7. I have not failed to give the utmost support in my power--a support unfortunately much needed in a colony like this--to the Chief Justice, and it has been a great gratification to me that, on my recommendation, the long and valuable services of Sir Archibald Paull Burt have been recognized by her Majesty, and that he has received the honour of knighthood--a rank which none of her Majesty's servants will more fitly adorn. I have suggested to the Legislature that a small increase of salary should be given to uphold the dignity of the Supreme Court; and the question, to which I have already drawn the attention of the Legislature, of the appointment of two Puisne Judges and constitution of a Court of Appeal ought to be taken into consideration at no distant period. One new resident magistracy has been established in a district where it was very much needed, and two Local Courts have been constituted. There is some difficulty in finding a sufficiency of fit persons for the commission of the peace who are willing to exert themselves, and the pay of the resident magistrates is in too many cases insufficient to enable them properly to support their position as representatives of the Government in their districts. 8. In the Military Department I have enabled successive commandments to make reductions in the enrolled Pensioner Force. By withdrawing the guard from Rottnest Island, and by concurring in the reductions at out-stations, a very considerable saving has thus been effected. I have given all the encouragement in my power to the Volunteer movement, and I may confidently state that the Volunteer Force was never before in so good a state, either so far as regards numbers or efficiency. To this result the efforts of successive commandants and liberality of the Legislature have mainly contributed. 9. It has been for me to preside over the latter stages of the existence of the Imperial convict establishment in Western Australia, as a large and important department; henceforth it will be confined in narrow limits, and I may state with confidence that the great reductions and concentrations that it has been my duty to effect have not been attended with those disastrous effects to the colony that were so confidently predicted, and also that although the residue of convicts are, many of them, men of the doubly reconvicted class and long-sentence men, discipline is well kept, serious prison offences are rare, the health of the men is excellent, whilst severe punishments are seldom needful. I here beg leave to make favourable mention of Mr. W.R. Fauntleroy, Acting Comptroller-General of Convicts, who has proved himself to be my most valuable officer.