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7. WATER-SUPPLY, TAKAKA Evidence was presented to us in Takaka that the farmers were having great difficulty with supply of water in the Takaka Valley. The area is a limestone one, and for a part of the valley the river disappears underground to reappear farther down the valley. In this area it is very difficult for the farmers to obtain water, and it seems to be uneconomic for them individually to obtain water for stock. It appeared to us that the Works Department might profitably establish a small water-supply scheme in this area, and we recommend investigation accordingly. 8. LEES VALLEY This is one unfortunate example of faulty subdivision in the South Island high country. The valley is an almost entirely enclosed one just west of Oxford, in Canterbury. The only entrance is by a narrow gorge, through which the road must climb by a winding route around steep faces to give reach to the valley. In our opinion, there is no question that the valley was badly subdivided, both in respect to the size of holdings and to the balance of country. It was originally subdivided into fourteen holdings. Many of these have failed, and already there has been some amalgamation and regrouping. We consider that before stability is reached further regrouping will be necessary. Evidence presented to us in the valley contained requests for attention to the road, but there was a lack of unanimity among the settlers. Some wanted a new road constructed over the saddle at the north end of the valley; others wanted the existing road improved. In view of the lack of unanimity, we make no recommendation. Before any great sums are spent on giving better access to the area, we are of the opinion that further consideration should be given by the Lands Department to the question of regrouping. Attention should also be given to the economic possibility of the drainage of the swamp area. In the meantime however, access to the valley in the event of emergency is provided for by a reasonable airstrip. Unfortunately, access to this airstrip is across a small creek where a bridge requires repairs which could be effected by the local settlers. 9. MOLESWORTH STATION Much has been written in official pamphlets and in articles in newspapers and journals, and much has been said in farmers' discussions all over New Zealand, on the subject of Moles worth Station and the steps taken by the Lands Department to reclaim it from its deteriorated condition. We spent some time at Molesworth, and by courtesy of the Director-General of Lands stayed at the station for a few days and were escorted across much of the station by the Manager. We would like to express our thanks to the Director-General of Lands for his invitation to view Molesworth at first hand. We would like to state, in the first place that we have found no evidence to justify the statements continually circulating in the district that Molesworth has been a " sink " for public funds. It would be well if we pointed out briefly the position of Molesworth as we have viewed it. There can be no doubt that the station was allowed to get into a very poor state. We do not propose to outline the causes of the deterioration ; suffice it to say that it did get into a poor state, with pastures depleted and rabbits rampant across its countryside. The licensee