D.—]

South Island Main Trunk. At the northern end the line is open to Ward. From there to Mills, eight miles farther south, the formation is now constructed and ready for platelaying, with the exception of some light earthwork near Mills Station. This section includes some heavy cuttings and fillings, a tunnel 8j chains long and a combined railway and road bridge over the Ure River which is now nearly completed. To the south of the Ure Bridge, where the formation is through sandhills, marram-grass has proved entirely successful for heavy sandy batters, banks, and sand-drifts, but experiments with other binding-plants resulted in comparative failure. No rails have yet been laid beyond Ward, but large supplies of rails, sleepers and other permanent-way material are being forwarded to the rail-head, almost the whole quantity required for the eight miles to Mills having already been received there and stacked ready for use. The section from Mina to Parnassus, eight miles and a half in length, at the southern end of the line, was completed and opened for traffic by the Railway Department in September, 1912. Formation-work, which had extended over the next four miles, has been suspended, and. is not likely to be resumed during the current year. The expenditure during last financial year amounted to £21,877 at the north end and £23,964 at the south end. For the current year a total vote of £20,000 will be required. Midland. At the Nelson end, since the opening of the section to Grlenhope on the 2nd September, 1912, construction-work was carried on with a reduced number of men over about two miles of the route towards Murchison until April last, when the work was suspended. It is not proposed to resume the construction of this section of the line during the current year, but the road between Grlenhope and Murchison will be made more suitable for motor traffic. On the Reefton-Inangahua Section the formation-work to the proposed station near the Inangahua Junction has been completed, rails laid, and the ballasting is well under way. This station will be the terminus of the line for the present, as it is not proposed to undertake any work beyond the Inangahua River this year. On the Canterbury side of the dividing range formation has been practically completed between the Cass and Bealey Flat, and a train service to the temporary station at Halpin Creek has been inaugurated. Floods in the Waimakariri caused considerable damage to the formation during the year, which has been repaired, and measures taken for the future protection of the railway. Messrs. John McLean and Sons, contractors for the construction of the Arthur's Pass Tunnel, were relieved of their contract and the work taken over by the Government on the 28th December, 1912, in pursuance of a recommendation of a parliamentary Select Committee, since which it has been carried on, principally by day labour, from the Otira end, under the direct supervision of Public Works Engineers. At the Bealey end excavation by co-operative contract was tried, but was not successful, and the experiment was not persevered with. From the Otira portal the bottom heading is now in 2 miles 12 chains, and the tunnel fully excavated and lined for 20 chains less. At the Bealey end the figures are : Bottom heading, 45 chains; excavation to full size and lining, 33 chains. Thus there remains 2 miles 48 chains between the headings, and 3 miles between the points to which the enlargement and lining have been carried on either side. A larger number of capable men could be employed to advantage on this work, but the best men are not obtainable in large numbers. The expenditure on the different sections of the Midland Railway during last financial year was as follows :— £ Nelson end .... .... .... .... 23,366 Reefton end .... .... .... .... 10,073 Otira-Bealey .... .... .... .... 61,809 Bealey-Cass .... .... .... .... 36,786

VII