F.—B.

Assuming that the expenditure of the year ending the 31st March, 1903, amounts to £145,000 or, in other words, absorbs the total amount of the Treasury advance, £120,000, and the earnings of the cable, say, £25,000 —the contribution from the various Governments to the cable for this year will be : — & s. d. United Kingdom, T \ of £120,000 33,333 6 8 Canada, T \ of £120,000 33,333 6 8 Australia, T % of £120,000 40,000 0 0 New Zealand, T % of £120,000 13,333 6 8 £120,000 0 0

Enclosure 3 in No. 116. Memobandum attached to Estimates referred to in the Secretary's letter of the 24th January. Apparently, therefore, the Treasury may assume that they will have to supply the Board in the year ending the 31st March, 1904, with a sum of £92,100, and that towards this amount they will recover from the colonial Governments for the years 1901-2 and 1902-3 the sum of £85,666 13s. 4d., leaving a balance of £5,433 6s. Bd. Note. —These estimates are, of course, based on very inadequate information ; but, 1. The expenditure on the cable in the year 1901-2 and 1902-3 may probably be some £15,000 less than the sum stated in the above estimate ; and 2. The loss on the whole cable in the year 1903 is not likely to be greater, and may be less, than £92,100, unless some unforeseen accident should cause its interruption.

Enclosure 4 in No: 116. The Financial Seceetaey to the Tbeasuky, London, to the Secretary, Pacific Cable Board, London. Sib,— Whitehall, S.W., sth February, 1903. The Lords Commissioners of His Majesty's Treasury have had before them your letter of the 24th ultimo, enclosing particulars of the estimated expenses and receipts in connection with the Pacific cable for the financial year 1903-4. Their Lordships observe that the information at present in the possession of your Board is not sufficient to enable them to estimate with certainty either the expenses or the earnings of the cable for the year in question, while the amount to be received from the contributing colonies must also be uncertain until the actual expenditure out of the current year's vote is known. In these circumstances, My Lords, while accepting your Board's estimate as the best that can be framed on existing information, think it desirable to adopt rounded figures for the purposes of the parliamentary vote, and also to allow for the possibility of a somewhat wider margin between expenditure and receipts. Accordingly, they propose to ask Parliament to provide a total grant-in-aid of £95,000 (instead of £92,100), and to estimate the colonial contributions at £85,000 (instead of £86,666 6s. Bd.), so that the net sum to be borne on the vote will be £10,000. As regards the anticipated receipt from the colonies, I am to point out that they are not under obligation to contribute the amount of interest in excess of 3 per cent, which was paid on the sum temporarily borrowed by your Board from the Bank of England pending the provision of funds under the Act. The excess interest so paid was £919 os. 7d., and, excluding that sum from the estimated expenditure in this year out of voted moneys, the maximum amount of the colonial contributions to be received next year would be £86,003. A copy of the draft sub-head of the Telegraph subsidies estimate is enclosed herewith. I am to request that, as soon as possible after the 31st March next, your Board will cause a statement to be furnished to this Department showing the approximate expenditure up to that date as provided out of earnings and out of voted moneys. On receipt of that statement My Lords will cause a communication to be addressed to the Governments of the contributing colonies apprising them of the approximate sums due from them in respect of the voted expenditure, and requesting them to take such steps as will enable their representatives in this country to pay over to the account of the vote the sums actually due as soon as the amount of the audited expenditure is known, in July or August next. In this way it should be possible to secure that the contributions will be available before the date (Ist December) at which the annuity to the National Debt Commissioners will fall due. I am, &c, The Secretary to the Pacific Cable Board, London. W. H. Fisher.

Enclosure 5 in No. ] 10. Copy of Draft Sub-head of Telegraph Subsidies Estimate (Enclosure to No. 4). For the Year ending 31st March, 1904. (Class V.) 5. Telegraph Subsidies and Pacific Cable— continued. 1903-4 1902-3. G.—Pacific cable, grant-in-aid: Grant in aid of the annual ex- & penses of the Pacific cable (" Pacific Cable Act, 1901," 1 Edw. VII., c. 31). This grant is required to defray the expenses of the Pacific Cable Board to the 31st March, 1904, so far as they cannot be met out of the earnings of the cable. These expenses are estimated approximately as follows : —

28