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knowledge of the history of each settler, the records of the office, and the reports of inspecting officers, is in a better position to judge how far the present position has been brought about by actual misfortune or adverse conditions of an unavoidable nature, and how far through the fault of the settler himself. From our knowledge of the whole position, the Land Board and myself are convinced that, although a proportion of the failures must be attributed to the fact that the men went on to the farms at a time when land had to be bought at prices above present productive values, and had to pay high prices for all stock and materials, yet on the other hand a proportion of the settlers' present difficulties are due to lack of energy, industry, method, and frugality on the part of the settlers, and that these reasons will account for a much larger proportion of the partial or total failures than some of the men will admit. With this view, two aspects of the question arise : (a) How far shall a settler be relieved from difficulties which are, in a considerable degree, of his own making ? and (/;) How far is the State to be at the expense of granting relief from difficulties so caused ? The Land Board, in making its recommendations, has endeavoured to give equitable consideration to all the factors, and to afford settlers such reasonable assistance as may be necessary to enable them to pull through, without unduly charging the State with losses due to the deficiencies of the settlers themselves. (2.) It also appears to be evident that the valuations made by the Inquiry Board gave a great deal of weight to recent slump conditions, and that the Board in many instances proceeded on the impression that many of the State purchases were made at unsound prices, especially in the; " Section 2 " cases, while the facts that these properties were chosen by the settlers themselves, who were in many instances prepared to pay (out of State funds) much more than a fair price, even according to prices then ruling, did not receive sufficient consideration. In regard to " Section 2 " purchases, I have to point out that the Auckland Land Board, notwithstanding considerable pressure from various quarters in many instances, declined to make any recommendations for purchase in about 50 per cent, of the cases submitted, this being generally on account of unsuitability of property or excessive price asked. Had the Land Board not exercised very critical consideration in such cases the percentage of failures might have been much larger. It will be obvious that the State should not be expected to reduce the values to slump prices, or to sustain undue losses by reason of inefficiency and failure to make the best of their opportunities on the part of some of the settlers. Even if it were the case that the existing mortgages or capital values are in many instances too high, an examination of many of the rent and instalment accounts indicates that the settlers have not even attempted to make payments on the basis of what might, under the conditions existing, have been claimed to be reasonable values. In regard to present valuations also, it is important to point out that we have recently been able to effect redisposal of some abandoned holdings at prices considerably above special valuations, while in some cases, holdings that have been inspected by the special Inquiry Board, and reductions recommended, are changing hands at a margin above; existing liabilities. (3.) It is apparent that in many cases the special Inquiry Board recommended settlers to incur further liabilities em improvements (such as provision of water in e;very paddock) which, while no doubt part of the equipmemt of an ideal dairy farm, can scarcely be regarded as essentials at the present stage eff development, nor as being of sufficiently urgent immediate necessity to justify incurring further liabilities while the payments attaching to existing liabilities are not being met. There has, moreover, evidently been a. tendency to recommend expenditure irrespective of prudent ami necessary consideration as to whence the money was to come, no doubt relying on the usual belief that, the State's purse is good for all demands, reasonable or otherwise, that may be made upon it. (4.) Allied to the 1 , foregoing is the fact that in a very large proportion of eases the Board recommended. " further financial assistance if required," irrespective of whether the limit of assistance had been reached or not. \\\ the majority of instances, no specific amount of further assistance was indicated. As far as granting it "if required" is concerned, observation shows that in many cases settlers will go on bevrrowing as long as it, is possible to dei so, apparently with little regard to the future day of repayment. (5.) In its discussions with the special inquiry Board the Land Board, notes a tendency on the part, of the former to favour dairy farms in areas averaging 80 to 100 acres, even in closely settled localities near to centres e>f population, such as the Mangateparu Settlement. While; the Land Board recognizes that locality and distance from rail or market must to a large extent be determining factors, the Land Board strongly deprecates the idea that 80 to 100 acres should be the minimum limits in country such as the Waikato, which is undoubtedly destined to become, generally speaking, a district of small, self-contained dairy farms, which can be worked by the owner without employing labour. A case has recently been quoted of a 59-acre farm on which twenty-six cows were; milked during the; past season, yielding an average of 3201b. of butterfat per cow for the season. Of course, systematic working, annual top-dressing, and a high standard of dairy stock must be maintained to yield such results ; but, if obtainable, it is better lor the country and the' settlers themselves that [arms should be limited to a convenient easily worked area from which the; best results can be obtained. (6.) In the special Inquiry Board's report there is a suggestion that orders from settlers for seeds, manures, &c, had been held up in this office owing to lack of farming knowledge. From my knowledge of the position I think the real explanation is that any delays that have occurred have arisen not from the; reason alleged—as this office has always recognized, the necessity for placing orders as expeditiously as possible but because in many instances settlers left their orders till the last minute;, and when the; position was investigated here it was found either than insufficient funds were available, or that there were other circumstances rendering special inquiry necessary. The; work of the office, as well as of its outside officers, would often have been considerably lightened if settlers had exercised more method and foresight in regard to their requirements.