D.—2.

For the year ended 31st March, 1940, the amount paid by the Department for exchange on purchases made through the High Commissioner, London, was £236,162 os. Id., a decrease of £132,878 Bs. 6d. compared with the previous year. The total issues to all branches (including coal) for the year amounted to £4,644,117 2s. 3d., as against £3,628,487 15s. sd. last year, an increase of £1,015,629 6s. lOd. A summary for six years showing the value of purchases and issues of stores (exclusive of coal), together with the value of stocks on hand (stores and coal) at the close of each year, is as under : —

It will be observed from the above that issues of stores (exclusive of coal) in 1939-40 reached a new high level of £3,827,494. This was due to the issue during the year of materials specially purchased in previous years for capital programme works, also that forty J class locomotives, valued at £647,978, were imported and issued during the year under review. In regard to stores stock, it is anticipated that this will be substantially reduced during 1940-41, as programme stocks now on hand will be to a great extent drawn out while the fulfilment of overseas orders now being placed is likely to be delayed as a result of war activities in Great Britain and elsewhere. COAL-SUPPLIES. The following return shows the purchases of coal made during the last six years Tons. Tons. 1934-35 422,334 1937-38 .. .. .. 544,222 1935-36 437,959 1938-39 .. .. ..505,189 1936-37 .. .. •• 433,795 1939-40 .. .. .. 490,350 Only New Zealand coal is used by the Railways Department, which has imported no coal during the last eight years. Of the purchases of coal made in 1940, 287,401 tons were hard coal and 202,949 tons soft coal. The average consumption of coal per week during the year was 10,184 tons, an Increase of 284 tons per week compared with the previous year.' This reflects the large increase in engine-miles due to the heavy traffic handled during the year. TIMBER-SUPPLIES. During the year the Department's supplies of native timber have been drawn from Mamaku Sawmill. At Maroa the Department's new sawmill has been brought into operation. The Department's timber area at Pokaka has throughout the year been operated under license to private interests under the oversight of officers of the Department's Forestry Branch. FORESTRY BRANCH. The tree-planting and other work of the Forestry Branch has been carried on with satisfactory results during the year, the weather-conditions experienced having been particularly favourable to planting operations. Close attention continues to be given to the consolidation and maintenance of areas already established as forestry reserves, while the output from the tree-nurseries at Athenree and Woburn has been fully maintained, some 180,273 trees having been raised at the nurseries and made available for distribution during the year. In order to control sand-drift and also prevent sea erosion in the district north of the Clarence River on the route of the new South Island Main Trunk Railway, arrangements have been made for the area to be planted with suitable trees which will be raised in the Railway Department's nurseries. The planting operations, in which the Railways and Public Works Departments will collaborate, will cover 1,600 acres and will commence in May-June, 1940. The major activities of the Branch during the year may be summarized as follows: — Tree planting and blanking : 172,367 trees. Nursery output, Athenree : 149,720 trees. Nursery output, Woburn : 30,553 trees. New crop, estimated, Athenree and Woburn nurseries : 405,000 trees. Six miles of fire-breaks cleared. 100 acres land cleared at Matata and 5 acres at Lower Hutt. Oversight and control of Pokaka Bush operations. Investigation of lire claims. General maintenance-work in connection with established forest reserves.

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Stocks on Hand. Year. Purchases. Issues. Stores. Coal. Total. . - — — £ £ £ £ £ 1935 . .. .. 1,269,171 1,136,243 584,611 160,177 744,788 193 6 .. 1,436,696 1,400,858 622,899 144,888 767,787 1937 .. .. 1,971,314 1,719,414 874,800 107,653 982,453 1938 .. 2,662,302 2,082,195 1,107,653 167,347 1,275,000 1939 .. 4,001,478 2,854,721 1,907,113 153,128 2,060,241 1940 3,165,437 3,827,494 1,881,948 93,906 1,975,854 I