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scope of our Commission to make other than incidental inquiry ; and we content ourselves with respectfully requesting your Excellency's attention to such portions of the accompanying evidence as relate to the subject. 17. The receipts of revenue upon working railways are an element in the question of profit and loss of not less important bearing than the expenditure; and we felt it to be our duty to give to that branch of the subject at least an equal amount of consideration. 18. On comparing the railway tariff of New Zealand with those of the other Australian Colonies as regards the chief items of traffic, we find that, while the average of the rates charged 'upon the Australian railways for the haulage of wool and agricultural produce is somewhat lower than the rate upon those commodities current in New Zealand, on the other hand, the average Australian rate for minerals —a term which serves to include coal, building-stone, bones, bricks, clay, lime, and road-metal —is higher than the New Zealand rate to the following extent: — First 10 miles ... ... ... ... 80 per cent, higher. Prom 10 to 50 miles ... ... ... ... 9 „ „ From 50 to 100 miles ... ... ... ... 47 From 100 to 150 miles ... ... ... ... 80 „ „ or, taking coal by itself — First 10 miles ... ... ... ... 1G per cent, higher. From 10 to 50 miles ... ... ... ... 1% „ „ From 50 to 100 miles ... ... ... ... 33 „ „ From 100 to 150 miles ... ... ... ... 68 „ „ Without further inquiry, we are unable to form a decided opinion whether the New Zealand lines are carrying on this important part of their business at a heavy loss, or whether the other colonies are deriving from it an exorbitant profit; but we have little doubt that a closer investigation than we have been able to make would prove that the New Zealand taxpayer is the sufferer. 19. With respect to another leading branch of the traffic —rtimber—the evidence we have taken leads irresistibly to the conclusion that, whenever that product is carried under the existing tariff for a distance exceeding seventy-five miles, it is so carried at an absolute loss; and if at the same time the haulage is over heavy grades, the cost to the colony amounts to 50s. for every 20s. received to the credit of the Railway Account. 20. Having thus drawn your Excellency's attention to some of the main features of the tariff now in force upon our railways, we refrain from going into further details; but we desire to express our firm conviction that the maintenance of a uniform scale of charges, applicable to every railway in every part of the colony, without regard to the amount of business to bo done, the cost of the service performed, or the amount and nature of the competition to be overcome, is absolutely incompatible with a favourable return from the traffic so treated. 21. We urge, therefore, most strongly that the system of a uniform tariff should be abolished, and the railways conducted upon commercial principles—that is to say, by charging for each class of service upon each line a rate proportionate to the cost of that particular service upon that particular line, varied from time to time as competition shall increase or diminish. By this system some approach would be made to the spirit of the original proposal that every district through which a line was taken should make up by local contribution any deficiency arising from insufficiency of traffic to support the line and pay interest on its cost. 22. There is one other point in connection with the economical value of the constructed railways to which we feel bound to call your Excellency's attention. From the evidence of Mr. John Henry Lowe, the Engineer in charge of Constructed Railways in the Middle Island, there appears too much reason to believe that even the unsatisfactory contribution which the railways in operation are shown by the public accounts to make towards the interest upon the cost of their construction is not wholly substantial, and that no inconsiderable portion of that contribution should in prudence be placed to the credit of a depreciation fund. It may be urged that by the time that the present cost of repairs and