No. 10.
H. T. Clarke, Esq., to the Hon. Colonial. Secretary,

Sir,—

I have the honour to transmit for your information and consideration copies of correspondence between His Honor the Superintendent of this Province, and myself, respecting the proposed course to be adopted with regard to the apportionment of the purchase money for Stewart's Island,

You will see from the proposition I have recommended for adoption that although in spirit the same, I have in some measure departed from the course indicated by the late Colonial Secretary (Mr. Domett), in his letter of instructions to Mr. Heale.

That you may have the whole matter before you at once, I will copy the paragraph contained in the letter of instructions to which I refer. Mr. Domett says:—

"You are to offer as purchase money for the land, a certain sum, to be paid at once, and a certain proportion not exceeding one-third of the proceeds of future sales or leases of Crown lands in the Island, on the understanding (to be explained to the sellers), that of the one-third so received, two-thirds will be spent for the benefit of the Ngaitahu tribe by trustees, to be appointed by the Governor, and the remaining third to be distributed annually to Topi, Paitu, and the heirs of Tuhawaiki, &c."

I respectfully submit that the system of making payments out of the proceeds of land sales is inconvenient, and has never been found to work well in other places where it has been tried. This would be especially the case with regard to Stewart's Island. The Provincial Government may find themselves trammelled in their mode of dealing with those lands, and it may become the source of frequent disputes and complications. On the other hand I know from my knowledge of the Natives, that eventually misunderstanding and dissatisfaction would inevitably arise. For this reason I have recommended the apportionment No. 2. There can be no room for misunderstanding or misconception when the Natives know that they will receive a certain annual sum.

You will see, from the Superintendent's letter, that he agrees in the main with these propositions, but suggests a modification in the manner in which apportionment No. 2 is to be dealt with, viz., "that it should be invested in Provincial securities, debentures bearing 6 per cent, interest.

With regard to this, I would beg to state that the sum accruing from the £2000, bearing 8 per cent., is, I consider, quite little enough. The only modification I could recommend would be to expend the sum of £2000 in the purchase of land in Southland as reserves for the purpose named in No. 2, and for the General Government to pay the 8 per cent., making it a first charge upon the estate when available.

With respect to the half-castes resident in Stewart's Island, it is possible (should you approve) that I may be able to induce the Natives to make a reserve exclusively for them, apart from any benefit they may receive, in common with the Natives, from reserves for educational and other purposes.

I regret to say that the Natives in this Province are gradually on the decrease. Taking five "kaikas" as an average since 1851, I find that nearly one-half of the males, and a little more than one-third of the females are dead. In the event of such a calamity as the entire disappearance of the aboriginal race, there can be no reason why the half-castes should not have the benefit of the estates under the second and third head.

Would you be good enough to take this subject into early consideration, and advise me as to the course I shall pursue. The Natives will be quite ready in a month or five weeks from this date, and as they have to assemble from distant places, I should not like to detain them.