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arrangement stores, particularly those of a bulky nature purchased overseas, can be consigned to the point at which they will be brought into use, thus effecting considerable savings in freight and handling charges. BUILDINGS. The increase each year in all branches of the Department's business is reflected in the continual demand for improved office accommodation. There are many places at which the need for additional space is urgent. The condition of certain buildings is such that the buildings should be replaced as soon as circumstances permit. But with the limited funds available each year all needed replacements cannot be made at once, and care is exercised to ensure that the erection of new buildings, &c., is dealt with strictly in order of urgency. To keep pace with the phenomenal increase in telephone-exchange subscribers it was necessary during the year to provide increased telephone-exchange accommodation at a number of places. A new building to house an automatic telephone exchange is now being erected at Miramar, while the erection of extensive additions to the exchange buildings at Courtenay Place (Wellington) and Wellesley Street (Auckland) is proceeding. My Department spends each year a substantial sum in the purchase of stores and equipment. Except in the case of the main store at Wellington, storage accommodation is provided mostly by means of a collection of sheds. The provision of suitable accommodation for stores at Auckland, Christchurch, and Dunedin will be dealt with as soon as the necessary funds are available. The steady increase in the use of departmental motor-vehicles necessitates the provision at different centres of suitable garages and workshops ; and in this connection every effort is being made to provide accommodation on modern lines, and to ensure that the equipment installed is up to date. VISIT OF THEIR ROYAL HIGHNESSES THE DUKE AND DUCHESS OF YORK. Very complete arrangements were made in connection with the visit of Their Royal Highnesses the Duke and Duchess of York, in order that the Royal party and entourage might be afforded full post, telegraph, and telephone facilities. At many offices the hours of attendance were extended, and special arrangements were made for handling the abnormal volume of press and other telegraph traffic inseparable from such visits of national importance. The organizing and supervising of motor transport in connection with the Royal tour was entrusted to my Department, which on account of its garages and workshops at Auckland, Christchurch, and Dunedin, and general organization throughout the Dominion, was well fitted to discharge this very important duty. Of the fleet of twenty-four cars of English make used on the tour, six were provided by my Department and the remainder by private enterprise. The personnel of the transport staff comprised twenty-four chauffeurs and two other officers from my Department. It is extremely gratifying to report that the staff responded loyally to the call for extra effort during the Royal visit, and thus fully maintained my Department's reputation for efficiency in meeting unusual situations. APPOINTMENT OF PERMANENT HEAD. Consequent upon the retirement of Mr. A. T. Markman, Secretary of the Department, the secretarial chair is now occupied by Mr. G. McNamara, formerly First Assistant Secretary. DETAILS OF REVENUE, ETC. Matters of detail with reference to the financial operations and business of the Department will be found at length in the statement and tables which follow. I have the honour to be, Your Excellency's most obedient servant, W. NOSWORTHY, Postmaster-General, General Post Office, Wellington.