568 PROCEEDINGS OF SECTION F. 



Rates of Interest on Public Debt. 



Rate. Amount at each Rate. 



£ 



6 per cent 4,796,350 



5 „ 9,546,160 



4| „ 151,880 



4^ „ 5,340,150 



4 „ 85,117,719 



3i „ , 38,709,834 



Total Debt £143,662,093 



Annual Interest at 31st December, 1890 £5,772,1601,= 4-02o/° 



The whole of this interest, however, did not accrue daring 

 the year 1890, as the debt increased by about £7,000,000 in 

 the twelve months, and there were balances unexpended in 

 the banks which bore interest ; but, assuming that £245,000 

 (being interest at 3^ per cent, on the £7,000,000) was a 

 sufficient allowance, the balance that accrued during the year 

 was about £5,527,000. Towards the liquidation of this 

 amount £2,720,000 was derived from the working of State 

 railways after payment of all expenses, and probably £500,000 

 from water and other reproductive works — the actual net 

 receipts therefrom in Victoria alone being nearly £219,000 — 

 leaving a balance of nearly £2,310,000 to be provided for 

 from taxation, surplus land revenue, and other sources of 

 general revenue. Thus, as much as 42 per cent, of the 

 interest for 1890 had to be so provided for. If the Federal 

 Government contemplated taking the debts over bodily, this 

 would be a matter which would require careful consideration. 

 Estimating the value of the reproductive loan works from 

 the net revenue actually obtained, vve arrive at another aspect 

 of the question. Capitalised at 2| per cent., the revenue of 

 £3,220,000 from railways and other reproductive works 

 would show their value to be close on £130,000,000, or 

 within 13| millions of the whole debt. 



This capitalisation is believed to be within the mark, con- 

 sidering, first, the probability of a fall in the rate of interest 

 from about 3^ per cent., which has recently prevailed, to 

 eventually 3 per cent. ; and secondly, the value to a syndicate 

 or company if the works were sold. In the latter case a 

 small increase in the present low rates, which it is the policy 

 of the Government to maintain, and a saving in the working 

 expenses by reason of the strict economy which would ensue, 



