from £2000 to £2400, I at once consented to place the amount at their disposal, feeling that when the safety of the lives and properties of our fellow citizens were concerned, the question of expense was not deserving a moment's consideration.

While we cannot but deeply deplore the loss of life and property occasioned by the recent flood at the Hutt—still we cannot fail to admire the cheerful spirit with which the Settlers there have borne their losses, and the energy with which they have set themselves to work to retrieve them—the fact that in spite of such severe losses, not a single case of destitution could be brought forward—nor a single person found to accept that pecuniary assistance which was freely volunteered, indicates far more eloquently than words could possibly do, the prosperity enjoyed by all classes. The damage done to the public works cannot be estimated at less than £5000. As any delay in repairing the damages—more especially in re-opening up the communications where they had been interrupted, would not only have aggravated the losses of the settlers but have ultimately caused an increased expense to the Province, no time was lost by the Government in taking the necessary steps to repair them.

While it is the duty of the Council to watch with extreme jealousy any unauthorized expenditure, it is equally the duty of a Government to prove themselves equal to any emergencies that may arise, and to take upon themselves for the public good any responsibilities which such emergencies may entail.

It is satisfactory to know that the large increase to your Revenue will enable you to meet these unexpected demands without materially interfering with your appropriations either for works in progress or what may be proposed.

Basing my calculations on the past, and on information in my possession, I estimate the 5ths of the gross Customs receipts at £13,500; the licences, publicans’ and auctioneers’, £2000; Resident Magistrate’s fees and fines, £800; pilotage and ferriage, £250; post-office receipts, £550; registration of deeds and Marriages, £400; assessment on sheep, £300; hospital and lunatic asylum, £150; registration of brands, poundage fees, and other incidental receipts, £500; immigration refund, £4000; making the total receipts from these resources, £22,450.

I estimate the arrears of land rates, at £400; pasture licenses and rents, £2500; land sales at £35,000; profit on sale of reclaimed land at £3000; Refund of cost of ditte, £1000—giving a total revenue, ordinary and territorial, for the year, of £64,350.

If to this be added the balance in the hands of the Treasurer on 1st January, £6301; the balance paid by the General Government on account of surplus revenue for the year ended the 30th June last, £2803; and the balance still due from the General Government on account of 1856, which will be paid as soon as the accounts have been laid before the House of Representatives, of £3319—the total receipts will amount to £76,773.

Taking the ordinary expenditure of the Government, necessarily increased by the growth of the Province, and by the requirements of newly settled districts, at £15,000, and the interest on the loans of the General and Provincial Governments, after deducting interest on the amount invested, at £9000, there will remain a surplus available for public works and undertakings, of £52,773.

Of the first loan there has been expended £31,500, leaving a balance of £18,450, on which no interest is paid, the debentures only being issued as the money is required. Of the second loan, there has been received £23,187, leaving a balance of £27,313, which has been invested in Exchequer Bills. The third loan of £25,000, which had not, according to last advices from England, been raised, of course remains untouched. The total amount not yet received of the loans authorized by Acts of the Council, is thus £70,763. Add to this the estimated receipts for the current year, and the amount legally at your disposal will be £147,536. In this amount, however, are comprised the appropriations and balances of appropriations, made last year for the following works, viz.:—Widening Petoni Road, £1500; Mangaroa Road, £450; Featherston to Masterton, £2200; Seventy Mile Bush, £20,000; Te Kopi Line, £1700; Karori diversion, £1000; Rangitiki Roads, £9000; Wanganui Bridge, £5000; No. 2 Line, £2000; Wanganui Bridge £900; Waiohini Bridge, £2000; Te Ante Road, £3500; Lighthouse, £2000—amounting (with other items), in the whole, about £50,000.

When it is considered that the loans were raised for the express purpose of executing, amongst other works, those above mentioned, it appears to me that it would be manifestly unjust to alter these appropriations, or to apply them to any other objects than those for which they were originally voted.

Assuming, then, that these appropriations will not be disturbed, and that the interest on the loans and the expenses of Government, will not exceed £24,000, the balance of revenue and loans still unappropriated, and available for public works, will be £73,536.

While you will probably find it difficult, with your finances in such a flourishing state, to refuse almost any application that can be made, still I trust that you will bear in mind that the financial prosperity of the Province has been mainly created by your having devoted nearly the whole of the funds at your disposal to opening up the communications of the country, thus rendering your vast estate available for settlement. In accordance with this principle, I propose that the present surplus should be almost exclusively applied to roads.

I have accordingly placed on the Estimates the following sums:—For repairs of North Western and Great North Eastern Roads, £2300; for completing the Ngahuranga, £2000; for the Ohariu, £1000; the Makuta, £250; for improving the Karori, £500; widening the Porirua, £500; for repairing the damages on the Hutt Road, £1000; for piling the river at the Hutt Bridge, £1000; widening the Remutaka, £1000; for the Greytown Road, in addition to unexpended balance of existing appropriation, £1000; for a bridle track from Masterton to Castle Point, £200; bridle track from Manawatu to Rua Taniwha, £200; from East Coast, £200; for a dray road from Waipukerau to Black Head, by which a large portion of the Ahuriri produce would be