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In criticizing the shortcomings of the Crown tenants in the above respect, allowance should be made for several important considerations affecting the position of Crown tenants in New Zealand. Amongst them I would mention— 1. That the lands selected are generally in their native or original condition, covered with dense forest, scrub, or high vegetation, and are almost always situated far distant from centres of population. In the early stages of settlement the holdings are difficult of access, and it takes many years of arduous labour and considerable expenditure of capital before they furnish a commensurate return to the tenants. 2. The Crown lands are thrown open to all. Any person possessing the necessary qualifications who is in a position to deposit half a year's rent and the lease or license fee takes his chance in the ballot, or can compete for the purchase of grazing-leases. It follows, therefore, that in the laudable desire to secure a holding and establish a home, persons of limited means go upon the land; indeed, under some of our systems —for instance, the village-homestead-special-settlement and improved-farm systems —men without means are encouraged and assisted to take up land and establish themselves and their families thereupon. It is manifest, therefore, that in the early stages of settlement it is only with extreme difficulty, by studying thrift and in some instances enduring considerable privation, that some of the tenants find the means to meet their engagements. It has been the policy of the Land Boards of the colony, and the departmental officers intrusted with the duty, to deal with defaulters as to payments with a due consideration of the exceptional circumstances in which many of them are placed, and the great difficulties and drawbacks to which they are sometimes subjected. After the tenants have become established upon their holdings, and are in receipt of returns sufficient to maintain themselves, they are expected to comply more promptly with their obligations. The encouragement afforded by the Crown Tenants' Rent Rebate Act has tended to bring about a more satisfactory state of affairs in regard to the payment of rentals. The arrears on the prosperous Cheviot Estate are necessarily small. Those under the Land for Settlements Acts might appear to be unduly heavy, but it must be remembered that, though the tenants are generally intrusted with the control and utilisation of improved properties, a very large expenditure is required before the homestead can be established, and fencing and other necessary works and operations carried out, and a return obtained from the land. Here again, limited means and the necessary preliminary outlay induce the tenant in some instances to postpone compliance with the requisitions of the Land Offices to pay his rental. Since the termination of the financial year special efforts have been made by the Land Boards and Commissioners to reduce the arrears, especially upon the valuable and highly improved Land for Settlements estates, as it is considered that, though the season had not been altogether favourable, the settlers as a rule had been fortunate in obtaining satisfactory returns from their properties, and that these lands, which have been purchased and made available for settlement by special legislation and financing, should return 5 per cent, upon the outlay. As will be seen elsewhere, this requirement has been generally fulfilled. Forfeitures and Surrenders. In Table 21, is given the usual information under this head. The total number of forfeitures under all systems is 283, affecting 130,143 acres, the annual rental thereon being £2,355 13s. Bd., a very considerable increase in number, area, and rental as compared with the preceding year. The great bulk of the forfeitures occurred under occupation with right of purchase, lease in perpetuity, special settlements, and miscellaneous leases and licenses. The principal grounds for forfeiture occur in the earlier stages following upon selection, when selectors who are dissatisfied with their holdings abandon them because they do not come up to their expectations, or the tenants find they are not in a position to effect the necessary improvements and comply with the other conditions of their leases and licenses. In other cases the Land Boards have to forfeit leases by reason of the non-compliance of tenants who have held sections for many years without making a serious attempt to fulfil the conditions. Frequently the tenants themselves apply to be relieved of their responsibilities. As a general rule, recourse to forfeiting the tenant's interest is not resorted to in this colony, because the policy, as indicated elsewhere, is one of helpful and sympathetic consideration and encouragement for those who desire to become successful settlers.

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