F.—3a

4

RECAPITULATION TELEGRAM. From Sir Julius Vogel. Following I understand to be decisions. Am I right ? 1. I am to send on account to Sydney. 2. You are not prepared to agree to modifications of service, but if we think fit we can further communicate with you on subject. I may say, however, that if you obtain what we have agreed to from Fiji and New Caledonia, our Parliament will be satisfied. 3. You are to negotiate to obtain five thousand pounds from Fiji and five thousand pounds from New Caledonia. 4. You agree to sixpenny rate between Sydney and landing-place, but rate from landingplace to other parts to be ordinary rate. 5. You are to suggest to Company ninepenny word rate. Answeh. Youb, recapitulation of what we have agreed to is correct. [THE HON. JOHN ROBERTSON'S LIST.] OVERLAPPING- OF TEMPORARY AND PERMANENT SERVICES. From the Hon. John Robertson and the Hon. J. F. Burns. All that we have to say in reference to overlapping is to explain the state of matters, which is as follows: — On 22nd May, 1875, the then existing contract with the A.S.N. Company having nearly terminated [the last steamer being appointed to leave Sydney 3rd July], the Government telegraphed to Sir D. Cooper to ask Mr. Russell whether if willing, in view of delay in taking permanent contract, to renew temporary contract; if so, for how long. On 26th May, reply received that Russell willing to extend temporary contract, but wishes to delay fixing exact time until tenders opened in London, Ist June. On 17th June, A.S.N. Company pressing for decision as to whether we intended renewing contract, the Government, in the same telegram which authorized the acceptance of Company's tender, informed Sir D. Cooper that we intended to-morrow renewing temporary contract until November. Not uutil the 24th was the Government advised that the Pacific Company's tender was accepted, and on the 26th we were told that Contractors would commence service in November. Owing to a legal difficulty, the contract had to be re-executed, and this was not done until 19th July, The telegram from this Government approving of the new arrangement [Pacific Company as Contractors, Elder and Macgregor sureties], stated that permanent service must not clash with temporary. Owing to some at present unexplained circumstance, the commencement of the permanent contract was so arranged in England as to clash with the extended temporary service as regards the departure from San Francisco, the time appointed for the sailing of the two last steamers from that port being Bth November and Gth December, the time for the first two leaving under the permanent contract being 10th November and Bth December. The agreement, moreover, only provides for the contract commencing 15th November, and yet, under arrangement above described, it was made to commence on Bth November. This clashing will involve a loss to the two Governments of £6,119 4s. Sd., that is, if the subsidy of the " Colima," the first overlapping boat of the Pacific Company, is paid. This matter having been settled satisfactorily by New Zealand paying its share of the overlapping trips of the A.S.N. Company, we think it desirable to inform you of the facts. Answee. I think we need not revive the subject of the overlapping. It arose through the great difficulty that was inseparable from a distant negotiation. The Contractors' representative in England was very reasonable. He offered to do service for nothing till proper boats ready. Breakdown of cable delayed this, and when Watt wrote you about it he offered to charter you " Cyphrenes." This was not intended. lam sure the Contractors would have paid everything until they were ready with proper arrangements. Under the proposal to which I refer, subsidy to " Colima" should not be paid, and you should telegraph to that effect to Mackrell. Suggest also that contract commence with outgoing boat. Mackrell would communicate with both Cooper and Russell. From the Hon. John Robertson and the Hon. J. F. Bubns. Content to let overlapping matter rest, and can appreciate the difficulties to which you allude; but the only gratuitous offer we had was to convey the October mails from Frisco by the " Vasco da Gama." We shall telegraph to Mackrell, as you suggest, that contract should commence with outgoing mail. Answee. I HEFEit to Watt's letter to Postmaster-General, Sydney, 10th November, the Company's representative's offer to convey the mails as best he could, free of cost, until they could carry out arrangements properly, which he expected to be able to do this month. CHARTER, OF THE "CITY OF MELBOURNE." From the Hon. John Robertson rind the Hon. J. F. Bubns. In reference to the " City of Melbourne," we are advised of her safe arrival at Frisco. Anticipate she will bring mails from thence, 2nd February. We telegraphed Forster and Cooper, London, advising