PUBLIC WORKS.

Press, Volume LXIII, Issue 19138, 22 October 1927, Page 15

PUBLIC WORKS.

£6,777,474 Expended During Year. ROAD MAINTENANCE COSTS. Minister's Annual Statement.

(PRESS ASSOCIATION TELEGKAtt.) | WELLINGTON, October 21. j The Minister for Public Works (Mr ! K. S. Williams) presented tho annual ' Public Works Statement iu the House j of Representatives to-night. j Following are the more interesting j sections of the Statement:— As honourable members arc aware, it is just a little over one year since I assumed Ministerial control of tho Public Works Department. During that period I have tried to study carefully the administration of the Department in its several branches, and iu making my enquiries I have always enjoyed ; the cheerful assistance of nil members | of my staff. -With a, view to enabling j mo more fully to appreciate my pre- I decessor's policy of public, works and to obtain a personal kuowlcdgo of tho j large enterprises in hand, as well as j the many smaller local works, I spent' most of last recess in systematically inspecting wherever I was able tho Department's operations throughout the j Dominion. By theso visits I have* obtained valuable personal knowledge. I have endeavoured to view the Department's operations from a purely j Dominion standpoint, believing that j local interests must always be subservient to national considerations. On the administration side, I have followed the policy of concentration expeditious achievement laid down by my predecessor in 1921. It is my endeavour to prevent waste, and so obtain good value to the State on all works undertaken by my Department. The country is at present suffering from a temporary depression, caused by a general decrease in the value of our primary products. This state of affairs has occurred before, and will happen \ again in our history, and it would be wise for us to bear th&t in mind and prepare ourselves to meet such occasions.- World prices for our primary products we cannot control; but we can increase production within our own country to ease the financial blow that this country inevitably receives on a fall of prices for our primary products. With a view to encouraging increased production from our country districts, it is my desire, by providing railway transport, hydroelectric facilities, and Toad improvements, to enable farming operations to be carried on economically and without hindrance, and by irrigation, flood control, and drainage to bring into full productivity ' lands not now fully utilised.

quired assistance, and ns a result, of this the .uumbov of mon increased from 0700 to 11,039 between July, 1926, and . August, 1927, and the numbor qf relief workers still shows an upward tendency, though indications point to tho probability that before long a large number will find work at their ordinary avocations. Relief Workers. In connexion with what I may call relief workers, it has not been possible either to pay standard wages or to provide the housing conditions and recreation facilities as are usual on our regular works; but, as my prudecessor has said in past Statements, it is undesirable that too great a numbor of workers should look to borrowed money as the source from which thoy should derive their livelihood,'and it is my desiro that the employees of my Department should be reduced to the number to whom continuous employment can bo reasonably assured in accordance with tho Government's policy of progressive development. . While the Government recognises that cases of hardship should be relieved, it does not wish to creato in the minds of workors tho foeling that there is no necessity to provide for a rainy day, and that whenever they becomo unemployed they can look to tho Government to find thorn work under , standard conditions. As has been set out more than ; once, tho Government has a settled -policy of developing the country progressively; the amount, how-, ever, which can be borrowed usually depends upon progress not only in hum' bers of population but in valuo of ex- ' ports, or, more properly perhaps,, the difference botween exports and imports, and the recent financial .stringency points unmistakably to the necessity for a decrease in tho amount of annual borrowing. The decrease must bo mado judiciously, however, in order that workers may have an opportunity of findirig work in their usual avenues of employment.

Motorists nod Roads. It has for some time been quite evident that the monetary provision for the maintenance of highways and also for other roads in the Dominion is inadequate. The total expenditure .for the past yoar by the Main Highways Board from its Eevcnue Fund, incurred on the highway system, which comprises approximately 13 per cent. of the total formed roads in New Zealand, or about 25 per cent. of the hardsurfaced roads, was £547,000, while the actual amount of rovenue teceived during the year into this fund was only £544,548. This latter figure, moreover, •is much inflated, due to the causes set out in the Main Highway Board's report. The estimates of revenue,, and expenditure for the current year show a much more unsatisfactory position* a deficit of over £200,000 being anticipated. The amount of money being found by the county ratepayers towards the upkeep of the highways has also been, increasing at a very considerable rate, the figures for the three years-up !to the present being: £IIO,OOO for 1924-25 (nine months only), £185,015 for 1925-26, £276,349*r0r/1920-27, and the estimates for the coining year indicate a still further increase. In addithe cost of maintenance of ordinaryiroads has been continually, increasing in sympathy with the increasing use of mo tor-vehicles; so that it is quite apparent that some further assistance must bo given to local authorities to cope with an increased expenditure, the greater' part of which increase is directly traceable to the use of motorvehicles. Moro might be done to reduce the wear and tear on the roads by. restricting, in accordance with the heavytraffic, regulations, the weights ..and speeds of the vehicles which are permitted to travel on them, and I think this course should be' followed by loepl authorities in cases where their roads are breaking up and funds for reconstruction are not available. This principle, if carried too far, would cause administrative difficulties and might be considered as unduly throttling road transport and thereby possibly creating hardship on the very people it was intended tb help. We have/therefore reached the point where either fresh taxation must be lovied or the good work which has been initiated in the past three years must ease off, which, latter course will be dis-, appointing alike to the motorists, the local authorities, snd the men engaged on the work. The improved roading facilities already provided have allowed motorists of all classes an opportunity to travel .more economically and into districts removed from their own. This has resulted not only in the use and wear of the main highways, but in a great deal of extra wear and tear on the subsidiary or settlers' roads, with the result that the ratepayers in a number of districts now find themselves loaded up to breaking-point with rates, and at the.same time they »re faced with the fact that their roads we deteriorating.

Need for Roads. r feel it my duty, as far as my financial resources will allow, to assist road-construction to open up lands where production is hampered by want of access. In many places, to my knowledge, it is, until comparatively late in the season, difficult and expensive' for produce to be" taken from the farm to.the market. This is'especially so in connexion with dairy produce from backblock farms,'and this hardship is reflected in reduced returns to the producer. The Main .Highways Board is relieving the position with regard to the main highways, and with the services rendered by railways great facilities are given for development work in the rural districts within reach of such means of transit. There still is, however, the roadless farmer in the .most remote parts whose farming opera- " tions are restricted for want of proper access to the markets. His difficulties are accentuated by deflation in land j values and the ever-increasing rate burden for the maintenance of existing roads, caused by the ■■ extraordinary in- | crease of motor transportation. His j case obviously and of necessity requires our special attention. The hydro-electric services, supplied by the Department are rapidly springing into favour both in the cities and country districts, and it requires but little imagination to realise the enormous claims that will in the future be made upon these services for power and domestic uses.

In public works construction it is imperative that national interests be paramount where they conflict with local desires. In arriving at decisions in this respect I must be guided by the Dominion scheme of construction to ensure proper connexions with existing systems; and the expert reports of my engineers, as to economy and efficiency of construction, and subsequent service, and the business to be obtained by the new enterprise. This policy is applicable both to railway construction and hydro-electric installations. Organisation of Workers. I have been much impressed with the organisation laid down by my predecessor with regard to the workers employed on construction works, particularly in the case of railway works and hydro-electric installations, where large numbers of men are concentrated for a lengthy period and additional expenditure is thereby warranted. The present conditions of employment, for which he is responsible, are eminently satisfactory, and the result is a contented and efficient body of men who have confidence in the Department. I do not intend to do anything to impair that confidence. The Department has every reason to be satisfied with its workmen, and they are justified in expecting consideration from the Department, especially, so far as practicable, to receive continuous work in exchange for faithful service. At one time the policy was to make public works the dumping-ground for the unemployed. The result of this policy was inefficiency and discontent. It is my duty to the State and the men to prevent overloading the works with unemployed, with the inevitable result of inefficient and costly work and subsequent slackening of hands. A't the same time the conditions in the Dominion during the past year have been such that very considerable numbers of men have been unable to find work at their regular avocations, and it became necessary for the Government to take vigorous steps to, relieve the position. A great deal was done, and is being done, by local authorities in the way of starting works which were not included in their ordinary programme for the year, and to assist them still further in doing this special contributions were made by the Government in the way of subsidies on the cost of the labonr employed on such works. Quite a lot of money was already raised by public subscriptions to assist those unemployed, but in spite of these avenues of assistance it became necessary for the Government to employ a great many mpr« who re :

I Fresh Taxation. An examination of the figures representing the importation of motor-ve-hicles and the cost of maintaining the highway surfaces shows that as the number of cars increases maintenance of road-surfacing increases practically in the same ratio. Since 19?4 the increase in the cost of maintaining the highways alone represents from £5 to £6 per annum per additional motorvehicle registered since that year, whereas the additional contribution from motor-taxation to the highways funds represents approximately only £3 per annum per motor-vehicle. Nevertheless it is most undesirable that there be any slackening-off of maintenance, as such a step would result in the loss of much of the capital which has already been spent in bringing the roads to their present state. It is undesirable, too, for other obvious reasons, that the construction programme be interfered with. Good progress has been made in this direction, but the desire of {he motorist who lives in the city to have even better facilities than the present programme and finance allow, and his willingness to pay for such are evidenced by the number of schemes • for local taxation Avhich are in operation, are being promoted, or are in the air. Looking at the matter from all points it appears to me that a further source of revenue is required which will provide sufficient funds to enable the present programme of highways construction to continue, the present standard of maintenance to be kept up, and,.in ad-

dition, to enable the Highways Board to grant such liberal subsidies as will enable the densclv trafficked ronds radiating from the principal centres of population to be surfaced with highclass paving within a reasonable time. Provision must also be made to enable assistance for maintenance being given on a pound-for-pound basis on a system of Focondary highways from 2000 miles to 3000 miles in length. This further source of revenue will r.lso furnish the interest and sinking fund on the loan of £3,000,000 which is authorised in the Main Highways Act, 1922. Such sinking fund will be based on a conservatively estimated life of the improvements financed by the loan This appears to be the right, policy, as we have no definite knowledge as to how long the present system of roading in New Zealand will stand the wear and tear of constantly increasing traffic, and therefore the loan indebtedness should be paid off within as short a time as possible consistent with the country's ability to pay.

The particular lengths of road to be paved in c vicinity of the centres of population will be selected by the Main Highways Board after consultation with the District Highways Councils and after any representations of organisations of motor-owners have been considered. The roads *-< constitute the eeco- lary system of rural highways above incut io. d will also be chosen by the Main Highway Board after District Highways Councils have submitted their recommendations.

The Case of Boroughs. The principle- that —■ >ietT»= should Hhare to a greater extent than is the case at present (if no* universally) iu the bencuts received lv local authorities from tho funds of the Main Highways Board under the present legis'"" has been stressed by municipal nuri''" u: The reply 'o si- -' a suggestion is that the present funds are inadequate for the purposes contemplated in the present Main Highways Art, nor does the suggested further source of revenue referred to above '-n any provision for direct assist; ••« to work in boroughs. The latter c:in only be provided for by a still further source of revenue.

Tho Main Highways Board has been subjected in a few instances to local pressure directed to' enforcing the carrying-out of grado easements and other improvements, which are perhaps just a little premature in the present state of development of New Zealand. It is important that the funds available, which are by no means in excess of bare requirements, should be conserved and devoted rather to the elimination of dangers and the improvement of surface than to the obtaining of ideal grades. Tho economics of all projects put forward are carefully looked into, and ■while perhaps to the passerby some of tho deviations or improvements ill hand may appear extravagant, an investigation of the pros and cons will showthat they have all a solid justification when upkeep and running expenses are / considered ns well as capital. EXPENDITURE.

The total net expenditure under all Totes and accounts appearing on the public-works estimates for the financial year ended March 31st, 1927, was 426,777,474. Of this sum £3,588,059 was expended out of General Purposes Account, and the balance, £3,189,415, ' out of special accounts, A brief summary of this expenditure, as well as the total expenditure since the inception of tho public-works policy to March 31st last; follows in tabular form:— For year ended

£ In addition surplus revenue as available will be transferred from Consolidated Fund tip to 500,000 Tho estimated expenditure under the account for the current financial year, including the transfer of £200,000 to Main Highwavs Construction Fund, is '.. .. .. 4,287,750 In addition to requirements for general purposes there are certain special accounts for works with separate ways and means. The total under theso heads is £11,611,097, which includes £557.107 of available balances at the end of the year, £9,013,990 of inexhansted borrowing authority, and £2,000,000 additional borrowing aulhoriy (for railways improvements), to be sought during the year. Tho accounts, with the amounts available are:— Klectric supply ■ . ■ - 4,753,180 Wnihou and Ohinemuri Rivers Improvement Account .. 170,666 Railways improvement . . 4,210,691 Main Highways Construction fund •• •• 2,170,560 From the foregoing figures it will be observed that at the end of hst financial year the unexpended balanco of the Public Works Fund for general purposes, plus existing and proposed authorities for raising further moneys, amounted to •• •• 9.000,437 While the balance at the same date in respect to some of tho more important public works, under sprfcial accounts, plus existing and proposed legislative authority to raise additional loans, amounted to . . . ■ 11,611,097 Or a total of £21,511,534 RAILWAY CONSTRUCTION. During the last financial year the Opunake Branch Railway, of a length of 23 miles, was completed and handed over to the Railway Department for incorporate n with the general railway •system of the country. In addition to this line, rails have been laid on 47 miles 65 chains. A passenger and goods service has been run by the Public Works Department over various lines totalling 152 miles in length, the principal sections being between Tauranga and Taneatua, Wairoa and Waikokopu, Waiotira and Pukehuia, and Okahukura and Ohura Goods traffic only has been run over a further length of 20 miles. These services, run while sections of line are, being completed, have undoubtedly been of great benefit to the district and settlers served, although perhaps in some cases adding to the cost of construction. • - The North Island Railways, on which work is now in progress, are the North Auckland Main Trunk Railway (two sections), Auckland-Westfield # Deviation (approximately 10 miles of double track), East Coast Main Trunk Railway (Waihi eastwards, the whole 87 miles under construction which should be handed over to the Railway Department within 12 months). NapierGisborno Railway, Stratford Mam Trunk, and Palmerston North Deviation. SOUTH ISLAND LINES. Following are details of South Island Railways: Midland Railway. Work on the Kawatiri-Murchison section of the Midland Railway is in hand over a length of approximately five miles, being the length from. "W" Kawatiri station to the Gowan station, of which the southern end is at 07 miles 9 chains. , . , i An investigation into the advisability of continuing construction of the railway -beyond the Gowan has been made, from which it is clear that present transport conditions do not warrant any further . extension of construction. This matter will, however, be further investigated when the amount of traffic offering on this new section of railway has been: ascertained. On the Cascade section of the West-. pbrt-Inangahua, railway, the main work has been the completion of the formation, plate-laying, ballasting, and bridging on a three-mile length to the sidings for the Cascade Coal Company at the 9-mile, The company will flume its coal seven miles from mine to siding. A trial run shows the flume to be successful, and it'is anticipated that a considerable coal traffic is likely to develop on the section, very soon. . On the adjoining ; Cascade-Hawk's Crag section, a /commencement has been made with preliminary ■' work preparatory to continuing construction on' the section.

South Island Main Trunk. Since my last Statement,-exhaustive surveys have heen made to. determine the best route for the Wharariui to Parnassus connexion of the South Island Main Trunk Railway. In brief, the result of these .surveys, arid the investigation of estimates hare been to show that the original inland route must be abandoned on the ground of excessive cost, which would greatly exceed earlier estimates. The coastal route offers the best possibilities, but cost of construction by this route would still be very heavy, and would certainly not be less than estimates previously adopted for the inland route. .

Lawrence-Eoxburgh. The construction of the Roxburgh section of the Lawrence-Roxburgh railway, which has been in hand for the past two years, is approaching completion. The main line is now fully ballasted into Roxburgh station; stationyard formation- and ballasting have to be completed, station-building contracts are in band, and bridge-girder spans are now being fabricated at the Tauranga workshops. It is anticipated that" the Roxburgh section will be ready for handing over to the Railway Department early in the new year. This will then complete the railway to its logical terminus, which has been the objective for many years.

IRRIGATION & WATER SUPPLY.

No new scheme has been commenced during the past year but work has been continued on the '' Arrow and Hawkdun schemes, on which construction had been begun the previous year. The Arrow scheme, which is designed to irrigate close on 6000 acres, has progressed'to the extent that ths earthwork involved in the system of main and distributary races is practically complete. . The ordering of material for building the siphons and pipe-lines is deferred till further funds are available. On the > Hawkdun scheme, which will irrigate 10,000 acres, substantial progress was made during the year with the reconditioning and enlargement of the old Mount Ida system of mining siphons and races, by which the water will be collected and delivered to the irrigation races. During the year tlfe existing schemes were maintained in good condition, certain minor extensions were made, and a supply of water was given to all lands requiring it. The total area irrigated under all Government schemes was 31,]£2 acres, the number of irrigators being 288. Experience of irrigation in New Zealand, confirmed by the experience on irrigation projects abroad, had shown the need of affording some assistance to irrigators in the earlier years of irrigation farming. This appeared, to be best met by a deferred scale of charges, and such a scale was put into oDeration in the later part of 1935. Under this "system, the rate for the first, year ..of. supply is on a very low basis, the scale rising in a period of six to ten years to its maximum. This policy was adopted to assist irrigators j in the early years of development of an irrigation farm, and while irrigators are gaining experience in.that class of farmine. Irrigators generally are taking advantage of the deferred scale. In addition to this, further assistance has been granted by supplying extra water, over the asrreement quantity, at a very low rate, where such extra water

is available. My policy in this is to help the man on the land without in any -way prejudicing the financial returns from the capital invested. Further schemes are being investigated and will be developed as funds permit and the areas already, served become fully taken up, and the necessity for further lands for closer settlement arises.

ROAD-CONSTRUCTION. As has been the case during the past eight or nine years, expenditure on road-construction during the last financial year again shows a large increase, the amount expended being the highest so far recorded by the Department. During the year .1925-36 the expenditure almost touched the £1,000,000 mark, but last year that mark was exceeded by a substantial amount, and a figure never before reached on this section of the Department's activities was passed. As mentioned in my Statement last year, the primary development in any country is by roading, and the figures just quoted will show the great progress that has been made towards the opening-up of back country for developmental purposes, and also in the improvements to existing roads, which should ultimately lie reflected in the increased productivity of the country served. Regarding the opening-up of the back country, I have previously mentioned that an effort was being made to devise some scheme whereby those outlying and isolated districts would receive the special consideration in the way of provision of reasonable access they undoubtedly deserve, and, as already disclosed, it has been possible to set aside a substantial sum this year for that purpose. The expenditure of this amount should to a very great extent alleviate the difficulties under which the backblock settlers are at present labouring as a result of the sparsely-populated areas not providing sufficient rates to enable the local bodies to undertake necessary roading. At the same time it will effect a desired improvement in the system of automatically allocating the funds under the Roads Vote by enabling provision to be made for those sparsely-settled districts in excess of what, they are entitled to on a basis of allocation, which must take into account such factors as population, rateable values, etc. For next year the factors will be reviewed in an endeavour to make the automatic allocation stili nearer the actual requirements of the various districts.

Back Country Roads. During the year a large number • of roads and tracks were completed to a standard sufficient for present requirements and handed over to the »control of the various local bodies throughout the Dominion. The policy of placing these roads and tracks under the control of the local bodies immediately they are completed to a width and standard considered sufficient to meet the present requirements of the district served has been in existence _ for some years, but on several occasions recently certain local authorities have protested against having to accept con-, trol'of roads before they are constructed to full width. These protests have arisen from a misunderstanding by those bodies of the future attitude of the Department in respect to such roads. Tho handing over of a road when formed to a width of, say,., 6ft does not mean that the local body to which it has been handed over will have to. finance the whoje cost of future improvements, nor does it preclude the Government, from assisting with maintenance. In the event of the: local authority being unable to bear the total cost of maintenance, it is at liberty to apply for Government assistance. Applications of this nature are "considered on their merits, and if circumstances warrant it and funds are available, assistance is granted. When the requirements of the districts- served justify the cost of widening or metalling, an application from the controlling authority will be considered in the same manner and appropriate financial assistance granted.;. This policy is only reasonable when it is remembered that local bodies collect the rates from the. properties served, and in the event of the Department retaining control until tho roads are completed to full standard the Government would be called upon in the meantime to carry the burden of main--tenance without cost to; the ' local bodies, while 'those bodies would be in a position to expend the rates elsewhere.

Flood. Damage. The expenditure on the restoration of flood damages was, unfortunately, high, owing to exceptional floods during the latter part of the year in many parts of the country, though the country did riot suffer so severely as during the previous year. , However, in several cases one disastrous flood was followed at a short interval by a second, and in these instances the Government was called upon to provide, liberal assistance, as the local bodies': resources were in some cases exhausted, and in others very much depleted. Nevertheless, the funds available under this heading were judiciously, administered to avoid approving grants where local bodies were in a position to reasonably meet the liability or where damage was caused or intensified by want of adequate maintenance.

HYDROELECTRIC DEVELOPMENTS. The year just completed,. the sixteenth'since construction works were first commenced by the Department, has been one of considerable activity. The expenditure during the year has been £1,293,439, increasing the total capital spent on hydro-electric works from £5,134,496 to £6,427,935. Of this amount somewhat over two millions is invested in works which are. still under construction and which have not yet commenced commercial operation. Although no new scheme has come into operation during. the year, the annual revenue continues to increase. For the year just ended the revenue has been £364,412,. as against £287,942 for the previous one, an increase of £76,470, or 26.6 per cent. Similarly, the maximum load supplied by the Government schemes during the year has increased to 50,150 kilowatts, as compared with 40,994 in the previous year. Lake Coleridge. Though there has been a very considerable increase in f capital investment during the year, the financial results for the year have been very satisfactory. They may be summarised as follows: — £ Capkal investment ; .. 1,538,569 Bevenue ... >; 150,239 Operating-expenses ... 30,728 Balance .. 119,511 This balance has been used in paying interest charges, and a 2 per cent, depreciation charge, leaving a profit on the year's working of £26,250. This has been paid into the ■Sinking Fund Account. This scheme now has a Depreciation Fund of £142,594 and a Sinking Fund of £35,443. The Chief event during the year has been the completion of. construction and putting into operation of the extensions to headworks and generating-station, which has increased the capacity of the plant from 16,000 to 3souo horse-power. The Department had contracted under heavy penalty -to have these "works in operation by the end of July, 1926, and was successful in carrying out its obli-

gations to time, and in providing the extra power that was urgently needed in the area.

The water-supply has been well maintained and there has been no serious trouble with the plant during the year. The maximum load tp the end of the financial year waß 16,880kw., but by the end of June 1927 this had grown to 21,020kw. It is pleasing to record that the service over the various transmission-lines indicates a reduction' in the number of interruptions recorded. There was only one interruption to thd Ohristchurch supply that could in any way be considered serious, and that lasted for a period of twenty minutes only. ' During the year the second - main transmission-line to Timaru was completed; and extended to Oamaru, where Coleridge power was first given to the Waitaki Power Board on Christmas Eve, 1926. Much improved Bervice was given to South Canterbury during the year. There were, however, two interruptions, each of about three and a quarter hours' duration, in the earlv part of the year, before the new line was fully tested out. Since then, however, the few interruptions that have occurred have been of .short duration on!v.

Horahora. The financial results of operation of this plant have again been very satisfactory, and may be summarised -as under: — £ Capital investment . .. 844,948 Revenue .. .. 108,748 Operatiug expenses .. 28,713 Balance .. .. 80,034 The balance has been used in paying interest and a 2 per cefit. depreciation and has left a profit of £25,564 on the year's operation. This has been used in paying £8,448 to the Sinking Fund and £17,116 to Reserve. This scheme now has a Depreciation Fund of £63,782, a Sinking Fund of £38,515, and a Reserve Fund of £47,669. The capital investment shown above includes £268,107 on lines and substations forming part of the Arapuni scheme, .but at present operated from Horahora.

Waikaremoana. Operation at this plant has been carried out during the year by the Wairoa Electric Power Board, who have leased the plant until December of this year. Both the original plant and the one recently installed to provide additional power, for constructional purposes have operated without any serious difficulties during the year. The capital expenditure has been increased during the year from £80,564 to £185,703. Capital charges, interest, and depreciation on the plant in operation .amounted to £6771, the revenue received! has been £2405, leaving, a loss of £4367 on. the year's operation. The accumulated loss on this plant now amounts to £15,050, against which there is an accumulated depreciation fund of £6326.

• Mangahao. The second year of operation of this plant has been marked by rapid growth of load, and the financial results have been satisfactory. The total capital expenditure* has been increased to £2,242,870 during the year, ..of which amount about £250,000 represents assets not in operation at the end of the year. Tlie financial position may be summarised as follows:--

Capital ... : >.. 2,242,870 Revenue ... •<• Operating expenses ... 26,921 balance ... -.'.. £74,976 The balance has not. been sufficient to pay interest and depreciation, and leaves a deficiency of £56,902. The accumulated deficiency on this scheme now stands at £124,193, against which there is a depreciation fund of £64,255. The balance of revenue over working expenses represents a payment of 4 per cent, towards capital charges, which can be considered as reasonable. It is a considerably greater percentage than was paid at a similar stage of its career by Lake Coleridge, which has since proved so successful. The fact that' the Wellington consumption does not show a'commensurate increase with the others does not indicate that the consumption of electricity is not growing in Wellington. The reduced consumption of Mangahao power is due to the fact that the growth of load in other districts has necessitated an increasing use being made of the Wellington city steam plant. •_.•■' Construction Works.

I An expenditure of £171,618 has been made in connexion with the duplication of the main generating plant at Lake Coleridge,, which was | completed in the early portion of the year. The first 7500 k.w. unit of the ! now plant was put into operation at | the end of July, and the second unit of similar size in December. The whole of the old low-tension switchgear was replaced with new' gear of the ironclad type to provide forMjhe increased capacity of the station. This work had "to be carried out step by step while the plant was in operation, and was completed without.any interruption to the supply. Siihilar new switch-gear hrfs been installed in the main Addington Babstation, where again the work had to be done without interrupting supply to our various consumers. The expenditure during the year at Mangahao has been £220,555. The expenditure at Arapuni for the year has amounted to £663',012, of which •£588,858 has been paid to the contractors for the headworks and plant, and the balance, £274,154, and various trans- j mission-lines and substations ■ described under the heading of Horal. a and carried, by the Department's own staff. Progress on the main contract has not been altogether satisfactory. Owing to delays at the power-house end it is now evident that tho contractors will be very considerably behind the contract time in completing the work. Construction work on tiie first stage of tho main development of Waikaremoana has been proceeded with energetically, and good progress has been made. The first of the machinery for the. power-station has just begun to arrive in New Zealand, and the major portion of it should be delivered early in 1928. Surveys and Investigations.

Apart from surveys on ts.chemes on which construction is already in hand, work in this direction has been concentrated on investigations to decide on the best|source for development to provide -duitional powc for Canterbury and the districts farther south, and on surveys of the potential sources between Lakes Manapburi, Te Anau, and the West Coast Sounds.

The investigations in South Canterbury have been carried sufficiently far to enr.ble a pronouncement to be made as to the future policy to be adopted in providing additional pewer for the Canterbury and North Otago districts. In making a decision on this matter due .uideration has been given to the following four main points:— (1) The cost at which power can be generated at fie generating-station and supplied to the main transmission system;

(2) The location of the feed-point in : peet to the centre of gravity of the load and prospective load -to be supplied ; (3) The location cf the feed-point oh the main transmission-line as affecting the security from interruotion of all substations supplied off the main transmission system; .■■•'.' (4) The possibility of the generating source selected being developed at vrea-

sonable cost for the capacity immediately required, and of economical extension to meet future growth. All the various, potential sources in Canterbury and North Otago were considered, including the Clarence river, th* Waimakariri, the Rakaia, the.Rangitata, Lakes Tekapo, and Pukaki and various possibilities on the Waitaki river. Taking all things into con<'deration, the sor-ce best suited to the conditions required above appears to be the Waitaki river, a few miles above Kurow. Surveys and borings are being made at two differe-.t sites on the river and alternative plans are being considered. In view of the prospective inc -> " l J ''- 1 - 1U tlie districts to De supplied it would appear that. a start will have to be made v"'t construction work within the present financial year. The survevs between Lakes Manapouri Te Anau, and the Western Sounds have been continued throughout thepast summer with a view of placing on record in more definite form than exists at present, the potential value of ■ these water-powers, with sufficient information to allow of accurate estimates of cost of development being made.

local Electric-Supply Authorities. The Public Works Department has two particular functions in respect to t' electric supply of tho Dominion. In the first place, as the o-ner of main generating-stations, it has to supply P r ,ov in bulk to the Power Boards and other local authorities to enable them to carry out the retail distribution to the actual consumers; in the second place, as the general authority controlling electric supply, it has also to exercise a general supervision and control over all supplv authorities, whether purchasing power from the Depart ent, in bulk or not. In both cages the fullest co-operation between.the Department and the various other authorities interested is necessary, and I au gratified to feel is in general being observed. The -mesa, in which Government and local authorities are both concerned is growing at a very rapid rate, as indicated bv the following figures: The capital expenditure by the Government itself has grown from £362,000 at March, 1916, the first complete year of supply from Govern ent stations, to £1,072,000 in 1921, and to £6,428,000 by the end of last March. In the samo period the capital investment of loc 1 authorities connected to the Government supply had increased from £200,000 i to £600,000 in 1921, and to £7,950,000 in the year Ijust closed. Apart from the above, other electric-supply. authorities not conneated with the Government snpplv have a capital of £3,647,000 invested in electric-supply undertakings.

Kail-way Electrification. The Joint Committee of the Railway and Public Works Department which has had in hand the- electrification or the Christchurch-Lyttelton: section ot railways has made-.its recommendations in regard to the tenders for. different, sections of this work, and contracts have been made for the supply of the necessarv materials. The work of providing the necessary sub-station and; supply of power will be controlled by the Public Works Department, .and the balance of the work by the Railway Department. , ".,' aThe Department, through, its officers on the Electrical Advisory Committee, has also co-operated with tlie Railway Department in connexion with the electrification of that Departments new workshops.

MAIN HIGHWAYS BOAR©. The Main Highways Board has completed its third year of active operation, and it must be -acknowledged by all who use the .'highways of the Dominion that very.substantial progress has been made, both in maintenance of the existing roads, and. in the way of new. construction. A number of local authorities with the Board's assistance hare embarked on comprehensive programmes extending over several years, some of which are already well advanced. Many other counties hare undertaken roading improvements on a more moderate scale, commensurate with their iresources and the requirements of traffic, with the result that the motoring community generally has reaped very appreciable benefits. However, in one or two localities where rconstruction of the roads is justified by the, present traffic, the local authorities concerned, have not come forward with suitable proposals tl the extent anticipated or intended by the original legislation, and consequently.the highways in these districts are appreciably below the average standard throughout the rest of the Dominion. *

During the last session, amending legislation was passed, empowering the Board to increase its subsidy, towards the cost of maintenance from £1 for £1 to £1 10s for £l. . Thus, within three years, the Board's contribution has increased froih 33 per cent, to 50 per cent., and then again to 60 per cent, of the total cost of highway maintenance.

To provide sufficient funds for this year's construction programme, it has been found necessary to make a trans-' for from .the Revenue Fund to the Construction Fund in accordance with section 15 of the Main Highways Act, 1922. This transfer will be a temporary one. only, it being the .Government's intention to introduce during this session legislation providing for reimbursement to the Revenue Fund of any amount so transferred. •

I have pleasure in recording that th<» Main Highways Board has willingly and effectively co-operated with the Government in providing suitable work for tho relief of the unemployed.

RAILWAYS, ADDITIONS TO OPEN LINES. The expenditure out.of the Public i Works Fund amounted to £384,439 Is 3d, for the provision of additional rolling stock, motor vehicles for road services, electric lighting for cars, improvements and additions to station buildings, extension of sidings, bridgework, cranes, weighbridges, turntables, additional and purchase of land. Railways Improvements. The expenditure tinder the Railways Improvement Authorisation Act, 1914, amounted to £665,145 «9s 6d, including the sum of £32,233 Bs-lia/the Railway Department's proportion of the cost of raising the loan. The works included in this expenditure were new stations, stationr-yards, goods-sheds,-and terminal facilities.. at Auckland, Wellington, Christchurch, Addington, Lyttelton, Timaru; duplication, Pen-rose-Papakura; grade easements, Frankton -Junction-Te Kuiti; new lines, Auckland-Westfield and Auck-iand-Morningside; workshops and locomotive workshops' equipments;-elimin-ation of level crossings; deviations, Ravensbourne-Burke's, Pelichet Bay, and Palmerston North; signalling, in-i terlocking, and safety appliances and-, electric lighting. '■'.. Harbour Works. At Westport a large amount of work has been carried out in connexion with protective works necessitated by the flooding of the Buller Riyer. . The dredging on the bar has been carried on regularly and a good entrance maintained,. whi)«:a start has been made with the dredging of a

swinging-basin, a bucket dredger being chartered to carry out this. work. At Karamea extensive works are being put in hand in order to provide stone for the maintenance and reconstruction of the training-wall:; ste ": sions to the wharf.were also carried ■ out. - .

TOURIST AND HEALTH RESORTS. The expenditure for the. yea*- was £31,981, as against £43,486 for the previous year. The main .expenditure incurred during the year was for improvements to the Rotorua drainage svsteni, extensions to the Rotorua electrical svstem, additions and improvements at Waitomo Caves, Helensville, and Te Anau, and the purchase of a new launch for the Waimangu round trip.

TELEGRAPH EXTENSION. The past year has been one of steady progress, both in the matter of providing greater facilities for inter-communi-cation by telephone between various part* of the Dominion and; in extending the local exchange .systems. Some idea of the vast amount of developmental work which is carried out in the course of twelve months in connexion with the Dominion's telephone system may be gauged from .the fact that the additions to plant during the year consisted of 1023 miles of. pole line, 32 miles of single-duct line, 16b miles of cable containing 47,415 miles wire, 8666 miles of bare aerial wire 1400 miles of covered wire lU,ow main and 2830 extension telephones, together with a large number of improvements to plant, the extent ot which cannot readily be illustrated by e Themost important work undertaken during the year in connexion with the toll-line system was the erection ot a new trunk telephone circuit between Seddon and Ohristchurch, and the installation at Wellington and Seddon of repeating-apparatus (amplifiers) for the purpose of extending the range of communication over the new Cook Strait telephone-cable: The completion of the Christchurch-Seddon line will also render possible a rearrangement of the existing circuits between Ohristclnvrch and Blenheim, whick will considerably improve the toll facilities between Christchurch and the exchanges in North Canterbury. A considerable number or toll lines of less general importance were also erected dwring the year. These either gave service to communities, which had previously not enjoyed the privileges and conveniences of the telephone, or provided relief between, places whore traffic congestion had been acute. In addition, a great deal of reconstruction work was carried out during the year both for the purpose of improving the stability and increasing the accommodation of toll lines, and for rearranging the circuits so as to increase their eai-ning-pbwer. The ramifications' of extraJiigh-ten-sion power lines, wihich now extend to practically every part of the-Dominipn, and which in many cases parallel for long distances telephone and telegraph circuits, necessitated during the year the conversion of a number of toll lines and telephone circuits to metallic-cir-cuit working in order to eliminate inductive interference from power lines. This, and the provision of additional protective devices to safeguard users of the telephone against injury from electric shocks and to protect Depart-m'erital-apparatue,- necessarily.adds considerably to the cost of providing telephone service. In connexion with the extension of the local exchange systems, 4here has been added during the year : . a total of 10,560 new subscribers; which, although not the largest number added in any one year, nevertheless represented <a very substantial increase in the number of subscribers'' stations and .involved a great deal of construction and ': extension work, both in the matter of outside plant and ; switching equipment. Deferred applications on hand for tele-, phone service oil-March 31st totalled 2286, of which numbers. 1600 are at five larse exchanges where a: shortage of ■ switching-apparatus is retarding development. *

Capital Expenditure. Of the -works upon •which heavy capital expenditure was incurred during the year the following were the more important. The erection of a . new telephone trunk circuit between Christchurch and Seddon, the installation of repeating apparatus (amplifiers) at Wellington arid Seddon respectively, and the laying of a special subterranean cable, between the extremities of the new Cook Strait cable and the Wellington and Seddon exchanges respectively. The improvement and extension of the toll facilities between .Napier and Gisborne, Wanganui and Palmerston North, and between Dunedin and Invercargill and the ' intermediate stations. The conversion to automatic working ,of . the magneto exchanges at Hawera arid Takapuna. Extensive construction work at Christehurch in connexion with the conversion of the telephone cabling system from aerial to underground and the reconstruction of the other outside distributing plant. Automatic installation work at Christehurch, Dunedin,. Napier, Dannevirke, and Stratford in connexion with the conversion of those exchanges to automatic working. The establishment of five new telephone exchanges in country districts. The extension of the switching facilities at forty-three exchanges. The providing of telephone exchange facilities for 10,560: new subscribers.

RIVER-IMPROVEMENT. Under this head, important work has been carried out on three major schemes of river-improvement and land protection. Brief particulars of the work accomplished during the year are as follows : Wairoa river: An extensive system of stop*banks is under construction to protect the rich Ruawai flats against river encroachment, and the progress made i 3 represented by the building of four miles and a half of stop-banks. Arrangements have also been laade for the commencement .of the.protective work against tidal and current erosion by the Wairoa river, and a large contract is let. for the delivery of ,rock sparfs for this purpose. Waihou and Ghinemuri rivers: Substantial progress has been made towards the completion of this improvement scheme./ Work.is now concentrated on the Lower Waihou river. Three miles and a half of very heavv stop-banks have been built with suction dredges. Much work has been done enlarging tributary streams, and in clearing the beds and banks of the rivers of willows, snags, and other sunken timbers. The reconstruction of the Ohinemuri river bridge, Paeroa, is also in hand. I anticipate that in eighteen months this important work will be-completed. Taieri.Plains protection: The'purpose of this" work is to. protect the Taieri Plains from the floods of the Taieri. and Waipori rivers,, which have caused such heavy losses in past years. During the year covered by this statement eight miles of stop-ljaak, together with associated works, have been-completed, and soma benefit is already apparent from the completed work; An important contract 1 -for the supply of the Slant for the- main pumping station as been let;' ' ■«.' ... .

REVIEW OF THE YEAR. It will be abundantly clear from the particulars given that during tho past year the construction of all classes of developmental works that are chargeable to capital has continued on. a very extensive scale. Tho total Expenditure against the Public Works Fund and other capital accounts amounted to £6,777,474, and that sum has only once been exceeded in any one financial year. The expenditure, however, on works which are directly carried out by the Public "Works Department represents a total greater than that in any previous period. The provision of transport facilities continues to be the most important of the . activities that are , chargeable against these fundfe, and this must necessarily be so in a young country where -the success of primary industries is so dependent upon a successful and adequate transport system. Qf the total expenditure from funds under my control the sum of approximately £2,360,000 was expended upon railway development, the construction of new lines absorbing £1,096,000, whilo the important railway improvements- works and additions to open lines now in hand absorbed a rather! larger sum.

Portions of new lines under construction represent important, links in the existing system, and as these aire approaching completion it is reasonable to anticipate that during the next few years there will be a dtecrease in the expenditure on the construction of new lines.

Next in order of importance is the expenditure upon highway and road construction and improvement. Under these heads a total sum of approximately £1,140,000 came to charge. 1 hare in the introductory portion of this statement dealt at some length with the most important and pressing question of finance for highway and road improvement purposes. The expenditure of the very large sum of £.1,130,000 from the waterpower works and electric supply account is an ample indication of the great importance in which the tidn of electric.energy is held by the Government. It is a most important and vital fact that electric energy is available for the use of town and country dlweller alike, and the, reticulation of country districts must go. a long way towards providing the coun* try dweller with the amenities of city life and retarding the urban drift. Economy and Efficiency.

I wish to very briefly stress that I feel sure that economy and efficiencyof management and operation are the guiding motives throughout the whole of the operations carried on by the Department. To these ends the use of mechanical plant continues to lend itself both by increasing" the output of ': work andMiy reducing the time re-' quired' for ite accomplishment. The staff throughout, the Department have supported me with their customary loyalty throughout the year, and, as an indication of the way they have risen to the emergency caused through the necessity or employing over two thousand more men than last year, I would point out that this has been done with an increase in staff of only-eighty-six. For the past year the expenditure has been five times what it was in '1916-17,' while the staff has not increased even to; twice its siza at that time and the • gross expenditure on supervision is only a little more than.twice what it was. In other words, the amount of work, as measured by expenditure

two and a h tjf tjmS&Htrcl 1916-17, and twirtfSggil 1919-20. that every officer very high many cases, being of the rank and'til* ijjira9[ anything near.'; i^l". will be necessary: sklerable officers in prabtiftMly^ffij^H

Class of "Work: 3lst March 1 Total. Railways- £ ■""' £ New construction .. 1,096,363 '34,259,198 Additions to opin lints 381,439 15,557,081 Payment to Midland Railway bondholders — 150,000 Koads _■ .. .. 578,128 ♦16,261,228 Publio buildings 326,039 9,920,287 Immigration 184,018 3,117,408 Purchase of Nativo lands .. .. ■ — 2,061,204 Lighthouses, harbourworks, and harbour defences 19,021 1,225,509 Tourist and health ■' resorts ... 31,931 421,609 Telegraph extension .. Development of mining 558,042 0,666,403 — 832,975 Defence works (goneral) 31,011 1,241,395 Departmental '.. 115,866 2,372,941.. Irrigation and watersupply Lands-improvement .. 56,987 56,267 734,345' 356,283 Minor works and services —. 312,607 Plant, material, and stores Cr. 24,148 358,492 Quarries (acquisition and' operating) 6,30-2 20,468 Timber-supply and sawmills for Publio Works Dept. 8,513 13,686 Motor-transport services .. .. — 83,636 .Cost and discount, raising loans, etc. 155,373 •2,496,325 Total General Pur- . poses Account .. 0,588,069+ 100,465,034 Aid to W'ter-power Works and Elcctrio Supply Account l,180,01St 5,845,927 Waihou and Ohinemuri river Improvement Account 65,856: £46,345 Total Publio Works Fund 4,783,928 106,859,856 Welliagton-Hutt Railway, etc— Railway .. ft "~* 228,874 Bead ™ — 101,658 Railways Improvement Account »_ 641,375 Railways Improvement Authorisation Act 1914 Account 880,339! 2,970,054 loans to Looal Bodies. Account—Roads to op»n «p Crown hinds — 697,403 Opening up Crown Lands for Settlement / Account—Boads to open up Crown ■ lands Lands for Ssttlement ■-*• 206,626 Account—Beads to open • up Crown lands 12,714 563,688 Rational Endowment Aocount ,; / _ ] 63,401 Education Loans Account ' .. .. 550,354] . 8,002,917 Vain Highways Ac- ' count Construction Fund 549,640! 1,197,448 6,777,474 116,542,235 WAYS AND MEANS. | On April 1st, 1926, the available ways and means for public £ works purposes were 526,421 Additional funds were received as (a) Under Finance Act, J924, section 2 (public works) ... 4,152,991 (b) Recoveries on account of expenditure of previous years ,. 146,933 (c) Ellesmere and Forsyth Reclamation and Akaroa Railway Trust Account receipts 1,620 £4,827,965 The net expenditure on \ orks and fervices against the General Purposes Account for tho (n) Under appropriat ions 3,S32,CS5 (b) Under Lake illesmere Land Drainage Act 1905 409 (c) Under Lake Elles mere and Ak.iroa Railway Trust Account (d) Charges and expenses of 81 raising loans 155.373 Makinj e total of 3,988,578 T':ii? left a credit balance in the ~ account for general purposes at March 31st, 1927 .of .. 839,387 Legislative authority exists for raising a further .. 5.06L050 It is proposed to ask for further legislative authority to borrow, when required 4,000,000 Thus making available for public n-orks. general purposes, a total of ..£9,900,437 '