'We cured last season the fish from ten smacks fishing at Faroe, Iceland, etc., and five smaller vessels prosecuting the fishing in the neighbourhood of our own and the Orkney Islands. There are other owners interested in some of these vessels, but we engaged the crews on shares; and at the end of the season, when the value of the fish was realized, we accounted with owners and men for their proportions. The gross value will be about . . . £4600 0 0 The cost of bait, salt-curing, etc., . . £650 0 0 The cost of biscuit, coals on owners' account, 250 0 0 Proportion paid crew individually, . . 2200 0 0 Proportion paid owners, 1500 0 0 £4600 0 0

'The fishermen's proportion is paid to each of them in cash, under deduction of any provisions and articles of clothing for themselves, and provisions, etc., supplied to their families during the season, so far as they have supplied themselves from us; but they are under no obligation to take such advance from us and can, if they choose buy their articles from any shopkeeper, either for cash (which many of them have spare) or on credit. A few of the men can do without advances, having spare money; but the fishing could not be carried on if we were not to supply them, especially as regards the lads in their first and second year.

'In years when the fishing is not remunerative merchants making those advances lose heavily in bad debts.

'I have gone carefully over the accounts with the crews of two smacks, and produce an abstract of the men's accounts, which shows that, as respects one of them in 1870, we accounted to them for £427,19s. 2d., of which they had from us for lines, hooks, and provisions on board, £71, 7s. 9d.; clothing, and supplies of meal, etc., to their families, £114, 14s. 5d.; and in cash, £239, 17s. The other crew, in 1870, had, in lines, hooks, and provisions, £81, 7s. 11d.; goods, £129, 0s. 8d.; and in cash, £374, 13s. 6d. The same crew, in 1871, in lines, provisions, etc., £63, 3s. 4d.; goods, £67, 7s.; cash, £198, 9s. 7d. Looking at the last two years as regards our fishermen in smacks, it appears they have had considerably more than half their gross shares paid them in cash.

'We would, as merchants, greatly prefer a cash system, payment being made upon the fish being delivered, the same as we do to English smacks fishing for us at it contract price-and we derive about one-third of our cure from this source. But I believe were such a mode attempted it would lead to fixed wages, and would end in loss to both men and owners, and a great falling off in this branch of the fishery.

'BOATS.-About one-fourth of our cure last year was from open boats-six-oared boats at far haaf, and four-oared boats at home haaf. About 63 tons of these are from crews who cure their own fish, and deliver at one time, at the end of the curing season. The remaining 71 tons are delivered fresh every day, as landed at our stations. Those who cure their own fish, whether they have advances of salt, meal, etc., from us or not, are at perfect liberty to treat with and sell to any merchant they can get the best price from when their fish are ready. Their boats and gear are all their own. The understanding about those delivered fresh is, that we pay not less than the current rate of the country. These men, as well as the others, own their boats and gear. The peculiarities of their situation make this mode of delivering in a fresh state a necessity. At two of the stations we receive from in that way; and we prefer it, although the fish should [Page 303] cost us higher than those cured by the men themselves, as we can make a much better article, having skilled men and better appliances. To show that our boat fishers do see more than a pound at settlement, I take the liberty to hand you herewith an abstract of my settlement last and previous month with the men at two stations in Walls, by which it appears that 36 men employed at far haaf, and 34 men at home haaf, had value in fish, £829, 19s. 1d. Our supplies in boats, lines, salt, meal, and other goods, was £29, 0s. 81/2d.; and I paid them in cash £600, 18s. 41/2d. I have not access to some of the station books; but, from an abstract of my last year's settlement at one of these stations, there was placed to credit of the men for fish, work, curing, etc., £655, 0s. 6d., which was thus disposed of: '1st. To account of arrears of advances of meal, etc., from previous years, £71 12 7 '2d. Fishing material, meal, goods, and cash from storekeeper during year, 270 7 2 '3d. Cash at settlement, 313 0 9

'It is not always so; this same island for three years, 1867-69, suffered severely from the crops being blasted, and the fishing of 1868 proving a failure (each fisherman's earnings for the whole year only amounting to about £3). We supplied them with meal during these years, at the end of which they were due us £228, 19s. 9d., besides some arrears of rent to Dr. Scott. All this is now cleared off, unless some three or four individuals; and the more provident have a good few pounds saved.

'In settling with our men, the whole crew, both as respects smacks and boats, are brought in together, and the statement of the division is gone over carefully. Afterwards each man comes separately, and every item of his account read over, or if a pass-book is kept (which is very common) it is made up. Copies of the account are given in every case when desired. I think our men are perfectly satisfied with the present system.

'The tenants on the Melby estate are perfectly free to earn their living as they choose; and it is the same as regards Mr. Umphray's tenants (who number 75) and my own. On going over the roll of Mr. Umphray's tenants, I observe there are only 17 fishing to my firm (some of them only part of the season), and of my tenants only 4.

'It is the exception, not the rule, for our fishermen to be in debt to us. Of the 70 men representing the sixteen crews of which I have given particulars, all had money to get, with the exception of six, who are due us balances to the amount of £33, 2s.