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EDUCATION. Owing to the limited funds available for the erection of school buildings, additions, and teachers' residences, and the purchase of sites, only the most urgent proposals could receive consideration during the year. The net expenditure out of the Public Works Fund for the financial year ended 31st March, 1934, was £52,239, compared with £52,623 for the previous financial year. During the period under review the sum of £5,221 was provided out of the Consolidated Fund to cover the cost of works under £200. During the same period the sum of £5,121 was spent on the restoration of schools destroyed or damaged by fire ; of this amount the sum of £3,846 was recovered from the Government Fire Insurance Fund. The following table shows for the last three years the amount expended out of the Public Works Fund on new buildings, additions, sites, and teachers' residences : — 1931-32. 1932-33. 1933-34. £ £ £ Public schools .. .. .. ..126,778 33,631 53,656 Secondary schools .. .. .. 65,030 21,754 2,030 Technical schools .. .. .. 44,507 3,584 1,197 Training colleges .. .. .. .. 1,228 Universities Native schools .. .. .. .. 14,433 704 2,330 Schools for mentally backward . . . . 199 Child-welfare institutions .. .. .. 714 Kindergartens .. .. .. .. 54 Massey Agricultural College .. .. 9,622 Canterbury Agricultural College Gross total .. .. ..262,565 59,673 59,213 Less credits-in-aid .. .. 3,417 7,050 6,974 £259,148 £52,623 £52,239 TOURIST AND HEALTH RESORTS. The net capital expenditure amounted to £13,510, as against £14,445 for the previous year. The principal works undertaken were the installation of hydro-electric scheme at the Chateau, Tongariro, and the reconstruction of the Blue Bath at Rotorua. During the current year it is proposed to complete the last-mentioned work and to carry out improvements to the Rotorua water-supply and drainage system, and the water-supply for the Hostel at Milford Sound. TELEGRAPH EXTENSION. The expenditure for telegraph extension by the Post and Telegraph Department for the financial year in respect of telephone, telegraph, and wireless facilities throughout the Dominion amounted to £144,159, as against £99,999 for the year ended the 31st March, 1933. Although the amount available for extension purposes was higher than that in the previous year, it was still such as to necessitate the keeping of expenditure as low as possible. Consequently, the programme of works undertaken during the year comprised only those works which were necessary for the proper carrying-on of the Department's services. In respect of the toll and telegraph services, the works carried out consisted mainly of general reconstruction of existing assets, including the rearrangement of circuits to provide improved toll facilities, and, in a few essential cases, the erection of new lines. The most important addition was a toll outlet between Wellington and Auckland, which was provided by the installation of a singlechannel carrier system operated over a route via Wanganui, New Plymouth, and Hamilton. The downward trend in the number of telephone exchange subscribers has been checked in that the relinquishments of telephones for the year have exceeded the new connections by only 775, or 0-6 per cent., of the paying main stations in use at the beginning of the year, as against 5,370, or 4-3 per cent., for the previous year. A pleasing feature is that the past six months have all shown gains in telephoneexchange subscribers. No important additions have been made to telephoneexchange plant during the year, but attention has been paid to the reconstruction and improvement of the existing plant, so that, when the time comes, the subscribers

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