A.—s

8

home to point out what was possible, and likely to be accepted, and be able to advise their Governments ? Your representative pressed this matter, and eventually it was agreed that an informal discussion should be held later on; a plan that was afterwards adopted, and the result will be hereafter referred to. As a matter of fact, the motion might just as well have been agreed to, for the discussion being officially reported with the other proceedings, the same purpose has been secured. IMPEOVED MAIL-SEEVICE. This was the next subject to come before the Conference, and the first motion connected therewith was introduced by the writer. It ran as follows : " That this Conference take into consideration the question of a mail-service between Great Britain and Australasia, via Canada." The objects sought by the promotion of this line of mail and passenger service are, of course, of a similar nature to those connected with the Pacific cable and colonial reciprocity proposals. They are of a sentimental and material character. Whatever arguments can be adduced in favour of the two latter objects can be equally advanced on behalf of the former. In reality, they are all links of the chain which it was hoped the Conference would add to the Imperial bond. The first step towards a direct steamer communication between these colonies and Canada was taken some little time ago, when the Governments of Canada and New South Wales arranged with Messrs. Huddart, Parker, and Co. for a monthly line between Vancouver and Sydney, a joint subsidy of £35,000 a year being given, in the proportion of £25,000 from Canada and £10,000 from New South Wales. The service commenced about a year ago, and up to the present time has continued to show an increasing development in respect of passenger and trade results. It is generally regarded as the initial movement in the enterprise of a through route, via Canada, from Australasia to England. So far as it has proceeded it has demonstrated the possibility of reaching London from either Sydney or Auckland within as short a space of time as, or perhaps shorter, than that via San Francisco. But the communication is at present incomplete, in that there is no quick or reliable connection between the eastern Canadian ports and Liverpool. Manifestly, therefore, it must continue to be at a great disadvantage's compared with the older services, unless some completing arrangements of a satisfactory character are added to the present partial service. It is this feature which gives prominence to the question whether such an addition would make the route advantageous to the interest of Great Britain and these colonies. Hence the matter naturally became one of the most prominent subjects to be considered at the Conference. Your representative, recognising that this means of communication with Europe would confer all the advantages of the San Francisco route were there a direct connection with our colony, had no hesitation in advocating its adoption. Moreover, the matter had received full consideration at the last Postal Conference held in March this year, and had there met with unanimous approval. The San Francisco service has been in operation for over twenty years, and has been found the most speedy and reliable mail-line hitherto used by New Zealand. Geographically viewed, the North American continent lies across the most direct path from this colony to Europe. In comparison with the San Francisco route, that via Vancouver would be shorter by several hundred miles if, instead of going by New York at at present, it were continued from some Canadian port to Liverpool direct. With such a class of boats put on as is proposed, it is estimated that the time to be occupied from Auckland to Liverpool would be about twenty-seven days, a saving of some seventytwo hours when compared with the San Francisco time. But it is with alternative lines via the East that the contract in favour of the proposed new service is most apparent. In this case the advantage in respect of time is much greater—no doubt sufficient to divert the New Zealand mails that come and go via Australia. As stated at the Postal Conference, the Government of New Zealand do not propose to abandon the San Francisco line, but to use both that and the Vancouver one as alternate fortnightly services. The trade aspect, however, is perhaps a more important consideration. During the few months the Sydney-Vancouver boats have been running there has been a gradual increase in the cargo carried each way. The products which, in the writer's opinion, would probably constitute the chief portion of a trade with Canada by this colony will be mentioned in another part of this report. It may be here noted, however, that a frozen-mutton export from Sydney to Vancouver has already commenced, several hundred sheep having been forwarded there by the vessel in which the Australian delegates travelled. The Imperial aspect of this question was regarded with the same unanimity of opinion and feeling as was shown to all the other subjects dealt with at the Conference. The material trade advantages of this route may not be immediately apparent—perhaps not sufficiently so, in the eyes of some, to warrant any great expenditure in the way of subsidy towards its support. But, in answering any objection that may be offered on this ground, there are some circumstances connected with the present methods of ocean carriage that deserve consideration. This is an age of extremely intense competition all the world over—a condition which has been largely fostered by quick steam communications ; so much so, indeed, that they in turn have almost become a primary consideration, or even a necessity, to those who would enter into the race with any expectation of success. The world's business is being done on continually lessening margins of profit. In common with all the other elements of cost in putting products on the market, the items of freight, insurance, and exchange have to be considered with the greatest nicety of calculation. The slightest disadvantage in this respect may divert the current of trade from its natural course. It is almost certain to do so in a case like that under review, where the business is of an initial character. To give an illustration, Canada has been a large consumer of New Zealand kauri-gum, but hitherto shipments have had to be forwarded vid the United States. This fact has naturally either reduced the net return to our colony or restricted the export, for the expense of extra freight charges, intermediate profit, &c,