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PUBLIC RECORD OFFICE

Reference :-

C.O. 882

8PUBLIC RECORD OFFICE, LONDON

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO

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one, either we shall have to reduce further the balance of Rs. 216,000, which is estimated as at the 30th June next, by the difference between Rs. 125,000 and Rs. 225,000, that is by Rs. 130,000-if the payment of the first instalment is made before the end of the financial year-that is before the 30th June-or we shall have to increase our deficit next year by so much. It is anticipated now that we shall have a deficit of about Rs. 400,000 during the coming year. If you add to that the Rs. 130,000 which have not been paid on the 30th April, and which, perhaps, will not be paid before the 30th June, you will have to add to that deficit Rs. 130,000, which will put the deficit at Rs. 530,000, and you will want taxation to pay the Rs. 530,000. (An hon. member:-There are the sums due to the railway.) The sum due to the railway is this. Last year, in order to make up the statement of the finances the balance sheet of the Government-Rs. 216,000 had been added as assets of the railway. Well, the Secretary of State has decided that the assets which were not tangible money, money not actually cashed, were not to form part of the balance sheet-that they were to be put aside. This year, it is expected that the outstanding accounts of the railway will be about Rs. 600,000 on the 30th June. But when the budget of the railway has been prepared, of course, account has been taken of that. It has been estimated that at least Rs. 300,000 of those outstanding accounts would be cashed during the coming year, and those Rs. 300,000 have been added on to the expected revenue of the railway. The railways are in this position with respect to their working. The estimated revenue of the year is Rs. 2,607,500. Well, as I said, it is expected that Rs. 300,000 will be cashed during the coming year, so that the revenue of the year, properly speaking, will be about Rs. 2,307,000. This estimate has been come to because it is expected that the new lines will bring in additional revenue (Mr. L. E. Antelme: They will give a loss.) They will surely bring in an additional revenue... Whether they will be worked at a loss or at a profit, I cannot say.

THE OFFICER ADMINISTERING THE GOVERNMENT: I do not wish to interrupt the hon. member, but perhaps he might say that the expenditure on the new lines is provided in the estimates.

Mr. LECLEZIO: I was coming to that. I was giving the estimated revenue. Then as to the estimated expenditure the estimated expenditure is Rs. 1,831,000, and that includes the staff of the different railways, except the staffs of the Rivière du Poste and the Town Tramways—and then the working of the Rivière du Poste line is put down in the estimates at Rs. 13,900, and the working of the Town Tram- way at Rs. 20,418. An addition of Rs. 80,000 has been made in order to provide for new wagons; it is indispensable that the number of wagons should be increased on account of the increased traffic. It is expected that the railway will on the whole give this year, as it has always given, a net profit.

I may be excused if I use an argument which is not mine, but sometimes one is tempted to make use of other people's arguments. On the question of knowing whether it is expedient to borrow for extraordinary or remunerative works or to pay for such works out of the general revenue I beg to quote the authority of the Chancel- lor of the Exchequer: I believe that authority will have some influence on the decision of this Council. This is what I read in the speech of Mr. Austen Chamberlain in the "Times of the 22nd April last:-

Of course, it is perfectly true that besides this sinking fund, which is devoted to the reduction of what I call a dead-weight debt, we have another debt. We have a debt raised by terminable annuities for naval and military works, for public build- ings, telephones and so forth. It has been said that if we were a company we should not be considered as in a solvent condition. I think a company that tried to provide the whole of its capital expenditure on works of that kind out of revenue would very soon find itself unable to carry out its intentions. It is a reasonable and thing, when you are dealing with expenditure which has, and will have, a capítal proper value for many years to come, that you should not necessarily burden one year with the whole charge but spread it over a reasonable number of years, provided we take care to have such a sinking fund as will redeem the debt well within the life of the works for which it has been expended. (Hear, hear.) And to speak of that debt as being on all fours with a dead-weight debt is misleading. It is a debt for which we have something tangible, which carries its own sinking fund with it, and which will all be redeemed within the period which parliament has laid down by the action of its own sinking fund."

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That is what we have done; that is what we have done for a number of years; we have borrowed money and we have paid that money by means of the sinking fund. After all, whether that is good or bad policy it is for you now to decide.

Mr. NEWTON: It is not bad policy.

If we

Mr. LECLEZIO: I for one shall say it is very good policy. I invoke the authority of Mr. Chamberlain. say it is good policy-the best policy that we can adopt. But whether it is good or bad policy we are driven into a corner, We cannot escape- we cannot escape either from taxation or from borrowing. It is for the Council to select is the Council to provide money by means of additional taxation for the extraordinary expenditure which cannot be met by the ordinary taxation? Does the Council rather think it proper to proceed to a loan in order to make payments which will benefit not only the present generation, but which will also benefit future generations? That is the policy which I have always heard advocated, everywhere, in every country in the world. I could understand very well, as I said at the outset, Sir Charles Bruce's policy-that so long as we had money in our safe, so long as we had money in the Treasury we had rather make use of that money to provide for the works than borrow money. But now I have shown, to the satisfaction of everybody I presume, that the balance in the Treasury has disappeared almost completely it is now Rs. 200,000, which may be reduced by Rs. 130,000 for the dredger, which will leave about Rs. 70,000 in the Treasury-that is not a reserve. Well, if you have some catastrophe, some calamity to contend with, will you not be glad to have some money in the Treasury in order to meet the first wants? were to have a cyclone like that which we had in 1892 do you believe that we could again have recourse to a loan in order to meet the deficit? Those are things which are done once, which cannot be done again-and it would be the height of imprudence to count on a small reserve of a few thousand rupees. I could conceive if things had a bright prospect, if we were in presence of a bright future that you should say; well, we shall go on, we need not reconstitute our reserves, we count upon good years, and the years which will come will produce a large profit, which will reconstitute the reserve. But, now, on what can you count? Can you count now, within one or two or three years, on such good years that you will be able to replenish the Treasury? do not think so. That is why I propose at the same time that we should delete from the estimates the sums provided for extraordinary works, and to meet those sums by means of a loan, that we should at the same time borrow in order to refund to the Treasury that advance which the Treasury has made. For instance, we have paid from the Treasury up to date, for the Long Mountain Railways Rs. 119,596-for the Bois Chéri and Rivière du Poste Tramway Rs. 239,384—for the Town Tramway Rs. 102,495, for the dredger 125,980, in all Rs. 587,456. Is it not prudent to refund to the Treasury that sum of Rs, 587,000? I think it is safe for the Government not to rely in time of calamity on its credit in order to raise money, it is much better that we should have in the Treasury some money in order to meet the first wants in such cases. Well, if you borrow Rs. 587,000 and Rs. 399,000 in order to meet the sums provided in the budget for extraordinary works, you will have a loan of about one million rupees. One million rupees at four or five per cent. will be very light indeed for the Colony, while the expenditure of one million rupees within two years for such works would be crushing for us.

I shall propose, therefore, that the motion be voted by the Council as I have put it.

Mr. NEWTON: I second the motion.

Mr. L. E. ANTELME: Je regrette de ne pas pouvoir me joindre au député de Moka. Lorsque Sir Charles Bruce a créé les nouveaux chemins de fer, il était sous l'impression fâcheuse qu'ils paieraient. Je dis fâcheuse, car Sir Charles Bruce ne consultait jamais les représentants de la population. Il avait un petit cercle qui l'entouraient et il croyait tout ce que ce petit cercle lui disait. Voilà pourquoi il a pris l'argent de la réserve pour le jeter dans des chemins de fer qui ne paieront jamais. Peut-être la ligne de la Rivière Noire aurait-elle payé si on l'avait conduite jusqu'à la Rivière Noire; mais, telle qu'elle a été créée, elle laissera un déficit chaque année. Quant au chemin de fer de Bois Chéri, il est aujourd'hui reconnu que c'est une vaste fumisterie électorale. De même pour la ligne de la Montagne Longue, elle ne paiera jamais. En un mot, avec votre système de toujours cacher la vérité au public, de la faire dissimuler par les journaux à votre dévotion, vous avez meng