Discussion.

Mr. E. Brodie Hoare, M.P.: I do not know whether three months' travel in New Zealand entitles a man to speak on this subject, but, having been for many years interested in the commerce of New Zealand, and having spent some of the most delightful months in my life in that wonderful Colony, I may be allowed to bear my testimony to the accuracy with which the Agent-General has set before you its claims on your sympathy; and, further, I think we may congratulate ourselves on having an Agent-General who can speak on such subjects with so much force and perspicuity. At the same time the mere reading of a paper does not convey to one's mind anything like the enthusiasm which one feels who has put his foot on the shores of New Zealand. It is a country which page 460 for climate, the beauty of its scenery, and the attractiveness of its people—who are Englishmen to the backbone—offers attractions that cannot be resisted by those who have been brought within the range of these influences. Though I have no criticism to make on the paper, perhaps you will forgive me—and, should it come to their ears, I hope the Government of New Zealand will forgive me—if I venture to question the wisdom of some of the proceedings of the Government. There can be no doubt that the one thing required for the resources of New Zealand as yet undeveloped is the introduction of English capital. I venture, with all humility, to say that the steps that are being taken are directly calculated to interfere with the introduction of English capital, and I will tell you in what way this is being done. There can be no doubt that the credit of the New Zealand Government in the English money market has, during the last four or five years, very materially and justly improved. The Four per cent. Stock stands at a good premium, whereas when I was there this stock stood at something like ninety-six. It is not, however, in my opinion, to the capital borrowed by the New Zealand Government that Colony has to look for its real progress and the sound development of its resources. It must look rather to the introduction of private capital through private enterprise. I will quote words used by the Agent-General to illustrate to you in what way I consider the recent action of the Government has tended to interfere with the introduction of private capital. He says: "I readily admit that, in the case of individuals and companies who have become the unwilling owners of large estates by properties falling into their hands, the remedy is somewhat drastic; but the policy pursued by these individuals and companies in holding their land instead of realising has gone far to bring about the change they complain of.' I ask you to consider what this means; and may I preface my remarks by saying that I am not personally interested in any company which holds any large tract of land in New Zealand? It means that certain companies have in the past lent money unwisely on the mortgage of properties in New Zealand; that they have been obliged to foreclose on those mortgages; that they now hold the properties so foreclosed, and that they are unwilling to sell them at a heavy loss. That is the plain English of it. Now I would ask the Agent-General—and I wish I could ask the Legislature of New Zealand also—to consider this: that their object is to promote the interest and the well-being of their country. That I firmly believe to be their one and genuine aim. They think it is better to do so by the introduction of small settlers and by increasing the page 461 number of small holdings; and I agree with them. I think that is a right and proper line of development for a country like New Zealand. But if you want to bring capital into New Zealand, is it wise—I do not say is it right or just—to so tax English capitalists who have embarked their money in the Colony that they shall be compelled, whether they would or not, to sell their property at a loss in order to escape that which is practically a fine for holding it in the attempt not to make a profit but to escape a loss? That is the real position into which the New Zealand Government are placing many of the large companies connected with the Colony, and I say in their own interest it is a piece of very foolish legislation. One other thing I know, and many of those who have been in New Zealand know—that the cordial co-operation of the Government in great industrial enterprises is almost an essential in a country like New Zealand if those enterprises are to prosper. I do not mean that the Government should take up those enterprises and nurse them—far from it; but when English capitalists are striving to accomplish great works or small works for which the help of the Government is required—I mean help in the way of facilitating arrangements and enabling them to go on with smoothness and ease—I say that that help ought to be granted in no ungrudging manner. At the present time that help is not granted with a free hand at all, and I have reason to believe, from what I saw when I was there, that a good deal of that difficulty arises from something which the Colony ought to be now old enough to get over—that is, a feeling of local jealousy. It is an undoubted fact, or was a few years ago, that that which was considered good in Auckland was considered bad in Dunedin, and that what was thought good in Christchurch was thought bad in Wellington. I do not say that everybody had that feeling, but the feeling was so prevalent as to lead to great friction and great impediments being placed in the way of industrial enterprises that required the co-operation of the whole Colony. It will be understood, I hope, that I make these remarks in no unkindly or unfriendly spirit, because, as I have said, I have the greatest enthusiasm for the Colony, and I have invested my own money there, and that of my friends. I believe that for New Zealand there is a greater future than there is for any other of our Colonies area for area; that there is no country on the face of the globe so fitted for the habitation of Englishmen; and that those of us who live for another twenty years will see New Zealand making rapid strides—such rapid strides that she will be outpacing the older and larger Colonies of the Australasian Continent. But if this page 462 is to be, the Colony must be guided by wisdom, and not run on what the Agent-General—by a slip or purposely—described as "fads." There is no doubt that a great many people in New Zealand take their political opinions from those whom we here call faddists. I marvel at the progress New Zealand has made. The great city of Christchurch, with its cathedrals, banks, railways, and tramways, was a bare desert when I was a boy at school, and I am disgusted when anybody calls me old. I think you will agree that few countries have made such progress, and I say with all my heart—May she continue to flourish.

Sir Julius Vogel, K.C.M.G.: After the very exhaustive paper which Mr. Perceval has read, there is not very much left to say about the present condition of New Zealand. I rather think Mr. Perceval did himself an injustice when he told us we were going to listen to a prosaic paper, for I am sure you will agree with me that when he took us to the top of Christchurch Cathedral and laid before us the fair and varied scene he disclosed a vein of true poetry. I will ask you to allow me to go back to the past. It is not generally known that the real origin of the immigration and public works policy of New Zealand was not, as has been supposed, a desire to obtain, by the expenditure of borrowed money, a fictitious excitement or a too rapid progress. The true origin of that policy was the native difficulties that then prevailed, and had prevailed since the earliest history of the Colony. Up to 1870 a species of dual control existed by which the Colonial Government and the Home Government jointly managed native affairs. In that year the Home Government finally withdrew. They took away every soldier, and sold everything on which they could lay hands, even to flagposts, and I am not sure they did not sell the flags. They threw on the Colony the whole responsibility for the future. It was then recognised that to go on spending millions as they had been spent on native affairs was a wasteful policy, and that a far better plan was to colonise and settle the northern island and carry out railways and other public works. The other island had long complained of the expenditure on account of the native difficulties, and this policy could not be carried out without extending to the south island the same policy of immigration and public works proposed to be carried out in the north. That policy was pursued on a more extensive scale than was originally proposed, and more railways were made than were at first contemplated. The time came when the increase of population was not so rapid—when it became desirable to "taper off," and there was not a small amount of heroism displayed when the process began. I may mention that the Colony page 463 has much more land under cultivation than the whole of the Australasian Colonies put together. The policy of colonisation from its earliest date was based on a twofold supply from the Mother Country to her Colonies of population and of capital. It would be simple folly, as regards the capital, to suppose that there would be any doubt whatever of the safety of the loans to the various Colonial Governments. As regards private loans, they are mostly of the nature of private investments. I believe, as a rule, they are good investments. From a study I have lately made of the subject, I have come to the conclusion that the approximate amount of money invested by the residents of Great Britain in securities of all kinds—foreign, colonial, Indian, and home—is, in round figures, £5,000,000,000. Now, a great financial genius—I am not speaking ronically—Mr. Wilson, has lately published in the Investor's Review a scathing article on the subject of Australasian borrowing. He couples, as I think he has no right to do, private loans and Government loans and makes up a total of £280,000,000, of which £40,000,000 belongs to bank deposits. Now, if I am right as to the total amount of British investments, this balance of £240,000,000 represents somewhat less than five per cent, of the whole. It may be a large amount, but it does not seem a very large proportion to invest in the Continent of Australia, to say nothing of New Zealand and Tasmania; and I am decidedly of opinion that there are thousands and tens of thousands whose investments are represented by the remaining 95 per cent, who would be glad to transfer their investments to Australasia's five per cent. Mr. Wilson's article is a strong and able article. It is a curious thing, however, that that article was published on the 1st May and has been greatly spoken of, and yet that ever since then Australasian stocks have gone up from day to day. It reminds one of the jackdaw in "The Ingoldsby Legends." The Archbishop cursed by "bell and by book," and in a variety of other ways—

"Sure never was heard such a terrible curse,
But what gave rise to no little surprise,
Nobody seemed one penny the worse."

I do not go so far as to say that there are not questions relating to Australia that are well worth considering. I think you will be amazed to find how the supply of population is falling off, and on this subject I will give you a few figures which I think are rather sensational. I find that in the five years 1882-86, inclusive, the total emigration of persons of British origin from Great Britain and page 464 Ireland to the Australasian Colonies amounted to 285,000 persons, while in the five years 1887-91 the number was 130,000, giving an average in the first five years of 47,000, and in the last of only 26,000. But we ought also to consider the number of persons who have returned from these Colonies to the United Kingdom; and I find this remarkable fact, that during the five years 1882-86 the balance in favour of Australasia was only 194,000, while in 1887-91 the balance of those who remained was only 82,000, being an average for the first five years of 38,000, and of 16,000 for the next five. The last two years are even more remarkable. In 1890 the total number of immigrants was only 21,000, and in 1891, 19,000; while if you deduct the returns, the numbers were 10,000 and 9,600 respectively. Thus you will see that we must go back almost to prehistoric times for a parallel for the small amount of emigration during the past two years to Australasia. I do not say anyone is to blame. I think there are periods in the lives of young communities when quiet must for a time prevail. In the case of Australasia I do not think that period can be a lengthened one; on the contrary, I am persuaded that before a long time has elapsed we shall again see a large steady flow of emigration from the United Kingdom to Australasia; and I may add that I believe there never has been a time when persons possessed of a fair amount of agricultural knowledge and with a moderate amount of means would be likely to do so well in the Australasian Colonies, including New Zealand and Tasmania.

Mr. Walter Busby: I have listened to the address with great pleasure and instruction. It is most gratifying to hear such a favourable account of the immediate past, so much satisfaction at the present, and so well-founded a hope for the future. In all this many of us have a certain amount of personal interest. As investors and by influencing the investments of our friends we have from time to time assisted the Colony by subscribing for the loans it has issued, and it is beyond measure pleasing to learn that the money borrowed has been productive of such good results. I have always entertained a very high opinion of the Colony of New Zealand as a field for investment, and when I hear such a glowing report I am constrained to ask, "Is there no little rift within the lute of so much prosperity? " It may seem ungracious to look at any other than the bright side at a meeting like this; yet, sir, I must claim your indulgence to publicly record the deep feeling of disappointment and regret experienced by holders of the New Plymouth Harbour Board bonds, which are in default, that your Government will afford them no measure of relief. These bondholders advanced their money page 465 on the security of a certain large subsidy of Crown lands in the provincial district of New Plymouth, which was given by the Government in consequence of their expressed opinion that this harbour was of national rather than local importance. These lands were estimated to be worth about £1,400,000. Now, sir, within a short time after the loan was raised here, the Government, without any reference whatever to the bondholders, take away from them 200,000 acres of these subsidised lands, valued by the Property Tax Commissioner and the Surveyor-General at about £380,000, and the land laws of the Colony are so altered, as shown by the Agent-General in his address, that the income from the remaining land is brought down to vanishing-point. I might adduce many further facts that prove and advance the claim of the bondholders. I do think it would be a dignified and graceful act on the part of the Government of New Zealand if in their prosperity they would deal generously and justly with those they have injured.

Mr. H. Moncreiff Paul: Mr. Perceval stated at the outset of his paper that foreign capital must be invested in the Colonies in order to develop their resources. In that we all agree. Hand in hand with capital must go a proper amount of emigration; and if the Government of New Zealand or any other Colony should so badly arrange matters, fiscal or otherwise, as to preclude this being done, no Colony can, in my opinion, be prosperous. At this late hour. I will not speak with any detail on the merits of the paper, but there are one or two points I desire to emphasise. In regard to taxation, I find that taxation in New Zealand represents about 50 per cent, of her revenue. That is quite enough in the way of taxation, and if any attempt be made to increase it, pro tanto, the success of the Colony for the time will be endangered. Then in regard to absentee owners. Of course as a matter of policy no man should be for any length of time an absentee owner. The chances are that his property will suffer during his absence. It must be borne in mind, however, that many of them were the pioneers of the Colony, men who bore the burden and heat of the day, and it may be a matter of necessity for them in some cases to absent themselves from the Colony they love, and in which the early and best years of their lives were spent. Therefore I do not think the Government would be well-advised in pressing too hardly on so-called absentee owners. We had in Australia a very remarkable instance of the result of driving good men from a Colony. There were many valuable Colonists who by the policy pursued in Victoria were driven across the Murray into New South Wales. Good, as is often the case, came out page 466 of evil, with the result that the development of Riverina was assured, and this pastoral district will in the future become the honour and glory of New South Wales. It does not do, however, to count on a like repetition of success attending a mistaken initial policy. Mr. Perceval alluded to the great success attending the industrial undertakings of New Zealand, and sought to show that the Colony is destined to be the great manufacturing centre of the Australasian group. I am afraid, however, that the initial stages of those undertakings are largely fostered by the system of Protection, which is a dangerous system to follow, and opposed to the Free Trade under which the Mother Country has prospered. Mr. Perceval has spoken of the products of New Zealand, and on that point too much cannot be said. If his statistics had been carried down to a later date than 1890 they would have been even more striking. Quâ the exports of these products. We find New Zealand sending to us and the United States various products without which we cannot do; they are, in point of fact, necessities which fill up blanks which occur both here and in America. It is not perhaps generally known in regard to dairy produce—butter and cheese, for example—that we import 50 per cent, of all we consume. Is it not better that we should if possible receive these products from our own Colonies than from foreign nations? Mr. Perceval has pointed out how that by obtaining experts from Europe the manufacture of butter and cheese may be improved and the factory system in making the former be developed. The shipment of fruit from New Zealand to this country is now being fostered, and, although initial mistakes incident to the opening up of a new industry may be made, these will gradually yet surely be overcome. Even now there is good promise that the success which has hitherto attended the importation of frozen meat may follow in the case of fruit, more especially apples, from the orchards of New Zealand. The formation of Boards of Conciliation there for the purpose of settling differences between employers and employed will be fraught with good results. A like course has been successfully followed in this country. The system of federation to which Mr. Perceval has also alluded is one of paramount importance, and will receive consideration at the approaching Congress, to be held here next month, of the Chambers of Commerce of the British Empire, when the commercial relations of the Mother Country with her Colonies will be discussed. As has frequently been pointed out, it seems unfortunate that the Australasian Colonies at least should not find themselves in a position to establish a zollverein inter se whereby free exchange of their various page 467 products might be secured. Such fiscal union lies at the base of all negotiations for federation. Mr. Perceval's remarks as to the beauty of New Zealand, and the comparison which he institutes between Auckland, Rio de Janeiro, Naples and Sydney, appear to be somewhat high flown. I can only assume that he has taken a leaf out of the South-country Scotchman's book, who after having visited London and Paris said on his return to Peebles, "I have been to London and been to Paris, but for real pleasure give me Peebles."

Mr. T. A. Dibbs: I wish, sir, to reply to some observations made by Sir Julius Vogel, which, if I understand them correctly, point to the fact that the rate of progress in the increase of population in New Zealand was not as great as formerly. I am not a New Zealander but a native of New South Wales, and I have had occasion lately to look into the question of population, and I find that in that Colony alone it has increased 860,000 in a period of nine years, or over 40 per cent. If this rate of progress continues you can imagine what some of the Australian Colonies will become in a short time. I was very pleased to listen to the address of the evening, and I certainly concur in the very sensible remarks made by Mr. Brodie Hoare on the taxation of capital by the New Zealand Government.

Dr. H. W. Maunsell: I think you will all agree we have had a highly instructive lecture, which will go far to dissipate many false impressions concerning the Colony, and, as a New Zealand Colonist of twenty years' standing, I make bold to endorse what Mr. Perceval has said. Mr. Brodie Hoare says we are jealous of one another. Well, we are chips of the old block, and if we grumble a little sometimes we are like other Britishers in that respect.

The Chairman: It is with great pleasure that I now move a vote of thanks to Mr. Perceval for his very able and interesting lecture. I may venture to say that the importance of the paper he has read can scarcely be overestimated. It cannot be too often repeated that whilst we here regard the British Islands as the British Empire, the real British Empire is Greater Britain, including New Zealand and Australia. The time will come—and may perhaps not be so long in coming—when, subject to the cost of transport, the price of meat, and of produce generally, will be equalised throughout the world. At present we have New Zealand meat at 4½d per lb., but many a householder trying to introduce it into his establishment will find his cook against him. The prejudice, however, will soon pass away, and we shall then have Antipodean meat and other page 468 produce in the same way that we have English meat and produce now. At this late hour I will not detain you with further remarks, except to say that I emphatically agree with Mr. Brodie Hoare as to the policy at present being pursued by the Government of New Zealand being unwise in so far as it tends to prevent the inlet of British capital. I say this in no hostility to the Labour Party, as it is called—on the contrary, I believe that the labour members are very capable men, but, owing to circumstances, they have not been able to consider at first the enormous business in which they are engaged. When, however, they do realise this, they will, if I mistake not, change their opinion. The great aim they have in view is undoubtedly the prosperity of New Zealand; but I am sure the prosperity of the Colony will be hindered by an absence of the inlet of British capital. I make this observation without having any personal interest excepting that of long residence and intimate acquaintance with the people of the Colony. I now beg to propose a hearty vote of thanks to Mr. Perceval for his paper.

The motion was carried by acclamation.

Mr. Perceval: I thank you very sincerely for the kind attention you paid to the paper. It was so long that I had to leave a good deal out, and the paper suffered in consequence. It is too late now to reply to the various criticisms, levelled not so much at the paper as at the policy which has lately been adopted in the Colony; but a careful perusal of my paper will show what is really proposed by the new system of taxation. I would very much like to see the man who could propound a system of taxation that would please everybody, for he would be one of the greatest benefactors of mankind possible. While I listened to the fulminations of Mr. Brodie Hoare and his friends against the present system, I wondered what they would have said had I described the old Property Tax as the system of taxation in force in the Colony. They have been vehement enough in regard to the present tax, but they would have been ten times more vehement in denouncing the iniquities of the old one. Gentlemen like these seem to find it their duty to oppose all systems of taxation, for the reason, I suppose, that they have to contribute largely, and very properly so, out of their abundance towards the revenue of the country. They do not seem to know whether they prefer being in the frying-pan of the Property Tax or in the fire of the new tax. There I will leave them. This is hardly the place, I think, nor is there time, to go into political discussions opening up such wide fields as the incidence of taxation and Free Trade versus Protection. One word in reply to the gentleman who complained page 469 about some money he had lost in the New Plymouth Harbour Board. I am very sorry for him. He has my entire sympathy. But I am afraid that many of us have lost money, if not in harbour boards in various other undertakings. He complained that the Government had been asked for some relief and no relief had been afforded. I would like to know what the Imperial Government would do if one of you were to complain that you had invested in the bonds of some Corporation in England—say Blackacre—and could get no interest. (A voice: "It is not analogous.") Would the British Government come to your relief? No; and why should the New Zealand Government come to the relief of the bondholders in the New Plymouth Harbour Board because that board has not been able to meet the interest? If the Government has varied the security, as has been asserted, it has committed an illegal act, and there are the courts of law to fall back upon. I thank you for the kind attention you have accorded me. In conclusion, I ask you to join with me in thanking our Chairman for presiding this evening. Sir William Jervois is one of the past Governors of the Colony—a Governor who was much respected, and who rendered valuable service to the Colony in the advice he was able to tender on defence matters, and he was much missed when he left us. We owe him a hearty vote of thanks for his services to-night, which I am sure you will readily extend to him.

The motion was cordially adopted, and the Chairman having briefly acknowledged the compliment, the company separated.