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and Mr. C>>nyers was so far satisfied with them as to recommend obtaining six more. This is a sufficient eviil.-n.-e that those imported to New Zealand were found to answer the purposes for which they were required, and to show that their merits are appreciated. It is, however, desirable that unqualified statements of the universal efficiency and superiority of American-built locomotives should not be circulated without comment, as they arc apt to mislead. The class of locomotives required orr a line will always have to bo determined by the features of the line, the kind of traffic, and the rate of speed demanded. The Engineer in Charge, North Island. J. P. Maxwell.

No. 3. Tho Agent-General, London, to the Hon. the Colonial Secretary, Wellington. Sir, — 7, Westminster Chambers, London, S.W., 10th December, 1878. I have the honor to enclose herewith copy of a correspondence between Messrs. Hemans, Falkiner, and Tancred, the Government Engineers, and Messrs. Neilson and Co., of Glasgow, and the Vulcan Foundry Company, which has ariseir owing to the attention of the contractors being called to the remarks contained in the Appendix attached to the Public Works Statement of this year, relative to the comparative merits of American and English locomotives. I have, &c, Julius Vogel, The Hon. the Colonial Secretary. Agent-General.

Enclosure 1 in No. 3. Copy of Memorandum sent out by Messrs. Hemans, Falkiner, and Tancred. Gentlemen, — November 25th, 1878. As you have from time to time supplied locomotives for the New Zealand railways, we beg to direct your attention to the following paragraph which appears in the report of the Commissioner of Eailways, addressed to the Minister for Public Works under date July 24th, 1878. With regard to the American engines the Locomotive Engineer reports, — " They have now proved.themselves to be both good arrd economical, and for attention to detail in design aud general excellence in workmanship they stand out first in our catalogue of locomotives. American engines I thoroughly believe to be more suited for our Hues than anything we can get built in England."

Enclosure 2 in -No. 8. Messrs. Neilson and Co. to Messrs. Hemans, Falkinkr, and Tancred. Dear Sirs, — Hyde Park Locomotive Works, Glasgow, 27th November, 1878. We are in receipt of your esteemed letter of 25th instant. We are neither prepared to admit nor deny the statement made regarding the merits of the American locomotives. We are, of course, quite ignorant of the design and details of the engines in question, arrd therefore cannot form arr estimate of wherein they differ in these respects from the engines built by ourselves, and others for the New Zealand railways. The ordinary American type of engine, such as is in use in America, is, we have not the slightest doubt, better adapted for railways as now constructed than the engine used in this country. It is more flexible, and adapts itself better to the line than our excessively rigid engines. It has also the advantage of being less costly, though, we quite believe, equally efficient in its details, by reason of these being of simpler construction and frequently of cheaper materials. We need not tell you that, although holding these views, it would be needless our attempting to persuade our locomotive superintendent to adopt even a modification of the American type, as you will be well aware of the vast amount of prejudice that would have to be overcome. While admitting that the American type of locomotive may have some advantages over those of this country, we must be allowed to protest against the assumption that they can only be made in America. This is a great mistake. We have ourselves been irr competition with American firms for the supply of engines of the American type to an American railway, and secured the contract, notwithstanding that our cost for delivery on the rails was necessarily so much higher than that of our competitors. We enclose photograph of this engine, No. 346. Quite recently engines of our own design were accepted for a colonial railway in preference to American-made engines of American type; price having been an important consideration. We enclose photograph No. 484 of engines recently constructed by us for South America, where American makers compete with us. Tou will observe that it is an engine of a modified American type. r,~ J"We are prepared to make engines to any drawing and specification that may be submitted to us, and to enter into competition for the supply of the same with any American makers ; and we undertake that our engines will give equal satisfaction, both as regards design of details and general excellence of workmanship with, and will prove quite as economical as, those made in America. 2—E. 4.