E—No. 9 Sec. IV.

A similar objection exists to the grant of money for building Court Houses. The Natives must be taught to understand, that in offering them a plan of government and the means of carrying it out among themselves, it is not intended to buy their allegiance at the cost of a sloshful neglect of their own duties. If there be any truth in the desire so often expressed by many of them for some kind of law and order, they will recognize their own liability to contribute directly towards the introduction of the proposed institutions. In no way could they more readily do this now than by building (as was done in Mr. Fenton's time at Waikato) neat raupo houses for Court Houses and Runanga meetings. In every case in which under your directions they will come forward with this work, the Government will supply plain doors and windows, and any carpentering work which you may judge absolutely necessary. But for the present, at least, the contribution from general funds for Court Houses must be limited, as in the case of the Bay of Islands District, to a grant of £100 for the District Runanga House. On the subject of schools, His Excellency's Government are of opinion that the present wants; of the district immediately round Tauranga are met by the Institution under the care of the Rev. Charles Baker. But at Rotorua, they would desire immediate steps to be taken for the establishment of a primary school; and you are authorized to expend £100 on^a building and books for the purpose, and to promise £100 as the first year's salary to a competent schoolmaster. In this case also, the Natives ought to be found not only ready but anxious to contribute some of the labour that will be requisite for the building, materials for the roof, and so forth. His Excellency would have been glad if he could have provided, at the present time, assistance towards the two mills of which yod have spoken. But the large demands upon the funds at the command of the Government, and the appropriation already made towards the Rotorua and Maketu Road, imperatively require that the strictest economy should be pursued: and it will not be possible to make any advances for the mill, until the estimates for the Native Service shall have been settled by the Assembly. But the Government hope that a plan will be devised whereby funds will be forthcoming for the efficient promotion of all works which shall so directly tend to improve agriculture among the Natives; and you may assure those immediately interested that, if enabled to do so, the Governor will not fail to consider their application favourably. His Excellency wishes me to add, however, that in one point he wuuld be ready to a moderate extent to provide funds at once—that is, for the purpose of erecting some kind of hospital at Rotorua. His Excellency thinks that the Natives should be engaged, without delay, in putting up a cheap hospital consisting of a series of raupo huts, and that the medical officer of the district should reside there. The warm springs at that place possess peculiar medicinal properties: and the earnestness and sincerity of the Government would be well shown by giving the natives the benefit of medical aid in so populous a locality, aud so highly favoured by nature. You are accordingly requested to take steps as early as possible for promoting this object, reporting the probable cost of such buildings; in the meanwhile enquiries will be made with a view to appoint a competent medical man to the situation. You are further requested to enquire into the probable cost of making the bridle road which the Rangitiki people have referred to, between Tapaporo and Wairoa, on the postal line between Tarawera and Opotiki; and if Mr. Henry Clarke's services can be made available for that purpose, you will request him to inspect the line, and assist you with his advice as to the contemplated improvement? I take this opportunity of referring to one point on which it is desirable that you should have full explanations with the Natives. The Regulations to be put in force under the Native Districts Regulation Act need not, and often will not, be applicable to the whole area of a District. They may either be General Regulations applicable to the whole, or Local Regulations applicable only to a portion. Thus it is intended that the General or District Runanga shall frame Regulations on matters affecting the whole Native population of the District; while the Vdlage Runangas shall frame Regulations applicable to each particular group of settlements. It is hoped that by this means the practice of self-government will be brought home to all the inhabitants, in the way that will best provide for their local requirements, and avoid the jealousies that might otherwise interfere with the proper action of the District Runanga. On every other point the Government would think it almost superfluous to give detailed instructions to a person of your experience in Native affairs; indeed it must be remembered that the present actiou is tentative, and that the Government do not pretend to have framed a perfect plan. In the end, they believe that the endeavour now making to give practical effect to the Native Act» of 1858 will lead to a good system of institutions, resting on the free assent of the Native people themselves, and fitting them gradually for a larger share in the government of the country. Whatever is now proposed should be flexible, and not too much should be attempted at once. The Government consider that you have already made good progress in the work entrusted to you, and confidently leave the prosecution of it in your hands. I have, &c., Thomas H. Smith. Esq , Henrt Sewell. Civil Commissioner, Bay of Plenty.

No. 7. THIRD REPORT FROM T. H. SMITH, ESQ., CIVIL COMMISSIONER. Maketu, April 8th, 1862. Sir,— I have the houor to report for the information of the Government my arrival at this place on the 28th ultimo.

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