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expedient of not filling up the vacancies which will occur in the natural course of events. When this reduction takes full effect the saving will be— £ s. d. On 14 first-class sergeants, at 2s. 6d. per diem ... .... ... 638 15 0 On 3 second-class sergeants, at 2s. per diem ... ... ... 109 10 0 On 41 first-class constables, at Is. per diem ... ... ... 748 5 0 Total ... ... ... ... ... ... £1,496 10 0 This saving cannot of course take immediate effect, but will commence more or less from this date, as will be seen by reference to that part of my report dealing with long-service pay and the retirements under clause 10 of the regulations. Laegb Number of Eented Stations. By reference to Schedule 111., attached, it will be seen that no less than sixty stations are rented, at an annual cost to the country of £2,287, an average of rather more than £38 per station. Assuming that it would require 6 per cent, to cover interest and sinking fund on brick- or stonebuildings, this rent represents a capital of £38,116, whereas £20,000 judiciously expended would build fifty of the most expensive of these stations. The remainder could be dispensed with, and the localities worked from other points. It would, however, be the worst possible economy to build as heretofore of wood, while brick or stone can be procured in all parts of the South Island at a cost scarcely greater than wood, and in the Lakes District even more cheaply. Ido not propose that these reforms should be carried out at once; but that sites should be procured where practicable, and a certain number of buildings erected each year, so as to decrease gradually the large and important item of rent. Schedule I. contains a list of twenty Government stations which w : ill require rebuilding, if not within two years at no very distant date. Some of these buildings are so old as scarcely to be habitable, and so ill-designed as to be offensive. At Westport the police-cells open into the kitchen of the constable's quarters, and there is no way of getting at these cells except through the kitchen; consequently every word uttered by a drunken man must be heard by the constable's family. Here we require two detached cells, and that two new rooms be added to the front of the house, for the accommodation is miserably insufficient. At Eiverton, Sergeant Eoutledge, an excellent non-commissioned officer, has a family of twelve persons living in a four-roomed house, built twenty-eight years since, and which is so rotten that it will hardly hold together. The worst buildings are, as a rule, to be found in the Lake and Southland Districts, where the severity of the climats demands the best possible accommodation. In Schedule 11. I have noted the rented stations which should be first dealt with for the following reasons: — Invercargill North. —Here we have an acre reserved for police purposes not more than fifty yards from the rented station. The cost of a good brick cottage should not exceed £250. Olaulan. —There is a reserve for Government buildings in this township, and the cost of brick cottage, cell, single-stall stable, and forage-room would probably not exceed £350. We pay £1 per week rent. Wyndham. — Here there was originally a police reserve, Block XV., 3-J- acres, but this would appear to have fallen into the hands of the local authorities. There is, however, space on the courthouse reserve sufficient for a police-station; and, as we now pay £1 ss. per week rent, it is advisable to build at a cost of £350. Balclutha. —Here we rent two cottages at a cost per. annum of £55. The site originally reserved was washed away by the great flood of 1878. A site should, if possible, be purchased without delay, for this must always be a police-station. Mosgiel, Morning ton, Roslyn, and North-east Valley. —Here we have no reserves, but it is advisable that sites should be purchased as soon as possible, for the first-mentioned village is rapidly growing in population and importance, and rent will soon be a consideration, for police-stations must always be near the centres of trade, where rents are high. The same argument applies with greater force to the suburbs of Dunedin, where property is even more rapidly increasing in value. Maclaggan Street Station. —l have already reported on this ease. In Dunedin alone, of all the New Zealand towns, no provision has been made for a central station. The rent paid for this building (£3OO per annum) does not by any means represent our annual liability, for by the terms of the lease all repairs have to be made at the cost of the police, a premium has to be paid on an insurance of £8,000, and all local rates and taxes paid by us. Other items make the total cost of this station over £450 per annum. By building a station at a cost of £2,000 on that portion of the gaol reserve nearest to the railway-station, not only could this at once be saved, but also £50 now paid yearly for transport of prisoners to and. from the gaol and railway-station. A fair proportion of the £2,000, say £500, would be properly a charge on the Justice Department for a police court where ordinary police cases could, be heard by Justices, as is the case at present in Maclaggan Street. This is a very excellent system, and relieves the Resident Magistrate's Court of much work of a petty character. No part of the colony is so ill supplied with reserves for police as Otago, for in many cases where reserves have been made they have been allowed to fall into the hands of the local authorities. In the City of Wellington £75 per annum is paid for police-stations at Newtown and on Clyde