F.—l

That the delayed telegrams are now decidedly taking the place of the ordinary messages is to be gathered from the fact that in 1884 the proportion of delayed to ordinary telegrams was about onefifth, while last year it increased to over one-half. The actual result of this increased use of the delayed system has been to add largely to the work of the department, at the expense of its revenue; and it will become a question for consideration whether or not some amendment should be made in the existing regulations. Government telegrams were 6,926 less in number, but £2,924 7s. Id. greater in value. The number of telegrams to each hundred letters posted for delivery in the colony was ICM9, compared with 1009 in 1886. There were 16,899 money-order telegrams issued, for £61,389 15s. Id. The commission amounted to £1,023 35., and the fees to £844 19s. Compared with the previous year, there was an increase of 331 orders. The number and value of money-order telegrams forwarded from offices within the several postal districts will be found on Table 25. A telegraph office (Morse) has been opened at the Milburn Eailway-station. At the following places the telegraph offices have been closed: Dunedin Eailway, Milburn Railway, and Waitakerei. The designation of the office at Greytown (Dunedin) was changed to Greytown South, and Arrow to Arrowtown. Telephone offices were opened at Berwick, Blackstone Hill, Broad Bay, Cambrians, Campbelltown North, Hamilton's, Hyde, Kai Iwi, Kumeroa, Kyeburn, Matakohe, Mauku, Midhirst, Nightcaps, Otakaia, Pahautanui (re-opened), Patumahoe, Pihama, Porirua, Prebbleton, Queensberry, Eichardson, Shortland, Springston, Springston Station, Tahoraite, Te Alraahu, Tologa Bay, Waeraugahika, Wairio, and Woodville Eailway. Bureau offices were established at Kai Iwi and Broad Bay. At the close of the year there were 200 offices connected by telephone. The number of offices, both telegraph and telephone, open at the end of the year was 437, an increase over the number in 1886 of 31 offices. There are 33 bureau offices now open in connection with telephone exchanges. The offices at Manutahi and Takapau are worked by telephone instead of by Morse instrument; while at Danevirke the Morse instrument has replaced the telephone. A very largo number of telegraph offices have been closed between 7 and 8 p.m. since the Ist of April last. The number of miles of line maintained was 4,646, an increase of 100 miles. The average cost for maintenance per mile was £4 13s. 9d., as against £4 15s. lid. the previous year. The expenditure out of loan for telegraph extension was £22,984 6s. Id. Telephone Exchanges. The increase in the number of subscribers to the several exchanges for the financial year ended 31st March last is given below : — Mar. 31, 1887. Mar. 31, 1888. Auckland ... ... ... ... 425 ... 439 Napier ... ... ... ... 94 ... 104 Wanganui ... ... ... ... 113 ... 81 Wellington ... ... ... ... 366 ... 402 Nelson ... ... ... ... 71 ... 64 Blenheim ... ... ... ... 45 Christchurch ... ... ... ... 299 ... 332 Timaru ... ... ... ... 62 ... 60 Oamaru ... ... ... ... 47 ... 47 Dunedin ... ... ... ... 500 ... 515 Port Chalmers ... ... ... ... ... ... 14 Invercargill ... ... ... ... 65 ... 57 Bluff ... ... ... 6 2,042 2,166 An increase of 124 subscribers for the year. The capital expended on the telephone exchanges up to the 31st March last amounted to £57,595. The following return gives the capital cost, working expenses, and revenue of the Telephone Exchanges since established : —

XIV