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C.—3.

No. 11. The School Commissioners, Dunedin, to the Under-Secretaby for Lands. School Commissioners of Otago. (Memorandum.) Education Eeserves Office, Dunedin, 22nd March, 1883. I have the honour to acknowledge receipt of your letter dated the 19th instant, and numbered as in margin (No. 142-2), informing the School Commissioners of the decision of the Government respecting the education reserves in the Waikaia, Mataura, and Wyndham Valleys. A meeting of the Commissioners has been called for Friday, the 30th instant, for the purpose of considering the matter. C. Macandrew, The Under-Secretary for Crown Lands, Wellington. Secretary.

No. 12. The School Commissioners, Dunedin, to the Undeb- Secretary for Lands. Sib,— Dunedin, 30th March, 1883. I have the honour to inform you that, at a special meeting held this day, the School Commissioners considered your letter of the 19th instant, in which the Commissioners are informed that, since they decide not to recommend that any of the lands they desire to open for settlement shall be leased, the Government would not be justified in agreeing that the area in question should be excluded from the operation of the perpetual-leasing provisions of the Land Act, 1882 : it will therefore refuse its assent to the proposals of the Commissioners, and will be bound to fall back on the Act of 1878, " unless, on reconsideration, the Commissioners see fit to allow settlers an opportunity of taking up the land on the much more favourable terms of the Act of 1882. ■ The chairman is therefore requested to bring the matter again before the Commissioners at the earliest possible opportunity, so that no further delay may ensue in advertising the land open for settlement." In accordance with the wish of the Minister of Lands, the Commissioners have met here this day, when your letter was laid before them, and, in replying, they desire to make some remarks upon the terms of that letter. In passing, it may be observed that the term " lease," as applied in the letter, is open to some misconstruction, as a mode of disposing of education reserves : it may mean a lease of not more than twenty-one years, as provided by the Acts of 1877 and 1878, or a perpetual lease, as provided by " The Land Act Amendment Act, 1882." The Commissioners had no occasion to recommend leases to be granted under the Acts of 1877 and 1878, seeing that " The Education Eeserves Act, 1877," gave them full authority to grant such leases, while under the Act of 1878 the Governor might set aside, until the end of next session of the General Assembly, twenty thousand acres of education reserves for the purpose of being leased by the Commissioners, under his direction. The School Commissioners have hitherto had no power of dealing with these reserves beyond that of leasing, as provided by these Acts. As pastoral and other leases fell in they have endeavoured to settle the land by that mode, and have signally failed to do so. The Hon. Mr. Eolleston refers to the 4,000-aere block at Waikaia, characterizing it as the one least likely to attract settlers, apparently with the view of showing that not the system, but the administration, was at fault. Perhaps that block, although near the local centre of population, was not the most attractive ; but the like objection to the argument against leasing does-not apply anywhere else. The Commissioners have had to offer for lease thousands of acres in other localities, and similar disinclination has been evinced to take up the lands in that way. For example, on Run 88 a block of 5,600 acres was surveyed into sections in 1879, and lease of them for twenty-one years offered by auction. They were offered after being well advertised, yet only one of these sections has ever been let. To avoid having the run unoccupied the Commissioners have been obliged to let it from year to year by auction for pastoral purposes only, at a rental of less than 4d. per acre : yet the land is of excellent quality, the freehold land adjoining it being most fertile. The Hon. Mr. Eolleston recently visited this locality and, the Commissioners have no doubt, knows the circumstances, but he does not offer any explanation of the failure to lease in this case, where the land was of good quality, peculiarly attractive for settlement, adjoined freehold land in cultivation, no selection made of any particular block, but all of the run offered —repeatedly offered —for lease. The Hon. the Minister of Lands takes the opportunity of referring to a single case, where the selection appears to reflect on the judgment of the selectors, but he does not refer to or try to explain the equally signal failure to lease reserves where the whole block, suitably subdivided, was thrown open, and where (as regards Bun 88) there was and still is an eager desire to acquire the land in freehold. After three years' experience of the administration of these reserves; in 1880 the Commissioners came to the conclusion that it was advisable to open them up for settlement by way of sale. The Commissioners did not always hold that view, for a proposal to that effect was considered in July, 1878, and rejected. That the desire to obtain land in freehold continues unabated may be shown by the result of the sale of rural land on Run 161, adjoining Run 88, about a year ago—when 5,671 acres were sold at an average price of £3 2s. 2|d. per acre, the maximum being £5 19s. per acre— and by the applications that are regularly made to the Commissioners to open Run 88 for sale : even this day a numerously-signed memorial from the settlers in the neighbourhood, who had heard of the refusal of the Government to open the land for sale, has been laid before the Commissioners, urging them to adhere to their decision. It will thus be seen that the Commissioners have no reason to expect that persisfent attempts to lease these lands under the.provisions of the Acts of 1877 and 1878 would lead to much settlement. Following up the resolution to endeavour to open these lands for sale the Commissioners in 1880 applied to the Government to bring in a Bill to enable this to be done. The Minister of Lands,, whilst declaring his unqualified hostility to the proposal, promised to bring the question before the