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No. 41. The Hon. the Premier, Melbourne, to the Hon, the Premier, Wellington. Sir, — Premier's Department, Melbourne, Bth May, 1893. The Postal Conference at Brisbane being concluded, I have obtained a perusal of a proof of the proceedings, and now beg to draw your attention to the position of the matter of the contract entered into by Queensland and New South Wales for a telegraphic cable to New Caledonia. . 2. I have received answers from New South Wales and Queensland to the letter of friendly remonstrance addressed to those Governments on the 17th November, of which a copy was transmitted to you on the 18th idem. 3. The answer of New South Wales is merely a covering letter, enclosing a minute by the Deputy Postmaster-General of that colony, which is confined solely to the point of this matter having been settled without the knowledge of the other Australasian Governments; and in this minute the Deputy Postmaster-General relies entirely upon the submission of the matter to the Hobart Postal Conference in March, 1892. 4. The sufficient reply to this is, that the negotiations had been concluded when the papers were laid before the Conference, the letter of the Hon. the Postmaster-General of New South Wales to Mr. Audley Coote, closing the agreement, being dated the 18th of March, the very day on which the papers were laid before the Conference. On the evening of that day, a brief discussion took place on a simple motion that the order of the day relating to the matter be discharged, which motion was carried. I cannot but feel that, supposing the other colonies to have any interest in the mattter, a submission of it ex post facto to a Postal Conference can hardly be said to involve the other colonies in a consent to or approval of the arrangement. 5. I desire also to submit, as of some importance in view of future intercolonial conferences, that a matter of such wide bearings as the present should scarcely have been dealt with by a. slight advertence to it in a Conference of a departmental character, but should have been formally submitted through the Premiers of the colonies interested for the consideration of the respective Cabinets. The Conference could hardly have been fairly seised of a matter the papers relating to which had only that day been laid before it, and were then ordered to be printed. It seems to me that an element of danger may lurk in the minor colonial Conferences if they should be taken as sanctioning matters such as this, on such very slight reference to them as was made to this matter at the Hobart Postal Conference. 6. As regards Queensland, Sir Samuel Griffith, in a reply of the Bth December to my predecessor's letter of the 17th November, also relies on the submission of the matter to the Postal Conference, as implying the approval of the Governments there represented, but he refers to the negotiations as being then pending. That this was not so, at least as regards New South Wales, I have already shown; and as regards Queensland I would point out that the Hon. the PostmasterGeneral of Queensland, in his speech at the Conference on the 18th March, distinctly referred to the matter as one already settled. He said : " The Governments of Queensland and New South Wales had undertaken, in connection with the Government of France, to pay the guarantee required for the working of that portion of the cable," &c, 7. The serious point, as regards the other colonies, is that sooner or later the whole of Australasia will be interested in the laying of a second cable ; and that the freedom of the other colonies to stipulate for a route, or to contract with the most advantageous tenderer, is marred by this premature engagement with a foreign company. 8. On the question of route, I would direct your attention to the important proceedings of the London Colonial Conference of 1887, vide particularly Mr. Sandford Fleming's remarks at page 212. 9. Sir Samuel Griffith, in his letter of the Bth December, takes the ground that the question of this cable forming part of a main cable to America is quite open. He says :"I am unable to offer any opinion on the question whether the cable now proposed to be laid will eventually form part of a line connecting Australia with America;" and the Hon. the Postmaster-General of Queensland, speaking in the Conference at Brisbane on the 22nd March, expresses the same view, only more emphatically. He says (page 6 of report of Conference) :"I may say at once without hesitation that we have entered into no agreement which at all binds us to extend the cablethrough that particular company beyond New Caledonia." Similarly, the Postmaster-General of New South Wales says (page 8 of Beport) : " So far as the other sections of the-cable on to Vancouver are concerned, we are just as free as the Governments of the other colonies." But this is in direct conflict with the signed and sealed contract between New South Wales and the French company, the 3rd clause of which reads as follows: "3. The said cable shall form part of the main Pacific cable connecting Queensland with Vancouver, San Francisco, or other such places in North America as may hereafter be determined." 10. If the two colonies have merely made a contract for a cable to New Caledonia, simply and solely, then we have no ground for comment with regard to it. But if, on the other hand, they have made a contract that this cable shall form a part of any future main Bacific cable, then the situation is quite altered ; for either the other colonies must accept under a measure of compulsion the New Caledonian cable as the first section of the main one; or else, if they decide on another than the New Caledonian route, they must be without the co-operation of these two great colonies. 11. There is another important discrepancy between the statements made in Conference and the printed documents. The Hon. Mr. Unmack says (page 6of Beport): "We have been charged with granting the exclusive right of landing a cable in our territory to a foreign company. Nothing could be more void of truth than such a statement. We have certainly made an agreement with this company, allowing them to land a cable on Queensland shores, but we are not precluded from allowing fifty other companies a similar privilege." But in the Bill laid before the French Chamber of Deputies, it is,stated that: " This company [Societe Francaise dcs Telegraphes Sous-Marins] has