SAN FRANCISCO MAIL SERVICE. [BY TELEGRAPH.—PRESS ASSOCIATION.] Wellington, Friday.

Waikato Times, Volume XXIII, Issue 1938, 6 December 1884, Page 2

SAN FRANCISCO MAIL SERVICE. [BY TELEGRAPH.—PRESS ASSOCIATION.] Wellington, Friday.

During the last three mouths a long battle lias been proceeding between New .South Wales and New Zealand regarding the San Ftancisco Mail service, and it is at length settled satisfactory for New Zealand. The late Government of New Zealand entered into an arrangement for the service by which they agreed to i>ay £31250 per annum against £18750 paid by New South Wales although the latter was to have the benefit of the teunini of the line for very little more the New Zealand Government could have had the terminus in New Zealand, they not only did not take advantage of such an opportunity, but they consented to New South Wale? having a power to Avithdraw during the last 12 months of the contract, though New Zealand was to continue bound. Of course such a provision gave the power to New South Wales to pay what it liked for the year's service as the boats were still to continue to run to Sydney. It might, however, at least have been supposed that New .South '-V a les would divide with New Zealand the benefit of any reduction ; that however they showed no disposition to do ; they gave the requisite notice of withdrawal from the contract, intimating the same to the New Zealand Postmaster-General, and adding significautly that this would not preclude them from considering fresh proposals from the conti actors. This was evidently an iutention not to lose the service, but to obtain a reduction of the cost. Indeed, the contractors subsequently admitted what amounted to an understanding of this nature. The Government weie so annoyed at the mauuer in which it was proposed to treat New Zealand that they determined that the contractors at least should pay for it. In order to do this they treated the withdrawal of New fcsouth Wales as final, and had recourse to the provisions in the Post-office Act. which prohibited steamers under contract to New Zealand from carrying the mails of other countries without its consent. Accordingly, when the PostmasterGeneral of New South Wales announced later that he had arranged with the contractor for a reduction of £7,000, and to rejoin as a contractor subject to New Zealand's consent, the PostmasterGeneral positively refused such consent, gave notice of the clauses in the PostOffice Act, and declined to allow the mails of New South Wales to be carried unless a prior arrangement was made with him. He informed the contractors he would not agree to their arrangement with New South Wales, unless they made a corresponding reduction to New Zealand. The contractors refused to make any allowance whatever to New Zealand, whereupon the PostmasterGeneral gave them formal notice not to 1 carry the New South Wales mails without his consent. Lengthened negotiation followed, and have resulted at length in that' colony agreeiug to pay New Zealand £7,000 for the carriage of its mails. New Zealand will also get the whole of the amounts from the other colonies for ,the car'rjage of their mails. The nettto