SECOND READING. (Hansard, 30 July 1857)

§ SIR JOHN TRELAWNY
said, he trusted he House would not sanction this Bill without having a statement from the Government of the grounds on which they were asked to guarantee a loan of £500,000 to New Zealand. He did not himself think that the loan rested on good security; and as he had waited in the House on several occasions until past one o'clock in the morning without having heard any explanation on the subject from the Government, it was now his intention to move that the Bill be read a second time that day six months. Of that sum proposed to be lent to the colony, £120,000 were to be appropriated to the 705 redemption of the colonial debt; £200,000 were to be paid to the New Zealand Company, in respect of former transactions, £180,000 to be applied towards the extinction of the rights of the natives in their lands. With regard to the natives, he thought this country was not dealing with them in a straightforward manner, for they had been induced to give up their property for a mere nominal price upon promises which had not been kept. It was true that a Committee, consisting of eight Members, had reported in favour of the Bill, but he must observe, without wishing to question their desire to act justly, that three or four of them had been connected with the Colonial Office, or entertained feelings of interest for the colony; and the only witnesses examined were the permanent Under Secretary for the Colonies and the Prime Minister of New Zealand. This proposed loan was in fact nothing but hush-money, in order that all discussion about past transactions might be put an end to. The Amendment moved in the Select Committee by the hon. Member for Oxfordshire, for the purpose of reducing the loan by a sum over £100,000, satisfied him that at all events a certain portion of the money ought not to be guaranteed by the House. It was true that the Bill had been recommended by the Colonial Assembly, but a portion of the assembly did not assent to that recommendation, and consequently there was no certainty that the Colonial Legislature would take measures to raise the interest on this loan; this absence of unanimity was a reason among others, for delaying the consideration of the Bill till another Session. The colony of New Zealand could obtain the loan in the money market at 8 per cent, and he did not see why the British Government should, under the circumstances, guarantee a loan with respect to which it was anything but certain that the security was good in order that they might obtain it at 4 per cent.

MR. W. WILLIAMS,
in seconding the Amendment, said he was at a loss to conceive why the Government should, in the present state of the public finances, agree to give a guarantee on a loan for so large an amount. It appeared that the colony could not raise the loan itself in the London money market at less than 8 per cent—a fact which clearly proved that the security was very questionable.
Amendment proposed, to leave out the word "now," and at the end of the Question 706 to add the words "upon this day three months."

§ MR. LABOUCHERE
said, that the purpose of the Bill was to enable the Government to guarantee a loan of £500,000 for the colony of New Zealand, and thereby to assist that colony under the financial difficulties in which it was involved to effect certain important political objects. He admitted that the proposition was one which that House ought carefully to consider, but there might be cases in which the country, with no cost to itself, might afford important assistance to a British colony by lending its credit to enable the colony to raise money for objects Imperial as well as colonial. The statement that the colony of New Zealand could only raise money at 8 per cent, whereas under the guarantee of this country it would obtain money at 4 per cent, must not be taken as a proof that the colony had not resources to pay the debt; for it was not to be expected that a new colony, whatever might be its resources, would find its name stand so high in the money market as that of a country like England. The proposition to guarantee a loan for a colony was no new principle, but had been acted upon at several periods, as, for instance, in the case of Canada and the West Indies. When he assumed the administration of the Colonial Office he found that his predecessor, the noble Lord the Member for London, had written a despatch offering to recommend that Parliament should guarantee a loan to New Zealand to the amount of £200,000, in order to enable that Colony to wind up the long and complicated affair which had arisen out of the relations between the New Zealand Company and the colony. The answer to that proposal came to him, and was to the effect that the colony had declared by its Legislature that it did not think itself justified in accepting it, if confined merely to the object mentioned; that the settlement of that affair would affect only a portion of New Zealand; that there were other and larger objects which they wished to accomplish, and that they could only fairly mortgage the colonial revenues to effect these more extended objects. Consequently, the Legislature of New Zealand passed an Act authorizing a loan of £500,000 instead of £200,000. A guarantee for the loan of £500,000 was therefore asked for by the colony. 707 He felt it his duty to look most carefully into the subject, and he came to the conclusion that the reasons given by the colony for the extension of the loan were good and valid; but not wishing to rely entirely on his own judgment before he submitted the matter to the House, he proposed that it should be examined into by a Select Committee as the most fitting tribunal to consider the matter. Something had been said about the composition of that Committee, but when he read the names of the Committee it would be seen that it consisted of hon. Members on whose judgment and independence the House could place reliance. Besides himself the members of the Committee were,—Lord J. Russell, Lord Stanley, Sir J. Pakington, Mr. Adderley, Mr. J. A. Smith, Mr. Henley, and Mr. Wise. The fact that Mr. J. A. Smith had been connected with the New Zealand Company and Lord J. Russell with the Colonial Office constituted no reason why they should not be proper persons to consider a colonial matter. He had attached much value to obtaining the assistance upon the Committee of two Members of the ability and acuteness which distinguished the noble Lord the Member for Lynn (Lord Stanley) and the right hon. Gentleman the Member for Oxfordshire (Mr. Henley). The noble Lord's name did not appear in the division upon the Amendment moved by the right hon. Member for Oxfordshire, but in a letter the noble Lord assured him that he approved of the guarantee to the full extent proposed, and with respect to the right hon. Member for Oxfordshire, though he objected to the guarantee, as far as part of the sum was concerned, he did not dissent from the principle of the proposition. The Committee looked into the question of security, and it was quite plain that unless the colony should be guilty of a gross breach of faith, it must have abundant means to pay the debt, the Customs' duties yielding £100,000 a year, and the land fund £80,000. He believed the proposed guarantee was most essential to the interests of the colony of New Zealand, and that the loan would enable it to place its financial and political affairs on a substantial footing. He therefore hoped the House would so far sanction the Bill as to allow it to pass the second reading.

MR. GILPIN
said, he should support the Amendment, as he thought the true policy to pursue with regard to the Colonies was to make them, as soon as possible, entirely 708 independent as regarded their financial affairs, and he looked upon this Bill as a step in the wrong direction. He should like to know the opinions entertained with respect to the Bill by the right hon. Gentleman the Member for Oxfordshire (Mr. Henley), who it appeared had divided in the Select Committee against a part of the proposed arrangement.

§ MR. SPEAKER
, who, in accordance with the standing orders, declared the debate to be adjourned.