8.—6

VII

British Government, in which case we shall, I hope, be willing to increase our contribution to £100,000 a year. The importance of securing the fullest protection of the British Navy cannot be over-estimated. Irrespective of the direct advantages thereby accruing to New Zealand, it must not be forgotten that the Pacific islands require regular visits of British ships of war. Our interests there are considerable, and are daily growing, and as New Zealand is very closely concerned in the preservation and development of these islands, it is essential that periodical visits of ships of the British Navy should continue. The influence of the regular presence of a British man-of-war in the Pacific can scarcely be too forcibly emphasized, and T am satisfied that Parliament, in the event of a change of the present arrangement, will do what is required to provide suitable headquarters for ships of the British Navy at Auckland, where the presence of a dock and other facilities for carrying out the work of repair marks its suitability as a centre. MINING. The mining outlook is of a very hopeful character. The export of gold for the year 1906 was the highest for a period of thirty-five years, while the output of coal shows a considerable increase over that of the preceding year, and is about double what it was ten years ago—a sure indication of the progress of the industrial life of the community. The increase in the value of our mineral products for the past year amounts to nearly a quarter of a million sterling. Considerable activity has been shown in the development of the deposits of copper, scheelite, antimony, and other minerals that are known to exist in various parts of New Zealand, and for which a great demand at present exists in Europe and the United States for manufacturing purposes. It is believed that the best way to encourage the development of our mineral resources is by providiug additional assistance towards the cutting of tracks and opening up of roads in the hack country and mountain regions. Some promising discoveries have been made during the past few years, but there are many difficulties in the way of getting in supplies and machinery, and marketing the products of the mines, for which better roads and tracks are indispensable. The two State coal-mines show a total increase in output, whilst the increase in profits is not so large as compared with the preceding year, on account of material concessions made in the prices charged to the Railway Department. The briquette plant erected at Westport for the utilisation of waste slack from the Seddonville State Coal-mine is now in working-order, and experiments in the manufacture of briquettes are progressing satisfactorily, the coal being well adapted for briquettes of excellent quality. Depots for the sale of coal are now open at Wellington, Christchurch, and W-anganui, and a ready sale is found. It is comtemplated to open depots tit other large centres as soon as more extensive developments at the mines have been carried out. LOCAL GOVERNMENT. A comprehensive measure for the consolidation and general amendment of local government law will he introduced, but, having regard to the magnitude and importance of the subject and the many other matters which must be dealt with, Ido not anticipate that the Bill will pass this session. It will, however, be circulated, so that its provisions may he fully considered by all parties affected and I hope Parliament will next session put this important legislation on the statute-book. In cases where amendments of the existing law are urgently needed you will be asked to make them. LABOUR. The administration of the Industrial Conciliation and Arbitration Act has disclosed certain defects which should be remedied. These he chiefly in the delays which have often practically defeated the main object of this legislation,