proportion of the winnings on the colonial goldfields in the 1860s was expended on construction. The real impetus to that industry came during the expansionist period, 1871-85; from borrowing, private (through banks and financial institutions using offshore deposits and debentures) and public (central and local government alike, the latter including borough councils and harbours boards raising loans on the London capital market). Public capital works financed by borrowing abroad fell away during the latter years of the Great Slump but resumed in the early twentieth century most markedly among Auckland municipal bodies including the Harbour Board, but generally throughout the colony.

Campbell-Walker observed that by 1876 the annual requirement of the new expanded public works schemes for durable native timber had become huge.69 For kauri above all.

Why Investment in Hauraki Forests became Important to Auckland Capitalists

To meet this demand, timber companies with a predominantly Auckland proprietary came into being. Circumstances favouring this are detailed below.

Search for economic viability

The Auckland Province over its first 50 years lacked a viable export base, unlike the southern pastoral provinces (wool in 1875 earned just on 60% of New Zealand's export income). So Auckland entrepreneurs turned to the timber industry as a money spinner; and more so when, in 1871, gold production in Thames began its long downward slide.

Company device well suited to character of timber industry and of Auckland

The kauri timber industry became most productive with an injection of the kind of substantial capital foundation that joint stock companies could provide. Auckland, a financial centre, was prolific in the promotion of these in the thirty years which followed the passing of the Joint Stock Companies Act 1860. Local rentiers, moreover, had become habituated to such investment when gold-mining companies enjoyed wide popularity in Auckland during 1868-71.70

The expansionist 1870s

In Auckland it became customary for capitalists who had prospered through investment in gold-mining companies, or through speculation in their shares, to seek further investment opportunities in the Hauraki region. We have seen how some Auckland capitalists bought into the Turua sawmill company. Or again it is noteworthy that the Thames Gas Company, incorporated on 28 April 1874, had as prominent shareholders

69 Campbell-Walker said that by that date, kauri and totara made up more than two-thirds of all the timber used for buildings and construction works; AJHR, 1877, C-3, pp. 20, 22, 38.

70 Stone, Makers of Fortune, pp. 72-73, also Table 5-1.

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