A.—No. 1

of regret that the promised scrutiny has not been made into the Colonial counter-claims, which are believed to be founded on justice, and which show a credit to the Colony of £147,235, after deducting from the Imperial claims preferred by Mr. Commissary-Greneral Jones, certain charges,' —such (amongst others) as the capitation charge —which His Grace the Duke of Buckingham does not consider justifiable. It is confidently felt that the result of the scrutiny would —not only on broad constitutional grounds of policy, but even if more narrowly tested, as a mere question of financial accounts, have placed a considerable sum to the credit of the Colony. But there are claims, other than pecuniary, which this Colony has on the British Empire; not those arising out of natural relationship, but claims which the Colony has eminently earned by its action during the late war; and it is gratifying to perceive that His Grace appreciates the national patriotism and unselfish character of that action; inasmuch as the Colony, under the pressure of war and of " a heavy debt, to a great extent caused by the same circumstances which had led to the Impe- " rial expenditure in the Colony," undertook " the entire duty of future internal self defence, thus " relieving the Imperial Government from the former responsibility, and the Imperial Treasury from the " expenses incident to the maintenance of a largo military force in New Zealand." To these claims His Grace might have added that the Colony also took upon itself the cost and responsibility of the fulfilment of those solemn obligations which the Crown of Great Britain had contracted in respect of the Maori race when the promise was made that, in consideration of the cession of the sovereignty of these Islands, " Her Majesty the Queen of England extends to the Natives " of New Zealand her royal protection, and imparts to them all the rights and privileges of British " subjects." And in undertaking these obligations the Colony has not been content with mere idle professions, but, notwithstanding the continued pressure of the heavy war expenditure, has expended, and is expending, very large sums for promoting the civilization and education of the Native race amounting (as shown by the annexed statement) to not less than £296,035 Bs. 10d., during the last seven years. Eor His Excellency the Governor. E. W. Staitoed.

Sub-Enclosure 1 in Enclosure No. 52. Expenditure on Native Purposes. 1860-1:— £ s. d. £ s. d. Civil List, including amounts unexpended in former years ... 7,909 3 4 Native Schools ... ... ... ... ... 6,254 15 7 Appropriations ... ... ... ... ... 2,934 19 10 17,098 18 9 1861-2 :— Civil List, as above ... ... ... ... 10,259 7 1 Native Schools ... ... ... ... ... 5,461 16 6 Appropriations ... ... ... ... ... 9,001 16 9 ■ 24,723 0 4> 1862-3 :— Civil List, as above ... ... ... ... 7,903 4 6 Native Schools ... ... ... ... ... 8,447 15 8 Appropriations ... ... ... ... ... 40,670 12 11 • 57,021 13 1 1863-4 :— Civil List, as above ... ... ... ... 7,327 19 1 Native Schools ... ... ... ... ... 4,525 13 9 Appropriations ... ... ... ... ... 41,105 10 4 ■ 52,959 3 2 1864-5 : — Civil List ... ... ... ... ... 7,000 0 0 Native Schools ... ... ... ... ... 2,508 5 0 Appropriations ... ... ... ... ... 51,044 2 0 60,552 7 O 1865-6 :— Civil List ... ... ... ... ... 7,000 0 0 . Native Schools ... ... ... ... ... 912 7 11 Appropriations ... ... ... ... ... 41,635 11 1 49,547 19 O 1866-7 :— Civil List ... ... ... ... ... 228 9 10 Native Schools ... ... ... ... ... 438 2 8 Appropriations ... ... ... ... ... 33,465 15 0 34,132 7 6 £296,035 8 10 J. WOODWABD, Treasury, 6th July, 1868. Assistant-Treasurer. 22

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ZEALAND TO THE SECRETARY OF STATE.