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THE NEW ZEALAND GAZETTE.
[No. 38

going on in the circumstances of the country. The increase in the value and
volume of many of its productions has made the task of retrenchment easier, while
it has had its effect in adding to the revenue.

There are encouraging signs that the improvement which has taken place
will continue. The higher prices which have been obtained for its chief exports,
while adding to the capital and increasing the income of the country, are
restoring the confidence in its resources which for a time seemed to have been
almost lost by many colonists. This is shown not only by the large amount of
capital expended in industries which have been found remunerative, but in the
extent of land which has been purchased from the Crown and, in parts of the
colony, from large owners, who have subdivided their holdings into convenient
areas and offered them for sale. A large addition has thus been made to the
land brought into useful occupation.

While confidence is being restored among colonists, and a renewed vigour
shown in promoting our industries, New Zealand is coming to be regarded with
greater favour by persons outside the colony who are in search of a home, or of a
place of resort for recreation and health. Judged, too, by the value of its securities
in the London market, the colony's credit has from month to month during the
past year steadily advanced in England.

My Government, while restricting unremunerative expenditure, have recognised
the advantage of a judicious outlay of money in developing the resources of the
country as occasion required. They have, therefore, in pursuance of the authority
given by you, let for construction such works as they believed were likely, either
directly or indirectly, to be remunerative. Detailed information on this subject
will be laid before you.

One of the most pleasing manifestations of the increased confidence of the
people in the colony's future is furnished by the determination of the inhabitants
of Otago to hold in Dunedin an Exhibition of Industries and Fine Arts, and by the
favourable response which they have received from other parts of the colony to their
invitation to join in the undertaking. My Advisers regard the enterprise as one
likely to have a beneficial effect generally, and you will therefore be asked to
sanction an arrangement which has been entered into by them to assist in bringing
the Exhibition to a successful issue.

During the recess my Government have brought into operation "The Govern-
ment Railways Act, 1887," and have placed the railways under the management of
three locally-appointed officers. After careful inquiry my Advisers came to the
conclusion that it was impossible to get from abroad, for the salary which was
authorised, or indeed for any salary which they were prepared to ask you to
vote, a Chief Commissioner to whom they considered they would be justified in
intrusting the great powers vested in that officer; while, on the other hand, their
experience of Mr. McKerrow pointed to his being a person well qualified to fill the
office. My Advisers believe that their choice of Commissioners will be justified by
results.

The sales of public land within the colony have been very satisfactory, both as to
the quantity disposed of and the class of persons who have acquired it. Much of the
land has been taken up in small areas, and by persons who are making their homes
upon it. The sales of runs which have lately taken place show that there is
increased confidence in the great industry of wool-growing.

My Ministers are confident that, by careful administration and by taking
advantage at seasonable times of opportunities for opening up the country, New
Zealand will soon be made to occupy that prominence, as a home for a thriving
population, which her position, climate, and resources fit her to attain.

GENTLEMEN OF THE HOUSE OF REPRESENTATIVES, —

The estimates of the revenue and expenditure for the current year will be
brought before you at an early date, when they will, I have no doubt, receive your
careful consideration.

The estimates of expenditure have been prepared with a due regard to
economy.