B.—No. 12.

PAPERS RELATIVE TO OVERDRAETS

6

Secretary, and to express the great regret of the Directors that, after such notice from the General Government and their expressed intention of putting into force the Provincial Audit Act, it will not be possible to carry out the arrangement of advancing by overdraft, or otherwise, to the County Council. It will be evident to you and the County Council, that the Bank has at least shown a desire to further the interests of the County ; but as it is declared that any financial assistance allowed would be illegal, and its repayment prevented, you will at once see that the Bank is rendered powerless to make such advances, without some alteration in the law being first effected. I have, <&c, Conrad Hoos, Esq, Wm. C. Eoberts, Chairman, County Council, Westland. Manager.

Sub-Enclosure 1 to 6 in No. 5. Hon. E. W. Staffoed to the Inspectoe of the Bane of New Zealand, Auckland. (No. 68-341.) Colonial Secretary's Office, Sic,— Wellington, 19th March, 1869. 'As there is reason to believe that your Bank may be applied to on behalf of some Provincial Executives for loans, either by way of overdraft or otherwise, the Government deems it right that you should be informed that it is advised that advances made to Provincial Executives, either by way of overdraft or otherwise, to be repaid out of Provincial revenues, are illegal, and that any Act or Ordinance of the Provincial Council purporting to appropriate money for the payment of any such overdraft or loan would be invalid. The Legislature, as you are probably aware, in the last Session of the General Assembly, declared in the Provincial Appropriations Validation Act that loans by way of overdraft were illegal, and certain Provincial Ordinances which had been passed to appropriate money to repay such advances were declared invalid until validated by the General Assembly; and a special authority was required to enable the Governor to assent to certain Provincial Bills passed for the same purpose. The Legislature has also repeatedly enacted that no further debts were to be contracted by Provinces, without its previous authority. There is therefore no ground for supposing that the General Assembly will again validate any Provincial Bill passed for appropriating money to repay overdrafts, or that it will itself appropriate moneys to the payment of moneys advanced in defiance of the law. Under these circumstances it will be the duty of the Government to advise His Excellency to disallow any Act or Ordinance passed by any Provincial Council appropriating money to the payment of any such loan or overdraft, and to withhold his assent from any such Bill which may be reserved for his assent. I have further to inform you, that should any officer of your Bank receive any revenue of a Province in payment of any money advanced by way of overdraft or loan to such Province, without the authority of an Act of the General Assembly, the provisions of " The Provincial Audit Act, 1866," will be enforced. The Inspector of the Bank of New Zealand, I have, &c, Auckland. E. W. Staffoed. P.S.—Please inform the other branches of your Bank to the effect of the above letter.

Sub-Enclosure 2 to Enclosure 6 in No. 5. Extract from the Westland County Estimates for the Year ending 30th June, 1869. XII. Public Woeks. • •••'«.#••* £ s. d. x 4. Track, Greymouth to Poenamu... ... ... ... 4,000 0 0 x 5. Eoad, Hohonu Junction to Poenamu ... ... ... 1,800 0 0 x 6. „ Stafford to Hohonu Junction ... .., ... 5,000 0 0 x 7. Arnold Track ... ... ... ... ... 1,000 0 0 x 8. Eoad, Hokitika to Arahura ... ... ... ... 5,000 0 0 x 9. „ Eoss to Totara Store ... ... ... ... 1,500 0 0 x 10. „ Kanieri, Kanieri Lake, and Longford ... ... 3,000 0 0 x 11. Track, Chesterfield to Hohonu ... ... ... ... 500 0 0 x 16. Tracks, Okarito District ... ... 2,000 0 0 17. Eoad Board Grants, viz.: — § Arahura ... ... ... ... £750 0 0 § Kanieri ... ... ... ... 750 0 0 § Totara ... ... ... ... 750 0 0 § Okarito ... ... ... ... 750 0 0 § Paroa ... ... ... ... 750 0 0 £3,750 0 0