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Under "The Immigration and Public Works Act, 1870," your opinion will be sought as to the Railways which ought to be constructed within the Province, under the powers conferred by the Act, in order that resolutions on this subject may be forwarded for the consideration of the General Assembly in its next session.

The same Act contemplates that the introduction of immigrants into the Province should be conducted by the General Government, on the request of the Superintendent, and in such numbers as may be recommended, and provides that regulations for the conduct of immigration, and for the nomination of immigrants by persons resident in the Province should be made by the Governor at the request of the Superintendent. I shall take occasion to obtain an indication of your opinion on this subject.

Under "The Railways Act, 1870," authority has already been given for the construction of portions of the Great Northern and Great Southern Lines of Railway, and for the portion of the Southern Trunk Line, between Timaru and Temuka, but the outbreak of War in Europe is likely temporarily to postpone the execution, by the Colony, of these works. From correspondence that will be laid before you, you will learn that I have requested the Colonial Government to give me an assurance that such liabilities as may be incurred by the Province in the execution of those works will be adopted on certain conditions by the Colony. The reply of the Colonial Treasurer is such as warrants the belief that the Colony will reimburse the Province for any expenditure it may incur for the purpose within the limits prescribed by the Railways Act.

You will no doubt agree with me that no time should now be lost in pressing on the works on the Northern Railway, as previously authorised by you. Tenders have already been accepted for the formation of the Line, as far as Papanui, and orders have been sent to England for rails, and for the ironwork of the bridges.

I have every confidence that the initiation of this and other works, together with the introduction of population, which is now taking place, will have a most beneficial effect in reviving the commercial prosperity of the Province.

It is a matter for congratulation that at a time like the present, when great difficulty is likely to prevail elsewhere in obtaining money on reasonable terms, the Province is able to proceed with the work of colonisation.

Should the General Government, during the current year, be in a position to recoup the expenditure which the Province may incur upon the Northern Railway, you will be asked to authorise the more speedy construction of the larger Harbour Works in Lyttelton, which will be necessary to meet the increased traffic upon the Railways. I regret that the uncertainty, which of necessity prevails, as to the time which the initiation of the plans of the Government will take place prevents me recommending, as I should have wished, the immediate diversion of funds for these larger works; but, under any circumstances, I think that an immediate outlay should be incurred to meet the requirements of the Shipping during the ensuing wool and grain season.

You will be asked to make such provision as will secure the continuance of Immigration, in the event of the General Government taking no action in this direction, and I feel no doubt that all future engagements, if not those for which liabilities are already incurred, will, if the province desires it, be brought under the terms of the Immigration and Public Works list.

Careful estimates of Revenue and Expenditure for the ensuing year will be placed before you in the course of a few days. In the meantime, it will be satisfactory to you to know that the Ordinary Revenue for the past year has exceeded the amount which it was estimated to reach by a sum of about £8000, and the Land Revenue for the same period has exceeded the estimated revenue by about £1898.

During the current year the Province will receive, as I have already pointed out, a considerable accession to its Ordinary Revenue, and there is every reason to believe that