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The Pamphlet Collection of Sir Robert Stout: Volume 80a

Romance and Reality

page 82

Romance and Reality.

When Treasurer Seddon seizes hold of a great sheaf of papers carefully prepared by the Colonial historian, or same other equally unreliable authority, he does not allow himself to be hampered by trifles. He just lets himself loose and talks of millions as if they were trifles light as air. He implies that he holds a patent for borrowing money without having to pay any interest on it; in fact that the more he borrows the more the interest charge decreases. He has been extremely busy on many platforms during the past month, and the fable he tells to every audience is this: «I admit that the Seddon Government is responsible for the increase of the public debt by £3,792,000, but of that amount £3,582,565 is remunerative. The interest is paid directly back and is not any burden on the tax-payers of the Colony. Only £210,000 is not earning interest and the annual charge is only £7350.»

Every one of his nominee candidates throughout the Colony echoes these figures. Mr. Cadiman varied it slightly at the Thames by saying that the unremunerative portion of the loans was £301,000, but that is too trifling a discrepancy to take notice of. The best test of the truth is to take the evidence of the two leading ministers themselves and the official records of their departments, and then see how the electioneering speeches fit in with the truth as told by the cold unsympathetic returns which have undergone the crucial test of the Audit Department.

First: As to the addition to our national debt—
Mr. Seddon now says it is £3,792,000
In his Budget of July 14, 1896, p. 9, he shows the increase of debt from 1891-5 to be £4,928,581
And there was authorized in the session of 1896, and it will all be spent before Parliament meets 1,400,000
6,328,581
Mr. Seddon's little error £2,586,581

Or over two-and-a-half millions of a discrepancy, to use a mild term; and this addition of over six-and-a-quarter millions to our debt takes no count or upwards of five-and-a-quarter millions more of liabilities incurred by the Banking legislation. Nearer twelve than eleven millions piled up within six years, and nearly all of it during the three years in which Mr. Seddon has held unbridled sway over the destinies of the people of this Colony.

Next let us test his assertion that the loan money is only a burden to the extent of £7350 per annum. We will take the four chief heads of expenditure, and so that no charge of injustice can he the statements of ministers themselves only will be used as evidence.

(1). The Lands for Settlement Act. In his Naseby speech the Hon. John McKenzie, said he had bought thirty-eight estates at a cost of £872,9ll on which 613 people were settled. It must he understood that when Mr. McKenzie uses the term «settler,» he includes the women, children, and babies in arms. Therefore it follows that each of them so far has cost the State £1423. This, of course, is borrowed money, and the real owners of the land are not the people who live on it, or the taxpayers of the Colony, but the «fatmens» of Great Britain. The immediate burden of these expensive settlers is not yet felt, but the debt is there all the same.

Now as to the returns we get from these estates which cost £872,911. The outlay and income is shown in the Lands Report for this year on page 143. and the «rents received and accrued,» mark that word occured to March 31 St, 1896, was £5946 4s. 3d., which amounts to just 14s. 4d. per cent, on the cost stated by Mr. John McKenzie of these investments of borrowed money. It is worthy of remark here that while Mr. McKenzie at Naseby said the Estates cost £872,911, Mr. Seddon at Hastings put the figure at £227,000. This discrepancy of over half a-million in the evidence of these two eminent authorities is too trifling for us to make a fuss about. The State historians have mixed things up a bit, but that is their trouble. However, as the cheapest money we are getting costs 3½ per cent. the annual cost for interest alone under this head is
£30,555
And deducting the earning power 5,946
The annual deficiency is £24,609
which the taxpayers have to make good.

It will be said that these estates have not yet had time to become self-supporting. To meet that argument we will take as a «shocking example» one of the earliest purchases. Pomahaka was purchased for £18,000 just on the eve of the general elections of 1893, when the Bank refused to hold it any longer as security for a debt of £8000. Its total cost in the last returns is given at £23,344, and last year's income was £192 13s. 1d., or considerably under 1 per cent. The total returns from all the estates since the scheme came into force over three years ago amount to £10,272.

(2). The seeond head of Loan expenditure is the purchase of Native Lands. Mr. John McKenzie says he has purchased 1,867,946 acres at an average cost of 6s. This amounts to £530,388 Practically these lands are still a wilderness and unremunerative: the total rents received since the inception of the scheme being £125 9s. 5d., and on a 3 ½ per cent, basis the Colony pays in annual interest £19,514. And in this, as in the Land for Settlement department, no account is taken of the enormous costs of administration.

(3). The Advances to Settlers Department. This State concern showed a loss in its first year's operations of £31,000, and also disclosed the appalling fact that there were already seventy defaulters in payment of their first year's interest. Ministers claim that the department is now paying its way, although half a million of the loan is still in hand. As a matter of fact the £31,000 lost last year is a debt to the Consolidated Fund, and cannot be written off, or expunged, or forgiven. It must be repaid out of future profits if any me made, and if none are made or more losses occur the general taxpayer has to find the interest. No sophistries can evade that issue.

(4). The last of the great spending departments is what Mr. George Hutchison so aptly and happily termed the Bribery Fund, viz.: the Roads and Bridges Account. In round numbers some-thing over two millions has gone in this way to debauch the constituencies of Government supporters chiefly. It say much for the audacity of Mr. Seddon and his obedient followers when they claim that this expenditure is remunerative. There can be no doubt that, had the Local Bodies been allowed to exercise their proper and legitimate functions, and supervised and constructed their own works, the roads and bridges would have been better made at less than half the cost. The interest charge under this head is £70,000.

To summarise the burdens placed on the people by the Seddon loans, and without taking into consideration the awful expenditure for departmental red tape and circumlocution, we find, after deducting what is earned, that the Colony has to pay:—
1. Annual loss on Lunds for Settlement Account £24,609
2. Annual loss Native Lands Account 19,389
3. Annual loss Advances to Settlers 31,000
4. Annual loss Roads and Bridges 70,000
Total loss £144,998

Or over Is. per head for every man, woman, and child in the Colony, and with a full knowledge of these facts Mr. Seddon and his satellites are roaming the country telling the people that the loanns are remunerative.

page 83

A few words regarding Cheviot. We are told by ministers and their candidates that this bargain is paying £4500 a year over interest and other charges. There is absolutely no warrant whatever for such a statement. The return published last session shows how unwilling Government is to let the truth be known. It is an alleged statement of Income and Outlay. The income, which includes rents «accrued,» is brought down to June 30, while the outlay for interest &c, is to April 18th, a difference of ten weeks. The Opposition asked for a profit and loss account, and it was flatly refused. Until that is given in a proper business-like form the public have a right to feel dubious regarding the claims of ministers that Cheviot is paying its way. At best it is a questionable good when it is shown that each settler has cost the Colony a thousand pounds.

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