The Timaru Herald FRIDAY, MAY 31, 1907. COLONIAL MAILS.

Timaru Herald, Volume XC, Issue 13300, 31 May 1907, Page 4

The Timaru Herald FRIDAY, MAY 31, 1907. COLONIAL MAILS.

It is nearly a year .since- tha Australian, public were given to understand that the -Federal Government' had entered ' into a contract with a powerful English syndicate for the provision of a speedy line of mail steamers to replace the service whose agreement will terminate next January. Yefc eleven months after the new contract was supposed to have been let, and with only seven or eight months .to go before the old arrangement with the Orient, and P. and 0. .Companies will come to an end, the', representatives" of the 'syndicate are still looking for the money to finance the scheme "and asking the different States to back their bills for tliem. The real position, according t.o the "Argus," is that the Government did not lot a mail contract at, all, but simply sold for £25,000 (which is not yet paid) an option to a syndicate of shipbuilders to form, if they could, a company to ■■carry out a contract. The purpose of the syndicate apparently was to form a sort of tied company which, ishould be bound to procure the '-steamers* necessary for the performance of the contract at its" disposal, from the shipbuilding firms composing the syndicate which negotiated with the Federal Government. The difficulties in the way of forming the desired company have obviously been insuperable, and the syndicate is laying the blame oh the " formidable ■ and relentless opposition of the shipping companies opposed to the new mailscheme." Nobody would expect that the existing lines would welcome the advent of the rival on whose behalf Mr rotter is making a rattier melodramatic appeal to colonial prejudices, but there has been ample time,, since the negotiations were commenced 'last July, ior- the investing public to institute its own, investigations into the soundness of the scheme, and it goes without saying that if the venture had had any attractions for the capitalist, the opposition of competing steamship lines would not have killed the prospects of the proposed company. There seems every reason, however, to suppose that the promoters never relied upon the necessary funds coming entirely from the public; they looked to the Commonwealth Government for support, but they looked in vain. Mr Beardmore, one of the shipbuilders who was induced to join the syndicate, said that he had done so on the distinct understanding that the Federal Government would give the new concern substantial, support, and when he found there was no hope of that, be retired from the syndicate. Tlie remaining members then sent emissaries to Australia with the object of securing State assistance, and _ prevailed upon the Victorian Premier to offer a guarantee of the interest on a portion of the debentures which it is prop'osed to issue, to the extent of 66 per cent, of the

cost, of the steamers. Mr Bent's colleagues, and the Governments of the'.other States, declined to support him in this offer, bub he ha« repeated in London the offer which was repudiated in Melbourne. The latest proposal from the syndicate was that two or more of the States should guarantee the debenture-holders for ten years an annual payment of £125,000, icpresenting interest and sinking fund, special treatment in the May of refrigerating space on thtt steamers being accorded to thn States which provided the guarantee. Mr Bent has expressed his readiness to fall in with this idea, but it would plainly be impossible for the Federal Government to allow a particular State to acquire special concessions under a Federal contract. The probability, therefore, seems to be that the contract will lapse, and Australia will have to make other arrangements for the transit of its mails. A telegram from Sydney indicates that the Vancouver route will in that case carry the bulk of the mail matter. We have no doubt whatever that a thoroughly (satisfactory service by way of Canada could easily be arranged, and with the San Francisco line out of the way, New Zealand, can be relied upon to assist in the foundation of the service for-which the Federal PostmasterGeneral is suspected of a partiality.