F.—l.

POSTAL SERVICES. INCREASE IN POSTAGE-RATES. Primarily as a means of assisting Government finance consequent upon the outbreak of war, postagerates were increased from the Ist October on inland and overseas letters, post-cards, printed papers, and newspapers, and on inland commercial papers, packets, and parcels. The " late fee " on letters, the registration fee, and the express-delivery fees also were increased. POSTAL CONCESSIONS TO MEMBERS OF NEW ZEALAND EXPEDITIONARY FORCE. Shortly after the outbreak of war the overseas postal administrations concerned were approached with a view to arranging concessions in postage-rates and Customs charges on mail-matter for members of the armed Forces serving overseas and, as a result, the following reduced rates on correspondence and parcels addressed to New Zealand and other Empire soldiers, sailors, and airmen were introduced : — Letters : The inland letter rate of 2d. for first ounce and Id. for each succeeding £ oz. Newspapers : The British Empire rate of |d. for each 3 oz. Parcels : Up to 3 lb,, Is. 6d. Up to 7 lb. (maximum), 3s. Negotiations are being continued with a view to reducing still further the postage-rates on parcels for the men on service overseas and to having the Customs charges on such parcels waived. Due to space limitations on the curtailed overseas air service, it has not been possible to grant any reduction in the charge on air-mail letters addressed to soldiers in Egypt. INLAND MAIL-SERVICES. Contracts for the performance of the inland mail-services in the Gisborne, Napier, New Plymouth, Palmerston North, Wanganui, and Wellington postal districts expired on the 31st December last, and were relet during the year for a further period of three years as from the Ist January, 1940. At the end of the year there were 32,486 rural box-holders. This number, which is the highest on record, represents an increase of 1,586 compared with the number at the 31st March, 1939. OCEAN MAIL-SERVICES. With the exception of the services to Great Britain and South America, little alteration as the n suit of hostilities took place in the normal steamship schedules utilized by the Post Office for the conveyance of mails overseas. During the period September-December several mails despatched to Great Britain suffered exceptional delays in transit, but it is pleasing to record that no mails were lost as the result of enemy ,action. The position concerning mails to Great Britain may now be regarded as normal, the average transit time being approximately forty days. Mails from overseas have been received regularly and no excessive delays have occurred. The average transit time for mails from Great Britain was approximately forty days. AIR MAILS. Inland. Up to the outbreak of war, when services were considerably curtailed owing to civil aeroplanes being taken over by Government for defence purposes, the volume of correspondence conveyed by inland air services continued to show a steady increase. Figures showing the number of letters carried during the last three years are hereunder : —

The effect of the curtailment of the services, combined with the increase in postage-rates, is reflected in the appreciable drop in the volume of correspondence carried during the latter half of 1939-40. At the 31st March, 1940, the following services were in operation :— Service. _ _ Frequency Auckland-New Plymouth - Palmerston North-Wellington-Christ- (both ways). church-Dunedin .. .. .. . ■ • ■ Thrice weekly. Wellington-Blenheim .. .. .. ■ • • • Twice daily. Wellington-Nelson .. .. .. .. • - ■ • Twice daily. Nelson-Westport-Greyinouth-Hokitika .. .. ' .. Daily.

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| 1937-38. | 1938-39. 1939-40. I 1 June quarter .. .. .. 325,584 508,625 685,984September quarter .. .. 381,019 558,642 694,145 "December quarter.. .. .. 4-66,813 649,437 304,023 March quarter .. .. .. 515,225 665,723 200,039 1,688,641 2,382,427 1,884,191