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It may therefore be said that the decision of the Government to employ convict-labour on the fortifications has practically been brought into operation during the whole of the past year. The result may be said to be satisfactory, as anticipated in my report of the 31st March, 1888 (H.-5). Although it is well-known by experience that the labour of convicts will not stand comparison with ordinary or contract labour by the amount of work executed in a given time, yet the economy of their employment compensates for the lesser result, where rapidity is not essential. In the particular case of our fortifications the better class of prisoners is selected for transfer to the temporary prisons and employment on the works ; they are housed in buildings which, while secure, are not suggestive of a gaol, and they have an always bracing atmosphere around them. Moreover, they have not to march through the streets to and from a city gaol every day; nor are they, when at work, exposed to curious eyes; and also the nature of the work upon which they are engaged has a definite interest and object to them, and is not merely a monotonous medium for the enforcement of hard-labour. All these considerations combine to induce them to work with greater willingness than is customary with convicts, and in many ca*es to display an unusual and intelligent interest in the execution of the tasks set to them. It is for these reasons that their work has been stated to be satisfactory, although it is not contended but that a system of contract or piece-work paid labour would have produced a bet.ter record of progress, while necessitating a much heavier expenditure than is involved in the wages of only those three or four artisans or foremen at each port with whom it is found advisable to supplement the prison-labour for its better direction and management. At first the prisoners at work were guarded by a picket of the Permanent Artillery, who had thus to be taken away from their drill and duty. While this arrangement worked satisfactorily, it has been found that the employment at each port of certain of the artisans abovementioned in the capacity of additional warders enables an equally-efficienL supervision to be maintained without additional expense; or detriment to the progress^ of the works; and the introduction of this system has, by Relieving the Artillery from sentry duty, enabled them to give better attention to the guns and stores ; while it has also, probably, contributed towards improvement in the work done by the prisoners, who, under their own warders only, and without the constant reminding presence of the armed sentries, appear to work somewhat more freely and willingly. No other labour than that supplied from the prisons having been employed during the past year, the works upon which progress has been made have been those only the sites of which were more or less adjacent to the temporary prisons. There are obvious reasons why, in a report upon the defence-works which may be made public, it is inadvisable to deal except in generalities, and I am therefore debarred from more particularly alluding to the batteries and other works upon which operations have been concentrated. But it may be said that the record of the year shows a substantial advance towards the desired stage of efficiency of the defences. The comprehensive attention devoted by General Schaw, C.8., E.E., to the colony's defences, and his invaluable advice, which has throughout been freely given, not only to the Government upon the larger general questions, but also to the executive officers of your department upon the details of design and arrangement both in the office and on the field, has enabled operations to be conducted and the available labour to be employed on definite lines. Eecent experience has proved that the surest reliance in fortification must be placed upon mother-earth. W Thile, therefore, it is at once advisable and necessary that gun-pits and magazines, and such other bomb-proof accommodation as may be required for the protection of artillery-stores and the shelter of the garrison, should be solidly constructed in concrete, masonry, or brick, it is equally essential that as little as possible of this class of work should be in any way exposed or even visible, and that the retaining-walls and other massive outlines, and the enclosed and walled spaces, as well as the neatly-formed and trimmed counterslopes and merlons of recent systems, should be conspicuous by their absence. The realization in actual execution of these principles, while maintaining convenient communications and providing a musketry-defence of the position, is more difficult than would at first sight appear ; but every effort has been made to apply them as well as the nature of the sites would allow. The shores of our harbours are singularly devoid of the extended area of fairly even-lying ground required for a fort or battery of this modern type, and their impracticable nature has occasioned a very great amount of difficulty in laying-out works. General Schaw has called frequent attention to this point: and it is one that it is only right should be made clear. x\ further result of the application of the above principles is this: that a completed battery buried under a mound of superincumbent earth of rough and irregular outline, evenly-trimmed and dressed slopes having been by modern experience found to be as gratifying to the eyes of the gunners of hostile vessels (enabling them to lay their fire accurately on the sharp and defined lines and shadows) as to those of the old school of military engineers eager for perfect neatness of outline. Hence to the casual visitor no proportionate indication is given of the work executed and thus concealed underground ; nor is it possible, even when the subterranean galleries and magazines, &c, are entered, to comprehend in the artificial light their extent and solidity. Such is or will be the appearance of all of the more recentlyundertaken works, both those that are completed and those that are approaching completion or are in progress. There are still a few main batteries and-several accessory works embraced in the accepted scheme of defence which lie unfinished or for which the ground has not yet been broken, although their armament is to hand in the colony. These are mostly works the sites for which have not been definitely acquired, and whicß cannot be reached under the present means of distribution and application of prison-labour. The funds at disposal have not admitted their being carried on or undertaken by contract or other methods. They form, however, essential and integral and, in one or two eases, most important parts of the defences, and it will be necessary to keep them steadily

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