B.—No. 2.

There are thus assets amounting to £217,171 19s. 9d., against liabilities amounting to £236,909 16s. 6d., showing the same balance, £10,562 3s. 3d., as before stated. Honorable Members will have observed that the full amount of Deficiency Bills authorized by law has been issued ; but I wish to mention that £60,000 of the amount is a merely nominal overdraft at the Bank, not bearing interest while (as is always the case) there are balances at the Bank from other funds to represent it. £10,000 has been taken up by the Trust Eund. Some objection was made last year to the Government asking for such an amount as £100,000 in the shape of Deficiency Bills ; but if honorable Members will be good enough to examine the various assets I have mentioned, they will see that the greater part of those bills is represented by advances outstanding from the Consolidated Eund. The full amount is represented and provided for in the assets; and when the bills fall due, in September, it may be found convenient to pay off a part or the whole of them. Honorable Members, I hope, clearly understand that after repaying those Deficiency Bills —after providing for the unauthorized expenditure of last year, and all the expenditure that has taken place for that year —after providing for the Reserve Eund, and for all the liabilities and engagements known to the Treasury —after having, in fact, paid or provided for interest and sinking fund in London up to the 15th July, or fifteen days beyond the end of the financial year —there still remained a balance of £10,562 3s. 3d. with which to commence 1872-73. THE PUBLIC ACCOUNTS. I am glad to be able to fulfil the promise made last Session, that an Amended Public Revenues Act should be introduced. During the time the present Government have been in office, and indeed from an earlier period, there have been constant discussions in the House upon the system of keeping the Public Accounts, and the systems of Control and Audit. Near the close of last Session, I read to the House, with the consent of the Committee on Public Accounts, a Memorandum I had submitted to that Committee, in which I stated the objects I considered it was necessary to secure in order to obtain anything like a satisfactory condition of affairs. The chief of those objects I stated to be, to secure a pre-audit. It has been my duty to point out, on several occasions, that under the existing system of audit there was no practical control over the expenditure; that the Controller-General's duty ceased when he had passed money to the account of the Paymaster-General; and that the custom had grown up of the Paymaster-General obtaining, by requisition, large sums from the Controller-General, with very little reference to the actual purposes to which they were devoted under instructions from the Colonial Treasurer. The Bill which I shall have the honor to introduce is not a long one ; but honorable Members may accept my assurance that it represents a large amount of trouble, and especially a very great deal of negotiation. The measure has received the cordial concurrence of the various branches of the Public Service which will be concerned in its administration. It has been ably drawn by the Controller-General; it is, I think I may say, in its general features, approved of by the Auditor-General, who has most willingly responded to my frequent requests for his valuable advice on the system of public accounts, and from which advice I have gained much assistance; and I believe I may add, that it has also the approval of the officers of the Treasury. The Bill, will really effect a revolution in the system of Public Accounts. Under it, the Controller-General and the AuditorGeneral will be associated as Commissioners of Audit. That is a union with which I believe honorable Members will be satisfied, and as to which the two officers concerned entirely agree. The Paymaster-General's Account will be abolished. Indeed, the use of that account has to a great extent been dispensed with since the Ist July, through the Auditor-General and Controller-General having co-operated with the Treasury, so as partially to initiate the new system. Since the Ist July, the Controller-General, instead of issuing orders on the Bank for the transfer of lar^e sums to the account of the Paymaster-General, under different votes, has issued orders for such amounts only as were required to be immediately paid away. The schedules of the amounts for payment have been approved and initialed by the Auditor-General; and the requisition on the Controller-General has exactly agreed with the amounts to be paid: so that, in effect, departmentally, we have 3

Deficiency Bills.

Public Eevenue Act Amendment Bill: Chief object to secure Pre-audit.

Bill drawn by Controller-General; approved by AuditorGeneral.

Those officers will become Commissioners of Audit.

Paymaster-General's Account abolished

9

FINANCIAL STATEMENT.