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In reply to the question—whether the lands in question, if thrown into the market simply for the purpose of raising the revenue I have estimated for the ensuing six months, are likely to be sold much under their value—I have the honor to observe that the Town Land and Rural Land must be treated differently in my reply. With reference to Town Land, which is sold at an open auction, no doubt if a large quantity be offered in excess of the demand, the effect will be to cause a reduction in the price obtained for the sections sold, but the estimated revenue which I have furnished—viz., £70,000—I assume will be obtained without unduly pressing town land into the market, unless the Government, by withholding rural land, render such a course necessary.

With reference to Rural Land, I would observe that the Land Regulations of Otago are not based upon the principle that it is desirable to obtain the full market value of land, but were framed with the political object of affording the opportunity of purchase to bona fide settlers, and to exclude speculative purchasers; hence a condition of purchase was attached, requiring the expenditure of £2 per acre in improvements.

That restriction has not latterly had to the full extent the effect which was intended; but I feel a difficulty in expressing any opinion as to obtaining the full market value of land sold under regulations formed with an intention not to obtain that value. If the object of Government be to obtain the full market value, the system of open auction is the only one which will attain that result. I am of opinion that the practice adopted in one case—viz., Block 6, Oamaru—of selling the alternate sections and withholding the others, has had the effect of reducing the market value of the land sold; but possibly if the unsold sections be retained for a considerable time, the enhanced value of the new unsold land may more than compensate for the loss on recent sales. The subject has a political bearing which, as the General Government deem it advisable that I should avoid taking an active part in politics, I abstain from referring to; but I may state that I think it advisable, if the practice of so selling detached pieces of land is to be continued, that the reserves should be at greater distances from each other, so that a buyer may obtain land in contiguity, which from its extent may bear the necessary outlay to render it profitable to work it.

No applications for land for depasturing purposes have been received during the past year, the Waste Land Board deeming it advisable in the present state of the Province not to let upon license for four teen years land which it may be necessary immediately to resume, at considerable outlay to the Government. The following tabulated statement shows the number of licenses issued during the year, in fulfilment of pre-existing engagements, and in terms of the Regulations. One abandoned run (No. 403) comprising about 70,000 acres, in the Interior district, was sold by auction for £700, but the license has not yet been issued.

On the probable operation of the system of leasing agricultural land in gold-fields I am not in a position to form an opinion excepting upon conjecture, the system having been so recently introduced as to

Days of Issue

• Jan. or Feb.
• June or July
• Agriculture