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70. Railway Battalions. The Railway Battalions lately organized should aim at being a Railway Staff Corps, wherein all ranks work with the military authorities in peace as they would in war. For this purpose the Director of Railways should work in very close and constant touch throughout the year with the Quartermaster-General. 71. Field Transport. It is very necessary that at least two wagons and carte should be supplied to each Army Service Corps company for training purposes and use at camp. The corps should not be wholly dependent on hired vehicles. With occasional use of the Field Artillery horses the Army Service Corps could then practice its functions during the year without any necessity for hiring. Attention will be given to the further classification of suitable horsed and mechanical transport available in each district. We cannot in peace expect to maintain transport up to war or even peace requirements. With the few vehicles above mentioned for training and a thorough system of registration and classification for hire, the Department should be able to cope with mobilization requirements. 72. Defence Vessels. The Defence vessels have all been fully employed except the " Lady Roberts " at Auckland and the launch "W" at Wellington. I would have recommended the sale of the " Lady Roberts " had it not been for the possibility of utilizing her in the new naval scheme, and vessels once sold are not easily replaced. Efforts have been made, but without success, to induce other Departments to utilize her services to a greater extent than is done now. 73. Artillery Horses and Mules. The number of Artillery horses and mules required at the various centres for the Field Artillery and Mountain Battery cadre- has been maintained. At these centres, the horses or mules being stationed there throughout the year (except during annual camps) for general training purposes, &c, contracts for the supply of forage required are arranged annually through the Stores Tender Board. 7 1. Artillery Gun-sheds, Quarters, and Stablks. The necessary accommodation for the guns ami permanent cadres of men and horses of the field batteries at Auckland (Devonport). Hamilton, Palmerston North, Napier, Nelson, Christchurch, Dunedin, and Invercargill has been completed. Ihe buildings are, generally speaking, of excellent design, and were erected at a very moderate cost. It is satisfactory to note that the Inspector-General remarked on their suitability for the purpose for which they were built. 75. Drill-halls and Offices. The existing drill-halls vested in the Crown have been maintained during the year. By the Rangiora Drill-shed Site Vesting Act, 1913, the Rangiora Drill-shed has been transferred from private trustees to the Crown. The Department was forced previously to assume a mortgage on the property to prevent it passing out of the trustees' control. The Whangarei Drill-hall and site (belonging to a private club formed of ex-Volunteers) has been acquired under the Public Works Act, at a very reasonable cost, and alterations have been put in hand to suit present requirements. The Kaikoura Drill-hall (private trust) has also been acquired under the Public Works Act, and new drill-halls have been erected at Reefton, Huntly, Levin, Feilding, and Opotiki. A new drill-hall is in course of erection at Invercargill, and provision has been made for one at Dunedin, where the existing; Garrison Hall is entirely inadequate for present requirements. When completed the present buildings and sites at these two places will be disposed of to recoup the cost, as provided by the Defence Amendment Act, 1912. Provision has also been made for the necessary*drill-hall accommodation at Cambridge, Pukekohe, and Thames, and the question of providing .new buildings at New Plymouth is under consideration. It will be necessary to provide for the erection of office and mobilization-store accommodation for the District Headquarters and Instructional Staff, and for drill-hall and store accommodation for the local troops at Palmerston North. At present private office accommodation is rented, and the Manawatu Agricultural and Pastoral Association's premises are leased for drill purposes. Repairs and alterations have been effected in the following cases, in several instances drainage and sanitary services being carried out to connect with new systems installed by local bodies, or to conform with new by-laws: Auckland Garrision Hall, extra offices, &c.; King Edward Barracks, Christchurch, alterations to caretaker's quarters, Ac. : Pahiatua Drill-hall, alterations and repairs; Temuka Drill-hall, alterations and repairs; Milton Drill-hall, office accommodation; Defence Store, Mount Eden, Auckland, office accommodation; Geraldine Drill-hall, repairs; Lyttelton Drill-hall, repairs; Woodville Drill-hall, repairs; Kaiapoi Drill-hall, repairs; Waimate Drill-hall, drainage, A-c.; Christchurch offices, alterations; Waiuku orderly-room, repairs; Waitara Drill-hall, repairs and alterations; Hastings Drill-hall, repairs; Hamilton Drill-hall, alterations; Millerton Drill-hall, repairs. Landslips necessitated removal of debris and repairs, ho., in the case of the Port Chalmers and Lawrence Drill-halls. Minor repairs and alterations have been carried out in several other cases, and shelving, cupboards, and minor alterations made in offices or orderly and store rooms at drill-halls, in many cases to provide necessary storage for equipment, &c.