XXIII.—Conclusion.

I have summarised the facts under the proper heads in Table V, and they seem to show conclusively, notwithstanding the rapidity with which the debt has of late years been increased, that there is no reason to fear the liabilities have outrun either the public or private resources of the colony. It will be seen that the annual charge of the debt per head of the population has increased 34 per cent, since 1870; but the property and income of the population have likewise increased, and in a very much greater ratio. For example, it will also be seen from Table V, that from June, 1870, the increase from three sources alone, viz., exports, live stock, and land under cultivation—is estimated at 54l. 19s. 2d., equal to 12i. 3s. 10d. per head per annum, independently of produce raised for home consumption and all other sources of income; or deducting 3s. 10d. per head for interest on the increase of capital borrowed by individuals during the five years—net 12l. Whereas during the same period the debt charge has increased only 13s. 4d. per head per annum.

Nevertheless I have not concealed my opinion that the credit of the colony has been too freely drawn upon during the past five years, and I am aware that this opinion has prevailed in financial circles. It cannot, indeed, be denied that a feeling of uneasiness began to prevail, with the usual want of discrimination, following upon the difficulties of Turkish, Egyptian, Peruvian, and other foreign debtors. Though from what has been set forth above, it will be seen that it has not been the resources of New Zealand which have been exceeded, but the disposition of investors at home to absorb the loans, the public not being aware how ample is the security afforded by the colony. Loan after loan has been brought out, and the market has been over supplied with New Zealand bonds. Before the capitalists who took up one loan bad been able to place it with the investing public, another loan has followed, at a lower price, and prejudiced the previous operation. But all this has no bearing upon the soundness of the security; though I trust it may prove a timely warning to the Government of New Zealand that they must moderate their expenditure, even upon works of the greatest ultimate advantage to the colony, and not suffer their zeal for developing its resources to outrun their power of borrowing on fair terms in the London money market.