D.—l

Lawrence-Roxburgh. The Big Hill Tunnel was completed in December last, and formation-works for a length of two miles and three-quarters beyond the tunnel are practically finished. It is proposed to put platelaying in hand with a view to opening a section of three miles to Athenaeum Flat for traffic as early as possible. Very little more in the way of construction-work will be required to permit of rails being laid to Beaumont Station, two miles and a half farther on, so that the completion of the line to that point may be looked for at a fairly early date. The expenditure on this line during the last financial year amounted to £17,392, and for the current year a vote of £10,000 is proposed. Catlins -Waimahaka. The terminus of the opened line is still at Houipapa, but rails are laid and the line ballasted up to Caberfeidh Station, 11J miles farther on, to which point a temporary goods and passenger service is in operation for the convenience of settlers. The roads in this district are not good, and a service tramway is laid ahead of construction-works to facilitate the transport of plant and supplies for the men. A bridge to carry the railway over the Maclennan River is being erected under contract, and on its completion will depend the opening of the line to Papatowai Station. Bushfelling and a little formation extending four miles beyond Papatowai are in hand. The expenditure on this line during last financial year amounted to £29,291, and for the current year a vote of £30,000 is proposed. Winton - Heddon Bush. There was no expenditure out of last year's vote for the proposed branch line from Winton to serve the productive agricultural district of which Heddon Bush is a convenient working-centre. There were local differences of opinion as to whether the district could not be more effectively served by a branch from the Riverton line, but the difference has now been settled in favour of the Winton connection, thirteen miles in length, and the vote of £8,000 to commence the construction of this line is renewed on the current year's estimates. Orepuki-Waiau Extension. The question whether the district surrounding Orawia shall be connected by rail with Orepuki or with Waikouro has not yet been decided. Further careful consideration is necessary, and the Engineer-in-Chief will visit the district during the recess and report to me thereon. Total Appropriations for Railway-construction. In addition to the votes already mentioned, an appropriation of £1,000 is required to provide for liabilities on account of the Kawakawa-Grahamtown Railway that did not come to charge against last year's vote ; £1,000 will also be needed for old land claims, damages,, and other similar charges; £5,000 for surveys of new lines ; and £90,000 for permanent-way materials ; thus bringing the total appropriations for railway-construction purposes up to £825,000. Other Rail way-works. During the year under review the sum of £300,059 was spent by the Railway Department on rolling-stock, tarpaulins, pneumatic coaling-cranes, steam heating-gear, workshops machinery, and steamer for Lake Wakatipu. The sum of £164,577 was spent on extension of station-yards, purchase of land, additions to workshops, cranes, bridge-work and subways, fire-prevention services, wharves, gasworks, and extension of signal and interlocking system, tablet installation, telegraph and telephone facilities, duplication of line, reduction in grades, and improvement of curves. A further extension of the duplication of the Dunedin-Mosgiel line was opened during the year, and the work of boring the Chain Hills Tunnel and completing the line from there to Mosgiel is in hand. Bad ground was met -with during the year, and this materially interfered with boring operations. As

ii—P. 1.

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