Early in 1906, owing to the death of Sir Hugh Nelson, Mr. Morgan retired from the Ministry, Mr. Kidston becoming Chief Secretary in his stead, while still retaining the Treasurership. Mr. Morgan then accepted the Presidency of the Legislative Council. In the year 1905-6 the revenue had become buoyant, the increase for the year being L258,124. The expenditure had also increased by over one-half that amount, the year closing with the surplus of L127,811. Loan outlay also showed an increase, totalling nearly L300,000. In 1906-7 there was a revenue jump of L454,389, with an increase in expenditure of L186,085, the record Queensland surplus of L396,115 being realised.[a] For 1907-8 the revenue increase was L180,486, while the expenditure increase was L461,299, and the surplus only L115,302. Loan outlay also advanced to L1,033,676. Including the Commonwealth collections the total revenue for 1907-8 approached 51/2 millions, or nearly 1 million in excess of the most fruitful year before federation. In November, 1906, a brief but important Act was passed providing that all moneys received in payment for auction sales of town, suburban, and country lands, or of such lands if subsequently purchased by selection, should hereafter be paid into the Loan Fund Account. But proceeds of the land sold under the Special Sales of Land Act of 1901 were not included, those moneys having been already appropriated to the repayment of sums borrowed upon certain Treasury bills issued in aid of revenue in former years. It is the policy of the Kidston Government, however, not to alienate lands under the Special Sales Act; therefore the deficits of former years which had been liquidated with the proceeds of Treasury bills, and practically formed a floating debt, are being gradually compensated for by the transfer of annual surpluses to the Public Debt Reduction Fund, the total amount of stock thus cancelled having on 30th June, 1908, reached the respectable amount of L942,641 since the inception of the fund. One of the wise determinations of Mr. Kidston as Treasurer was to keep off the London money market for several years at least after the rebuff received by his predecessor in 1903. Consequently he abstained from making any attempt to float a loan till March, 1909, when L2,000,000 worth of 31/2 per cent. stock was disposed of. The net proceeds were equal to L94 9s. 61/2d. per cent., a price about equivalent to that obtained by New South Wales a little earlier in the year. This, although dearer money than was obtained by issues of Queensland stock in the closing decade of the last century, compares not unfavourably with the prices obtained earlier in the financial year for other gilt-edged securities on the London market.