E.-i

VIII

held sacred. The same remarks will apply to the other railways, which are to depend for their construction upon the proceeds of the sale of lands to be rendered valuable by them. A very important line in Canterbury, which is not included in the present proposals, is the Akaroa and Lake Ellesmere Line. The Government hope that the Trust—whose powers will be prolonged and extended by the Bill which has recently passed this branch of the Legislature—may find means whereby this work may be proceeded with. If, however, it should be found that the Trust is unable to do so, the Government will, at a future time, be disposed to deal with the matter specially, with a view to this most important undertaking being pushed forward. As regards the branch line, Waipahi to Heriot Burn, it will be recollected that last Session the House decided that this branch should be constructed as far as Tapanui. It voted no money for the work, but resolved that it should be paid for out of land to be set aside for the purpose. lam pleased to say that this branch is now under way, and that no money will be required until after completion; the_ terms of the contract being that payment is to be made in cash, in three equal instalments, at two, four, and six months after the line is completed. The amount is £61,500, and the time for completion twenty-two months from date of contract, so that we shall have two years and upwards in Avhich to realize upon the 40,000 acres of land reserved. The probability is that this land, owing to the construction of the raihvay, will realize from £2 to £3, and upwards, an acre, and will thus yield double the amount of the contract, I may add that there were five tenders for the work on the above terms, and the one accepted, being the lowest, was £2,000 under the Engineer's estimate. This fact is worth any number of arguments to shoAV lioav Aye might, to a great extent, construct our railways without increasing the amount of our public debt, or adding to the annual burden in respect thereof. It is now proposed to extend the line 10 miles further; by so doing the growth of cereals will be very largely increased, and one of the most productive districts in the colony fully developed. I have heard it objected that now, when the Land Eund has been colonialized, it is unfair to the colony as a whole to alienate large portions of its landed estate for local purposes. To me, such an objection seems—if I may be permitted so to sa y_ s i m ply absurd. We are not alienating landed estate: we are changing the form of parts of it, and thereby greatly increasing the value of the whole. If portions of land go, so far as the colony is concerned, the railways constructed out of the proceeds remain; and if we manage our affairs wisely, we shall derive a much larger income from those railways than we ever did, or ever could, derive from those portions of land. We do not propose to deal exceptionally with the proceeds of land set apart for the construction of railways. Those proceeds will be dealt with as ordinary revenue; while from the enhanced value of the lands to be affected by the lines so constructed, we may fairly assume it as a fact that the ordinary revenue will year by year be greatly increased. SUMMARY OF PROPOSALS—AIDS TO THE PUBLIC WORKS FUND. Summing up the proposals I have had the honor to submit, they will be found to involve an expenditure for railways in the North Island of £3,733,000, and in the Middle Island of £4,652,000; altogether, £8,385,000. As I have already observed, the estimates under Avhich these figures have been arrived at are to a certain extent approximate. My belief is that they are more over the mark than under, and that, with judicious and careful administration —unless circumstances alter very much within the next few years —it will be found that a much less sum" will suffice. We propose that the expenditure shall be extended over five years, which, in my opinion, is the shortest period Avithin which we could carry out works to this extent, unless we are prepared for the importation of labour to a greater extent than can be readily absorbed in the permanent settlement of the country. Our object will be so to regulate the administration of the waste lands of the Crown, as to afford every inducement and facility to men who labour in the construction of railways to invest their earnings in land. By laying off allotments for sale along the various lines as they progress,