds Act, 1869, and the Regulation of Hundreds Act, 1869, Amendment Act, 1870.

1 find by your last issue, that your Railway Committee have held a Hireling, at which it was suggested by the chairman that, in tfie face of the prusent European war, it wuuld be futile and waste of time to expect money from the great colonial loan towards the construction of a railway to Lawrence ; and that it was better to memora'ize the Provincial than the Colonial Grovernment to construct the line. Setting aside altogether the question of war, T believe it is doubtful whether the Colonial Government could get the money at the rate provided for by tie several .Vets The cardinal point of Mr Vogel's policy was to borrow m >ney, at a eh' ap rake, to be expended in the provinces on works of reproduction, and for imjii^ration. Air. Yogel also admitted tnat this great sche ue could not be carried out without the assistance of the provinces of Canterbury and Otago — two provinces that had lai'gs land revnues, and contemplated the const ruction of railways, and who had taken power to raise loans for that purpose.

Those provinces would not wait, and, therefore, it was necessary to carry the great scheme that session, although it was the last one of the Parliament. If the colony could nob go into the market without the guarantee of the provinces of Canterbury and Otago at its back, surely these provinces combined can carry out their own railways unassisted by the colony with at least five bankrupt provinces hung on to it. The cardinal point of the Fox-cum-Vogsl policy of cheap money, broke down before the end of the session. It broke down when the Government asked for the extension of the Treasury Bills, which were falling due next year to the year 1874 ; and also fur power to raise £500,009 at any rate of interest ; and further empowering the Governor to make any terms with the Imperial Government for the £1,000,000 loan, which we had only a week before rejected. T think, with these circumstances alone before us, the suggestion of the committee to fall back on the £400,000 provincial loan is a wise one. In some of myprevious communications I suggested that neither this province nor colony would progress till we became more selfreliant, and depended less on foreign aid in respect to borrowing money. The facility of borrowing js a power perilous to statemen as to individuals in a humbler sphere. There is, however, this distinction, that in the one case it is the borrower himself who generally suffers, in the other, the penalty falls upon a whole community, and its paralysing effect is distributed over a wider area, 1 am afraid, however, that the paralysing effect will be confined within the limits of Canterbury and Otago, because from past experience in respect to the loan allocations the provinces of the North Island have never paid a farthing ; nor will they pay a rap of any future allocation of colonial debt which may be put on them. They play a sure game. They go in for any amount of borrowing ; get the lion's share expended on them (as is now being done by the present administration^), submit to allocations ; but never submit to the payment of principal or interest. The whole thing is beautifully donu I assure you. The manipulation is perfected on scientific principles. It is done thus : — They wait for a favourable opportunity as in 18G7 — perhaps when a great consolidation scheme is before the House — and then they get the principal Aviped out, and the amount for interest and sinking fund, which is tk-n duo, extended to the year 1870 In the year 1870 another great gigantic scheme is before the House. This scheme is for the borrowing of no less a sum than £10,000,000. Of course the interest due by the provinces of Auckland. Hawkes Bay, Taranaki, and Wellington, is not paid — oh, no, it is put imo this great loan, and is extended for payment to a period no one knows. All those transactions look very like the plan adopted by Mieawher when he was liquadatin^ his debts to his creditors. So in like manner are the provinces of the North Island paying their debts to the colony.

It no doubt naturally suggests itself to the mind of every person, how does the colony manage to sustain its credit, it is the easiest thing out. The colony adopts the same plan as Mieawher and. the North Island provinces. Every year the colony obtains authority to issue treasury bills, to be paid out of current revenue. But they are never paid ; they are extended from time to time, and they have now reached the small sum of £528,000, bearing interest at the rate of upwards of 6 per cent, per annum, and payable in the year 1874. When that year comes, thuy will either be funded or extended for payment to a future year.

When the Hon. Julius Yogel came down with his budget, there was a touch

of old tales about his story. Professions of solvency, elasticity of our resourci s, and honesty, were employed as introductions to a fresh " transaction." We only wanted money, railways, and population. Get these, and all would be well. Like the spendthrift, on looking into his accounts, the one indispensable thing is a slight advance of £10,000,000, and there would be a glorious future for New Zealand. Now, borrowing implies lending, and lending only proceeds on reasonable expectation of repayment ; and the North Island had been borrowers before. Will the North Island take to honest practises, and pay its honest debts, or will it throw the responsibility of payment on Canterbury and < )tago ? Canterbury and Otago have a magnificent public estate, and if properly administered for the habitation of man, would be sufficient for all purposes. With ours we ought to be able to carry on all our public works, and borrow as much money on it as would construct lines of railway throughout every part of the province. Setting aside the question of the war in Europe, I think the estimate of revenue and expenditure of the colony is sufficient to throw a doubt on the probability of our getting the colonial loans at the rate of interest authorised by the Acts, when the expenditure for 1870-1 is £326,000 more than the estimated revenue.