A.—No. 2A.

Were it not for the convenience of calculating a uniform fractional part of the proceeds, I should have put a higher price on the open land, and somewhat less on the bush, of which probably the greater part of the land which may be handed over to the Province, after providing for the Military Settlers and the Maoris, will consist. With respect to the enclosed Resolutions of the Provincial Council of Taranaki, to which I have several times referred, I have to observe that in recommending that the confiscated lands should be sold under some such Regulations as are therein indicated, I do not wish to imply that I think the apportionment of the Land Fund there proposed should be strictly adhered to. I have the very strongest conviction that the construction of a breakwater at the Sugar Loaves is a work which X>ught to be undertaken without delay, if, after a proper survey of it, it is found that such a work can be constructed so as to answer our present purposes, at a moderate cost. I should, therefore, be quite prepared to devote a considerable portion of the Land Fund to that purpose, if agreed to by the General Government, but it appears to me premature to decide now as to what that proportion should be. Again, the amount for immigration might probably be increased with advantage, supposing the confiscated lands to continue to be held by the General Government, under the " New Zealand Settlements Act," and to be administered by the Provincial Government upon some such terms as above suggested. The Regulations as to the application of the land fund could, of course, be varied by Government as circumstances might require. I have said nothing hitherto as to the claim of the Province for the expenditure of the balance of the Land Purchase Fund, or for an equivalent quantity of land free of charge. This is a specific claim which can be easily dealt with when matters requiring more consideration have been disposed of. Before concluding this letter, I have the honor to draw your attention to the effect which the proposed financial arrangements as to an apportionment of the war debt, &c, will have upon the present revenue of the Province of Taranaki. If I understand the matter rightly, it is proposed to allow the Province 9-16th's of the gross Customs revenue. This will give as our proportion about £8,000, against which there will be charged :— £3000 Local charges, say 3700 Interest on proportion of debt. £6700 giving a balance of fourteen hundred pounds, which will just suffice to pay the interest of our Provincial debt. If, at the same time, in consequence of land being handed over to the Province, the guaranteed Land Fund should be stopped, we should be left at the present time with no funds whatever to meet the necessary expenditure of the Provincial Government, except what may be raised by local rates. With respect to such sources of revenue, I am quite willing to ask the Provincial Council to agree with me in imposing any such rates in our Province as are borne by the inhabitants of other Provinces of the North Island, but I do not think it likely that either the General Government, or the Colony at large, would wish, or think it expedient, that our small population should be ground down by an exceptionally heavy taxation, as a consequence of its special misfortunes. With these observations I must leave this matter entirely in the hands of the Government, in the confident expectation that the Province of Taranaki will continue to receive the support of the Colony, until it shall be in a position to bear whatever may be considered to be fairly its special burthens. I have, &c, 11. R. Richmond, The Hon. the Colonial Secretary, Wellington. Superintendent. Enclosure in No. 1. Extract from minutes of council. Resolved— New Plymouth, 6th July, 1865. " 1. —That all lands shall be sold by Public Auction, at an upset price ; the sales to take place monthly. Town Lands to be sold in |-acre sections, and Eural Land in such quantities as the purchaser may name at the time of purchase." " 2. —That the upset price of Town Sections be £20 ; of Suburban Sections, £50; of Open Eural Land, £2 per acre; of Bush Land, £1 per acre. That the boundary line between the Bush and Open lands shall be decided on by the Superintendent, with the concurrence of the Provincial Council, so that, if it be thought desirable, the land within the edge of the Bush may be classed as Open Land." " 3. —That one-tenth of the purcnase-money shall be paid in cash, at the time of purchase, the remainder within one month afterwards, or the sale shall be void, and if default be made in the latter payment, the instalment of one-tenth shall be forfeited." '■ 4.—That the nett proceeds of the Land Fund be permanently appropriated, as follows :—■ Harbour Works .. . . . . .. .. .. .. 7-16. Roads, Bridges, and Other Public Works .. .. .. 7-16. Immigration .. . . . . . . . . . . . . . . 1-16. Education.. .. . . .. .. . . . . ~ , . 1-16." " 5. —That out of the amount for Immigration, part shall be appropriated for remitting a portion

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FUETHEE PAPEES EELATIVE TO THE SETTLEMENT