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the officers of the Public Works Departments, of the colonies I visited, for much valuable information. My best thanks are also due to T. H. Smeaton,- Esq., Secretary of the Village Settlement Aid Association, F. Duffield, Esq., Adelaide, and to A. E. Mursell, Esq., Eenmark, for their kind assistance in my mission. What may be done in New Zealand. And now the question will naturally arise : " What can be done in New Zealand, and what recommendations can be made to deal successfully with a difficulty —the excess of labour—which is continually arising in the large centres of population ? " I find in all the Australian Colonies there has been great scarcity of work, and in several employment is still most difficult to obtain. New Zealand by no means stands alone in this respect. Unfortunately, also, this unemployed difficulty is no new thing amongst us. It has been constantly cropping up for years past, and will continue to do so until a radical cure is provided. There is no easy or royal road to prosperity, but I have seen that it can be attained by industry, perseverance, and sheer hard work ; and am decidedly of opinion that in this colony, where there is so much remunerative work to be done, there should be very few, if any, unemployed among the able-bodied men. In order to bring this about I would respectfully recommend: — 1. That more vigorous measures should be adopted to promote settlement under the village homestead system on suitable land in country districts, and the acquisition of land under the Land for Settlements Act, near large centres, for the same purpose. The regulations under " The Lands Improvement and Native Lands Act, 1894," provides that: " The Commissioner of Crown Lands, or the Chief Surveyor of the district, will in each case select the men who are to form the association." I think similar power should be given in connection with the occupation of village-homestead settlement lands, more especially where those lands have been acquired under " The Land for Settlements Act, 1894." Take, for instance, land purchased near a town or city. There the object is to offer some little assistance to artisans and others whose trade or occupation is in a town, and who may only be working half-time. Ploughmen, farm-labourers, shepherds, bush-men, and others, who are accustomed to work on the land, should be directed to a village settlement allotment in the country districts, and should not be eligible for land acquired near a city. To promote this class of settlement successfully it will be necessary to grant by way of loan a little monetary assistance. I have pointed out in this report that the aid granted in New South Wales is £50, in Victoria £40, and in South Australia £50, with every probability of it being increased in certain cases. In England the amount set out by the Colonising Society as being necessary, in their opinion, to carry out the work of land settlement successfully, is £100 per family. I recommend, therefore, that assistance should be given to village settlers who are approved by the respective Land Boards to the following amount : On plain or open land (for dwelling-house) £20 ; on bush-lands, £40 — namely, £20 towards the erection of a dwelling-house, and £2 per acre up to 10 acres for clearing, burning, and grassing. Eegulations should be made for the repayment of these advances by instalments, after the first four years; a fund would thus be created from which assistance might be granted to new settlers. 2. I would also recommend that the regulations under improved settlement farms should be made more generally known; and that married men taking up land under those regulations be granted an advance of £20 (by way of loan) towards the erection of a dwelling-house. 3. The promotion of co-operative settlements on a somewhat similar plan to that adopted at Koo-wee-rup, Victoria —namely, to take a block of Crown land, or to acquire a block under the Land for Settlements Act, where drainage or other works are necessary to bring it into a state for profitable occupation, the men to be be employed for a portion of a month on the works, and ari equal portion on their holdings in the immediate vicinity. 4. The establishment and promotion of labour colonies. I have frequently been asked what is the meaning of a labour colony, and what are the objects sought to be attained. I reply that there are labour colonies and labour colonies, and it is quite feasible to establish them on greatly improved lines to the one at Leongatha, Victoria. For instance, there might be a labour colony, — (a.) To provide work for the unemployed, and to give instruction to men who have previously received no training or education for work on the land. Employment on a labour colony of this class, which might be established on bush-land, would be temporary, until something better was found for the colonist, or until he is able to take up a village settlement allotment on his own account. I am correct, I think, in stating that all those who have been brought into contact with our surplus labour are aware that a large percentage of the men lack experience on land, and they require instruction to gain this knowledge. If a labour colony does not immediately repay so much per cent, on the outlay, no one need be discouraged, for if the colony is wisely and properly managed it is doing good work —work beyond the power of any one to assess at so much money value. We spend annually a large sum of money on education, but no one anticipates to see an immediate return of 5 or 6 per cent, in hard cash on the outlay. We have, however, faith in believing that the expenditure thus incurred will eventually return some thirty, some sixty, and some a hundred fold. So also with respect to labour colonies, the instruction to be gained thereon, and the truly valuable work which may be accomplished, will repay the State by-and-by, if it does not immediately. (&.) A labour colony could be established on open land to provide permanent and settled homes for men (including their wives and families) who have passed the prime of