C—l.

Perpetual Lease. —This is rapidly becoming a tenure of the past, last year's tenants now being reduced to four, with an area of 2,797 acres and a yearly rental of £339. Occupation with Right of Purchase. —This easily holds pride of place in tenure-selection, 25 tenants having been added during the year, whilst 2 were written off, and 15 acquired freeholds. There are now 242 tenants, with an area of 133,496 acres, on the books, who pay an annual rental of £6,646. Value of improvements effected on properties visited was £110,767, as against £41,201 law ; and souls residing, 344. Lease in Perpetuity. —The ordinary lease-in-perpetuity selections show a falling-off as compared with previous years, and numbered 8, with an area of 3,459 acres. There were 3 surrenders and 1 exchange, and the area now held by 199 tenants is 104,462 acres, for which an annual rental of £3,642 is payable. Value of improvements required was £42,332, while those actually effected were £98,588 ; and 397 souls were residing. Small Grazing-runs. —Eighty-five tenants hold the large area of 248,938 acres, the annual rental payable being £2,775. The leases of twelve runs, containing an area of 21,430 acres, and for which an annual rental of £268 is payable, will expire during the yeax 1908 ; and of these a fair proportion will no doubt be cut up for closer settlement and offered under the optional system. Pastoral Runs. —101,481 acres are now held by fifteen settlers, who pay an annual rental of £692. The concluding remarks of the preceding paragraph also apply to this system of tenure, although, owing to the inaccessibility of the runs, it is not anticipated that a large area will be suitable for closer settlement. Inspections and Rangers' Reports. Ranger H. M. Smith reports that he visited 671 properties, with an area of 275,334 acres, on which he found 2,090 souls residing. Value of improvements required was £96,496, as against £298,638 actually effected. 43,260 acres of the total area visited were felled, 64,552 were grassed, and 9,688 acres were in crop, whilst 536 buildings had been erected thereon. Out of a total of 1,300 tenants, 92 are defaulters for non-residence, &c, due in some cases to difficult access. Ranger Simson reports that he visited 206 properties in the Poverty Bay District, with an area of 115,868 acres, and found that 611 souls resided, and that improvements to the value of £150,641 had been effected, as against £58,332 actually required. Area felled on holdings visited was 52,216 acres ; grassed, 50,268 acres ; and in crop, 298 acres. Position and Progress of Settlement. Another excellent and prosperous period obtained in this district during the past twelve months, and as a whole the tenants are carrying out the requirements and conditions of the Act in a most encouraging manner. That the district has undoubtedly advanced and prospered is evidenced by the great increase in revenue and decrease in arrears. There has been a constant demand for land of all descriptions, and keen competition and a plethora of applicants is invariably experienced when a block is thrown open for selection. The spread of settlement over all parts of the district during recent years has to a considerable extent contributed to the general prosperity, and has added in no small degree to the production of grain, dairy-products, growth of stock, &c. This is partly disclosed by the Rangers' reports, which give total improvements required on holdings visited, £154,828, whilst those effected amount to £449,279. Stock carried shows the remarkable increase of 127,802 over last year, and is now —horses, 2,481 ; sheep, 313,793 ; cattle, 17,164 ; and pigs, 1,320. The area grassed and in crop is 124,806 acres. The future prospects of our settlers appear to be of a most hopeful character, and there should be no difficulty in keeping up the present high standard, even in less favourable years. The seasons have been exceptionally good, and it is with confidence that I look forward to another successful, year. Rebate of Rent. It has not been the custom hitherto to grant rebates under " The Crown Tenants' Rent Rebate Act, 1900," but during the year just ended a new departure has been made, a rebate of 10 per cent, having been allowed to 415 tenants, amounting to £492. Three hundred and fifty-two tenants under " The Land for Settlements Consolidation Act, 1900," were granted rebates amounting to £2,309. Number of Tenants and Arrears. A further increase of 101 tenants has been gained during the year, 801,245 acres being held by 1,300 settlers, for which the annual rental of £57,261 is payable. The arrears stand at £1,044, owing by fifty tenants. The Land for Settlements arrears total £816, as against £185 due on Crown lands, but the general reduction, as compared with last year, is £1,058, which must be considered satisfactory. Forfeitures and Surrenders. There were 9 forfeitures for non-compliance with the conditions, 3 of these being reselected ; 6 surrenders were accepted, 3 for subdivision and transfer, whilst 3 were unable to carry on ; 4 of these latter are now in occupation.

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