PRIVATE FINANCE. THE 'HE first century of Australasian history closed on the 26th January, 1888. It is impossible to trace step by step the progress made during that period, as the data for the purpose are for the most part wanting. Sufficient material is, however, available, from which a comparative statement of the wealth of the colonies at different periods may be deduced. In the following figures the private wealth of the people has alone been considered, the value of the unsold lands of the State, as well as the value of public works, having been omitted. The table shows the private wealth of the whole of Australasia and the increase thereof at intervals of twenty-five years from the date when this territory was first colonised : The progress exhibited in this table is marvellous, and as regards ratio quite unprecedented. Though Australasia has but the population of a province of one of the great European powers, in the wealth and earnings of its people it stood, in the year 1890, before most of the secondary States, and as regards wealth and income per head of population far before any other country. The plan adopted in valuing the elements of private wealth has been sketched in previous issues of this work, and, as it is marked by no features of special interest, it need not be repeated on this occasion. Below will be found the valuation of each of the principal elements:-- Plant employed in Agricultural, Manufacturing, and other industries not elsewhere included.... 35,260,000 Total 1,169,434,000 Let it be understood that the figures just given refer to the year 1890. No attempt has been made to bring the estimates of private wealth down to a later date, but it cannot be denied that the upheaval caused by the financial crisis of 1893 has wrought very material changes in the value of most descriptions of property in all the colonies. The depreciation in the value of real estate may be gathered from the fact that between the beginning of 1893 and the end of 1896 the annual ratable value of Melbourne and suburbs declined from £6,639,014 to £4,168,182, while during the same period the annual value of Sydney and suburbs fell from £6,067,882 to £5,019,230. The conditions of productive industry, however, are still hopeful, and there is nothing to warrant a gloomy outlook for the future. True, it is not likely that certain forms of investment, notably land, will reach their former speculative values, at least for many years, and it is not desirable that they should do so; but there is sufficient evidence that, with the expansion of population, there will still be ample scope for the remunerative employment of capital. THE DIFFUSION OF WEALTH. In former issues of this volume the probate returns of each colony were made the basis of a calculation of its private wealth. Extended investigation showed that unless the ages of the persons dying were also taken into consideration, estimates based on the probate returns were likely to prove fallacious; and as information in regard to ages was not procurable, this form of estimating was abandoned. The occurrence at irregular intervals of the death of very rich persons, even if the ages had been procurable, would have had a disturbing effect on the calculations, as it can be readily imagined that, where the average number of deaths ranges from only one thousand in Western Australia to sixteen thousand in Victoria, an exceptionally large estate might easily vitiate the average. In support of what is here stated, it may be pointed out that, as estimated by probates, the average wealth per inhabitant in Victoria during five years ranged from £325 to £610, and in New South Wales from £300 to £530. That such was actually the case involves a supposition too ridiculous to be for a moment entertained. The probate returns, however, have some statistical value, as will presently appear, and the returns for the year 1896 are, therefore, given below: As already pointed out, the value of estates is liable to vary greatly from year to year. For the past seventeen years the average value of property left by persons who have died and left property was :-For New South Wales, £2,649; Victoria, £2,469; Queensland, £1,688; South Australia, £1,420; and Tasmania, £1,226. For New Zealand, returns are only available for ten years, and they show an average of £2,357; while the values have only been ascertained in the case of Western Australia for the year 1896, when they amounted to £1,377. Although the probate returns have little value as indicating the total wealth of the community, in the absence of the exact figures which property returns disclose they form the only means of estimating the diffusion of wealth. The following table shows the proportion of persons out of every 100 dying who left estates sufficiently large to be the objects of specific bequest. The figures cover seventeen years: These figures show a distribution of wealth not to be paralleled in any other part of the world; and in a country where so much is said about the poor growing poorer and the rich richer, it is pleasing to find one out of every four adult males and females the possessor of property. Taking the last two years, in Victoria is found the widest diffusion of the individual colonies; South Australia comes next to Victoria; then come New South Wales, New Zealand, Western Australia, and Tasmania; and lastly Queensland. Too much stress may be laid on the apparently wider distribution of wealth in one colony than in another, for it is obvious that a province with a stationary or decreasing population will naturally come out of a comparison of this kind more favourably than another with a rapidly-increasing population. Taking all things into consideration, the table as a whole is highly satisfactory, and should be additionally pleasing from the circumstance that the ratio of distribution has been increasing fairly regularly in every province of the group. In the United Kingdom, during the five years 1890-94, the last period for which complete returns can be obtained, the number of estates on which legacy duty was paid was 257,351. Making the liberal allowance of one-fourth for successions, of which the number is not given in the Statistical Abstract, the total estates would be 321,700, as compared with 3,595,447 deaths, or a little over 8.9 per cent., as against 140 per cent. in Australasia during the same period. To show still more clearly the wide distribution of property in these colonies, the following statement is even more useful than the figures just given. The comparison is made as for every hundred deaths of adult males, and for the same number of deaths of adult males and females. This latter method is undoubtedly the proper basis of comparison, as large numbers of females are possessors of a substantial amount of property :— Colony. Proportion of Estates Proportion of Estates per 100 deaths of adult males and females. 1880-84. 1885-89. 1890-94. 1895-96. 1880-84. 1885-89. 1890-94. 1895-96. At the close of 1897 Australasia ranks among the debtor nations. its people owed to persons outside its boundaries, or, more correctly speaking, there was invested in it by non-residents, and owing by its various Governments, a sum approximating to £367,168,000, or £81 per inhabitant. Of this large sum, £146,894,000 represents the private investments, and £220,274,000 the outstanding liabilities of the States and local governing bodies. More important in some respects than the corpus of the debt are the annual payments made in respect thereof. These can be stated with some exactitude. The yearly interest paid on account of State and local government debts to other than Australasian creditors amounts to £8,336,000, while the income from private investments may be stated at £5,813,000; in all, £14,149,000. The return on private investments represents an annual interest of about 4 per cent. When it is remembered that the bulk of the shares of the large dividend-paying mines of New South Wales, as well as of many of the Queensland mines, are held in London, and yield to the owners a return which falls little short of £900,000, and that there are very many investments in all the colonies which yield a much higher return than 4 per cent., it will be evident that a considerable sum, variously estimated up to seventeen millions sterling, has been sunk in unproductive investments. |