B.—No. 4.

upon the Colony of upwards of £30,000. The annexed tabular statement of the quotations of the new stock will prove that the maximum possible limit had been fixed on. It is unnecessary for me to repeat the statements made in the Beport of the Crown Agents showing the amount of annual saving effected to the Colony, and the amount of sinking fund liberated. When it is considered that the saving of income to the Colony is to a considerable extent a measure of the loss of income to individual bondholders, some of the difficulties which attended the accomplishment of the task may be more exactly comprehended. I would only observe that although the principal debt of the Colony has been increased by £251,450, yet that this increase is purely nominal, inasmuch as the annual burthen is lessened by £28,517, and that, although reduced to that extent, it includes not only interest but a provision for the ultimate extinction of the capital debt. I have created bonds to the value of £4,191,000; and I cannot omit reference to the valuable . services rendered by the gentlemen named in the margin, who, at considerable personal inconvenience, consented to attend in London from time to time, for the purpose of attesting the delivery of the new bonds by me to the Crown Agents for issue, and examining the cancelled bonds. Their several certificates have been from time to time forwarded to you, and the Crown Agents have, in pursuance of my instructions, forwarded to you, per steamship " Great Britain," via Melbourne, eleven cases containing the cancelled bonds themselves. The question arose as to the terms to be offered for conversion of the bonds issued under the loans guaranteed by the Imperial Government. Preliminary inquiries were instituted, as will appear by the enclosed correspondence; but the New Zealand new 5 per cent, stock never attained such a position in ! the market as to induce me to proceed to fix a definite rate for exchange. I shall transmit a summarized statement of my accounts, which will, I hope, present them in a form readily intelligible: while for the full details I may refer you to the general account of the Crown Agents, which will be explained by separate accounts which have been prepared in accordance with my request. The vouchers will accompany the accounts. When you receive these various accounts, I particularly invite your attention to the books A.,8., and C, which are transcripts made by my direction of those kept by the Crown Agents, and show every separate transaction connected with the conversion as it occurred, viz.: — A. Statement of old bonds received for conversion, showing the several Governments to which they respectively belong. B. Statement showing the separate transactions comprised in the conversion scheme. C. Statement of accrued interest and fractional parts paid on bonds converted. Before dismissing the subject of accounts, I take the opportunity of referring to the rate of percentage of charges on the entire operations, which cannot, I submit, be deemed otherwise than extremely moderate. If compared with the rate at which other loans, unencumbered with any scheme of conversion and consolidation, have been put on the market by banks and other agencies, it will be found that a charge of 1 per cent, has been a usual one. And if further compared with the rate of percentage of charges on the conversion of Canada Bonds, which scheme embraced proposals to convert bonds to the extent of about £11,000,000, and is the only operation of a character similar to the present one, it will be found, as I understand, that the rate reached something like 2£ per cent.; whereas, for conducting the entire operations on which I am now reporting, the percentage of charges of all kinds, including printing, my own expenses as special agent, brokerage, commission, guarantee, &c, only amounts to 15s. per centum. Connected with this subject, I have further to draw your attention to the very favourable terms which I made on behalf of the Colony with regard to the charge for the payment of dividends. The minimum charge made by first-class banks for the payment of interest is -| per cent. But this charge only applies to cases where the dividends are payable half-yearly. In the present case, however, not only is the charge one-half the usual one, but it includes double the amount of trouble, inasmuch as the dividends are payable four times instead of twice every year. The time which has been occupied in fulfilling my mission has proved to be much longer than I had myself anticipated ; but many persons better acquainted than myself with the nature of the transactions which I had to conduct, assured me from the first, that twelve months would be required for their completion, and the calculation thus made has proved correct. I had, as you have been already informed, fully prepared to leave by the Panama Mail of the 2nd instant, but to my great disappointment that service suddenly collapsed. I shall therefore necessarily have to furnish a a supplementary report, when I shall have an opportunity of offering such further observations as may become necessary. I have now alluded to the various points which appeared to me specially to require explanation. I need not observe that a sense of high responsibility has been present with me throughout the conduct of these operations. That T should have been able to manage negotiations so delicate, and operations so difficult, as those intrusted to me, in a way which has elicited approval here, both as to manner and matter from those in whose presence they have been conducted, will always be a subject of deep gratification to me. I can only express a hope that the good opinion awarded to me here will receive the indorsement of the Colony. I have the honor to be, Sir, To the Hon. E. W. Stafford, Colonial Secretary, Tour most obedient servant, Wellington, New Zealand. William Fitzhekbeet.

Enclosure No. 14.

E. A. "Weld, Esq., W. S. Grraham.Esq., H. Sewell, Esq.

Enclosures Nos. 15 and 16.

Enclosure No. 1. Memorandum for the Seceetaet of State for the Colonies. Export of Gold. Having regard to the amount of Gold produced in New Zealand, which since its first discovery in these Islands has raised and exported £14,540,573 in value of the precious metal, and to the fact that this 2

5

MR. EITZHERBERT'S MISSION TO ENGLAND.