A.—3b.

8

that he had no doubt that Her Majesty's Government would approve almost any form of confederation which the Governments of the assembled colonies might unitedly propose. IV. The discussion then passed to the subject of the unoccupied Australasian Islands: the danger to which they were exposed of foreign annexation, menacing for military reasons, or obnoxious on account of convict settlement. Sir Francis Dillon Bell urged, with great force and complete knowledge of the subject, the imminent and odious danger which the colonies incurred from the obvious determination with which the French transportation scheme was being pressed through the Chambers. Upon this point, Lord Derby, while .promising that further remonstrances should be addressed to the French Government, through the Foreign Office, expressed his own doubt whether the perils resulting from the measure were so great as were contemplated by Sir Francis Bell, his Lordship's view being, that the convicts would be kept under surveillance, and were not likely, therefore, to become such a nuisance and danger to the colonies as we apprehended. Mr. Archer, at this point, interposed the pertinent observation that, within a comparatively brief period of time, his Government had returned to the Government of New Caledonia no less than fifty-five escapees, and that, in the last notorious case, the Administration of the French island had absolutely refused to apply for the extradition of three dangerous criminals, who were therefore obliged to be set at large in the colony. V. This naturally led to a discussion of the question of New Guinea. Having in mind the letter addressed to the Administrator of Queensland last summer, in which Lord Derby referred to the cost of annexing that island, we pressed him to state whether, in the event of the colonies agreeing to share the charge of such an operation, in regard not merely to New Guinea, but to other islands, he would be prepared to assent. But he declined to give any positive answer. Pressed by me to state whether, even as regards NeT Guinea, on the colonies agreeing to contribute, say, £10,000 annually (which I had reason to believe was the estimated charge), he would then agree to declare even New Guinea under protectorate, he still declined to give any certain assurance. At the same time, he admitted that the question of New Guinea was by far the most pressing, and claimed that Her Majesty's Government had, by action taken in the course of this year, effectually warned Foreign Powers against attempting to occupy the island. VI. As to the New Hebrides, he stated that Her Majesty's Government adhered to the agreement made with the French Government in 1878, and renewed this year, that the independence of those islands should be respected by both Powers; but added that the agreement in no way contemplated such complications as might arise in connection with the French transportation scheme. As to the other islands, he declined to pledge himself beforehand in anyway, adhering, in fact, to the line already taken in Mr. Bramston's letter, in reply to mine of the sth ultimo. VII. In compliance with the request of the other Agents-General, I prepared, and forwarded to you the account of the interview contained in my telegraphic despatch, of which I enclose a copy. I have, &c. The Hon. the Premier, Melbourne. Eobt. Mubbay Smith.

See A.-3, p. 89, No. 21.

Authority : Geobqb Didsbubt, Government Printer, Wellington.—lBB4.