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Section X. —H.M. Dockyard and Naval Base. 39. Progress continues to be made with reconstruction works. 40. The naval sick-quarters were previously very inadequate, and new sick-quarters are now being erected. The clearing of the site was commenced early in August, and the building itself is now well advanced. Gunnery instruction huts and a 10-ton dock-side crane were completed during the year. 41. The erection of the naval barracks is progressing, and the first building is now being roofed and the walls made ready for plastering. The site for the second building is being prepared. Clothing and victualling stores have been arranged to accommodate accountant staff and large quantities of stores. The foundations for a welder's shop have been laid down. 42. Hot and cold water systems have been installed and wash-places are in use for workmen at the dockyard. An area beyond No. 3 oil-fuel tank is being reclaimed. 43. Apart from the work carried out on ships of the New Zealand Squadron, work was also carried out on H.M.S. "Hector." R.C.S. " Viti," owned by the Fijian Government, has undergone an extensive refit. 44. The increased activities of H.M. dockyard have been reflected in the volume of work of the Naval Store Department, and a large proportion of the work of the Department is the supply of stores and materials for dockyard work on H.M. ships. 45. Despite shipping difficulties, large consignments of stores have been received and are arriving regularly. The stores which are arriving are those for which orders were placed in New Zealand about six months before the outbreak of war, when every effort was being made to provide adequate reserves of stocks. Section XI. —Naval Armament Depot. 46. During the year the usual testing, receipt, and reissue of ammunition for H.M. ships and services has been continued. It has been found necessary to increase storage accommodation at the Naval Armament Depot, Kauri Point, by the addition of a shell store and magazine, which was completed in March, 1941. 4-7. No difficulty has been experienced in dealing with increased naval and auxiliary service requirements in regard to work or supplies under war conditions. In addition, it has been found possible to provide ordnance stores and ammunition for military defence from reserve stocks. Section Xll.—Drills, Exercises, and Training Afloat. 48. Whenever possible exercises have been arranged with the Royal Australian Navy and units of the Royal Navy, and these have been of considerable value to ships of the New Zealand Naval Forces. Section XIII. —Visits prom Foreign Warships. 49. One foreign warship which arrived in New Zealand in March, 1940, sailed from Auckland during April, 1940. 50. The American cruisers " Brooklyn " and " Savannah " and four destroyers, " Case," " Shaw," " Cummings," and " Tucker," arrived in Auckland on 17th March, 1941, for a visit of three days. Opportunity was taken to extend a welcome to these ships in view of the cordial relationship which exists between Great Britain and the Dominions and the United States of America. Section XIV. —War Activities. Examination and Naval Control Services. 51. The Naval Control Service has continued in operation at the three defended ports of Wellington, Auckland, and Lyttelton. 52. The port war signal stations are manned by men of the Royal Naval Volunteer Reserve, and buildings have been erected to provide comfortable living-conditions. 53. The examination vessel at Wellington underwent a long refit of three months, the principal item being extensive repairs to the boiler, which it was originally intended to renew. The motorvessel " Gale " was chartered as "a temporary relief. 54. The examination service at Auckland has been regularly maintained, and, in addition, patrols of the approaches to the port have been maintained. Defensive Equipment of Merchant Ships. 55. In order that ships may defend themselves when attacked by the enemy they have been fitted with defensive equipment. This work includes fitting new equipment, repairs, and maintenance. Instruction of Personnel of Mercantile Marine. 56. Instruction in gunnery, depth charges, and signalling is carried out by the Naval Control Service on board defensively-equipped merchant ships. Although the members of the ships' companies are occupied with ships' duties when in port, it is satisfactory to note that they devote as much time as possible to instructional work. 57. Masters and officers are instructed in the use of confidential books and on coding and decoding, with particular reference to enemy reports, distress signals, artd reporting suspicious vessels. W. E. Parry, Commodore, Chief of the Naval Staff.

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