D-No. 1

15

I should wish to draw your attention to that part of the alteration which contemplates Melbourne becoming the Port of arrival and departure for one of the lines ; instead of Sydney being, as at present, the Port of arrival and departure for both. The Government of New Zealand would be very anxious, in case the Government of Victoria should think it desirable to take advantage of this stipulation, and my object in addressing you is to enquire whether your Government would be willing to contribute a sum equal to the additional expense thereby entailed. I learn from the public papers that the Contract entered into by the Government of Victoria with the owners of the Steamer " Boomerang," for maintaining communication by steam between Melbourne and Wellington, is about to terminate ; and it has occurred to me that you would be disposed to lend your co-operation towards the establishment of a service which would, offer much greater advantages than that about to be broken off, while the expense to your Government would not be greater than that incurred under the Contract with the " Boomerang," which, it is understood involved a payment by the Colony of Victoria of £6000 per annum. The chief advantage of the plan which I am now submitting to you consists in the fact, that the proposed line, instead of connecting Melbourne with only one Port of New Zealand, would bring it into direct communication with all the Ports of the Colony. It is calculated at a rough estimate, that the additional expense entailed upon the Company, by the substitution of Melbourne for Sydney as one of the Ports of arrival and departure, would exceed the proposed additional subsidy by from £1,500 to £2000, owing principally to the higher price charged for coals at Melbourne, as compared with their cost at Sydney, added to the greater distance, and consequently increased consumption of coals upon the Melbourne line. But it appears also that the expenses on account of harbour dues and wharfage, with others incident to a vessel visiting Melbourne, are much higher than at Sydney, and would therefore from another item of increased expense. I do not know whether the Government of Victoria would be in a position to make arrangements for some relief as regards this latter item, by exempting the Steamers employed in this Service from charges of this nature ; but, if this were done, I should suppose the additional subsidy would be sufficient to cover the additional outlay, and the line might then be established permanently. It is the interest, of course, of the Government, as well as that of the Contractors, to make the Service a remunerative one; as, if it does not answer, an interruption would take place, prejudicial to all parties, by the Company exercising their privilege of determining the arrangement, and reverting to Sydney as the only Port, of arrival and departure. The Government of New Zealand, while sensible of the many advantages afforded by the alteration which I have proposed, consider at the same time, that so great an outlay in proportion to the revenue, is already being incurred by the Colony on account of Steam Communication, that they would not feel themselves justified in expending any further sums for this purpose. Should you consider that the advantages of the line which I have proposed, would be sufficiently great to induce you to contribute £6000 per annum, I should be prepared on receiving your assurance to that effect, to advise His Excellency the Governor to establish it at on c, by requiring the Contractors to make Melbourne the Port of arrival and departure for one of the Boats. I have, &c, (Signed) Henry John Tancred. The Honorable The Postmaster-General, &c, &c, &c., Victoria. MR. COLEMAN, TO POSTMASTER GENERAL. Inter-Colonial Royal Mail Steam Packet Company (Limited), Auckland, September 12, 1859. Sir,— Referring to the conversation I had the honor of holding with several Members of the Governmet, with regard to the necessity of providing for the Service of this Colony, a fifth Boat of adequate size and power, and in every way fitted and adapted for the Inter-Colonial Service, with the double object of placing one of the present Inter-Colonial Boats upon the East Coast Service, and of providing to a great extent, a spare Boat to meet casualties ; I have the honor on behalf of the Company to make the following proposals :— Ist. That the Company will provide a fifth Boat of the description hereto annexed, and such Vessel shall leave England for Australia, or New Zealand, within twelve months from the date of the order arriving in England, or not later than Ist January, 1861, provided that the Government assent to the following conditions. 2nd. The estimated cost of such Vessel being not less than £25,000, it is proposed that the Government should assist the Company, by way of providing the necessary Capital, by not demanding repayment of the present Mortgage, or any instalments thereof, for a further period of eighteen months, and all instalments now repaid by the Company to be refunded.