D-No. 3

Sub-Enclosure to Enclosure in No. 2

LORD STANLEY OF ALDERLET TO THE LORDS COMMISSIONERS OF THE TREASURY.

General Post Office,

12th June, 1861.

My Lords, —

With reference to your Lordships' letter of the 25th of March last, transmitting for my information, and with a view to proper steps being taken for recovering from the different colonies, the sums to which they are respectively liable, copies of letters from the Commissioners of Audit, and from the Admiralty, relative to the amounts to be contributed by the several Australian Colonies on account of the mail service between this country and Australia, I have the honor to send herewith, a statement* prepared by the Receiver and Accountant-General, shewing the amouut chargeable against each Colony, from the Ist January, 1857, to the 31st March, 1861, the sums already paid on account of each Colony, and the balances remaining due. In preparing this statement, the account given in the Treasury Minute of the 15th November, 1858, for the period ending the 31st December, 1859, has been adopted, and the account for the further period from the Ist January, 1860, to the 31st March, 1861, has been drawn up in conformity with the rule laid down in the same Minute. I request that your Lordships will be pleased to issue such directions as you my think necessary for obtaining an early payment of the sums due from the several Colonies. These sums are as follows :—

£ s. a. From Victoria 132,397 7 5 " New South Wales 44,019 9 8 " South Australia 20,859 12 5 " New Zealand 21,123 1 3 " Tasmania 11,524 3 5 " Western Australia 1429 15 7 " Queensland 1239 11 6 £232,593 1 3

I have to add th_t I shall very shortly transmit to your Lordships a similar statement of the amount henceforward chargeable against each of the Australian Colonies under the terms of your Lordships' Minute of the 25th April last, and in that statement will be included the sum due from each Colony on account of the transit of the mails through Egypt, an item which has been omitted in the present statement.

I have, &c,

The Lords Commmissioners of the Treasury. Stanley of Alderley.

* This Statement is printed in full in the Appendix to the Report of the Postmaster General of New Zealand, D—No. 2, 1862.

No. 3.

MEMORANDUM BY MR. TANCRED,

In reference to the demand made by the Home Government oj a portion of the Postage on Intercolonial letters conveyed by the vessels of the I.R.M. Company.

This demand appears to rest on two grounds, neither of which appears to me tenable. Ist It is said that the disposal of the Postage on Inter-colonial Letters, conveyed under the Pearson and Coleman contract, was not considered at the time when that contract was

enteretl into.

2nd. That the contract was entered into without consulting the governments of the other Australian Colonies; and that for this reason it cannot be treated as a part of the general scheme proposed in the Treasury Minute of November, 1855. With regard to the first point. So far from the question as to the disposal of the Postage on Intercolonial letters having been overlooked at the time when the contract for the Branch Service to New Zealand was entered into, it is clear on a reference to the Treasury Minute above mentioned that the whole question had been fully considered and settled. Under that minute the Imperial Government engaged (subject to a refund) to establish a main service to Australia and branch services to those Colonies which were not visited by steamers employed on the main line. The expense of the whole, both main and branch services, being defrayed at the common cost.

This was the general arrangement, to which New Zealand gave in its adhesion, and I am not aware that this Government has ever consented, either directly or impliedly, to annul that part of it which more exclusively affects the interest of the Colony; though, failing such consent, the proposal now made to charge the cost of the branch service exclusively against New Zealand is virtually an infringement of the compact, on the faith of which this Colony paid its share of the subsidy, even before the establishment of the branch line.

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