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No. 154. Extract from the Speech of Mr. John Pender, Chairman, Eastern Extension Telegraph Company. The next question I have to deal with, and which I referred to at the last meeting, is the negotiation that has been going on with the New Zealand Government. Nearly nine months ago, the subsidy of £7,500 per annum which we received from the New Zealand and New South Wales Governments came to an end. I made proposals for renewing it. The New South Wales Government were quite prepared to renew it for ten years, but the New Zealand Government objected to renew it for that period, but agreed to a renewal for five years. We did not consider that the five years' renewal was sufficiently beneficial to us, because we had found during the whole of ten years that the return from the cable did not give us, after calculating amortization, more than 2 per cent, on the capital invested. I therefore held that we were entitled to have the subsidy renewed for the full period. However, after some negotiations, and the Parliament having decided on the five years, we reconsidered the question, and, looking at it in connection with the larger questions which we hope to see carried out eventually in the Australasian Colonies, we agreed to accept the five years. Negotiations then went on again with the Postmaster-General of New Zealand, Sir Julius Vogel—a gentleman very well known in London and all over the colony, when at the head of the Government —and it was with him that I conducted these negotiations. After trying in every possible way to conciliate the New Zealand Government, and to get them to renew for five years, we have been driven into this position—that they have declined the five years, and they have declined arbitration; and the reason given for this is that they think that any subsidy would interfere with the laying of an opposition cable between Australia and Europe via the Pacific. Now, it is well that you should know the whole of the facts. There is no immediate possibility—l do not think that there is any possibility —of a cable being laid in opposition to our cable, for the simple reason that I do not suppose that the colonies at the present moment, but particularly New Zealand, have too much money to throw away. I do not think this would be approved, and I doubt if the people of New Zealand would approve of the spending of money on an opposition cable when they can get from the present company a cheaper and more efficient system of telegraphy than can possibly be procured by another cable. I make this statement advisedly, and I wish it to go before the public by the Press taking full notice of it. I will give you figures which will bear out my statement. Taking the figures of the proposed opposition, and taking the subsidy which they would require to cover expenses and obtain 5 per cent, on their share-capital as compared with the cost of our guarantee proposal, calculated on the same basis and giving precisely the same tariff, the cost to the colonies, apart from any subsidy that might be obtained from Canada, would be as follows: — „ , . Subsidy for Guarantee for on^' Pacific Scheme. p]xisting Companies. Victoria ... ... ... ... £35,680 ... £16,353 New South Wales ... ... ... 34,194 ... 15,672 South Australia ... ... ... 11,610 ... 5,321 Western Australia ... ... ... 1,223 ... 560 New Zealand ... ... ... 20,945 ... 9,599 Queensland ... ... ... 21,503 ... 5,274 Tasmania ... ... ... ... 4,845 ... 2,221 I think you will agree with me that no body of sensible men, either at Home or in the colonies, would be justified in subsidizing a company with a single line of cables in opposition to an existing one doing the work so well as we are doing it—with a duplicate system. I therefore have no fear of any opposition coming if it is dependent on receiving a subsidy from the British or Australasian Colonies. I will go a little further than that. If, instead of subsidizing an opposition company, they will give us the subsidy which the opposition company desires to get —that is, £100,000 a year— we will give them a tariff of 2s. 6d. instead of 45., the tariff which the opposition proposes to give. That would be an extraordinary revolution —to have a message carried to Australia on such a tariff as 2s. 6d. We are prepared to do it if they will give us the terms the opposition company want, and without obtaining which it could not cover expenses, and even then the tariff would be 4s. I speak from practical experience of a great many years of submarine telegraphy. Gentlemen who try to get up opposition companies frequently know nothing about telegraph-working ; but if they can get millions sterling to manipulate, they expect a considerable amount may be shared between them in the form of promotion-money. Your company has not been established in that manner, but upon fair and sound principles ; and by sound principles we are determined to stand. I think we can meet all competition, come from what quarter it may, if it is dependent on subsidy from the Governments of Australia, New Zealand, and England. I think I have shown you pretty clearly how we stand at the present moment. I will say one word more in regard to the correspondence which has taken place in regard to the New Zealand cable negotiation. I have told you that we have exerted every possible means of bringing about a conciliatory arrangement. We have got with vs —which was not always the case—the Press of New South Wales and the Press of Victoria. I believe I may say that the Governments of those two great colonies also approve the position we have taken up. W 7hen we offered to refer the case to arbitration, we thought it was not possible that Sir Julius Vogel could decline the proposal. He has, however, this morning, after a week's delay, refused arbitration. He does not see that there is any necessity for it. Now, gentlemen, on Monday next we shall put up our rates between Sydney and New Zealand from 6s. to 10s. per ten words for intercolonial telegrams—(Hear, hear) —and* we shall show them that private enterprise, having done so much tor the colony, is not to be trodden down in the way which they have attempted. Nay, more than that. Our bargain with New Zealand was that even after the termination of the subsidy they were bound to give us the same accommodation for the following ten years, whether the tariff was raised or not. They now threaten to take away that