D—No. 2

to his excellency the s0vern0r. Sir,— I have the honor to present to your Excellency ray Report on the Postal Service of the Colony for the year 1861. EXTENSION OF INLAND SERVICE. The tabular statements which form the Appendix record the principal statistics of the department increase of department. for the past year. They enable a comparison with previous years to be readily formed, and indicate a large and rapid increase in the use made of the Post Office by the public. Generally throughout the Colony this increase, though large, has been steady in its rate of advancement; and it has been possible, therefore, to maintain the efficiency of the Postal arrangements in most of the Provinces at a point not far behind the requirements of the public. But the gold discoveries made during the year in Otago attracted to that Province, suddenly, so Effect of gtfld discoveries, large an increase of population, that the Postal establishment as previously organized there proved altogether insufficient to perform the duties demanded of it; and for some months, in spite of the exertions of the local head of the department, the public service continued seriously to suffer. As soon, however, as information reached the Government that the increase of population in Otago was likely to be more than temporary, the necessary steps were taken for strengthening the Postal staff, and for extending the mail communications where required ; and these arrangements were in due course carried into effect, At the present time the Postal Service is as efficiently performed and the public requirements supplied as satisfactorily in Otago, as in any other Province. The conduct of the Officers of the department during the year may be characterized, on the conduct of officers, whole, as praiseworthy. There has been an instance of defalcation, to a small amount, reported in the case of a Postmaster newly appointed to the charge of an office on the Gold-fields of Otago. The case was promptly dealt with, and the offender has been sentenced to a term of imprisonment. Since the date of my predecessor's last report, there have been thirty-five new Post Offices es- Number of Post offices, tablished within the Colony, raising the whole number to one hundred and fifty-two. This number is exclusive of Letter Receiving Houses in the Towns, of which, at the close of the year 1861, there were seven, increased at the present time to about eighteen, either open or nearly ready. This extension of Offices has rendered necessary a corresponding increase of paid Officers, the number of whom is now greater than lastyear by thirty-five. The majority of these Officers are Postmasters in Country Districts, whose remuneration is very small. There are others who give their services gratuitously. If it were not for this fact, it would be impossible to extend the advantages of a regular Post to distant and thinly populated districts. In the buildings used as Post Offices in the towns of the Colony, improvements and extensions improvement in offices. have been required, proportionate to the increase of the work and utility of the department. In Christchurch, the Provincial Government of Canterbury have provided and fitted a large and convenient building for the use of the Post Office. In Dunedin, a considerable enlargement and re-arrangement of the Post Office has been already effected; and this may satisfy the requirements of the service until a new building, which it is proposed to construct, can be erected. Buildings of a suitable character have been put up on the Gold-fields. It is not easy to say how soon any one of these structures may have to be replaced by a more permanent building, or, on the other hand, may have to be removed. In Invercargill, the separation of the Province of Southland has caused the Post Office to be raised to the rank of a Chief Office, and the Staff of the department has been separated from that of Her Majesty's Customs. A new building, of small size, has consequently been erected to accommodate the Post Office. It is proposed to take the same course and make similar arrangements in Napier, with the assistance of the Provincial Government of Hawkes Bay. In Wellington, the Provincial Government have provided an excellent site and make advanced preparations for building a Post Office of a size and character suitable to the town. In Auckland, preliminary steps have been taken by the Porvincial Government with the same very desirable object in view. Additional accommodation is much required for the Post Office in Lyttelton; and in Nelson, the high rent paid for the building now in use, and the approaching termination of its lease, render it desirable to make arrangements for the construction of a permanent Post Office. The additional accommodation provided for the convenience of the public during the past year private botes, includes the construction of private boxes in considerable numbers at several Post Offices. Those now in use number about 270 in all ; and the only Offices of importance without them are those in the Provinces of Hawkes Bay and Marlborough. . The Inland Postal communications have been extended and accelerated in a great variety of Extensions and acceiera directions. The most noticeable of these are the following:— tl(* ng ' A daily mail for letters is now established between Dunedin and the Gold-fields of Otago. A second daily mail now runs between the towns of Lyttelton and Christchurch.

REPORT,