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4

There is due to the contractors on account of 10 per cent, retained by the £ a. d. Government as against finished work, and for finished work at end of June, 1912 ... ... ... .. ... ... 24,802 0 0 Plus deposit ... ... ... ... "... ... ... 5,000.0 0 In all ... ... ... ... 29,802 0 0 Less advances over 50 per cent, on plant and materials ... ... 25,000 0 0 Balance ... ... ... ... £4,802 0 0 This would represent the amount due to the contractors if the contract were cancelled and the plant and material taken over at half the actual cost as at the end of June, 1912. (9.) lhat the contractors have, under great and varying difficulties, endeavoured to carry out the terms of the contract, and have sustained heavy losses both in connection with the Otira Tunnel and' Wellington Dock contracts. (10.) That, in view of the whole of the circumstances and of the difficulties experienced by the contractors, the Government be recommended to release the contractors and their sureties from their contract if the contractors so desire, and to return to the contractors the sum of £5,000, the deposit paid. (11.) That the Otira Tunnel is a national work, and should be completed. That the Government be further recommended to invite tenders for the completion of the contract, and that, pending a decision on such tenders, the Government should carry on the works. (12.) That, in the event of no satisfactory tender being received, the Government be recommended to take such steps arid make such arrangements for the completion of the works as $ national undertaking as they may think advisable. The minutes of evidence are attached hereto. 18th October., 1912. E. P. Lee, Chairman.

LIST OF WITNESSES. PAGES PAGES 1. Murdoch McLean ... ... 5-13 8. I. Kennedy ... ... ... 47-52 2. Murdoch McLean ... ... 13-18 9. H. T. Armstrong ... ... 53-65 3. H. J. H. Blow ... ... ... 18-24 10. T. J. Malloy ... ... .. 65-73 4. C. R. Viekenmm ... ... 24-34 11. R. W. Holmes ..". ... ... 73-83 5. Murdoch McLean 34 12. Murdoch McLean ... ... 83 6. Mark Fagan ... ... ... 34-41 13. P. S. Waldie ... ... ... 84-85 7. W.H.Gavin ... ... ... 41-47 14. Murdoch McLean ... ... 85-91

APPENDICES. EXHIBIT pAQB A. I'eefton Award and Present Wages at Otira Tunnel ... ... 92 B. Arthurs Pass Tunnel Contract in Account with John McLean and Sons to 30th June 1912 ... ... ... ... ... ... ;.. ' 9 2 C. Arthur's Pass Tunnel Contract, Particulars of ... ... ... 93 D. John McLean and Sous : Ledger Balances to 31st July, 1912; Cost of Works and Progress of Works to 31st July, 1912 ... ... ... ... ... 93 E. Rate of Wages, Engineering, and all other Salaries, from commencement of Contract to April. 1912 ... ... ... ... ... ... . 94 (Exhibits A. to E handed in by Mr. Murdoch McLean.) F. Particulars a.s to Contract and Contents of Tunnels ... ... ... 95 G. Tunnels done by Co-operative Labour, North and South Island, New Zealand 96 H. Tunnels done by Contract, North and South Island, New Zealand 97 (Exhibits Fto ll—Mr. C. R. Vickerman.)