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Wellington, July 27th, 1857. Sir,— I have the honor to acknowledge the receipt of your communication of the 14th on the subject of Native Schools, beg to offer the following observations in reply:— 1. I sincerely regret that my Eeport is unsatisfactory to you. I had hoped ere this to be able to report a School in full operation at Kai-Iwi. This, unfortunately, has been delayed by unforseen, difficulties. The Rev. Gγ. Stannard who is at present in charge of that Institution is, however, confident of ultimate success. The principle we have adopted is first to prepare the farm by cultivation, thereby hoping to make the establishment popular with the natives, and in course of time selfsupporting. I cherish the hope that on the arrival of the trained master from England he shall be found imparting a systematic education to a considerable number of Native youths and children at that place. Our experiment will not until then be complete. Preparations are in progress for the erection of a suitable school-room, dormitories, &c, which will I hope be erected by the end of the year. The difficulties which beset Native Education are second only to the importance of the object. The partial or total failure of some schools has been ascribed to the heavy amount of manual labour exacted from the pupils. This has certainly created in the Native mind no light degree of prejudiceagainst Industrial Schools. It has been our design, while keeping in view the importance of Industrial occupations, to have the Institution in that state of forwardness which will make it available for a supply of food. Hence our attention to clearing, fencing, stocking, &c. By this means we conceive the pupils will be lightly taxed in point of labour, their prejudices removed, and more time will be commanded for direct educational effort. Of what has been done, and its adaptation to the end proposed, the Inspectors will inform you in their Report. 2. I shall be happy to give all the assistance in my power to the gentlemen appointed or who may be appointed by his Excellency to inspect the school. I have written to Mr. Stannard who will, at Kai-Iwi, be prepared to give all the information they may require. 3. In reference to the expenditure for the past year, of which you request a more detailed account, allow me to remark :— (1). While, as you truly observe, at Kai-Iwi, we have not yet entered on its regular educational functions, hV has not been the less necessary to incur considerable expenditure in the development of the plan as stated in the first paragraph of my letter. That the Institution should have been so long in a mere initiatory state is a matter of regret, and in attempting any further explanation I labour under a great disadvantage in a written correspondence. The peculiar difficulties which have hindered can be better explained on the spot, and I trust that Mr. Stannard will be able to satisfy the Inspectors on this point. We are anxious to make the best possible use of the funds placed at our command by his Excellency's government; and, although at the present stage we are unable to point to those educational results which are so greatly desired by us, we hope the measures we are using will lead to the accomplishment of this purpose. (2). An ordained Missionary will continue in charge of the Institution and be held responsible for its entire management; but without the aid of a competent master it is found impracticable for him to attend to the details of a regular school. A teacher combining the peculiar qualifications required for this office is not to be obtained at any price. Therefore we have sent to our Normal College at Westminster for such a master as is necessary, on whose suitability the success of the school mainly depends. Hence the item No. lin the expenditure. (3). The sums appropriated to the Hutt, near Wellington, speak for themselves: 152.—half year's salary for a Native Schoolmaster whom we have engaged within the present year. For want of a. more convenient place he has held his school in a Maori house, and the sum of 150 Z. has been allotted for the erection of a school room on an eligible site which has been the subject of a negotiation for some time. (4). The sum of 3C51. expended on Kai Iwi, has been appropriated in the following proportions, vi .: — £ a. d. Labour and Fencing 112 7 6 Bullock Cart ~. ..,., , 38 15 0 Carpenter's Work 23 15 6 Additional Implements , 29 Iβ 0 Stock , 150 0 0 Sundries 10 6 0 £365 0 0 I have, &c, James Bulleb. To the Honorable the Colonial Treasurer, &a, &c, &&