A.—3.

be easily misled; but Pa, though a lady of strong natural sense, has a remarkably strong will, and brought this proposal before the Council, by whom it was rejected. The Council, reinforced by Mr. Gelling, met on the 22nd December at Pa's house. She considered it her right to have this meeting at her house, as the former had been held at Makea's. Makea consented at once on my informing her of Pa's wish, and the usual invitations were sent by Pa accordingly. The laws to be now considered had been carefully prepared in Earotongan and English, and given to Tepou, who had been elected President at the previous meeting of the 22nd November. They were chiefly to provide for regulating the proceedings of the Council, for the upholding of existing laws, the defining of what should constitute promulgation, and similar preliminary matters. The laws, as passed, will be found attached to the general report, which I have also the honour to submit to your Excellency. After prayers, the Council proceeded at once to business. Pa provided, as Makea had done, a very plentiful banquet, well-served in European style, and which was duly attended to during the day. Another characteristic difficulty arose at the opening. Pa objected to Tepou as President. He was Makea's "mouthpiece," but Maovete was hers and she wished him to take the chair. Tepou speaks English fairly, and is pretty well versed in English ways; but Maovete was without experience of any kind. I should like to have objected to this arrangement; but it was in accord with native customs, and the Council accepted Maovete at once. To meet the difficulty I took notes of the proceedings myself. These were afterwards translated, and handed to Tepou to keep as a record of the meeting. They will be also found appended to my general report. The few preliminary laws were soon explained and passed. The liquor law prepared for their consideration was then taken, and excited long and keen discussion. Great diversity of opinion was manifest on the several points, but on one point there was complete unanimity. There should be only one law for both races. Tepou and others entered upon what, in colonial Parliaments, would be considered a skilful piece of " stonewalling." They persisted in repeating arguments for the application of the law of the 22nd November to foreign residents as well as to themselves, but carefully refrained from making any distinct motion on the subject. At last, as the day wore on, the question was put, at my request, whether the Council desired total prohibition or a law based on a permit system on the lines of the proposal before them ? The voting against total prohibition was unanimous on the part of the Arikis and other native members; but Mr. Gelling asked that the Council might be adjourned for two days, to enable him to consult his constituents. It had been stated during the debate that the majority of the foreign residents were in favour of total prohibition. If this were so, one of the chief difficulties in the way of carrying out such a law would be removed, and he should waive his personal views, and give his vote in its favour. The Council adjourned, therefore, till the 24th, to meet at Makea's, as her house was the most central and much time would be saved. Mr. Gelling held a meeting in the interval, and found that only two of his constituents desired total prohibition. The rest were in favour of a system of permit and restriction having a fair trial before extreme measures were attempted. They regarded prohibition as in some degree a slur upon themselves, and unnecessary. The Council renewed its sitting at Makea's on the 24th December. This, I may observe, happily involved the restoration of Tepou as President, he being the only one at all able to properly perform the duties of that office in our sense of the term. The proposed law, amended in accordance with suggestions at the previous meeting, was considered and passed. Mr. Joseph Henry Garner, a gentleman whom I had long personally known in Auckland and who is in Earotonga with the intention of coffee-planting, accepted from the Council, at my request, the post of Licensing Officer. Mr. Garner is a gentleman in whom the fullest confidence can be placed, and he is not engaged in any business on the islands. His duty will be to take possession of all intoxicating liquor and secure it in a store at the risk of the owners. The owners can then only sell to persons who have obtained a permit from Mr. Garner, with whom the delivery will rest. He is to give this permit to foreign residents where there is no obvious reason to the contrary, but to natives it is to be given only on the written authority of one of the ruling Arikis. A record of all issues is to be kept. Provision is also made for prohibitory orders against the sale or gift to habitual drunkards, or to persons to whom liquor is known to be injurious. Heavy penalties are provided for any breach of the law, which was well and thoroughly discussed by the Council who made several amendments to the original proposal. The law, as finally passed, will also be found in the appendix to my general report. The experiment of thus regulating the liquor-traffic, though novel, will, I hope, prove successful. It has, at all events, brought the traffic under control, and information as to the extent and character of the consumption will now be available. Total prohibition can always be resorted to if necessary; but, unless worked by efficient and properly-paid European officers, must, I fear, lead to vexatious searching, much demoralising espionage, and still more demoralising bribery and smuggling. Even with European officers, a marked preponderance of public opinion in favour of prohibition would be necessary for success. That preponderance does not now exist in Earotonga. I had hoped, as the voting was so unanimous in the Council, that the liquor question was settled for the time, but in the evening of the 28th December I received from Pa and Kainuku, and the mataiapos of Pa's district, a letter stating that they wished to revert to the law of the 22nd November. No reason was given, but the cause of dissatisfaction is, I have reason to believe, the refusal of the Council to sanction a Licensing Officer and a store for spirits at Ngatangiia (Pa's village) as well as at Earotonga. Pa vigorously contended for this as her right; but it would have been absurd to multiply these officers and stores, and the system would have become unworkable. In reply, I wrote to Pa that the law can now only be altered by the Council, and must be obeyed till so altered; and that unless this be done the natives would prove themselves incapable of managing their own affairs, and the attempt to assist them in doing so would be abandoned by me. I urged

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