53

A.—3a,

placing them at the disposal of the Treasurer of the General Government, is calculated to destroy public confidence in their safe keeping, ending, as it is apt to do and has done in this instance, in their being appropriated to the general purposes of the Government, instead of being kept as a sacred trust for widows and orphans, whose private property, and perhaps sole source of maintenance, they are." 7. Moved by William Fox, Esq.; seconded by Jacob Joseph, Esq.: " That the establishment of a Government Bank of Issue, which has lately been effected by the Governor-in- Chief, is a measure totally uncalled for and unnecessary in the circumstances of this colony. Without entering upon a discussion of the arguments in favour of the Government being the sole maker of paper money, it is sufficient to observe that the principal guarantee against the abuse of the prerogative which its most ardent advocates admit to be essentially necessary —namely, a representative Assembly, to scrutinise its operations —is wanting in New Zealand. Nor is this the only objection ;itis a fundamental principle laid down by the supporters of such a system that on no account should the Government have power to discount bills. But Sir George Grey, contrary to the express instructions of the Lords of the Treasury and of Lord Grey, has established the New Zealand Government Bank by means of an Ordinance, which gives him full power to discount, in as much as it provides for the investment of the funds of the bank on such colonial securities as the Governor may think sufficient, which may, for anything in the Ordinance to prevent it, be private bills, or the Government might lend the funds of the bank to itself. Sir George's disregard of instructions in this matter leads necessarily to the conclusion that he does intend to make some such improper use of the funds of the bank. But, further, when the unscrupulousness of a needy colonial Government, in appropriating to its use any funds on which it can lay its hands, is considered, to say nothing of the risk of embezzlement by the officers intrusted with the charge of the public money, of which serious instances have already occurred in New Zealand, and repeated instances elsewhere, this Association cannot regard the Government Bank as entitled to public confidence, at all events till brought under the check and control of a popular A ssembly." 8. Moved by William Lyon, Esq.; seconded by Mr. T. McKenzie: " That the late melancholy accident at the Wairarapa Lake is attributable to the neglect of the local Government of its proper and legitimate duties, and that this Association desires to express its warmest sympathy with the surviving relatives of the parties drowned." 9. Moved by Eobert Waitt, Esq. ; seconded by Kenneth Bethune, Esq.: "That in a young colony the first object on which the Government should expend the revenue are roads, bridges, and ferries. Accidents have before occurred at the Wairarapa, and the Government have been appealed to to establish a ferry there without effect. This is the more to be observed upon, because, though the Wairarapa stockowners contribute largely to the revenue, not one single farthing of it is expended either among them or for their benefit. For eighteen months past the Government has carried on no public works of any sort in this settlement, while such as had previously been partly executed go to ruin ; yet, in this province a revenue of nearly £21,000 is spent by it solely in maintaining official establishments. Of what use those official establishments are, except to receive the revenue and pay their own salaries out of it, it were difficult to say. Nor among its other neglects must the want of a proper gaol in this settlement be omitted. On repeated occasions for two years past have grand juries and Justices of the Feace denounced the existing gaol as a disgrace to humanity and the worst in the British dominions, yet the Council meets, separates, and never notices it, never proposes to place a new gaol on the estimates, while it cheerfully votes the large revenue of the province towards official salaries. But it were useless, when all the proper functions of Government are neglected, to specify any particular neglect. Suffice to say that we hand over in taxes £21,000 a year, and get in return no single thing which we value, wish for, or require." 10. Moved by Mr. W. E. Taunton ; seconded by Dr. Dorset: " That a copy of these resolutions be forwarded to the Lieutenant-Governor for transmission to Lord Grey, and another to the Colonial League."

Sub-Enclosure 3 to Enclosure 1 in No. 26. The Hon. the Colonial Treasures to the Hon. the Colonial Seceetaet. Sie, —■ Treasury, Wellington, 7th October, 1850. I have the honour to acknowledge the receipt of your letter of the 3rd instant, calling my attention to the sixth resolution of the Settlers' Constitutional Association, published in the Wellington Independent of the 21st August, 1850, and requesting to be informed whether the local Government had suspended payment twice during the past year ; and, if such suspension did occur, in reference to what account and under what circumstances it arose ; and whether the imputed suspension of payment has reference only to the deferring of the payment of the official salaries beyond the usual monthly periods. My attention being directed in the first place to the resolution (a copy of which I enclose), I beg to state in reference thereto that the usual financial position of the local Government is certainly not such as to lead to the improper appropriation of such a sum as that referred to—namely, £269 16s. The change of system referred to, respecting the custody of such moneys, was effected by new rules laid down by the Chief Justice and Mr. Justice Chapman, approved by the Governor in Council 17th December, 1845 ; and made part of Ordinance No. 12, Session VII., passed sth November, 1846. A reference to further regulations appended to the same Ordinance, though not forming part of it nor signed by the Judges, will show that the very reverse of that stated by the resolution is the fact. The Judges made a rule placing the intestate funds under the control of the Colonial Treasurer. The Governor-in-Council made a regulation restricting the authority over the funds to the Judges only. The suspension of payment presumed to be referred to extended only to the delay in two instances of the monthly payment of the salaries of the heads of departments : in the one instance from the Ist to the 30th of the month, in the other from the Ist to the Bth. The above remarks will have given you the desired information upon all points called for but one, and that is, under what circumstances the suspension of payment referred to took place. The circum-