duce the payment to the New Zealand
Company to a mere fractional amount,
they could only have committed this act
of injustice (for such under the circumstances it would have been) by devoting
the whole residue to surveys and emigration without being able to appropriate
any portion whatever to any public work
or other purpose of general advantage.

25. This had been so strongly felt by
    my predecessor, Earl Grey, that he had
    thought it advisable, by way of compromise with the New Zealand Company,
    to fix the proportion to be paid to them,
    by mutual agreement, at one-fourth of
    the gross proceeds. And, after the best
    consideration I could give the subject,
    with the advice of the parties best qualified to assist me, I arrived at the conclusion
    that the arrangement thus practically in
    existence already was that which it was
    best to retain in the act.

26. I regret that I have found myself
    unable to accede to your proposal, made
    to my predecessor, to transfer this charge
    from the Local Land Revenue to the Imperial Treasury; not seeing any grounds
    of justice for the charge. It was Lord
    Grey’s project, on the other hand, to alter
    the charge into a fixed debt, of less
    amount, chargeable on the whole revenue
    of the province, and bearing interest: a
    project on which I offer no opinion of my
    own, merely stating that I have no doubt
    her Majesty’s Government will at all
    times be ready, if called on, to assist in
    any reasonable scheme for the extinction
    of the debt which the Local Legislature may devise.

27. The remaining exceptions to the
    general transfer of the control over the
    waste lands consist in the provisions
    thought necessary to maintain the Canterbury Settlement, and to empower her
    Majesty’s Government to maintain that
    of Otago, if it shall find the Crown bound
    by existing engagements to do so, or
    shall deem it expedient to renew the
    powers of the Association on fresh terms.
    For the present, therefore, the affairs of
    these settlements, and the distribution of
    their funds, remain as heretofore, and I
    will duly acquaint you with any decision
    at which her Majesty’s Government may
    arrive respecting either of them.

28. I shall, also, address you further as
    to the affairs of the other settlements of
    the New Zealand Company, so far as
    they may be affected by the present Act.

29. In addition to these functions, the
    Act confers on the Legislature by sections 67, 68, and 69, the most extensive
    powers of introducing into the Constitution such changes as experience may indicate, or deliberate public opinion may
    require.

30. Your own powers and duties, with
    reference to the ultimate confirmation or
    disallowance of Acts of the General Assembly by the Crown, are defined by the
    56th and following sections so fully as to
    render it unnecessary for me to enter into any details on the subject.

31. Before dismissing the subject of
    the General Assembly, I wish to point
    out that while five years is fixed as the
    period of its duration, the Act contains
    no provisions fixing the periods of its sessions, or rendering it imperative on the
    Governor to assemble it at stated times,
    it has been felt that, under the present
    circumstances of New Zealand, and with
    a complete machinery of Provincial
    Councils, it was possible, although no
    absolute prediction on this point can be
    hazarded, that for some time its meetings will be occasional only.

32. The provisions of section 70 have
    been introduced into the statute in order
    that its enactment may not clash with any
    measures which you are taking, or may be
    advised to take, respecting the establishment of municipalities.
    At the same
    time I wish to convey my own opinion
    that, considering the character and functions of the Provincial Councils, which
    must be eminently of a municipal character, it seems doubtful whether there will
    be any necessity for the creation of other
    local authorities subordinate to these,
    until New Zealand has attained a greater
    amount of population than is likely to be
    the case for some time.

33. It has farther been thought essential to preserve to the Crown by section
    71, with power of delegating it to yourself, the authority which you already possess, of portioning out districts in which
    the customs and usages of the natives
    may be preserved, and exempting them
    as it were from the common law of the
    settled portions of New Zealand. This
    is a power not to be exercised without
    strong ground, and which, it is rather to
    be hoped, you may not find it necessary at
    present to exercise; but under the power
    reserved by section 79 I have to inform
    you that the authority given to the Crown
    in that behalf, as well as for the formation
    of Municipal Corporations, by section 79