D.—l

V

Pokeno-Paeroa Railway and extension of the East Coast Railway beyond Taneatua : In view of the investigation to which reference has just been made, I have not deemed it advisable to place any sum on the estimates in respect to these two projects. I wish to state, however, that it is my intention to submit these two proposals, which have been represented to the Department by honourable members representing the respective districts, to the Committee for its consideration. Surveys have been made in connection with the Pokeno-Paeroa project in accordance with the undertaking to that effect given last year. This information will also be available to the Select Committee. The growing expenditure as far as arterial roads are concerned, the ever-increasing mileage of permanent construction laid down, has to some extent operated disin regard to the backblocks settler. A moment's thought will show that the full use of the main roads is not reached until a reasonably adequate measure of assistance is given to those who are developing the out-lying areas and who in many cases have had to put up with little more than bullock-tracks as their means of communication. The question of assistance to the backblocks settlers in the way of improved road access which was the subject of special mention by my predecessor in his Public Works Statement of last year, has had my sympathetic support, and arrangements have been made this year for the vote providing for access to outlying districts to be materially increased. The large expenditure on the development of hydro-electric-power works which was being incurred by the Department caused me to carefully review the position under that heading, and the result of my investigations is that I consider the Government in endeavouring to keep up with the demand for bulk supply of electrical energy is adopting a sound policy. The investigations I have made into the financial aspect of the main systems of supply at present operating give gratifying results, as the following statement of the position and the accompanying graph will show.

HYDRO-ELECTRIC OPERATIONS, 1929-30.

Percentage earned on Operating Capital after paying Net Operating Expenses.

From the above graph it will be seen that the complete system indicates a general improving position until 1924-25. This is, in the main, due to the fact that the two schemes then operating, Horahora and Lake Coleridge, were largely

Average Operating Capital. Gross Revenue. Workingexpenses. Percentage of at i t> ci Net Profit to Net Profits. n ,. Operating Capital. Horahora-Arapuni Mangahao-Waikaremoana Lake Coleridge £ 2,649,085 3,351,711 1,517,803 £ 225,683 259,461 196,648 £ 62,571 59,235 36,808 £ 163,112 200,226 159.840 6-15 5-97 10-53 Total 7,518,599 681,792 158,614 523,178 6-96