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The railway wharf is in a state of good repair. The rails have been lifted and relaid in order that the working of the coal-shoots might be conducted with greater economy and despatch. I may mention that since the alterations were completed one vessel took on board ISO tons of coal in six hours, and the steamer " Grafton " took on board 186 tons in three and a half hours. The crane-shoots and coal-shipping appliances are in efficient condition, but further coal-wharf accommodation is urgently required. All the additions and improvements executed during the year have been charged against maintenance, although much of the work was properly debitable to construction, and this has told heavily against working expenses. Proper station accommodation is urgently needed, both at Brunner and Greymouth, the line generally having been handed over to this department in a most unfinished condition. The locomotives have undergone heavy repairs, and are in good running order. The carriages and wagons have also received careful attention, and all of them are available for work. This line has carried during the past year 39,427 tons of goods and minerals, as against 36,065 tous during the previous year, showing an increase for the year of 3,362 tons. It is in the best position financially of any railway in New Zealand, the working expenses being only 5337 per cent, of the receipts. Westport Section. A considerable amount of work beyond actual maintenance has been carried out on this section also. The embankments between Westport and Waimangaroa have been made 2 feet wider. The Westport Station-yard has also been improved. The line between Ngakawau and Waimangaroa, 8 miles 56 chains, the traffic on which was trifling and very unprofitable, has been closed during the whole year, a measure which has been productive of a considerable saving. A workshop has been erected. The 12-ton crane, which was brought from Greymouth, has been profitably employed, among other work, in removing snags from the river, the navigation of which is much improved thereby. The works of the Westport Colliery Company are being pushed forward. The Koranui Company is also earring on operations to open out its mine; and, if these two undertakings get into successful working, the traffic receipts of the railway will soon show a marked improvement. The locomotives have been fitted with bogies and cabs, have been thoroughly overhauled, aud the boilers tested and painted, &c. The carriages and wagons also have received due attention, and the whole are in thorough working order. The traffic over this line has hitherto been very light, the earnings having been insufficient to meet working expenses, notwithstanding that the most rigid economy has been practised. I trust, however, that the opening up of the coal mines above referred to will alter this state of things, and that next year's report will exhibit much more favorable results. The goods and minerals carried during the year amounted to 5,656 tons, against 5,888 tons in the preceding, showing a decrease of 202 tons. The number of passengers carried shows a large increase. Nelson Section. This section has been well maintained during the year. Portions of the embankments have been widened and the line in several places reballasted ; the bridges also have undergone heavy repairs, and all of them have been tarred. A loop siding has been put in at Bishopdale, and has proved a great convenience in working the traffic over the incline. A wheel lathe and a small stationary engine have been erected and are doing good service, but tho covering over them is only of a temporary nature. Proper workshop accommodation is urgently needed, and an amount has been placed upon the estimates for the purpose. The locomotives, carriages, and wagons have been well attended to and are in thorough working order. A third locomotive, similar to those now in use, is about to be shipped to this section from one of the southern ports. There has been an increase in the traffic, and although not very marked it has been steady, and will noj doubt be maintained. The Port extension, which will shortly be ready, may be expected to produce additional revenue. The number of passengers carried during the year was 65,390, as against 40,811 for the previous year, showing an increase of 24,579. The goods and minerals carried in the year amount to 13,830 tons, against 8,579 tons carried in the previous year, showing an increase of 5,251 tons. Picton Section. This section has been worked with the strictest regard to economy, the result being that for the past year the working shows a balance of profit. Although there has been a considerable reduction in the staff, the line has been well aud carefully kept. In addition to the ordinary maintenance, sundry works have been executed. The steep gradients, 2 miles from Picton, have been lowered, so that a much heavier load can now be taken than was formerly possible ; and the engine coming to a stand, which was formerly a common occurrence, is. now a thing of the past. The embankments, some of which were so narrow that the ends of the sleepers projected over the slope, have been widened. Three curves have been entirely removed, several, which varied from 6 to 8 chains' radius, have been altered to 25 chains, and one sharp curve has been so much improved that it is now 70 chains' radius. The bridges have been repaired and tarred, and some new sleepers laid.

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