THE MAIL CONTRACT

New Zealand Times, Volume XXIX, Issue 6218, 25 May 1907, Page 7

THE MAIL CONTRACT

MR BENT S PROPOSAL CONSIDERABLE ANXIETY IN AUSTRALIA. By Xelesranh-Presa Association-Copyright. MELBOURNE, May iU. There is considerable anxiety regarding the Federal mail contract, £6pocially as tho present contract encU in January. It is considered unlikely that the Federal Government will move further in the matter. Ihe subject will probably bo dealt with at the Premiers’ Conference, which will open at Brisbane next week. Tho renewal of tho proposal of Air Bent, Premier of Victoria, that the State Governments should guarantee the Australian section of tho debenture holders £125,000 annually for ten years, is likely to meet with considerable opposition. Mr C'arnithors, Premier of New South Wales, declines to say anything. Mr Kidston (Premier of Queensland) has declared against Mr Bent’s proposal. Tho South Australian, West Australian, and Tasmanian Premiers aro believed to bo rnoro sympathetic. The position in respect of the Australian mail contract is daily becoming more interesting.. It is especially so just now because, in addition to the differences between the Federal Government and the contractors for the service which has to begin in February next, the general question of mail communication between Britain and the Antipodes was brought to a prominent place at the Imperial Conference. Tho contract which is tho subject of the foregoing cablegram was made in 1906 between the- Federal Government and Sir James Laing and Sons, of Sunderland. It is for ton years from February Ist, 1908. The payment is to be ,£125,000 per annum, with possible extra payments up to <£25,000 for acceleration of speed, and penalties for late arrivals at the terminal ports (Adelaide and Brindisi). Sir James Laing and Sons have formed a syndicate (approved by the Commonwealth Government) to take over the contract and build steamers to fulfil it. Tho Federal Government recently, acting under a clause in the agreement to that effect, called upon tho syndicate for a bond of £25,000 (in addition to a deposit of tho same amount made when tho contract was accepted), as an indication that satisfactory progress has not boon made with preparations for beginning tho service on due date. Tho syndicate was given a week in whichto nav tho extra bond. The week expired on Thursday, and the bond is not forthcoming. It would appear now by the' terms of the agreement that the Federal Government has power to cancel the contract. There is.'however, another alternative open. Tho syndicate may bo left alone at present, and punished if it fails in February to commence the service, for the contract provides for a penalty of £SOO for every twenty-four hours (up to £20,000) for such delay. Mr Bent’s proposal, mentioned in this morning’s cable message, is a peculiar one—though it seems to have been suggested by ft request quite as peculiar The underwriters of the syndicate’s debentures recently asked for a guacan tee that the annual suhsidv of £125.000 per anmim would be paid for ten years "■under any circumstances/’ thereby apparently stripping the contract of .oil provisional conditions. To this Mr Bent, the Victorian Premier, who is now in London, replied by saying Victoria would guarantee the whole subsidy if allowed preference in the shrine of n reduction of fares and freights. Sir William Lyne, however, declined to consider the suggestion—saying that it was impossible to consider one State recoiling preference over another. It is rot clear what status the Premiers have in dealing with this matter at the Brisbane Conference.