B.—ll

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competing with three strongest colonies, which will probably come for thrice five millions at three and half between now and January. Now, while these issues are strongly against your attempting three and half, they are favourable to your four per cent. London, 30th.

The Colonial Treasurer to the Loan Agents. Loan Agents, London. Wellington, 7th October, 1884. Unless you act on cable authority new loan powers only reach you December. If only new loan floated would require additional million July. Perhaps, therefore, better float two millions and a half January. Have arranged wants till then, but regrettable lose good market. Beconsider expediency immediate conversion Consolidated Loan, 1867. Must base conversion on market, not actuarial equivalent. If conversion effected market bound support new loan. Advise all points, will accept your judgment.

The Loan Agents to the Colonial Teeasurer. (Beceived 10th October, 1884.) Conversion of Consolidated Loan, 1867. Benewed reflection only confirms our opinion. It is true that any conversion must be based upon market, but equivalent must be starting point for estimating necessary inducement. Beal point, however, is that—counting, firstly, £200,000 due Bank of England ; secondly, £745,000 under agreement with Bank of England, for paying 5 per cent. 5-30s ; thirdly, £50,000 for expenses of recent conversion ; fourthly, third million ; fifthly, new million and a half; there will be three millions and a half of new inscribed stock to place during next year. Now, any prior conversion of Consolidated Loan, 1867, by adding to volume of inscribed stock, and multiplying daily operations market, would further compete against new loans ; and no saving you could make in sinking fund meanwhile would be worth setting against that danger. We therefore feel convinced still that should not attempt any conversion until new loan safe. Lastly, respecting cable authority, would be useless, because Inland Bevenue would not enrol deeds creating new inscribed stock without seeing Act and warrants. London, 9th.

No. 23. The Agent-General to the Peemiee. Sib, — 7, Westminster Chambers, London S.W., 6th September, 1884. The approaching expiration of the arrangement I made in 1881 with Sir Penrose Julyan makes it necessary that his future position should be settled. You are aware that he has been acting as Loan Agent, Stock Agent, Trustee of the Sinking Fund, Agent under the Bevenues Act for guaranteed debentures, and Commissioner of the Public Account. In all these capacities it is obviously necessary there should be a second name ; and the great skill, judgment, and sagacity which Sir Penrose has shown, together with his long services to the colony, lead me to assume that the Government will, as a matter of course, desire to continue his employment. If I am correct in this, I should be glad to receive a telegram at once, as you will remember that the existing arrangement with Sir Penrose ends in November ; and it will be necessary, at the same time, for the Government either to settle his remuneration themselves or to give me the power (as before) to arrange it with him here. It will be in your recollection that the scale of remuneration settled by Sir John Hall for the Stock Agents, before I came to England, was a commission of T \- per cent, on all conversion operations, provided that no Agent should receive more than £2,000 in any one year. This I reduced, first, to a maximum payment of £5,000 for the three Stock Agents, and then (on the revocation of their warrants) to £2,000 for Sir P. Julyan. A commission of T 3^ per cent, would have involved payment of the following amount for the conversions recently effected, viz. : — On the £1,832,000 of Treasury bills ... ... ... £4,579 10 0 On the £3,558,300 of 4J- and 5-per-cent. 5-30s (main operation) 8,895 15 0 On the £745,600 of 5-per-cent. 5-30s (last operation) ... 1,864 0 0 Total £6,135,900 £15,339 5 0 But, under Sir J. Hall's limitation to £2,000 for each Agent, the total amount paid would have been £6,000 last year and £1,864 this year, or, together, £7,864. Under my arrangement with Sir P. Julyan these conversions, and the two millions of loan raised besides, have together only cost £2,000, which is at the rate of a fraction under -^ per cent, on the total amount of £8,135,900 covered by all the operations. I have, &c, The Hon. the Premier, Wellington. F. D. Bell.

No. 24. The Agent-Geneeal to the Premier. Sib, — 7, Westminster Chambers, London, S.W., 11th September, 1884. After writing to you on the 6th about the position of Sir Penrose Julyan, I thought it would be as well for him to let me know his own views in time for this mail respecting remunera-