D.—No. 1

represent the wishes of the Canterbury Government with respect to the Contract lately entered into by Mr. Crosbie Ward with the Intercolonial Royal Mail Company. I have, &c, William Fox. His Honor the Superintendent, Canterbury. No. 84. Auckland, May sth, 1864. Sib — I have the honor to inform you that I have arrived from Canterbury under the direction of the Superintendent of Canterbury, with the view of communicating with the General Government of the Colony as to the ratification of the Contract entered into between Mr. Crosbie Ward and the Intercolonial Royal Alail Steam Packet Company (limited), for the conveyance of New Zealand Mails —Panama and Interprovincial—dated 7th December, 1863. I beg to hand you the Report of a Committee of the Provincial Council of Canterbury for giving effect to the above-mentioned Contract; and also, the Resolutions * of the Provincial Council on the subject, passed on the 26th April last. In accordance with those Resolutions, I have to request your reply to the following questions : — 1. AVhether the Government will be prepared to consider its decision as to the nonratification of the Contract ? 2. AVhether, in the event of Government not being prepared to do so, it will be willing to accept the Contract, taking the guarantee of the Province of Canterbury in conjunction with other Provinces, or otherwise, for the excess of the Contract-price on the amount voted for the Panama Service by the General Assembly ? 3. AVhether, in the event of the Government declining to adopt the course last above mentioned, it will be willing to pay over the sum capable of being appropriated under the vote of the General Assembly for the Panama Service, to one or more of the guaranteeing Provinces, and to credit those Provinces with the Postages, and also to assist the Provinces guaranteeing in negociations with other Colonies for their contributions ? I have, &c, E. C. J. Stevens, Alember of the Executive Council of the Canterbury Province. The Hon. the Postmaster-General, Auckland. Enclosure to No. 84. Report of a Committee appointed by the Provincial Council of Canterbury to inquire into and report upon the means best calculated for giving effect to the Contract lately entered into by Crosbie AVard, Esq., for the Conveyance of Mails by way of Panama. Tour Committee have the honor to report that with a view of obtaining authentic information as to the facts connected with the question into which they have been instructed to enquire, they have taken the evidence of two gentlemen (Air. AVard himself being one) who have been directly concerned in negotiations for the establishment of a Panama Service for the Colony, and who, it may be assumed, have made themselves familiar with all the main points of the case. It appears that the Colony of New Zealand is placed in a disadvantageous position as regards the other Colonies of the Australasian Group in two essential points so long as it depends solely for its means of Postal Communication with Europe on the present Service by way of Suez. Ist. New Zealand being at the end of the line, and its distance from Australia being too great to allow of the return mail being despatched so as to arrive either at Sydney or Alelbourne in time for the return mail for Europe of the same month, the course of post is increased by one whole month. 2nd. Notwithstanding this disadvantage, New Zealand contributes more in proportion towards the maintenance of the Suez line than any of the Australian Colonies, and this in more ways than one. The rule by which the sum to be paid by each Colony interested in the service is ascertained, imposes the larger share of the burden on those which are most distant from the mother country, consequently New Zealand pays the most of all the Colonies, as not only does it contribute to the service to Sydney, the extremity of the Trunk line, but bears also the expense of the service beyond that point. Thus, for instance, Western Australia contributes nothing to the cost of the service between King George's Sound and Sydney; on the other hand, the Colonies of New South Wales, Queensland, and New Zealand, contribute towards the whole cost, though they get their mails later, and in the case of New Zealand, too late to catch the return mail. Hitherto, although the larger portions of the New Zealand mail have left the Trunk line at Alelbourne, it appears that by some oversight, the contribution of the Colony has been calculated as though the whole was carried on to Sydney. * Published as Enclosure to No. 86.

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