THE PARLIAMENTARY SCANDAL

Inangahua Times, Volume XI, Issue 1733, 21 July 1886, Page 2

THE PARLIAMENTARY SCANDAL

The evidencegivenhoforethe DUtriot Railway Committees as been circulated this evening. It occupies twenty-four foolscap pages of small print. It includes a large number of letters and telegrams. The gist of it is, however, that Mr Steward stated positively that when lie laboured so hard to get the bill passed h« had not the slighest idea he would ever he personally interested in the sale of debentures, !>ut worked solely in the interest of his constituents. He denied absolutely that he had shared his commission wii>h anyone, or agreed to do so, and expressed his inability to see why a member of Par l iament should not be at liberty during the recess. The. total amount of commission was al>out £1035. H« admitted that the Government might possibly have purchased without his intervention, and that they derived no advantage from such intervention, hut he did not think they could have purchased at a better figure, excepting that his commission might have been saved*. He did not know whether the company would take his commission into consideration in he sale. It was only after the passing of the Act that be became interested in the sale of the debentures. He had no idea that he should be asked to act in that capacity, and it «» quite a surprise to him that he was asked. He declared that tbe Government had nothing to do with suggesting the matter. An important item in the correspondence is the follow ing letter from Frank Slee, secretary of the Waimate Railway Company, to Mr Steward, dated ISth September, 1885 (the day after passing of the District ! Railway Purchasing Bill in the Lower House). Tiie blanks are as in the printed evidence : — " Waimate, N.Z., 18th Sept.. 1885. "Dear sir, — (Private) — In congratulating you upon the successful passage of the District Railways Purchasing Bill through Parliament, it strikes both Mr and Mr it would be an opportune tine for yourself and probably interviewing die powers that be iv connection with the insur* ance department, with a view to dispos ing of .he £38*000 odd dentures of this company to be given by the Government at the purchase price for the railway. The money market at the present time should be as favourable as any for effecting this. You will notice by yesterday's cablegrams that money in the Home market is 1^ In the event of yourself and effecting this tale on favourable terms the directors would ofcoarae heat itns a matter of business. You may remember my speaking of this to yon before. I perfectly remember what w»s said by me. Although the loss to the company will be a heavy one, this would not preclude their seeing and acknowledging yo>ir and valuable services.*' Another important item in the correspondence is the following letter from Mr Steward to Mr Brodrick, official liquidator of the Duntroon Hakateremea Railway Company, dated 28th September, 188^- " The agreement between the Government and yourself for the purchase by the Crown of the above railway having been validated by the pissing of the District Railways Pnrchasing Act, it remains only, I presume, to obtain an order from the Supreme Court, under article 3 of the said agreement, to enable effect to be given to the Ba me. Thereupon, as I read the Agreement, payment will be mndp to you of the agreed price, viz. , £ 61 ,000 in 4 per cent, debentures. As I •anticipate that in order to enable you to wind tip the whole matter us speedily as possible, it will be yonr desire to convert the debentures into cash withont loss of time, I write to say that; I think I can be of some assis t&nce in that direction. About two yeaca ago (prior to the proix>snl for the purchase of the lines by the Govern tuent), the negotiation of the said of the £70,000 debentures of the Dun troon Httka-temniea Company, and of 440.000 of tbe W*to*ite Company (7 per cent.) was placed in my hands, and I should fiß>* succeeded in disposing of them at or about the limit fixed, but for the hitch that arose through the Government guarantee of a part of tbe interest being limited to a term of roars, and that term not even b»in<; concurrent with the currency of the debentures. The conditions are mow greatly altered, the debentures now to be issued being colonial bonds hearing 4 instead of 7 p^r cent, interest. If sold in the colony a discount would obviously have to be submitted to ; and even if sold in London in the small parcels which the purchase prices of the lines respectively •epeoSent, I question whether mare Mitm 97 or 98 could be look for. \* the «A> in London would also involve a delay of at least six months, if my 95 could he immediately obtained here, that 'vonld be a better financial refill t.h m 97 or j even 98 in London six month* heiioe, i m besides loss of interest there nm ! considerable expenses in the way of I advertising, exchange, etc., to be t iken into account. Accordingly the Wai- j B&te Company, immi'diHtely on receipt, ; af the news of the paging of the Act. j rrote to me asking me again to take ip the matter of the sale of th« Jebentures (£33.91 8) which are payable io that company. I have already j entered upon the necessary negotiations i md hope shortly to be able to lay an ' )ffer before «y clients for their

acceptance. I have reaso'i to think ■ that I coul I a!s-> oUUia an off*>r for ( the Duntt'Oon<tl:ikatHi-amt (<Hi»entiires, t and write to know whether you will authorise me to enter into negotiations to that end, as in tint ca-u* I can mike i most likely oun transaction of the. matter. If so, please state (privately) what figure you would be disposal to accept. A reply by wire would Inexpedient — Yours very oliediently, W. J. Steward." Sir Julius Yogel in bis evidence thus explained the origin of the transaction : — " The facts genemlly were these : I had it in ray mind to try and get hold of these del>enrures, because it would be undesirable tlmt four or fiv> i different companies should l*> offering debentures in London or ht-iv at the same tune. The act gave the power of buying to the Government As we hail spare, funds, I brought it. before my col leagues as soon as the session was over to try and buy them at 93 or 95 with 2 per cent, interest accrued. Iw is about to write making an offer when Mr Steward came and said be was authorised to act for the Waimate company. It was much easier to negotiate verbally, S3 I arran ?ed with him." Sir Julius add^d that, the first intimation he had tint Mr Steward was in a position to negotiate was after the session was over. The other portions of the evidence of chief interest I telegraphed to you previously.