8.—19

1904. NEW ZEALAND.

"THE PUBLIC REVENUES ACTS AMENDMENT ACT, 1900" (CORRESPONDENCE IN A CASE UNDER SECTION 9 OF), RELATIVE TO THE PAYMENT OF INTEREST ON DEBENTURES ISSUED UNDER "THE AID TO PUBLIC WORKS AND LAND SETTLEMENT ACT, 1900."

Laid on the Table pursuant to Section 9 of " The Public Revenues Acts Amendment Act, 1900."

The Contkollee and Auditob-Genebal to the Hon. the Speakee of the House of RepbeSENTATIVES. Sib— Audit Office, 6th July, 1904. The Controller and Auditor-General has the honour to respectfully submit to the House of Representatives, in accordance with the provisions of "The Public Revenues Acts Amendment Act, 1900," a copy of the correspondence in a case under that section where a difference of opinion having arisen between the Audit Office and the Treasury on the question whether on money raised by certain debentures issued under " The Aid to Public Works and Land Settlement Act, 1900," there is appropriation in that Act for the payment of interest in addition to the interest which the debentures were issued and provided with coupons to bear. The Governor has decided the question by determining that the payment of interest beyond the due date of such debentures up to the date of actual payment in cases where the delay in payment was not caused by the holder thereof should be charged to the Act. J. K. Wabbubton, Controller and Auditor-General.

No. 1. Copy of a Minute or Voucher for £1 7s. 4d. in favour of Trustees, Porirua College. Theee is no authority in "The Aid to Public Works and Land Settlement Act, 1900," for paying interest in respect of the debentures beyond the due date thereof. J. C. Gavin, A.C. & A.

14th April, 1904. No. 2. Memorandum for the Audit Office. The Treasury is of opinion that the payment of overdue interest is duly provided for by section 11 of "The Aid to Public Works and Land Settlement Act, 1900." The wording of subsection (3) of section 11 refers to the sum of money named in the debenture, and states that " all interest payable in respect" of such sum of money shall "be a charge," &c. The Treasury reads such subsection to mean that all interest (including overdue interest) may be paid under the appropriation of the Act authorising the issue of the debentures. Jas. B. Heywood, Secretary to the Treasury. 15th April, 1904.

No. 3. The interest payable under section 11 is the interest payable in respect of the debentures that is the interest which section 3 provides that "they shall bear." It is only on money raised under the Act by debentures, scrip, or stock that the Act authorises the payment of interest. If in paying off the debentures, there is failure to duly pay, for which the Treasury is responsible, and interest is allowed for the period of such default, this interest would be not interest in respect of the debentures but interest in respect of the money in default, and would not therefore be authorised by the Act. Where the Treasury is not responsible for the failure of the holders of the debentures to receive payment of them at the due date it is obvious that interest allowed for any period after such due date is not authorised by the Act. J. K. Wabbubton, C. & A.-General. 18th April, 1904.