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is supposed to have passed the same tests, under the supervision of Imperial officers, as the powder supplied for the manufacture of Martini-Henry ammunition for the Imperial Service. The Colonial Company contended that the powder was not good, and attributed the failures of the ammunition chiefly to that cause. On my recommendation five hundred rounds of ammunition from each month's manufacture in 1896 were sent to England for proof and examination by the Government experts. The report of the tests lately received shows that the inferiority of the ammunition is not due to the powder, but to irregularities in manufacture. I expect shortly to receive a further report after a chemical analysis of the materials of which the cartridges are built up. The Colonial Company have asked that samples of powder from certain lots received in the colony should be sent Home for examination. These samples should have gone Home at the same time as the cartridges for examination, but the shipping companies are most unwilling to carry powder on the homeward voyage, and we actually received the report on the examination of the cartridges before the powder was shipped from the colony. There are but scanty facilities for carrying out the conditions of the specification as regards the proof of the finished ammunition. On my recommendation velocity instruments have been ordered out from England, but there is no officer in the Colonial Force who possesses sufficient knowledge to set these instruments up and work them. I will, as far as possible, supervise the setting-up of these instruments, and give the necessary instruction, until an expert can be got out from England to take the work over. One of the officers from the Permanent Force should be sent to England for instruction in the examination and proof of warlike stores under the Chief Inspector at Woolwich. On his return to this country he should receive the appointment of testing officer, being given extra pay for the performance of this duty. As regards the ammunition now in store, it should be used up as soon as possible, being replaced by a good and serviceable supply. I suggested to the company that they should take back what is known to be bad of our present stock; but this they refused to do, alleging that as it had passed the tests we put it to here, and had been accepted by the Government, their responsibility ended. In testing ammunition, only a small percentage can actually be put through the firing-test, and it is on the performance of this percentage that the ammunition is accepted or rejected. The testing officer has, to the best of my knowledge, done his work conscientiously, and the percentage of rounds tested has been in accordance with the terms of the specification. Every possible step in reason should be taken to insure a supply of reliable ammunition ; the very existence of the colony may some day depend on this, and, although the Government is bound by contract for some years still to obtain their supply of small-arm ammunition from the Colonial Company, still, I think that, in case of necessity, they should not hesitate to obtain from other sources a supply of reliable ammunition. It would be more advisable I think, in future, if the company supplied their own powder and all component parts, as recommended by my predecessor in his report for 1896, so as to obviate any divided responsibility for the quality of the supply. The troops are being supplied with "rolled case" ammunition. This quality of ammunition is very liable to damage in the men's pouches, and if damaged or covered with dust it is liable to jamb in the rifle, and render a rifle useless at perhaps a critical moment. It would be advisable to arrange for the future supply to be " solid drawn." I understand that the cost of the latter would be about £1 more per thousand than that of the "rolled case," and the extra cost would be quite worth incurring. In the Imperial Service the " rolled case" is not now used. Uniforms. The dress regulations lay down that the uniforms for all Volunteer corps excepting the Naval Volunteers should be practically of the same pattern, the mounted corps wearing cord pantaloons instead of the blue Zouave trousers worn by the dismounted corps. The colour and facingsjof all jackets is to be the same, and the only difference between the several branches is to be the badge of the arm of the service worn on the collar. I much regret that this decision has been arrived at, more especially as regards the colour and material. In the Imperial Service each branch is clothed in peace time with a distinctive dress, but when proceeding on active service the troops are put into kharkee uniform, their caps, buttons, and the badges on the shoulder cords differing according to the branch of the service the men belong to. The Imperial soldier has thus two dresses—one for peace and the other for war—both being supplied by the State. In this colony, where all the uniforms are bought and kept out of the capitation allowed to corps, it is not possible to provide and keep in store a set of active-service uniforms for each man. The uniform which the soldier in this colony wears on ordinary parades would be the one which he would have to fight in, and should be the most suitable one for that purpose. Undoubtedly, the colour best for this service is kharkee, and I think it is a matter for regret that the Conference of 1894 should have decided on the present uniform. Several of the Infantry corps have supplied themselves with the new uniform, and it would not be fair to ask them to make another change at present. All the corps should have the new uniform by the end of this year. So far, however, only one corps of Mounted Infantry are supplied with it, and I recommend that kharkee be adopted as the service colour for the uniforms of the mounted troops, the cut and pattern to correspond with that issued to the troops sent to England for the Imperial celebrations ; the helmet for mounted corps to be superseded by the felt hat with brim turned up at one side. In the Auckland District only one corps, so far, has provided itself with the new uniform. The other corps in the district require new uniform, and three new corps have just been formed. All the corps in the district are desirous of wearing kharkee uniform, and on this account, and for climatic reasons, I strongly recommend that their wishes be met, and that kharkee be adopted as the universal dress for that district.