WEDNESDAY, 2nd MAY, 1917. _________________________

Present: J.O. Giles, Esq. (Chairman), H.H. Paynter, Esq., I F.E. Venn, Esq.

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WILLIAM PATERSON, General Manager of the Agricultural Bank:

8609. By the CHAIRMAN: What was the date of the opening of the Agricultural Bank?—1895.

8610. Whence is the capital of the bank derived. - In those days it was found by the Savings Bank.

8611. And later?—The Government simply tell us to go on and that they will find the money. Advances, as required, are furnished by the Government.

8612. What is the present capital of the bank?—4½ millions.

8613. Is that the authorised capital?—It is actually the authorised capital, bit I do not say that we could lay our hands on the whole lot if we wanted it to-day. It is forthcoming when we do want it.

8614. What is the total amount actually advanced by the bank?—£3,607,665.

8615. I suppose most of these advances are made to the full value of the work done?—Our advances were originally 75 per cent. of the value of the work done, but it is now 100 per cent. up to £500.

8617. And the advances of £500 - Fifty per cent. and often less.

8618. How do you find that the principle of advancing full value for improvements has answered?—I think has been a detriment and that people do not cling to their properties when given all the money they want.

8619. Was your earlier experience more satisfactory than your later experience?—We did not do so much then but are now getting further afield. The settlers seemed to get on well and to get good crops without our supplying them with machinery and horses.

8620. You consider that the advances you were making 15 years ago were safer?—Undoubtedly safer, but the progress was not made that is now made.

8621. What safeguards are adopted by the bank in advancing on improvements to insure that the money advanced is actually spent?—Up to say 15 months ago we used to take certificates from the farmers' neighbours. Now we only pay on the certificates of inspectors.

8622. How many inspectors do you employ?—Between 30 and 40.

8623. Are these the bank inspectors? — All the inspectors for land, the Industries Assistance Board, and the Bank are under the control of the bank.

8624. Why are the certificates from neighbours abandoned?—They got to know too much. A neighbour would often sign a certificate and never make any measurements. The settlers would work into each other's hands and the system was found to be a dangerous one.

8625. Originally it was a good policy?—Yes. Eventually, of course, we got the matter put right but the settlers often beat us. Then, again, the Government would interfere and would not allow prosecutions. We had to abandon the system then.

8626. What would be the motive of the Government in preventing prosecution in a case of fraud?—I must leave the commission to answer that.

8627. By Mr. VENN: There were very few convictions being obtained?—I think we would have got very few convictions, but when there was a possible chance of conviction the prosecution was not allowed. We were not told why prosecutions were not allowed.

8628. By the CHAIRMAN: Do you consider that is inimical to sound management? Certainly.

8629. Are there any other instances to which you can point where interference by the Government of the day has stultified the usefulness of the bank?—No two Ministers of different Governments work on the same lines. We have to make the Act fit every Minister who comes into office. Ministers can interfere though they do not do so very much.

8630. For advances of over £500 you only advance 50 per cent. on improvements? - We have been advancing the full value up to 600 acres of clearing, no matter what the settler may have done in the way of tanks and fences. This brings up the acreage to a workable area.

8631. We have come across cases in which men assert that they have been compelled to clear their medium and indifferent land, not their best land, because the policy of the Agricultural Bank was only to advance £1 per acre, which was insufficient for clearing the good land?—We have never forced the settlers in this respect. If the settlers wished to clear this other land, and the inspector reported favourably, it was done. I know of no case where a man was forced to clear his scrub land. There might have been one or two cases where the man had a solid area of morrel country, but up to a certain margin the scrub land is fairly good.

8632. The settlers I have in mind state that the amount advanced by the bank is insufficient for the clearing of the best land, and that they have therefore had to clear their second class land?—I would like to quote the case of a new arrival from England, who had been only in the State 12 months.