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between my estimate of the proceeds of Immigrants' Passage-Money Notes and the actual receipts. The only other sources of revenue to keep in view, the receipts of which have fallen below my estimate, are those from the Sale of Reclaimed Land, and Land Sales. But, had it not been for the parties, who purchased allotments of the Reclaimed Land some years since, refusing to complete their purchases, my estimate of the proceeds of the Reclaimed Land would have been slightly exceeded. The Land Sales instead of realizing £28,000, amounted to £23,000 when I state that at end of the financial year there were unsatisfied applications for about 100,000 acres of land—unstatisfied simply because of the inability of the survey-staff to keep pace with the demand, you will recognize that but for that cause the territorial revenue would have been double the amount of my estimate. On the other hand, the Customs' Receipts exceeded my estimate by some £4000, and the Revenue has been so amply sufficient to meet all demands, that we have held a surplus at the end of £25,000 for a year, thereby saving a year's interest to the Province.

With regard to Public Works, under the sole control of the Government, they have all, with one or two most unimportant exceptions, either been completed, or are in progress. The only appropriations unexpended are a few for Public Works under the superintendence of certain Local Boards, which, instead of employing their own Engineers and Surveyors, have preferred postponing the works until they could obtain the services of the Government officers. At the same time, I need not point out, that it is unreasonable and absurd to expect that all the works you authorize are to be commenced the moment the Session ends, or can be carried on simultaneously. For in all works there are certain preliminary steps to be taken, and the cost of the works authorized by you to be defrayed out of funds in hand, but out of the accruing revenue of the year; so that these must inevitably be at the end of each financial year works incompleted, and unexpended balances in the hands of the Government. Uninvested votes are always placed on the next year's Estimates, no injurious is done to any district.

The balance on the first of this month in the hands of the Treasurer being here £1444, and to your credit in England £2100, I estimate the receipts as follows:—Interest due from Hawke's Bay, £200; proceeds of Reclaimed Land, £5000; three-eighths of the Customs' gross receipts, £16,000; Licenses, Publicans' and Auctioneers', £2000; Pilotage, £600; Assessment on Sheep, £600; Incidental Receipts, £200; Tolls, £1500; Wharfage dues and Bonded Store dues, £1500; Promissory Notes, £3000; Rates on Land and Voluntary Contributions for Grants in Aid, £3000; Pasture Licenses, Rents, and Land Sales, £3000; and the net proceeds of the Loan of £25,000—£27,000: thus giving an estimated income for the year of £49,890.

In framing the Estimates of Expenditure I have ever in accordance with your wishes, to foster the institution of Local Boards, endeavoured, with a due regard to other interests, to place ample funds at their disposal, especially for the construction of district roads. You have for the last few years given to District Highways Boards grants in aid double the amount of what they have raised by local rates. And I propose, not merely to continue this liberal contribution, but to give special grants to almost every one of the Local Boards, upon the understanding that both the grants in aid and the special grants are to be expended in the construction and not in the repairs of roads, and with the warning that if my expectations in regard to the acquisition of extensive tracts involving the construction of great works to make them available are realized, the Local Boards must be prepared next year to rely more exclusively upon their own resources.

With regard then to the expenditure proposed for the current year, taking the cost of the ordinary Departments of Government and Council at £15,944, including the Land and Land Purchase Departments, you will find placed on the Estimates, for Surveys, £5000; for Engineers' Department, £1300; Education, £3000; Colonial Secretary, £100; Observatory, Geological Surveys and Explorations, £900; Ferries, £250; Steam Subsidy, £1000; Insurance and Repairs, £500. Under the head of Bridges—for the Wanganui, £400; Turakina, £250; for the Tutunui, £150; Porirua, £250; at Featherston, £300; and on the Hutt road, £100; giving a total expenditure on Bridges of £1450. For Roads—repairs of the trunk lines, £4000; widening Porirua, £1000; for the road from Featherston to Masterton and Te Kopi, £750; Masterton to Castle Point, £750; through the Forty-mile Bush, £1500; Mungaroa, £100; widening Rimutaka, £500; Rangitikeito Wanganui £2500; Wanganui to Waitotara, £1000; No. 3 Line Wanganui, £1000; grants in aid, £9000; and special grants to Belmont of £200; Pahautanui, £200; Masterton, £200; Karori, £200; North Makara, £200; Ohariu, £200; Ohiro, £200; Wainui-o-mata, £500; Great Western, Wanganui, £500; Manawatu, £500; Rangitikei, £500; Lower Rangitikei, £500; giving a proposed expenditure on Roads of £27,100. Under the head of Sundry Works—for improvements of Reclaimed Land, £500; Piling right bank of Wanganui river, £300; Custom house and Post-office, £500; Supreme Court and Police-office, £2887; Fire-engine, £20; additions to Lunatic Asylum, £306; Gaol, at Wellington, £600, at Wanganui, £2500; house for Native Chiefs, £500; Museum, £300; Wharf at Campbelltown, £200; at Wanganui, £1000; Court-houses at Turakina, Rangitikei, Manawatu and the Wairarapa, £500; Wharf, Wellington, including moorings, rails and other plant, £5000. Contingencies for Public Works, £4000. Immigration, £6500. Ann. Wilson's Immigrants, £1400. Patent Slip (portion required this year), £5000. Interest on Loan £10,650, making the total expenditure, £97,998.

You will perceive that in these Estimates no provision has been made for Land purchases, though the amount required will probably during the current year be little short of £20,000, and the balance of the Land Purchase Loan is only a few thousands; still, as the acquisition of fresh lands will at once materially augment your Land Revenue, and will afford ample security for any advances, I deem it inexpedient to do more than simply to ask you, by a similar resolution to that you passed last year, to guarantee the repayment of any overdraft I may require from the Banks for extinguishments in the Native Titles.

In conclusion, though the progress of this Province during the last few years has been slow in comparison with that of the provinces of the Middle Island, I think it will be admitted, on all sides, that it never was in such a satisfactory state as it is at this moment; and that far from losing the faith we have never ceased during the most trying times to hold in its ultimate future, we may now confidently look forward to a period of renewed energy, when all the elements of wealth and prosperity that it has made during any previous period of its history.

I. E. FEATHERSTON,

Superintendent.

Superintendent's Office,

Wellington, 24th April, 1863.

Printed under the Authority of the Government of the Province of Wellington, by Thomas McKenzie and James Moore, Printers for the time being for such Government.