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pass the land on to some one who had the means and the disposition to aggregate a large estate. A partial check has been given to this in future, by the legislation of 1884, postponing the right of purchase to six years from date of license. It is worthy of consideration if residence on bush lands should not also in most cases be made compulsory, say, after the first two years. As the law stands it is simply a matter of administration whether residence is made optional or compulsory on the selector in bush land. In open lands residence is compulsory after the first six months and up to the end of the sixth year from date of license. Referring still further to the transfer and aggregation of lands obtained from the Crown on deferred-payments, it may appear at first sight narrow and arbitrary to seek to control the size of holdings within any defined limit; but it has to be borne in mind that the deferred-payment system is specially designed to establish communities of settlers that will be mutually helpful to each other in subduing the wilderness, in the support of church, school, postoffice, the village tradesman, and the other requirements of civilized life. If a few speculators are allowed to mar this fair purpose by abusing the system in taking up land merely to sell out and give facilities for the interposition of large estates, making the settlers a straggling instead of a compact body, it is manifest that the end sought is in a great measure frustrated, for the few cannot cope so successfully with the road and other local matters requiring co-operation as the many. The perpetual-lease system, pure and simple, seems to meet the case, for, while it gives perfect security of tenure and of improvements, and allows of transfer, the cardinal principle is maintained that the land is never sold, and aggregation of leaseholds must stop at the maximum of 640 acres. The Perpetual-lease System. Within proclaimed goldfields this system is, as its name imports, a lease of Crown lands in perpetuity, with adjustment of rent at intervals, the first term being for thirty years, and subsequent terms twenty-one years. Within the ordinary land districts of the colony the same terms are in force, but with the right of making the land freehold by purchase if the option is exercised before the end of the eleventh year from date of lease. During the year 121 persons have leased 26,711 acres, of which 111 were on Crown lands, taking 24,410 acres at an average rent of a little over Is. 7d. per acre, or a capital value of £1 12s. The other ten leases were on the educational reserves, Ota o—six in the primary education reserves, and four in the Dunedin High School endowment, Strath Taieri—comprising a total area of 2,301 acres, at an average rental of 2s. Bd. per acre, or a capital value of £2 13s. 4d. per acre. Since the introduction of the system in May, 1883, there have been up to the 31st March, 1885, 253 leases taken up, comprising 52,596 acres, of which 181 leases and 42,460 acres are in goldfields, and therefore held truly on perpetual lease. Between the 31st March and the 15th June 45 more leases, covering 8,472 acres, have been taken up, making a total of 298 leases and 61,068 acres within the two years the system has been in operation. As a proof of the acceptance of the perpetual-lease system with settlers, it may be mentioned that there are frequent applications made to the Land Offices to have certain sections brought under it, so that the land may be held under that tenure. Village Settlements. During the year eighty-five settlers took up on deferred payments an area of 499 acres, or a mean of about six acres each. This class of settlement has been very successful during the past few years in establishing several hundreds of the better class of labourers and their families in homes of their own, in circumstances of comparative ease and comfort, within a short space of time. Thus, at Orari, Canterbury, where the land was only opened in 1881, there are now forty-eight holdings, on 403 acres of land. Similarly, at Beaconsfield, about four miles from Timaru, there have been, since September, 1883, no less than thirty-two families settled on 394 acres. In both places the settlers, in the erection of houses, fencing, and cultivation, have made marvellous progress, converting open wastes of brown-tussock land into thriving country-sides. The land was sold on the usual villagesettlement conditions of residence, improvements, and payment in ten half-yearly instalments. The price of the Orari land was fixed at £10 an acre, and that of Beaconsfield at from £12 to £15, with no advance on price, duplicate applications for the same land being determined by lot. One important element in the success of village settlements is their being situate in good farming districts, or not very far from a township, so that the settlers may have a chance of occasional employment and of a market. These conditions existed in the two cases adduced, from the fortunate circumstance of reserves of Crown lands being available. Ordinarily, however, in selecting village sites, as in selecting sites for towns, the favourable conditions have to be anticipated, and reserves made to meet the future progress of the country. In the happy gradation of village lots up to twenty acres, of small farms up to fifty acres, of deferred-payment farms up to 320 acres, of perpetual-lease farms up to 640 acres, the steppingstones to competence and independence are made sure to the thrifty and industrious, and are now being availed of by thousands of settlers. But in the deferred-payment system there is, as already mentioned, the future danger of amalgamation of properties and the undoing in a measure of all the care and expense the colony has been to in the survey and settlement of districts on that system. It is worthy of consideration if it would not be well, having once carefully fixed on the areas to be offered for occupation on settlement conditions, to determine that in future the area of holding should be fixed within the definite limits of acreage according to class, and be all on the tenure of perpetual lease. In this way, while every facility of transfer would be allowed settlers, there would be maintained a gradation of village lots, small farms, moderately-sized farms, and large farms, the advantages of which to a country have been so ably referred to recently in the Nineteenth Century* by the Duke of Argyle and Lord Napier and Ettrick, in their controversy on the crofter question and the depopulation of the Highlands of Scotland.

* See numbers for November, 1884, and January, 1885.