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settlement at Halcombe the difficulties which had to be encountered at Feilding from the want of cottages. I therefore took advantage of the lull in immigration to establish a saw-mill at Halcombe, and to build a number of cottages there of a superior class to those at Feilding, sufficient to keep ahead of the expected immigrants; and for the convenience of their supply I encouraged the settlement of a few tradespeople, storekeepers, and others, as soon as the building of the town was started. The first immigrants arrived in Halcombe in April, 1876, and they were immediately housed and put to work on road-formation and house-building in the town and iis immediate vicinity. The railway to Feilding was finished in September, 1876, and, with a view to the employment of the immigrants to be sent to Halcombe, I endeavoured to make a similar arrangement for the continuation of the railway line through Halcombe as bad been made at Feilding. In this, however, I was not successful, as I could not agree with the Minister for Public Works as to the price, and, in consequence, the contract for the main portion of the work fell into the hands of a contractor, who has never employed any of the resident settlers A small portion of the railway formation was reserved for the employment of the Corporation immigrants under the terms of the Feilding contract, but as the wage offered —viz., ss. a day—was at least 2s. under the current rate, and as they were only permitted to earn £1 a week, all that could possibly do so refused the work; and although they were offered contracts on the Corporation roads for the rest of their time, they—not, I think, without reason— objected to the constant change which such an arrangement implied. Many of the Halcombe immigrants were moreover of a superior class, and, having sufficient means to seek more suitable employment elsewhere, removed a short time after their arrival. At the new settlement at Halcombe, also, there have been, and will continue to be, even greater difficulties in the way of locomotion than had to be contended with at Feilding, which will only be removed by the opening of the railway line, which will not be for another ten or twelve month;?. I must confess to being very much disappointed with the comparatively little progress at present made in the settlement of Halcombe, both because the place is far more picturesque and attractive and less rough than Feilding, and because the immigrants located there have had none of the discomforts which those at Feilding had to put up with. Every family, without any exception, which has been taken to Halcombe has been carried comfortably, and with every article of baggage with them, right up to their cottage doors. The cottages are far superior to those at Feilding, and every reasonable provision for the immigrants' comfort has been made, even to providing each cottage with some days' firewood supply. Those immigrants who were without money had orders for necessary stores placed in their hands, and arrangements were made by which the men could, if they were so disposed, go to their work the morning after their arrival. With regard to the settlement of this part of the block, however, the causes which at present operate to prevent its progress will all be removed so soon as the railway to Wanganui and Feilding is finished. It will then be on a main highway, instead of being, as at present, completely isolated from the rest of the world. And whereas the only work now is that which the Corporation road-making supplies, which is, of course, more inconvenient to the workmen, as it extends farther into the country, there will be ample employment then for a very much larger population than is there at present in the timber and firewood trade, which, under the reduced railway tariff, can be carried on from Haleombe to the different stations in Rangitikei and to Wanganui at a profit to the exporters ; and the roads leading from Halcombe into the Corporation lands being already well advanced, the land will be speedily taken up and occupied as soon as an easy access is provided to the town itself. The present resident settled population on the block is, as nearly as I can ascertain, 1,600. Of these, 1,200 are settled in Feilding, and 400 in Halcombe, and about 70 per cent, are Corporation immigrants. The Corporation has erected 121 immigrants' cottages at Feilding, and seventy-one at Halcombe, at a cost of £7,690. It has also erected other houses and buildings, and effected improvements in the way of fencing, &c, at a cost of £5,537. The whole of the cottages erected at Feilding are occupied, and forty-one of those at Halcombe. A large number of other buildings have been erected by other settlers, as also three places of public worship, two large hotels at Feilding and one at Halcombo, and both at Feilding and Halcombe schoolhouses have been erected to which the Corporation has very liberally contributed. A reference to the map and Appendix B will show 52 miles 32 chains of road lines dealt with by the Corporation, and in various states of progress Of these, 47 miles 68 chains lie within the Corporation boundaries, and 4 miles 44 chains entirely outside of it. The roads inside the block have cost the Corporation £9,976; the lines outside have cost £2,124; both amounts being exclusive of subsidies from the Government or Highway Board. The survey of not quite half the block has been executed at a cost of £12,080, and a reference to Appendix F will show the exact position of the survey work and the proportionate areas of subdivision. At this work five survey parties are constantly kept in the field, of which one party always, and often two, are solely engaged in exploring and laying off the road lines, which are determined and carefully levelled for their formation before any subdivisional survey work is undertaken. As a consequence, all our road lines are practicable and the best obtainable, and even where opening up rather hilly country there are no bad grades. As to the permanent settlement of the immigrants, those who have had any experience with "new chums " have no need to be reminded of the difficulty of dealing with them even under the most favourable circumstances. That difficulty is greatly increased in the case of the immigrants with whom I have had to do, not only because the very best of English immigrants are at first entirely unfit to deal with a bush country, but because they all form a most exaggerated idea of the duty of the Corporation towards them, which it would be absolutely impossible to realize ; and when to these disadvantages are added the unusual difficulties with which the settlement has had to contend for the want of any passable road up to the base of its operations up to April, 1876, I declare that it is a source of wonder to myself that so successful a result as the bond fide settlement of some 70 per cent, of the immigrants sent out has been obtained.

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