E.—No. 1

" Enquiries have been made of the Board of the AVest India Royal Mail Company as to whether their arrangements could not be reversed, so as to make the direct vessel for St. Thomas leave Colon on the Bth instead of the 23rd, but they stated most emphatically that this could not possibly be done. " The Board conclude that whatever alterations may be made as regards the dates of sail in"from Sydney end New Zealand, the date of the departures from Panama may be considered as finally settled, but making it the 24th instead of the 25th, as the AA'est India Royal Mail Company's steamers will arrive at Colon a day earlier. We shall therefore book passengers and cargo per the Royal Mail Company's vessel leaving Southampton on the 2nd of June, and thus the first departure from Panama will be the 24th idem, by one of our new ships, which will be ready to leave London about the end of March for Panama. " You will at once see that this is the best arrangement that could be made, and the dates correspond with those proposed by you to the Government. "It is to be regretted that the Government did not agree to the dates submitted, but the Directors have little doubt that when you have explained all the circumstances, they will at once see the desirability of altering the dates of departure from Sydney from the Ist or 2nd to the 16th. The date fixed for the outward passage from Panama will do very well but it will probably be one day earlier. " As the matter is one of considerable importance no time should be lost in again communicating with the Government on the subject, and the Directors will be obliged if you will send a telegram by the earliest opportunity in order that they may know as soon as possible the final decision of the Postmaster-General on this point." Immediately upon the receipt of the foregoing advices (which on account of the mail being late we did not receive till after the departure of the steamers with the mails for Auckland and Nelson or I would have communicated with you further by that opportunity), I waited upon the Postmaster-General and Colonial Secretary of this Colony and put before them the information contained therein, requesting approval of dates if possible in time for outgoing mail; I enclose copies of replies. The General Manager desires me to say that the non-receipt of Time Table for this very important line, our portion of which has to work in conjunction with that of another Company, places the Directors in a perplexing position ; while they have been on their part making every effort to prepare for its prompt commencement, they are at a loss to comprehend why the details are not agreed upon by the New Zealand Government, who must be aware that the time is going on, as already referred to in Capt. Hall's letters. As mentioned in my letter of February 14th, we had communications and interviews with the members of the late ministry of this Colony, but nothing definite was arranged. AYe supposed that they would communicate with the Government of New Zealand, as of course we had nothing to do with them as principals. AYe felt very much embarrassed at not being able to send to the Directors either Time Table, Contract, nor directions consequent on same for placing the ships. Capt. Hall more than once, when in New Zealand, applied for these, and by every mail from England the Secretary expresses much surprise at not receiving instructions ; the only information we have been able to send, being that the Panama Service was generally agreed to, and speed decided upon ; and this most important point one of the first essentials for the satisfactory working of the service only settled in time for intelligence to reach London in October or November last. The unsettled state of the Government of this Colony prevented our taking any further action, and of course we had no power to urge them or claim to their notice, as our contract was with the New Zealand Government only. I exceedingly regret that Captain Hall is detained in Hobarton by indisposition, and therefore unable to communicate with you direct, or come across to New Zealand ; however, I will be down soon. Capt. Hall further desires me to say that his suggested dates as in former letter, are the only ones that the Company have any cognizance of or guide as to commencement, and therefore have as stated adopted them pro. tern. I have, Ac, The Hon. the Colonial Secretary,. H. Lawson, New Zealand. Sub-Manager. Enclosure 1 in No. 15. Copy of a Letter from Mr. Halloean to Mr. Lawson. Colonial Secretary's Office, Sydney, 22nd February, 1866. Sib, — I am directed by the Colonial Secretary to acknowledge your letter of the 20th instant, with enclosure, supplying information as requested by this Government, relating to the class, character, and passenger capacity, of the steam ships to be employed in the mail service between Syd-

9

THE PANAMA MAIL SERVICE.