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CIRCULARS. (Circular No. 2.) Education Department, Wellington, Sir,— 12th February, 1878. I have the honor, by direction of the Hon. the Minister for Education, to explain to your Board that the due administration of " The Education Act, 1877," renders it necessary that Government should ask the several Education Boards for information relating to educational matters in advance of the annual reports to be furnished by them before the 31st March under section 102 of the Act. It is hoped that the returns made by the School Committees to the Boards last month will facilitate the supplying of the information asked for. 2. The attention of Education Boards is particularly requested to the provisions of the Education and Appropriation Acts of 1877, which positively limit the amounts to be placed at the disposal of the Boards by Government for school purposes, and which consequently render it indispensable that the expenditure on the part of the several Boards should be kept within the specified limits. 3. The annual payment to Boards is restricted by the Education Act to £3 15s. for each child in average daily attendance at the public schools within the respective education districts. For the current financial year a sum of £25,000 has been voted "in lieu of capitation tax," which will be paid to the Boards for distribution amongst the various School Committees, and which is expected to yield about 10s. per pupil in average daily attendance. This will enable the Government to pay to Education Boards at about the rate of £4 ss. per head on the average daily attendance for the current financial year. Payment of this grant must, however, be subject to a deduction, based upon the net amount of rents or profits derived from education reserves: see section 40. 4. It is to be understood that this allowance of £4 ss. per head is to provide for the Board's expenditure, as specified in section 43 of the Act. It will be noticed that, while the grants by Government to the Boards for all educational purposes are to be at a fixed rate on the aggregate average daily attendance at the schools under their control, it is left by the Act to the several Boards to distribute the amount of their grants in such manner as they may deem proper, and to determine ihe principle according to which they will make payments to the different Committees, teachers, and schools. Several of the Boards have for years past adjusted their payments to schools and teachers according to average daily attendance and the grade of certificate held by each teacher. It is obvious that the abolition of school fees and local rates will render necessary the general adoption of this plan. 5. The several Boards have already been communicated with in regard to the distribution of the special vote of £50,000 out of loan for school buildings. It should be understood that this vote is to be applied to the completion, enlargement, or erection of school buildings, and that the expenditure by Boards and Committees on ordinary petty repairs will necessarily come out of the ordinary grants to Boards. While, however, the whole amount of the grants out of this special vote is intended to be expended on the providing of additional school accommodation, Boards are clearly empowered by section 43 to expend also on the same purpose such portion of their ordinary Board Fund as can be spared from the ordinary and necessary current expenditure. 6. There is a special vote of £1,000 to provide for scholarships which may be instituted under section 51 of the Act. Boards are invited to forward, for the consideration of the Hon. the Minister, as required by this section, their proposals for the establishment of such scholarships, keeping in view the proviso contained in the subsection, and the fact that the above-mentioned vote of £1,000 represents the whole of the means at the disposal of Government to satisfy claims under this head throughout the colony. 7. A special vote of £6,000 has also been passed for the current financial year for normal schools. Eegulations as authorized by the Act will shortly be made " for the establishment and management of normal or training colleges." Meanwhile it should be understood, in regard to those already in operation, that the special vote is intended for the cost attending the department of such schools specially devoted to the education and training of candidates for the office of public-school teacher, and that the expense of maintaining the ordinary elementary classes, in the practising school attached to the institution, will fall to be defrayed out of the ordinary Board Fund. Boards will therefore be entitled to include the attendance at the practising elementary department of a normal school in their returns of the aggregate average daily attendance for their several education districts, on the understanding that the cost of such department will be defrayed by the Board out of the Board Fund. The practising or elementary department of a normal school will thus rank as a public school under section 84 of the Act; and it will be necessary, in reporting on the expenditure on account of a normal school, to divide the cost of its maintenance equitably between the training department proper and the practising school, and to show each proportion separately. 8. It is necessary to take into consideration that, while the " school year" runs from Ist January to 31st December, the current appropriation out of which payments are to be made for educational purposes is for the year ending 30th June next. It is therefore necessary, at the present juncture in educational arrangements, to ask the several Boards to be good enough to cause to be furnished, for the information of Government, two different estimates —one, as required by section 39 of the Act, for the current school year, the other for the current financial year. Herewith are enclosed in duplicate two sets of returns, which your Board is requested to cause to be filled up as soon as convenient. One copy of each is to be kept for reference ; the other you will be good enough to forward to this office as soon as possible. In regard to the filling up of the blanks in lines 1 and 2of the "Estimated Eeceipts," the returns sent in to Boards last month by the Committees will enable you to form a reliable estimate as to the aggregate average daily attendances for each of the periods for which you are requested to make a return. In framing their estimates of expenditure for both periods, Boards are requested to keep clearly in view the explanations given in paragraphs 2 and 3 of this letter. 9. The accounts of some Boards will be more or less complicated this year, by reason of the division or alteration of education districts. Boards will keep this in view as much as possible in filling up the returns now asked for.