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ANNUAL BE POET. The Undeb-Secbetary for Lands to the Right Hon. the Minister of Lands. Sib, — Department of Lands and Survey, Wellington, Ist June, 1917. I have the honour to submit herewith the report on the operations of the Department of Lands and Survey for the year ended 31st March, 1917. I have, &c, T. N. Brodriok, Under-Secretary. The Right Hon. W. F. Massey, P.C., Minister of Lands.

REPORT. Tim operations of the Department have been to a certain extent restricted by the unusual conditions produced by the existing war, but every endeavour has been made to meet the altered circumstances. Naturally, the settlement of returned soldiers on the land has been the chief object in view, and the separate report (C.-9) on the operations under the Discharged Soldiers Settlement Act indicates what has been and is being done to meet the requirements of the situation. The other work of the Department in connection with general settlement still continues, however, and is dealt with hereunder. Conditions of Settlement. Weather conditions over the whole of the Dominion have been somewhat exceptional, the summer especially being remarkable for its dryness, except in the northern portion of the North Island, where the rainfall was much above the average. On the whole, however, the conditions have been very favourable to the growth of grass, the moist spring producing a luxuriant growth which the succeeding dry season was not of sufficient duration to check. As a result those farmers who devoted their attention mainly to grazing, and were well established before the war, have had a very successful year, and the high prices ruling for stock have returned them very handsome profits. The demands for mutton and beef for export purposes and the prices offering have tended to induce graziers to dispose of their young stock more freely than usual, and a shortage of stock in the coming season is not improbable. In the dairying districts the returns produced have been highly satisfactory. The lot of the agriculturist has not been very encouraging, as the dry summer was not conducive to heavy yields, especially of grain crops; on the lighter land these crops were far from good. The prospects of the root crops in their early stages were decidedly promising, but the development of the crops was somewhat marred by the dry summer, particularly on the lighter classes of land. The development of the fruitgrowing lands is progressing steadily. A fair area of new land has been broken in and planted, and a considerable number of new orchards have come into profit during the year. The yield of fruit was very satisfactory. While the existing commercial conditions have been particularly favourable to improved lands, they have operated as a serious obstacle to the development of new lands. With the scarcity of labour and high prices demanded for material for fencing, <fee., the cost of effecting improvements has so increased as to overburden those settlers who are endeavouring to bring new holdings to a state of profit. An appreciable reduction in the value of new improvements as compared with previous years is noticeable. Recent Legislation. During the session of 1916 legislation was passed affecting the operations of this Department, and the following is a summary of the principal provisions : — Appropriation Act. —Section 29 appropriated £20,000 for the formation of roads for the purposes of the Discharged Soldiers Settlement Act. Discharged Soldiers Settlement Amendment Act amended the Act of 1915 by extending its provisions to residents of New Zealand who have served with other Expeditionary Forces in the present war. It also enables financial assistance to be given to any discharged soldier who already is, or may hereafter become, a holder of a lease of Crown land or any land administered by Land Board, whilst it authorizes the taking of freehold land under the Public Works Act for discharged soldiers settlement, and furthermore gives authority to raise a sum of £500,000 for the acquisition of land under the Discharged Soldiers Settlement Act. At the same time the sum of £50,000 previously authorized to be raised for general purposes was increased to £100,000.