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estimates for Immigration, £3,000; Education, £700; Subsidy to Boomerang £2,100; to Wonga Wanga, £500; for Ferries, Local Posts, &c., £626; for Lighthouse, £1,750; for additions to Gaol, Government Offices, Furniture, &c., £340; for Turakina Bridge, £1,500; Hutt Bridge (being the probable amount required this year), £2,500; Waihoine Bridge, £2,250; Taunera Bridge, £80; for Repairs of North Western and North Eastern Roads, £2,000; widening Petoni Road, £130; Road from Mungaroa to Featherston, £650; Featherston to Masterton, £1,000; Featherston to Te Kopi, £1,200; Ngahauranga and Ohariu, £200; Karori Road, £1,000; Porirua, £150; Beach and Thorndon quay, £500; Rangitikei—Wanganni, £2,200; No. 3 Line, Wanganui, £880; Buoys, at Manawatu, £100; making (with some other items unnecessary to specify) a total estimated Expenditure of £56,427; in addition to which, there may be a claim on account of the Ana Wilson’s immigrants, should the award of the arbitrators to whom I have proposed referring the case be adverse to the Province.

You will be prepared for a far less flattering statement of your future financial prospects, than it has hitherto been my pleasing duty to lay before you; for, in addition to the loss of the proceeds of the greatest part of your unsold estate—an estate which you had rendered valuable by colonizing it—in addition to one sixth of your remaining land revenue being under the Land Revenue Appropriation Act of 1858, taken away, because the funds that funds may some time or other be required to extinguish the native title, his Excellency’s Government have, (the Act in question being retrospective in its operation) called upon you to refund one-sixth of your territorial revenue for the year ended the 31st Dec. 1858, or rather, without giving the slightest notice of their intention—without the slightest regard to your financial engagements—have impounded one third of your land revenue, until one sixth of the land receipts for the past year, amounting to between six and seven thousand pounds, has been repaid. Nor is this all; in 1856 a Committee of the House of Representatives was appointed to lay down the principles upon which the accounts between the several Provinces, and between them and the General Government, were to be adjusted; the Committee’s report having been adopted by the House, the Auditor General adjusted the accounts. According to his statement, there was a balance due to this Province for the period ended 31st Dec. 1855, of £3,319; that balance was not only admitted by his Excellency’s advisers, but a pledge given that it should be paid as soon as the accounts had been laid on the table of the House of Representatives.

Previous, however, to the meeting of the Assembly in 1858, his Excellency’s ministers readjusted the accounts in such a way that, while they converted the debt of £4,012 due to the General Government from the Province of Nelson into a balance in its favour of £1,800, they reduced the balance due from the General Government to this Province from £3,319 to £512. They effected this by simply declaring that a sum of £10,000 paid for the purchase of lands in Nelson in 1855-56 ought not to be treated as revenue of that year—the year in which it was paid—but should be regarded as revenue of the following year—1856-57. By this arrangement the Province of Nelson became entitled to the whole £10,000, and the surplus distributable amongst the provinces was reduced by the same amount.

Nor is the course pursued by his Excellency’s Government in withholding a balance of £1988 due to this Province on account of the ordinary Surplus Revenue of the year ended the 30th June, 1858, less open to animadversion. You will remember, that his Excellency’s Government, after declaring in a letter, dated the 31st October, 1857, that the presence of a military force at Napier, was in their opinion, absolutely necessary for the protection of the lives and properties of the settlers there, intimated that they would not send the force, unless I would at once guarantee to provide funds for the erection of barracks. You will remember further, that when that threat was made, the Council was not in Session, and that I had therefore no alternative but to comply with this demand; but you will be surprised to learn, that although I gave that guarantee, as Superintendent of the Province of Wellington as then constituted, his Excellency’s Government, three months after Hawke’s Bay had been created a separate Province, sent in a claim for £1870 on account for the Napier Barracks, with an intimation that the balance of £1988 would be withheld until the claim was settled. The fact that his Excellency’s Government have within the last few days waived this monstrous claim only renders its injustice the more palpable. But though they have paid the balance of £1988, they have compelled me to pay the interest and sinking fund of monies expended in the purchase of lands in Hawke’s Bay, which have only recently been handed over to that Government. With these facts before you, it will, I fancy, be difficult for you to come to any other conclusion than that his Excellency’s present advisers have done their utmost to involve this Province in financial difficulties, and to check its progress.

Your financial position on the 1st of January, 1859, was as follows:—Balance in hands of the Treasurer, £2777; due from the General Government, £1988; at the credit of the Province in England, after paying £3082 for interest due on that day, £23,789; giving a total balance at the credit of the Province on the first of the year of £28,554. I estimate three-eighths of the gross Customs receipts at £14,000; Licenses (publicans’ and auctioneers’) £178; Registration of Deeds, £500; Pilotage, £450; Fees and Fines, Sheep Assessments and other incidental receipts (including Immigration Promissory Notes), at £1075; the Territorial Revenue, including rents on Land, Pastoral Licenses, and two-thirds of Land-Sales: at £14,000; proceeds of sale of reclaimed land, £8000; making the receipts for the year (assuming that the reclaimed land will be sold) £39,805; which, with the balances already specified, will give a total sum of £68,359, available for the current year. To this will have to be added, the amount that may be recovered from the Hawke’s Bay Government on account of interest on the Loans. From this statement you will perceive that while the Revenue (ex-