SHIPPING DAMP WOOL.

The Hon. Mr. SHRIMSKI asked the Attor ney-General, Whether the Government will take such action as will make it a punishable offence to ship damp wool, whereby life and property are endangered? He might say that just before the "Tainui" completed her loading here the other day it was noticed that one of the dumps of wool in the shed was damp and heating. On inquiring, it was found that a number of similarly damp dumps had been stored. They all had to be taken out. Had the ship gone to sea with such a cargo a fire would, without doubt, have occurred. The barque "Lochnagar was also recently found to have a lot of damp wool on board, and had to leave out cargo. One of the dumps, on being opened, emitted dense smoke, and in a very short time would have burst into a blaze.

The Hon. Sir P. A. BUCKLEY said this was a very difficult question to deal with, and one on which it was almost impossible to legislate by any special Act. He thought the honourable gentleman should move that a Committee be appointed to inquire into the matter, and obtain

such information as would warrant the Govern

ment in taking action. He was just as anxious to protect life and property as his honourable friend. At present, however, the Government had no power in the matter.

The House adjourned at twelve minutes past BANK OF NEW ZEALAND SHARE GUAone o'clock a.m.

LEGISLATIVE COUNCIL.

Wednesday, 18th July, 1894.

First Reading-Bank Directors and Shares-Transfer
Bill-S.S."Stella"-Shipping Damp Wool-Bank
of New Zealand Share Guarantee Act 1894
Amendment Bill.

RANTEE ACT 1894 AMENDMENT BILL. This Bill was received by message from the House of Representatives, and read the first time.

The Hon. Sir P. A. BUCKLEY.-I will ask the indulgence of the Council to suspend the Standing Orders, with a view of allowing this Bill and the Bank Directors and Shares-Transfer Bill to pass through all their stages to-day. It would be as well if I now made the remarks which I proposed to make on the second

The Hon. the SPEAKER took the chair at reading. It will save repetition; and it is only half-past two o'clock.

PRAYERS.

right that I should inform this Council of the necessity for the suspension of the Standing Orders, as well as of the necessity for passing the Bills through all their stages to-day. In asking the Council to take this course, I will briefly call attention to the passage of the BANK DIRECTORS AND SHARES TRANS- main Bill. Honourable members will, of

FIRST READING.

Auctioneers Bill.

FER BILL.

course, have a perfect right, when I move the

This Bill was read the first, the second, and second reading, to say what they wish with the third time.

S.S. "STELLA." The Hon. Mr. RIGG asked the Government, Will they consider the advisableness of utilising the s.s. "Stella," after existing contracts have expired, in carrying coals from mining ports for the supply of Government institutions in the colony?

reference to the Bill. A few days ago, on my assurance that there was a matter of very great urgency and importance likely to arrive from another place, the Council was good enough to meet late that evening, and, after an examination of the principles of the Bill, and after hearing the evidence given before a Select Committee which was set up, at which many honourable members besides those on the Committee were present, to pass that measure

The Hon. Sir P. A. BUCKLEY said he had not received an answer from the Marine Depart-through all its stages on that morning. Now, ment, but he might say that the Government wished to sell or get rid of the "Stella" as soon as possible. He did not wish to say anything which might injure her credit.

Sir, I am bound to say that, although that is now an old story, at the time we had some difficulty in placing the very serious question clearly before honourable members,

That

this Bill is to help the Assets Company.
is not the intention of the Government; and
we are determined, so far as we possibly
can, at some prudent time, to insist on a
severance of these two institutions, and that
the bank shall revert to its original and
proper function of banking. The bank would
then be free from its complication with the
other institution, and, being a national in-
stitution, should confine itself purely and
simply to banking business. That is the
main object of the Bill. It is a Bill, in the
first place, to preserve the credit of the
colony in the London market, and, in the
second place, to assist this institution to obtain
this money on the most favourable condi-
tions, retaining the principles contained in the
previous Act. I may say it is necessary that
this should become law as soon as possible,
because the autumn holidays will commence
shortly in England, and I an assured on the
best authority-the Agent-General-that it
is almost impossible to prosecute any busi-
ness there during that time. People are then
away from London, and business of this kind
is at a standstill. I think I have explained the
Bill, and the reasons for asking the Council to
suspend the Standing Orders. I therefore ask,
That the Standing Orders be suspended, in
order to pass this and the other Bill, which is
somewhat of a machinery Bill, through the
Council to-day.

Standing Orders suspended.

The Hon. Sir P. A. BUCKLEY moved, That the Bill be now read the second time.

and the public; and I am bound also to say that nothing but congratulations from one end of the colony to the other have reached the Government for the action which this Legislature took on that occasion to meet the great difficulty, which was averted by the Bill passed into law that morning. In speaking to many members of this Council whose experience in commercial matters is very much greater than my own, I need only state that one can scarcely venture to say what might have been the consequences if that measure had not become law. Since the passage of that measure the Government have been naturally anxious to ascertain what its effect was in the Home-country, where the money was to be raised. I would remind honourable members that that Bill gave the Bank of New Zealand power to increase its capital by not exceeding two millions, in shares called "A" preferential shares-shares with the Government guarantee. The Government, anxious, of course, for the credit of the colony, have been in communication with their representative in England, the Agent-General, and he has advised the Government that the issue of shares might entail a serious loss to the bank. That loss to the bank would naturally be a loss to the colony, because of the difference between the value of the shares, if guaranteed, and of stock, if guaranteed by the colony. That is a matter I need scarcely call attention to. Then, it is considered that the fact that no shareholder is able to hold more than three thousand shares in the Bank of New Zealand would create a difficulty in the The Hon. Dr. POLLEN.-Sir, I am about to London market; and the delay in the issue of protest now, as I have always done, and shall shares might also be a serious consideration always do, against this kind of legislation. with those who have the management of the Under ordinary circumstances, such changes business it is therefore considered desirable to as we are required to make in the constitution alter the provisions of the statute passed the of a particular bank would have been made other evening, and enable stock to be issued judicially by a private Bill or by a number instead of shares. The holders of stock have of private Bills. Instead of allowing the no control whatever over the bank. It is matter to take the course which it ought to stock guaranteed by the colony, and the take under all circumstances, we are required, holders of that stock are in no way whatever at a moment's notice almost, to deal with proentitled to take any active part in the manage-perty which is not ours, without even the forment of the bank. However, the Government mality of asking the consent of the persons who are anxious to safeguard the interests of the are particularly interested in the matter, before colony, and they are particularly desirous that it is done. I am reminded of a French story, the stock shall not be below par. The latest told of a celebrated wit, who was consulted information is that the amount can be obtained by a young lady on a particular point. She for this guaranteed stock at more than par, asked whether it was possible for St. Denis, and quite sufficient to provide for the amount according to the legend, to have walked all payable for stamp duty by the bank in this the way from his home in the country to Paris transaction. There is a provision in this with his head under his arm. The answer Bill, also, to which attention might be called, was, "Pourquois pas ? Ce n'est que le premier and that is, that there should be no limit to pas qui coûte" ("Why not? It is only the the number of "A" shares that any share- first step that is difficult"). If he was able holder may hold up to the amount guaranteed, to take one step he could walk the remainder and that no "A" shareholders should be en- of the distance. Well, Sir, we have taken titled to vote at meetings. Then, there is the the one difficult step, and now, with our heads clause with reference to the issue of preferential under our arms and not in their proper place, shares, the transfer of which is to be authorised are compelled to go wherever the Government by the president, "or some other person ap- chooses to lead us. I protest, once for all, pointed by him, with the approval in writing against this kind of legislation. I cannot take of the Colonial Treasurer." It has been said upon myself the responsibility of doing more in another place that the Assets Company is so than that. I can merely relieve my mind of interwoven with the bank that the object of responsibility, as I have done, by this protest.

any member of this Chamber. It seems to me the responsibility was taken in the whole affair when the Government consented to in| troduce the measure to Parliament. As soon as the necessities of that institution were made public, there was no other alternative but to permit it to close its doors or to pass these Bills. I think, under the circumstances, if, as we learn from the Colonial Secretary, the slight alteration which is proposed to be made by this Bill-to wit, the change from shares to stock-will have the effect of facilitating the issue of shares, we should not hesitate to make the required change. The other change of any importance which the Bill containsnamely, to get over the difficulty of one article of association which prohibits the holding of more than a certain number of shares

is one which we may easily pass, especially as it is accompanied by the provision that the holders of stock would have no power to vote.

The Hon. Mr. OLIVER. — Sir, we have to accept the Bill? That was the sole quesagreed that the Standing Orders shall be sus- tion before us. I would not take the responsipended, and the protest just made by my|bility of voting against this Bill; neither would honourable friend comes a little too late. It does appear to me that the proposal which is now made to us is one which is most reasonable under the circumstances. It has been found necessary, in the opinion of the Legislature of New Zealand, to guarantee two millions sterling in aid of an important institution. That policy has been adopted without one member of either Chamber feeling himself able to oppose it. Having gone so far, it seems to me reasonable that the colony, having undertaken that responsibility, should see that the institution so to be benefited shall receive the utmost benefit under the circumstances it is capable of receiving. It is too late to inquire into the policy which we have adopted. We have adopted it deliberately, certainly under pressure of circumstances, and under severe pressure as to time; but even the pressure that was put upon us in regard to time was more or less reasonable. Every one knows how exceedingly sensitive a bank is to public opinion. The proposal having been brought before us in the terms in which it was produced, and the representations having been made to us to which we then listened, we had only two courses open to us: one was to reject the Bill and face the inevitable consequence- namely, the stoppage of the bank on the following morning; or we had to do as we did, accept the Bill on the responsibility of the Ministry. It does not appear to me that at this time it would serve any useful end to discuss the policy which we adopted some days ago. Inquiries which have been made in the money-markets of the world have shown that, in order to get the fullest advantage of the course we took, some amendment of this character is necessary. For my part, I think it is quite reasonable on the part of the Government to bring down this proposal. Under these circumstances, any examination at this stage would be a mere pretence. think the appointment of a Select Committee was a mere pretence, and I pointed out to the Council, before we appointed it, that time would certainly not permit of any inquiry worthy of the name. And, although I was not a member of that Committee, I attended its sittings and heard the evidence. The evidence did not forward us at all. It did not add to our knowledge one whit. It was simply a repetition of what we had already learned. We had the evidence of the Treasurer, of the Premier, and the evidence of Mr. Murray, who represented the bank on that occasion; and, although the Select Committee reported to us in favour of the Bill being allowed to proceed, it seemed to me, after having listened to the evidence very carefully, that the reasons for going on with the Bill were weakened, not strengthened, by the evidence to which we had listened. It came to this, in my own instance at all events: that the real question which we had to answer was, Were we prepared to see that bank close its doors, or

I

us.

The Hon. Sir G. S. WHITMORE.-I assume, Sir, that you rule, as you ruled on a former occasion, that this Bill is a money Bill. I hope, therefore, that we shall not again_go through the ridiculous farce of sending the Bill to a Select Committee, and thus place our consciences in the hands of seven gentlemen who do not feel bound to supply us with the grounds upon which they make their recommendations. In such a crisis, and under the circumstances detailed to us by the Colonial Secretary, I think the Government had a perfect right to come down and ask us to accept, on their responsibility, such a Bill as they have brought before Why should we insist upon a Committee to inquire into the matter, considering we can do nothing to the Bill, and none of us are prepared to reject it? I could not understand it last time, and thought it was one of the most foolish things this Council has ever done. I am glad nobody proposes to repeat that performance in this Bill; and, for my part, I think our duty is to take the Bill as read, and for this reason: that we cannot amend or modify it in any way; therefore for the Council to go on nagging at the matter, and objecting to it, or making difficulties, I think unwise. I am prepared to take the Bill as it has come down, on the responsibility of the Executive. The Colonial Secretary told us only a little about the Bill, and I could have wished that we had a little more information than we have had in this Chamber. But when once the Speaker has ruled that the Bill is a money Bill we cannot interfere with its details, and they matter very little to us unless we are prepared to lay the Bill aside, and I am quite certain we are not prepared to do that. With regard to the Act already passed, which placed an obligation, I am bound to say, on the colony, the country, as far as I can hear, is entirely satisfied with our action on that occasion. I know that stringency exists all over the colony, a stringency more severe

than has ever before occurred in my experi- | in the position of a listener, and in that capaence of the colony. That stringency has been enormously relaxed through the fact of our having passed that Bill; and other banks have already issued instructions to their branches to relax to a very considerable extent, and there is a probability that the depression hanging over the colony may now be, to a large extent, removed through the fact of our having passed that Act, because for the last six or eight months those persons who are better able to judge of the position in regard to financial affairs than we are have been preparing for disaster which they saw coming, and very likely to occur, in consequence of the position of the Bank of New Zealand. That condition of affairs has been removed, and therefore I speak absolutely on good grounds -our action has justified the other banks in relaxing the pressure that has been put on the commercial interests of this colony. Although I do not like the principle of replacing shares with stock,-because the stockholders will look more to us, and not to their directors, for the proper investment of their moneys,-still, as the essence of this business is that the money is wanted at once, and there seems to be no other way to get it, I say that the Government, on the whole, could have done very little else than what they have done. I shall therefore take the Bill as read, and vote for it in its entirety, and not for any further Committee such as we had the other day, on which occasion certain honourable gentlemen satisfied themselves about something which they never informed us of, and we had to swallow the Bill in globo.

city he was not called upon to perform any judicial functions. For my own part, I may say, if one can trust-and I should hope that in a matter of urgency one may trustthe evidence submitted to the Select Committee by Mr. Murray,-if one may trust that the evidence submitted for the consideration of the Committee was reliable, then the Committee was justified in recommending the measure as expedient. In point of fact, what he told us was that the general decadence of commercial prosperity in the colony, the failure in trade, the difficulty of making a profit, had resulted in a condition of things which, taken into consideration with the large ramifications of the business of the bank and its responsibility to its clients, places it in an embarrassing condition on account of advances necessary to be made for trade purposes in the ensuing season. For this purpose he considered half a million was required; and it was of the first importance that a special reserve of £500,000 should be laid on one side, not exactly for immediate use, but in case of emergency, and upon which the bank could rely in case of accident, to strengthen its position. In regard to the second million, it seemed clear to the Committee that the bank transacted such a large business, it ought to have for the security of its position a liquid asset of one million of money. As explained to us, both by the Colonial Treasurer and the Premier, and by Mr. Murray, this amount was to be distinctly allocated for the purpose of furnishing to the bank a liquid asset, restoring thus general confidence in its transactions. The Hon. Dr. GRACE.-Sir, I do not under- In reference to this, there may be a difficulty stand you to rule that this is a money Bill, and if the Colonial Treasurer does not act with I do not ask you now to rule on that question. judgment. An asset that may be converted into It is a question which may be worthy of some gold at any moment is what is required. consideration later on. It seems to me to be a that precaution is taken, and if the business of new parliamentary doctrine that the Legisla- the Assets Company is properly administered, ture merely makes a pretence when, under cir- the bank ought to come through its difficulty, cumstances of urgency, it exerts itself to arrive and ought to assist materially in restoring comat all the information attainable before passing mercial prosperity in the colony. But for this a Bill of the importance of the Bank of New purpose, Sir, we must have honest, incorruptZealand State Guarantee Bill. I say it would ible men, and amongst them the most importhave been a gross neglect of duty on the part of ant will be the president of the bank, because this Council not to have moved for that Select it is not merely that he is armed under the Committee; and, if at any time this Council conditions of this measure with a veto, but in should neglect to avail itself of all the means order to exercise that veto judicially he must in its power, and at its disposal, for the pro- know the business of the bank minutely. He tection of the interests committed to its care, must have the judgment to decide, and to acthen the Council will become a mere pretence, curately forecast the future. I am not one of and its functions will be neither more nor less those who despair of the recuperative power of than a farce. Sir, the Committee reported that a great institution whose prosperity is necesin the interests of the colony it was an expedi-sarily based upon the security of a rapidly-deveent measure. It was not the duty of the Select Committee on that occasion to make public in the public Press or through Hansard what were the reasons that induced it to urge upon the Council the expediency of the measure. My honourable friend Mr. Oliver has informed us that he was present at the meeting of this Select Committee, and that the impression left on his mind was that the urgency and cause for the Bill had not been demonstrated. Of course, the honourable gentleman was only

If

loping country; and if this bank is to continue to go forward, and be renewed by a fresh departure, it should confine itself to strict banking business. I say competent directors ought to be in a position to save the bank, and if the bank is not saved it will be discreditable to us and to the colony. Under all the circumstances, I trust the Council will not carry away the idea or be led into the impression that the appointment of this Select Committee on that occasion was a mere pretence, or that delegat