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The contracts on the Waiareka and Western District lines are progressing favourably.

The lines which are being constructed by the Colonial Government are, I understand, being vigorously pushed forward, and the Southern Trunk to Balclutha will be opened so soon as_ the Chain Hills Tunnel is completed, which it is expected will be about the end of July next.

Last year you resolved upon the construction of various Branch Railways — railways in many respects, even more important and ueces»ary than the Main Lines, inasmuch as they would connect the interior with the seaboard, thereby rendering the country available for profitable settlement -unfortunately, however, the Colonial Parliament declined to sanction the necessary loan, and, with the exception of preliminary surveys, things remain -ah they were.

I propose that another effort be made, at the ensuing Session of Parliament, to enable the works in question to be proceeded with.

In compliance with your resolutions of last year, preliminary surveys have been put in hand, and estimates ordered to be prepared as to the probable cost of various lines. A nying survey has also been made of a line ' to the Dunstan, both by Waihemo and Tuapeka, with a view of ascertaining the relative cost of the two routes. Full particulars of all these surveys, together with estimates, will be placed before you.

It is scarcely necessary to add that unless the Colonial Legislature will sanction the required advance to effect the^e works, or purchase the Bluff anil Winton Railway, there is little or no probability of their being constructed, with the exception, perhaps, of such lines as that from Riverton to Oiepuki, which will open for settlement Crown lands which are at present practically unavailable, the proceeds of a portion of which will amply cover the cost of the line. In the case of Oivpuki, T may say that the present contract will be absolutely unproductive unless the line is completed.

These and similar works of an eminently urgent and reproductive nature cannot possibly be at once provided tor out of ordinary revenue. They are works, however, which the Province would not have the slightest difficulty in accomplishing if their payment could be spread over a limited number of years. The Colonial Legislature last session refused to grant your application for a loau, and decided that the Province should not obtain the means required for the construction of its branch railways, notwithstanding that advances for various purposes were made to other Provinces. lam glad to be able to state, however, _ that before the close of the session, the Legislature, recognizing the' iuj ury that would be done by refusing to enable the Province to undertake the important works for which the loan was required, agreed to an Act authorising an advance of L(50,000 fiout of the Public Works Loan for the construction of branch railways in the Province. I am not without hope, therefore, that, on proper representation or the matter, the Colonial Legislature will sanction a temporary advance to the Province, sufficient to enable it to construct the branch lines so urgently required, and without which the trade of the main lines, and the benefits to be derived from their construction, will not be fully realised.

As it will become necessary to assimilate the gauge of the Bluff and Winton Railway to that of the Colonial lines, the requisite rolling-stock has been ordered from England. So soon as it arrives the gauge will be altered. It is hoped that the value of the existing plant, which it has been agreed to dispose of to the Government of New South Wales, will to a certain extent cover the cost of the new stock.

Gentlemen, the Estimates for the year have been framed, with a desire to apportion the revenue equitably throughout the various districts of the Province. I only wish that the amount likely to be at our disposal during the current year were such as to enable us more fully to meet iirgent requirements.

In dealing with the' Educational requirements of the Province, the General Education Board has had frequently forced upon its attention the necessity of making provision whereby those districts which may desire to tax themselves or the purpose of supplementing the Government allowance so schools, might be enabled to do so.

With this view a Bill will be submitted for your consideration and approval.

On this subject I may say that in my opiniou it is a in,ere question of time when a General Education \i\e will become imperative. Th.« ' d&u'^id: f<jr schools throughout the Byo,viu.c<s even at the present time can only he partfftUy met out of the ordinary revenue, and the rents of tho 3ikluca#Qiial endowments.

During the past year there have been expended on school buildings alone £21,000. The