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and 20 to 50 acres in the case of rural settlements, all of which were readily taken up. The distinguishing feature between this system and that under the previous legislation was that the freehold could not be acquired; the result being that whereas those that were settled prior to 1886 have, with few exceptions, become freehold, and in a large measure lost their distinguishing feature, the later ones are practically in all cases still in existence. A very large number of those who originally selected under the perpetual-lease tenure have availed themselves of the advantages obtained by exchange to the lease-in-perpetuity system. Subsequent to 1887, owing to the fact that the bulk of the available lands had already been taken up, there was for several years very little selection under this tenure. In 1892, however, two blocks of land near Waimate and Studholme Junction were acquired from the School Commissioners in exchange for a large block of pastoral country, and were very successfully settled in areas ranging from 10 to 40 acres. In 1893-94 also village settlements were established at several points round Lake Ellesmere on endowment land, the areas ranging from 10 to 50 acres ; and on the Cheviot Estate villages were laid out adjacent to the Mackenzie Township, Port Robinson, and other points where it appeared that small' holdings of from 5 to 50 acres might be advantageously utilised. In 1894, the supply of available Crown lands in the district in suitable localities being practically exhausted, the system, introduced by the late Hon. Sir John McKenzie, of purchasing private estates for close settlement on a more extensive scale came into operation under "The Land for Settlements Act, 1892." This practically superseded the older systems, which had, within their possibilities, done such excellent work. The only new village settlements of any size established since then were inaugurated in 1895 at Ruapuna and Westerfield, on the plains between the Ashburton ami Rangitata Rivers. The areas averaged about 100 acres; but, as the land was of very light quality, their success has been somewhat limited. In many cases time has proved that in order to assure the position of the village settlers and enable them to obtain a sufficient subsistence it was necessary to extend their holdings, either by granting additional areas in the vicinity if such could be secured, or by permitting, by means of transfer, a judicious amalgamation of holdings within the settlements. Thus, in the settlements at Cheviot holders were allowed to acquire, by selection or transfer, an additional adjacent allotment; and in other settlements the Land Board has used its discretion within the scope of the law in permitting such amalgamation as was calculated to serve the best interests of the settlers. To deal in detail with the present position, occupation, &c, of the settlers in the larger number of these settlements would burden this report, which is already lengthy. Generally speaking, it may be said that all the settlements are now firmly established, and in a healthy and prosperous condition. The lessees generally find employment in the surrounding district at such rural avocations as more particularly obtain there, either as general farm-labourers, contractors, railwayhands, ploughmen, or shepherds, or they obtain intermittent employment in mustering, shearing, harvesting, &c. Their holdings are as a rule neatly kept, in good order, and well cultivated. On the smaller suburban holdings the grazing of a few cows, the growing of a small quantity of garden-produce, or occasionally fruit-growing represent the uses to which the land is generally applied. In the larger rural holdings, such cropping as the district and circumstances favour, and the grazing of a small number of stock, are practised. The settlements have ample road access, and the prevailing tendency to exchange into the lease-in-perpetuity tenure has placed at the disposal of the local bodies sums of money, as " thirds " from rents, which have been applied to the improvement of the means of access, or, where necessary on the plains lands, to the provision of additional water-supply by means of water-races. The number of village settlements in existence is forty-seven, comprising 13,184 acres, held by 477 selectors, averaging about 28 acres. The total number of residents is. 1,260, and the improvements on the land are valued at £44,508. Cheviot Estate. There has been practically no change in the areas held on the Cheviot Estate. One lease in perpetuity of 41 \ acres was surrendered by arrangement with the lessee, and was regranted in two leases in perpetuity totalling 34J acres, and one grazing-farm of 6£ acres, the balance of the area being absorbed by a road. These leases were granted to adjoining holders without competition, as the lands were necessary to them for the convenient and advantageous working of their holdings. Two miscellaneous occupation licenses, comprising 8 acres and 4 perches, were granted. Seven leases in perpetuity, comprising 1,547 acres and 29 perches, eight village-homestead leases, covering 126 acres 2 roods ; and two grazing-farm leases, representing 4,407 acres, were transferred during the year. The total revenue collected from the estate for the year was £14,606 4s. lid. The arrears of rents due at the close of the year amounted to £617 12s. lid., owing by twenty-two tenants, out of a total annual rent-roll of £14,434 13s. 5d., payable by 334 tenants. The arrears.thus represent just over 4J per cent, of the whole. The Crown Lands Ranger reports that the settlement has made steady and satisfactory progress during the year. Many new houses and enlargements of houses have been built, and everything is now recovering from the effects of the earthquake. In January last the central and southern portions of the estate were visited by a disastrous hail-storm, followed by frost, which did a large amount of damage to the crops. In general, the holdings continue to be used for grazing in preference to cropping, and only about 2,200 acres of cereal crops have been grown during the year, as against about 5,000 acres of rape- and root-crops. The lambing-returns have been good, yielding an average of about 90 per cent., and the output of fat lambs for the year will probably total from 50,000 to 60,000. Inclusive of stock on the freehold portions, about 100,000 sheep and 2,200 head of cattle and horses are now wintered on the estate.