of the thorough change in our position since June last, to learn that, owing to the decrease of Revenue derivable from the sale of land, arising from temporary causes, I have been unable to carry out the objects for which you so liberally voted the supplies; other and more urgent demands imperatively arrested my attention, and, feeling that I should ill require your confidence did I not act upon my own responsibility, I met each case as it arose without the slightest hesitation, knowing that though the captions might cavil, you, appreciating the difficulties of my position, would readily accord your approval.

The disturbing causes which have influenced the past are still in operation, and, therefore, in estimating our probable revenue for the current half-year, I speak with diffidence; fresh elements, which cannot well be anticipated, continually enter into the consideration. I can only, therefore, lay before you a rough approximate estimate of our receipts.

The total amount of revenue which may be received during the current half year may be estimated at £100,000, of which nearly £50,000 may be regarded as derivable from the sale of land, £30,000 from our proportion of the Customs, including the export duty on gold, and £10,000 from other sources connected with the Gold Fields. It may be necessary to supplement this sum with about £20,000 to be raised on loan, independently of the sums to be obtained on the security of the Harbour Endowments, which will be carried to a separate account, and used for the purpose of forming wharves and jetties, and reclaiming the land between high and low water mark. After deducting the expense of establishments, amounting to not less than £20,000, inclusive of £10,000 for Police, and £5000 for Surveys, the remaining sum will be chiefly expended on the formation of roads, the promotion of education, and the extension of public buildings, as will be more fully indicated by the Estimates which I shall shortly place on your table.

I have no reason to doubt that the checks which the Executive Council, Ordinance of last Session introduced for the better protection of the public property, will be found to be useful, though the late legislation of the General Government, by the introduction of the Provincial Audit Bill, has made some of its provisions unnecessary, and, moreover, the allurements of the passing hour have caused an unexpected difficulty in filling up Government offices, the selection being restricted to the members of the Council; it may, therefore, be a matter for enquiry whether some alteration be not needed. I think it expedient that provision should be made in the Estimates for the appointment of a Provincial Secretary, as the increase of business may at any moment, and not improbably at an early period, make it necessary that such an office should be added to the permanent Establishment of the Province. I thankfully accept this opportunity of expressing my obligations to the gentlemen composing the Executive Council for the support and advice they have given me in these trying times; in all important matters, affecting the well-being of the Province, we have had but one opinion, and in my determination to prefer the general interests to those most urgently obtruded by individuals or classes, I desire no better aid than that which they have afforded me.

Anticipating the difficulties which might arise from our altered circumstances, it was one of my earliest endeavours to provide for the creation of an effective Police Force; and I would here acknowledge the prompt and valuable assistance which I have received from the Government of Victoria, and from Captain Standish, the Chief Commissioner of Police at Melbourne, which resulted in the acceptance of office by our present Commissioner, Mr. Brannigan, in whom the Government place the highest confidence, and in the establishment of a small but efficient body of police, a fitting representative of that force from which most of its members were received. Protection to life and property being the first duty of the State, I shall ask you for liberal supplies to meet the requirements of this department.

I have organised, in anticipation of your wishes, a Water Police Force, which was called for by the increased amount of shipping and the desertion of seamen, and, as soon as the bill to be laid before you for that purpose shall receive your sanction, I will proclaim the “Thomas and Henry” a gaol for the safe custody of prisoners.

The new Education Bill has scarcely yet had time to come fully into operation. The Inspector appointed under its authority has been actively employed in visiting the schools, and ascertaining the requirements of each locality. The system, now introduced for the first time, promises to render important aid to the cause of Education, and place it on a footing equally honourable to the parentage, the community generally, and the State.

I am most anxious that no mistake should exist on the important subject of education. Even aided by local contributions the Government provision does not prove, as has been stated, adequate to the wants of the Province; neither is it now, nor has it ever been, the intention of Government to relieve any person or associated body from expenditure in the matter of education. They invite all to join, to the utmost of their power, in the efforts to educate the young; and they expect that the united exertions of the people and the Government, combined with the co-operation to be expected from the Trustees of the funds for Religious and Educational purposes, whose services I hope to see early and earnestly in the field, will place this Province, as regards Education, in a position which may challenge comparison with any other. I cannot leave this subject without expressing my sense of obligation to Mr. Livingstone, who came to this Province under an engagement as Rector of the High School, but who has hitherto most willingly and conscientiously devoted himself to purely Elementary Education, the Government not being prepared to carry out, in all its integrity, the obligation it had incurred. Justice to this gentleman demands that this state of things should no longer exist, and I