266 FINANCIAL CONSIDERATIONS 



side of this account should be dealt with first. This 

 will include the rent of the land in the state before 

 it is cut up, the interest and sinking fund on any 

 buildings, fences, water - supply, and the laying 

 down of permanent pasture, where these items 

 have been necessary. Finally, if the scheme is 

 done on purely business lines, there should be a 

 reserve fund to cover contingencies. It has been 

 estimated by judicious landowners that this should 

 be at least 15 per cent, of the rent of the holding, 

 but others might be satisfied with a narrower 

 margin. 



When all these items have been added up, the 

 landowner will be in a better position to communi- 

 cate with prospective small tenants, and see whether 

 their desire to rent small holdings is effective in 

 the economic sense that is, will they pay enough 

 to make it worth his while ? 



The conditions on various estates vary so 

 enormously that it is obviously impossible to do 

 more than give this brief indication of the lines 

 which preliminary considerations should take. How 

 different landowners have pursued this policy will 

 be seen in the following reports. 



