On the financial respect Sir Robert holds similar views to those of Sir Harry, Atkinson and Mr Ballance, and suggests that theonly condition of finance under which we could accept federation would be the fede ralising of the public debts, and confining of the federal taxing power (outside of Customs and Excise) strictly to the emergency of a time of war. Sir Robert appreciates more fully than either Sir H. Atkinson or Mr Ballance, with their North Island experience, the gain that Federation would be to us. "It would be immense, parti cularly to Otago, Southland and Canterbury. Auckland would receive benefit, but the central districts of Hawke'sßay, Wellington, Mai-lborougli and Westland would not be much affected. The gain through the other, districts would, be not less than £500,000 a year, arif} a§ tjrne rplletj. pn, this would be much increased, Our cereals, ' i nfcx r, dairy products and woollen goods would compete success fully with all that Australia could produce. Colonial freetrade would give these industries an enormous impetus. That is the strongest argu ment for federation, but the benefit would be dearly purchased by accept ance of the present Bill, because the finance it would impose upon us would paralyse all out industries, both agri cultural and manufacturing." Sir; Robert recognises the very different conditions of ihe two Islands of New Zealand, which he thinks are so cliverse that we should require to form New Zealand into two States, North and South New Zaaland. This would give us sixteen member* of the Senate, instead of eight. It would not be un fair to Australia—*(l) Because Tas mania, Queensland and South Australia each have eight members, and their populations are each less than that of the Middle Island; (2) the number of our members m the Lower House would not be increased. Indeed he thinks the old Provincial system of one House w.ould be reverted to, as the work of our Parliament would be simply muni cipal and the direction of public works. If the greater part of the public debt were federalised, our Railway Depart ment alone being left to us, then we »h.0u14 not require any taxation beyond our railway revenue and ouu air opt taxation, such as stamps. Property tax, or Land tax to carry on our govern ment of the two islands. 