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Amendment of Defence Act. 17. Your Committee recommend that an amending Defence Act should be introduced and passed into law during the present session, giving legal effect to such of the recommendations of your Committee as can properly be provided for therein, and that the Volunteer Eegulations be also amended accordingly as may be necessary. Naval Eeseeve. 18. With regard to the subject of the establishment in this colony of a branch of an Imperial or colonial Naval Eeserve, your Committee consider the matter to be one of such importance that they recommend negotiations being entered into by the Government of New Zealand with the Commonwealth of Australia and the Imperial Government, with a view of ascertaining whether some satisfactory arrangements can be made upon the subject. CoNVEESION OF StEAMEES. 19. Your Committee further recommend that the attention of the Imperial authorities be drawn to the matter of the conversion of merchant steamers trading to this colony into armed cruisers, and the proper equipment of such steamers as cruisers. AUSTEALIAN SQUADBON. 20. Your Committee, having regard to the altered international political conditions, especially in China and the Pacific, recommend that representations should be made by the Government of this colony to the Commonwealth of Australia and to the Imperial Government as to the necessity of strengthening the Australian Squadron by raising the class and increasing the number of the cruisers composing that squadron ; the increased cost to be paid by the Commonwealth of Australia and by New Zealand on the basis of the present agreement. Conclusion. This report of your Committee is submitted upon the assumption that arrangements will be made for the capital necessary for carrying out the recommendations of your Committee being advanced by the Imperial Government; to the colony at a rate of interest satisfactory to the Parliament of New Zealand, and that a sinking fund will be provided for the ultimate extinction of the loan. If such arrangements cannot be made, it is obvious that parts only of such scheme could be carried out by the colony, and then only by spreading the necessary capital expenditure over a number of years. If the colony has to undertake the work without assistance from the Imperial Government, your Committee submit for consideration the alternative of completing the fortifications of, say, only two ports in the colony; more especially as having regard to the fact that, owing to the rapid changes and improvements in artillery armaments, those now recommended to be purchased for the completion of the forts may in a few years be quite obsolete, and consequently a very heavy expenditure upon guns in the forts may become a dead loss to the colony. The scheme submitted to Parliament by the Eight Hon. E. J. Seddon, Premier and Defence Minister, on the 20th July, 1900, and which was referred to your Committee, has been taken by them as the basis of their report. Your Committee have dealt with the many important matters concerning the defences of the colony mentioned in that scheme, and with others which have been suggested during the course of the investigations of your Committee. The capital cost of carrying out the improvement of the defences recommended in your Committee's report would be, approximately, £373,428, as shown in the estimate in Schedule A attached to this report. The annual extra cost to the colony in respect of such improved defence, including interest and sinking fund, would be £59,303. Albeet Pitt, Lieut.-Colonel, 21st September, 1900. Chairman Joint Defence (Secret) Committee.

ADDENDUM. Resolved, on the motion of the Eight Hon. the Premier, —" That this Committee desire place on record their appreciation of the efficient services rendered by the Hon. the Chairman the conduct of the Committee, and in connection with the preparation of this report."