Mr. SEDDON.-On the point of order I would say that the honourable gentleman mentioned the name of the Minister for Public Works. Mr. FERGUS.-There is no point of order to raise.

Mr. SEDDON.-Yes; there is a point of order raised as to whether the honourable gentleman should withdraw the expression.

Mr. SPEAKER.-What is the point you wish to raise ?

Mr. SEDDON.-I wish to put the matter clearly to you, so that you may decide upon a full statement of the case.

Mr. SPEAKER.-I do not think I can hear the honourable gentleman. The honourable member for Mount Ida has put forward certain suggestions with a view to show that he should be allowed to use the phrase to which I took exception. But I have to point out to him that the ruling of English Speakers is to the effect that no "conduct approaching to trickery or unworthy proceedings can as a matter of debate be charged to a Government. If that cannot be done, most certainly corruption cannot be charged to a Government; and if the honourable gentleman turns to Blackmore, page 315, he will find it there distinctly stated that it is not within parliamentary rule "to charge a member with having been detected in the grossest practice of corruption." He will also find, if he turns up Burke's "Parliamentary Precedents," a celebrated case in which Mr. Duffy said, "I don't think, in the worst days of Walpole and the Pelhams, more scandalous corruption existed than I have seen with my Own eyes practised upon Irish members." These words were taken down as not being within the rule of parliamentary order. They were considered by the House on the following day, and they were, by direction, explained and apologized for. Undoubtedly the honourable gentleman is right to a certain extent. Any member of the House can in a proper way bring forward a charge of corruption or any other offence against the Government of the day; but it must be done with all the gravity due to such a proceeding, as, for instance, by a motion of censure or for a Committee of inquiry. I rule that such a charge cannot be made incidentally as a matter of debate.

Mr. FERGUS.-I presume the honourable gentleman can finish with a motion.

Mr. M. J. S. MACKENZIE.-I have no intention of finishing with a motion; but, as regards gravity, I assure you, Sir, that I scarcely ever felt graver in my life. But if you wish me to withdraw

Mr. SPEAKER. - Yes; I must ask the honourable gentleman to withdraw the words.

Mr. M. J. S. MACKENZIE.-I ever obey the ruling of the Chair; but if you compel me to withdraw I submit there should be some rule, Mr. Speaker, to compel you to supply me with another word. I do not know of any other word to apply to that letter. I withdraw the words absolutely; but I would remark that some philosopher explained that words were,

Mr. SPEAKER.-The honourable gentleman must not attempt to qualify the force of his withdrawal in the manner that he is now doing. In all fairness to the Chair and to the House, when once the Chair has ruled that an expression must not be used, the judgment must be accepted, and no attempt be made to recur to the point.

Mr. M. J. S. MACKENZIE.-Then, Sir, I must withdraw the words absolutely; but I confess to you that it does raise the indignation of an honourable man to see honourable members sheltering themselves behind a mere quibble; because, after all is said and done, what did that letter mean? I ask any member of the House if it did not mean this, in the vernacular: "You put our man in the House and you shall have the Rangitikei bridge; put the Opposition man in and you shall not have it." I put it to honourable members, and leave them to decide if that is not the fact. I say it raises the indignation of an honourable man in the highest degree to find the public moneys being jobbed away, or to view the prospect of public moneys being jobbed away, in that peculiar manner. It is impossible to express one's indignation adequately when we find the money derived from the toil and sweat of the people of the colony being bartered away in order to temporarily improve the position of Ministers in this House. I do not know what term to apply to such a proceeding. I have withdrawn the term I did apply, and I allow any honourable member to supply such other as he thinks suitable. Leaving that question and coming to the Land Fund,-about which I have not heard a single member on the other side of the House say a word,-it must be admitted that it is in a most desperately unsatisfactory position. We are told that there is a particular anomaly in connection with it. references to it in the Statement are as follow:

The

"I have not amalgamated the Land Fund Account with the ordinary revenue, and the anomaly remains of having to provide for a deficiency in this department out of the consolidated revenue. The excess of expenditure over revenue, it will be seen, amounts to £35,162, which will have to be made good by a transfer from the Ordinary Revenue Account. I think the time is not far distant when this separate account will have to be absorbed in the ordinary revenue, and the annually-recurring deficit effaced from the estimates. There is less reason now to keep them distinct, as the larger portion of the work done by the Survey Department, and debited to the Land Fund Account, is in connection with perpetual leases; the revenue derived from these being credited as territorial revenue in the Ordinary Revenue Account of the Consolidated Fund."

"The practice of the Government has been to devote out of ordinary revenue sufficient to

for a particular purpose-namely, to prevent money accruing from capital through the sale of land being called, and used as, revenue; and now, because there happens to be £20,000—a matter of account-credited to territorial reve

Land Fund and absorb it as revenue. It would be infinitely better that the Land Fund should be credited with this £20,000, and after that made to pay its way. We now come to the surplus: and there is no doubt there is a surplus. It is stated at £165,000, which swells itself to £330,000 for the current year.

Mr. J. KELLY.-They stopped the surveys. Mr. M. J. S. MACKENZIE.—Who stopped the surveys? The expenditure on surveys was then very much greater than, looking at the accounts, it is at the present day. It was £158,000 then, and it is about £94,000 now. However, as I say, the Premier succeeded to a surplus of £86,000, and after three short years he left a deficiency in that fund of £133,000. That £133,000 is, in the shape of deficiency bills, outstanding still. When he left office, and the next Government took over the administration, they could not recover all in a year, and so there was a deficiency in 1889-90 of £45,000, which was also wiped out by transfer of revenue; and, in 1891, the result of Sir Harry Atkinson's finance, after three years, was to give a surplus to the Land Fund of £2,040. Then, last year we had a deficiency -the honourable member wiped it out with revenue of £16,000; and this year we have an estimated deficiency of £36,000, which also is to come out of revenue: that is to say, it falls upon the taxpayers of the colony. I do not hesitate to say that the Land Fund should at least be made to pay its way, as it has done in the past. Now let me deal with the reason assigned for the fact that it has not paid its way. We are told that the expenditure for surveys of perpetual leases is charged to the Land Fund, while the rents of those leases go to the territorial revenue-that the larger portion of the survey work debited to Land Fund is for perpetual leases. Now, that is not the fact. It is not the fact that the larger portion of the £94,000 spent on surveys is for survey of perpetual leases. The total sum is only £20,000. I had it direct from the department by the courtesy of the Minister of Lands, so that, with a deficiency of £36,000, even if that £20,000 were, as it should be, debited to the territorial revenue and credited to the Land Fund, there would still be a deficiency in that fund of £16,000. Yet the Premier tells us the cure is to abolish the Land Fund, and absorb it in the ordinary revenue. Perhaps honourable members do not know that in 1881 Sir Harry Atkinson established the Land Fund as a separate account

VOL. LXXVI.-2.

An Hon. MEMBER.--An estimated surplus. Mr. M. J. S. MACKENZIE.-An estimated surplus, of course. There is no doubt they have got it, and I am glad they have got it. They inherit it from us, it is true.

An Hon. MEMBER.-No.

Mr. M. J. S. MACKENZIE.-Yes. I repeat the word particularly for the honourable gentleman's benefit. They owe that surplus to this side of the House. I do not grudge it to them. I do not complain of the fact that they have inherited our surpluses, because there can be no doubt we have for a long time inherited their deficiencies. It is merely striking a balance -a mere matter of account between

us.

The honourable gentlemen are quite entitled to it. But what are they going to do with the surplus now they have it?-for the disposition of that surplus involves the whole policy of the Government, since otherwise the policy of this year, so called, is a mere remnant of the policy of last year, not yet come into operation. The whole policy of the Government is summed up under two headsnamely, the diversion of £200,000 of the surplus into the Public Works Fund for carrying on the public works of the colony; and the initiation of a system of local borrowing, mainly from the Trust Fund - the so-called self-reliant policy. Everything is to be raked into the Public Trust Fund. A sum of £450,000 is to be forced from the fire and life assurance offices; and there is the Testamentary Trusts Bill, of which we have heard so much, and the unclaimed bank deposits, and so forth - all intended to swell the Public Trust Fund. A large portion of the moneys, as I understood the Postmaster-General to say, to be taken from fire and life insurance companies, is to be lent out to farmers at a low rate of interest. Now, the House has heard the Opposition criticism of this new policy at some length, and I do not mean to supplement that criticism now. I am proceeding on an entirely new line to-night. I am going to give the Government criticisms on the Government policy-and I do not mean Government criticisms as we get them in the Financial Statement, but Government criticisms as passed when they are in Cabinet together, when they unburden their minds freely to each other. I trust there is no danger of the Secretary to the Cabinet being discharged, as so many Civil servants have been; because in this case no secrets have been divulged by him. Nor will the House suppose I have been eavesdropping. I am going to give

savings-banks is not a trading fund, and it should not be spoken of so lightly as to be termed a trading fund, to be used for purposes of this kind."

We should speak of the trust funds of the colony with proper reverence! I hope the honourable gentleman thinks so still. But I proceed to quote:

"Until this proposal was made I never heard the trust funds of the colony spoken of as trading funds to be applied at the option of the Ministry of the day or Parliament of the time being to purposes such as this. At all events, if they are to be so used, let those particularly interested, the depositors, know it, so as to give them the opportunity of investing their money elsewhere if they differ from the proposal now made. I am afraid we have just entered on a dark and dangerous track."

That is exactly my opinion. We have entered upon a dark and dangerous track; and when we entered upon it it might have been dark and dangerous with the late Government, but God only knows what it will be with the present.

"The system is one of undefined borrowing, and we do not know where it will lead us to. . . It would be nothing surprising if the people took alarm at their money being used for such purposes"-say, for lending out to farmers at a small rate of interest; I am afraid to mention Rangitikei bridges, as I might be called to order. But I continue to quote:

"Is the Ministry of the day or the House to seize upon these moneys and spend them for political purposes? This means that public confidence will be shaken; and, once the public confidence is shaken, the result will be disastrous."

That, Sir, is the gist of their opinions. I was anxious to quote from the Minister of Labour, but I find his speech was devoted to a series of jokes about the Otago Central Railway, and there was no business in it. Well, Sir, so much for the second part of the new policy of the Government-borrowing from the trust funds-and their own opinions on it. Now about the first part-the construction of railways from revenue. There is no doubt I think every one must agree that the principle as a general one is wholly impracticable, absolutely impracticable, and, in our circumstances, unsound. In the first place, as has been pointed out, the revenue-the surplus of revenue is only an estimate for the year; but the works are in hand, and must go on. If, therefore, the estimate does not come out right it will end in so much more borrowing: first deficiency, then deficiency bills, and ultimately funding. We all know the process. So that it is just possible-it is always to be contemplated that while the works are proceeding the revenue will not be forthcoming. The revenue in its very nature is a fluctuating thing. Deficiencies will arise under any circumstances and under any Government. And it must be admitted that the honourable gentleman at the head of the Government has had a remarkable experience in producing deficien

cies. On the first occasion on which he took office he left a deficiency of a million; on the second occasion, only the other year, he left a deficiency of half a million; and the next time he leaves office, which will not be very long after the next general election, he will doubtless leave a quarter of a million. It would seem that the honourable gentleman is improving; and by the time we are dead and gone, if he survives, he may make the two sides of his accounts balance. And what is the prospect before this colony? Is it at present so very cheerful? It is a fact that wool, which is our main staple export, has never been as low for twenty-two years as it is at the present time.

Mr. W. P. REEVES.-Hear, hear.

Mr. M. J. S. MACKENZIE.-I am glad to hear the Minister of Labour corroborate me. We saw in the paper the other day that wheat is at 31s.

An Hon. MEMBER.-Thirty shillings.

Mr. M. J. S. MACKENZIE.-Well, 30s.: it has fallen very much. Frozen mutton has also taken a sudden step downwards. These are things that form the foundation of our prosperity, and consequently of our revenue. What right have we, at a time like this, to use the public money--the money of the taxpayers— for public works other than roads, bridges, and suchlike? What guarantee have we that this surplus will continue? Under all the circumstances can any one doubt the honest principle underlying the question of the disposition of our surplus? I have no hesitation in saying

and every authority in finance in the world will bear me out that the first thing we should do with such part of our surplus as we can spare is to pay off the deficiencies of the past. Can any one question that? There are about £450,000 of deficiency bills outstanding-the outcome of deficiencies of previous years. How is it possible for us to tell the world we are paying our way if we absolutely refuse to use the surplus of the present year for its first legitimate purpose-namely, to pay off the deficiencies in the revenue of the past? So long as we refuse to use it for that purpose it must be held that we are not paying our way, but that we are living on loan. Then, if we do not choose to do as we are bound to do,-use the surplus to reduce the deficiencies of past years, -is it not a cardinal principle that the next best purpose to which to put the money is to reduce taxation? Is it possible any one can refuse to recognise the soundness of that proposition? Surely the taxation which is imposed on the people of the colony in periods of depression and deficiency should be removed when the depression passes away, and prosperity, as we are told is now the case, takes its place. And, Sir, look at the danger threatening us if we do not reduce taxation when we have the opportunity. What then is the position? The colony might find itself landed on an evil day, when, owing to the refusal of the Government to take advantage of the opportunity of reducing taxation, we might have to impose new burdens with all the old still on

So.

As &

the backs of the people. That is the position we should be in if we were face to face with deficiency in the revenue and a depression in the colony. There might easily be a failure next year in the revenue of £100,000. matter of fact the Customs unexpectedly rose £100,000 this year. Then, there is an acknowledged deficiency in the Land Fund, estimated this year at £36,000. Then, we have to look the fact in the face that the Government may be successful in their policy of bursting up, as it has been called. I pointed out last year that the success of the Government finance depended upon the failure of the Government policy. If they succeeded in bursting up estates, the Premier will admit that a loss of £60,000 or £70,000 to the revenue would be thrown upon the general taxpayer. Where is it to come from? Take all these sums together, and where is the sum-total of them to come from? It must come from the Customs; and the Premier himself has said Then, there is the question of improvements. A large amount of taxation is now levied on improvements. Every member on the Government side has objected to the tax on improvements. Sir George Grey condemned it; the honourable member for the Grey, on the Address in Reply, condemned it; the honourable member for Heathcote did the same; and the honourable member for Wellington City (Mr. McLean), I think, also did So that the tax on improvements must go sooner or later-probably sooner. Where, then, is the money to come from to meet possible deficiencies in the ordinary revenue, certain deficiencies in the Land Fund, and losses consequent on the success of the Government policy-which we must assume they wish to carry to success-and the remission of taxation on improvements? The whole may easily amount to £250,000, and the Premier has told us that, .whatever it may be, it has to come from the Customs: that is to say, it is to be piled on the shoulders of the working-class, in spite of the fact that that class has already to pay as much as can be borne in the way of taxation. In a speech delivered at Feilding during the last recess the words used by the Premier were as follow:

So.

"It had been said that if the large estates were burst up there would be a loss of £70,000 to the revenue; but he could lose that amount from that source with a light heart, and easily make it up by an increase in the Customs revenue consequent on an increased population."

Here is a nice prospect for the people of the colony. And he could do it "with a light heart." That was the language of Napoleon III. when he went gleefully into the great war with Germany; and so with a light heart the Premier is going to make up for all possible deficiencies from the working-classes in the shape of Customs duties. And there are honourable gentlemen on the benches opposite who are supposed to represent the working-classes, and they sit quietly by and say that the Government policy is a grand policy, and that the Financial Statement embodies everything that is sound. |

As

This is what is called a self-reliant policy. my honourable friend sitting on my left, the member for the Hutt, remarked during his speech last night-and it is one of the best things I have heard in debate this sessionif we go to London for money at a low rate of interest it is borrowing, but if we get money in the colony at a high rate it is self-reliance. It is a positive libel on the name "self-reliance." Here we are cadging for public money in every possible direction, raking it, as has been remarked, from every quarter, into the Public Trust Office, that we may borrow it at 5 per cent. We call this a self-reliant policy, and yet we know perfectly well that the money borrowed locally will in reality-the whole of it- - come from England. Even this self-reliant policy compels the honourable gentleman to clutch greedily the money of foreign life insurance and fire insurance companies. He compels the companies to supply it at 4 per cent. in order to give it to our farmers, as he pretends. This is like the self-reliance of the man who is hauled out of the water in a drowning state, and who clings to his rescuer and says, "There is nothing like self-reliance." All the time we are raking in foreign money we are glorying in the fact that we are carrying out a policy of self-reliance. Sir Harry Atkinson in 1881 raised a local loan of £250,000; and what was the result? Every penny came from London. It is much as if a man should go to a shop and say, "I am buying this article locally; I am determined to be selfreliant "-when all the while he was but purchasing an import. The telegrams every morning in the newspapers refer to Mr. Dibbs, the New South Wales Premier, and his mission to England. What has he gone Home for? To induce the English public to believe that the credit of the colonies is not so bad but that England might still afford out of her superfluity to lend us the money we require. Does any one suppose that New South Wales could not raise money locally that there is not more local money available in that colony than we have here? The thing is absurd. But, of course, there are no political charlatans in New South Wales to endeavour to teach the people-as some are doing here--that we are following a self-reliant policy in adopting a vicious and extravagant system of borrowing nominally in the colony and actually from England. I had a series of notes with reference to the insurance forced loan, the testamentary trust proposals, and so forth; but these matters have been so largely dealt with by other honourable members that I do not wish to elaborate upon them now. I would, however, ask the Premier why he should take the trouble to declare that he wants this money from the insurance offices as a guarantee of good faith. Why on earth does he not tell us plainly the truth-that he wants the money in order to lend it to the farmers? Why say he wants it as a guarantee ? There was no necessity for that. According to law, life insurance offices have now to deposit securities to a very considerable amount with the Public Trustee.

If