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Inland Mail Services. There were but few alterations during the year, and those carried into effect were mainly the result of railway extension. The services, as a whole, were performed with more than usual regularity, the interruptions and delays being fewer than in former years. The following gives the particulars of the inland mail services for the year 1880: — Performed by coach and mail-cart, 108 „ on horseback ... 217 „ on foot 58 „ by water .. .. .. 40 „ by railway .. .. 51 474 Aggregate mileage 7,485s Total number of miles travelled ... .. 2,631,568 Cost to the department ... £35,062 Is. Id. Average cost per mile .. .. .. 3Jd. The total cost in 1879 was £33,719 lis. Id., and the cost per mile 3fd. The contracts for the majority of the inland services expired on the 31st December last. Prior to calling for fresh tenders, the several schedules were carefully examined with the view of ascertaining what saving could be effected, as a substantial reduction in cost was believed to be practicable without seriously curtailing the public facilities. Accordingly, amended schedules were prepared and advertised. The result of the tenders (which, in most cases, have been accepted for two years), is a net saving of £8,256 Is. Bd. per annum. The tenders generally were lower than in former years, a circum» stance which must be attributed to the cheapness of labour and the unusually low price of horse-feed. Mail Steam Services. The negotiations undertaken by the Agent of this department at San Francisco, with the view of obtaining a reduction in the charges for the conveyance of the colonial closed mails between San Francisco and New York,'have terminated most satisfactorily The United States Congress has voted a sum of 40,000 dollars for direct payment to the colonies, in lieu of a former authority empowering the Postmaster-Genera] of Washington "to remit in favour of the Colonies of New Zealand and New South Wales so much of the cost of the overland transportation of the Australian closed mails as he may deem just." This latter decision was accompanied with the condition that, in the event of any reduction being made, the colonies should undertake to renew the San Francisco service after the expiration of the existing contract, which terminates in October, 1883. There was also a doubt in the minds of the United States authorities as to the extent to which the colonies would benefit from any such reduction, seeing that the charges were paid to the United States Post Office by the Imperial Post Office, and not by the colonies. This uncertainty probably led the Congress to authorize the direct payment; and at the same time it was decided not to require any stipulation for the continuance of the service. Indeed, the Postmaster-General of the United States had been informed by this department that, while the colony had no desire to abandon the San Francisco service, it was not possible to give any assurance that the service would be renewed on the termination, of the present contract. There is reason to hope that a sum will annually be appropriated by Congress for payment to the colonies in respect of the service ; and at the proper time suitable representations will be made to the United States Post Office for a continuance of payment in aid of the line. The service is of especial value to the United States in the interests of its commerce, inasmuch as it materially fosters the very large trade already established with the colonies. The extent of the American trade with the colonies may be gathered from the fact that in 1880 the value of the exports from the United States to Australia and New Zealand amounted to eight million dollars (£1,600,000). Great praise is due Mr. Creighton for the able manner he has urged the claims of the colonies, and to his intelligent and persistent advocacy is mainly to be attributed the result already chronicled. The acknowledgments of the department are especially due to the Hon. Mr. Horace Davis, who has taken a warm interest in the service and the colonies, and materially assisted Mr. Creighton. The San Francisco service continues to be performed with punctuality, as may be seen by a reference to Table No. 7 The contractors have been eager to accelerate the transit of the mails, not only by their own vessels, but also across the American Continent. The department is again indebted to the United States Post Office officials and railway authorities for facilitating the despatch of the colonial mails. On the homeward voyage the mails have, with one exception, been delivered within the stipulated time. The average time within which the mails were delivered in London from Auckland was 40'33 days ; the shortest transit was 38 days. On the outward voyage equally good time has been observed. London mails were delivered in Auckland, on the average, in 40'08 days; and the shortest delivery was accomplished in 38 days. There were slight delays in transit owing to prolonged passages made by the Atlantic steamers ; but there was no detention from snow-blockades on the railway route across America worthy of mention. The City of New York, which left Auckland on the Ist March last, for San Francisco, met with a serious accident. Her after crank-pin broke, at 3 p.m. on the fifth day from Auckland. The repairs, which were not completed until the 17th, occupied eleven days seventeen hours, and were made under disadvantages inseparable from the situation. Very great praise is due to the commander and his officers for having effected repairs of such a substantial character, which enabled the vessel to prose-,