Colonial Secretary’s Office,
Auckland; 30th May, 1859.

TIS EXCELLENCY THE GOVERNOR DIRECTS the publication of the following Despatch from Her Majesty’s Secretary of State for the Colonies, respecting “The Waste Lands Act, 1858.”

Henry John Tancred,
(for the Colonial Secretary.)

Downing-street,
23rd February, 1859.

Sir,—Her Majesty’s Government have had under their attentive consideration the Bill of the New Zealand Legislature, entitled No. 75, “Waste Lands Act; 1858,” reserved for the assent of Her Majesty, and transmitted with your despatch No. 72 of the 26th August last. They have also considered the minutes of your responsible Advisers on the subject of this Bill, transmitted with your subsequent despatch, No. 99, of the 11th October.

They have had great difficulty in deciding on the best course to take with respect to the provisions of this Bill, especially as your despatches do not fully advert to some very important objections which, nevertheless, seem obviously to arise on the inspection of it.

So far as the effect of the Bill is simply to transfer the management of the Waste Lands to the several Provincial Governments, the measure appears one to which Her Majesty might be at once advised to assent. That is a subject on the expediency of which the New Zealand Legislatures are the best judges, and there are, besides obvious advantages in the transfer.

But a more serious question arises, where not only the management of the revenue, but the use of the revenue itself, is transferred to the Provincial Governments.

The Act of Parliament to guarantee a loan for the service of New Zealand, 20 & 21 Vict., cap. 51, recites and adopts the provisions of the local Act for raising that loan, one of which is, that the general revenue of New Zealand which is pledged for payment of the interest of the loan includes the revenue arising from the disposal of the Waste Lands of the Crown.

Any Act by which a portion of that revenue is diverted from this purpose, and made over to a Provincial Government, would therefore seem illegal on the face of it.

Moreover, it was on the faith of this application of the Revenue that the loan in question was guaranteed by this Country. To infringe on the revenue fund so made applicable would therefore seem to involve a breach of faith.

But it is a misfortune arising from the peculiar mode of framing this Bill, which professes to confirm in one mass the voluminous Land Regulations of several Provinces, that part of it at least is open to this objection. As regards the Province of Wellington, the general Land Regulations of March, 1853, are kept in force, but those regulations expressly devote the Waste Lands fund (after payment of Parliamentary charges under a former Act of Parliament) to provincial purposes. By confirming those regulations, as to Wellington, the New Zealand Legislature, (no doubt quite unintentionally, as they have obviously inserted other provisions from a desire to maintain the guarantee) would as far as their power goes exempt the land fund of that Province from any liability to interest for the loan of 1857.

I do not notice that the other Provincial Laws and Regulations confirmed by this Waste Lands Act are open to this specific objection. But in none of them is there any recognition of the lien imposed on the Waste Lands Revenue by the Loan Act; and it is not easy to foresee the complications and difficulties to which this omission would give rise.

Her Majesty’s Government regret that defects of so partial a character should nevertheless be so serious as to compel them to delay Her Majesty’s assent to the entire Bill, there being no legal method of giving force to that much largest portion of it which is unobjectionable. It is by no means their wish so to enforce the provisions of the Guarantee Act as to make them burdensome to the Colony. They are fully aware that specific appropriations of the Land Fund whether by general or by delegated provincial authority, must take place, and that they may take place with ample security to the creditor; provided only the paramount nature of the lien be maintained. And they regret that by delaying Her Majesty’s assent to the Act they may cause some inconvenience to parties who, both in the Colony and in this country have engaged in transactions on the faith of the Auckland Regulations, before these had been made duly operative by law. But they are of opinion that the exigency of the guarantee cannot be fairly satisfied, unless the Act be amended by the insertion of some provision recognising it. They would be satisfied with a general clause empowering the Governor, anything in this Bill contained notwithstanding, to take from the land revenue of the several Provinces pro rata whenever, and if ever the revenue from other branches shall be insufficient to pay the interest of the guaranteed loan. They do not however, wish to prescribe this particular form of clause if any equally stringent can be devised. Until this proposal has been considered by the Legislature, Her Majesty’s Assent to the Act is necessarily delayed.

I have, &c., &c.,
E. B. LYTTON.

Printed by McKenzie & Muir.