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Perpetual Lease, Rural. —The continual drain upon this system caused by purchase of the freehold has reduced the holdings to 203, the area to 81,601, and the annual rental payable to £4,534 19s. 3d. None of the lessees converted to the lease-in-perpetuity system. Occupation with Right of Purchase, Rural. —The new transactions during the past year are 120 selections, and aggregate 32,106 acres. The number (493), area (139,876 acres), and annual rental (£8,369) of the holdings on the register exceed that of any single system. Lease in Perpetuity, Rural, Village, <&c. —Total area held on the 31st March, 1899 : Number of holdings, 1,214 ; area, 201,745 acres. Annual rental payable, £11,018. Village Settlement, Deferred Payment. —The sections held on this system stand at the same figure—seven —as last year, and represent the last of the holdings in the Hunterville, Alfredton, Levin, Bunnythorpe, and Marshall Settlements, all the others having been converted to freehold. Village Settlement, Perpetual Lease. —The holdings under this system, situated in the Levin, Marshall, and Hunterville Settlements, have been reduced by two freehold purchases to three, and the area to 29 acres 1 rood 27 perches. Village. Homestead, Lease in Perpetuity. —The increase in the selections last year raised the total area held under this tenure to 6,398 acres, the number of holdings to 333, and the rental and interest payable to £843. Seven conversions from the perpetual-lease system were effected, apparently with the object of securing reduction in rental by one-fifth. Village Homestead, Perpetual Lease.- —The holdings under this system have fallen from 126 to 120, caused by seven conversions, partly counteracted by one additional selection. The following summary of the foregoing village settlements is submitted : —

This shows an increase of fifty-three holdings compared with the previous year. To expand this system more land of the quality and other necessary essentials making for success is at present lacking. Special Settlement Associations. —Deferred payment: By completion of payments on thirtynine holdings the number of selectors on the register is reduced to sixty-two, comprising 6,029 acres, returning a rental of £226 annually. Lease in perpetuity (farm homestead) : These show a fallingoff from 521 to 479 holdings, the reduction being accounted for by forty-seven forfeitures, counteracted by five fresh selections. Improved Farms. —l 24 holdings are on the register, an increase of thirty-two compared with the year 1897-98. These figures do not take into account forty-seven lots which have been balloted but not yet finally allotted. This helpful system has been utilised in the Wellington Land' District to the utmost, and would have been applied still further but for the lack of land adapted by quality and position to afford selectors reasonable prospects of success. As it is, many of the holdings fall short of the recognised requisites to afford the selectors all the advantages proposed under this system. Here, as in other walks of life, ultimate success or failure depends mainly upon the industry, capability, energy, and thrift of the individual. Small Grazing-runs. —These holdings have fallen from seventy-seven to seventy-four. The difference is accounted for by one forfeiture and two conversions to lease in perpetuity. There were no fresh selections under this system last year. The provision of " The Land Act, 1892," section 160, induced several lessees under this system to apply to the Land Board to be allowed to convert from the present twenty-one-years lease to a lease in perpetuity (999 years). It was contended in one instance that the conversion was a right, and should be granted by the Board at 4 per cent, on the original price under small-grazing-run system, and not upon a revaluation to ascertain the present unimproved value of the holding. Another question raised was the classification of such lands, which determines whether 640 acres or 2,000 acres is to be the maximum area to be included in the proposed lease under the perpetuity system. The following principles were submitted for discussion at the Land Board meetings : (1.) The conversion of a lease under the small-grazing-run system to one under the lease-in-perpetuity system is absolutely at the discretion of the Land Board. (2.) Such conversion only to be allowed in cases where the Land Board were of opinion that the lands were not likely to be required on the termination of the twenty-one-years lease for general settlement purposes, as provided by section 209 of " The Land Act, 1885." (3.) If approved, the conversion only to be allowed conditionally upon a definite revaluation to determine the present unimproved value and the future fair rental of the holding to be held under a fresh lease for 999 years. These principles and conditions are held to be equitable, and in accordance with the Land Acts, and to conserve the interests of the Crown, and consequently of the public. Pastoral Rtons.— The licenses under this system suffered a reduction—twenty-two to twenty- " one. There were no fresh leases granted during the year. The falling-off was due to one run being transferred to the control of the Auckland Land Board.

System. Holdings. Area. Annual Kent. Deferred payment ... Perpetual lease Perpetual lease, village homestead Lease in perpetuity, village homestead 7 3 120 333 A. 14 29 1,440 6,397 B. P. 0 28 1 27 2 26 3 1 £ s. a. 130 4 5 3 13 0 499 5 2 843 7 5 Totals 463 7,882 0 2 1,476 10 0