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No. (31. (Circular.) Sic, — Downing Street, Bth December, 1887. I have the honour to transmit to you, for your information and for that of your Government, a copy of a letter from the Treasury respecting the continuance after the 31st January, 1888, until the following November, of the existing arrangements for the mail service via San Francisco. I have, &c, H. T. HOLLAND. The Officer Administering the Government of New Zealand.

Enclosure. Sib, — Treasury Chambers, 26th November, 1887. I am directed by the Lords Commissioners of Her Majesty's Treasury to acquaint you, for the information of Secretary Sir Henry Holland, that my Lords have been in correspondence with the Post Office upon the question, whether the existing arrangements for the New Zealand mail service should be continued after the 31st of January, 1888, the date when the contracts for the conveyance of the Indian and Australian mails expire, and that their Lordships have been pleased to authorise the prolongation of the present arrangements for this service, via the San Francisco route, until the termination of the existing colonial contract for the conveyance of the mails in November, 1888. I have, &c, Sir E. Herbert, X.C.8., Colonial Office. E. E. Welby.

■ ■ • No. 62. (Circular.) Sm, — Downing Street, 22nd December, 1887. With reference to my telegram of the 15th instant, respecting the arrangements for the conveyance of the Australian mails across France and Italy, I have the honour to transmit to you, for communication to your Government, a copy of a letter from the General Post Office on the subject. I have, &c, H. T. HOLLAND. The Officer Administering the Government of New Zealand.

Enclosures. Sir,' — General Post Office, London, 13th December, 1887. With reference to your letter of the 12th July last and previous correspondence, I am directed by the Postmaster-General to state, for the information of Sir Henry Holland, that the arrangements for the conveyance of mails to and from Australia and the East by special trains across France and Italy, after the close of the current year, have at length been completed. The matter has long been settled with the French Post Office; but the Italian Post Office had not until now given its final reply to one of the proposals of this department. The Secretary of State is aware that the object of the negotiations now concluded was not only to obtain a substantial reduction in the rates at present paid for this service, but also to recover the liberty of the Post Office to use other routes than that of France and Italy for the transit of the mails in question ; and, further, in the case of Italy, to arrange for a reduction of the rate payable by the colonies to that country for correspondence sent to Europe via Brindisi. In regard to these several objects the negotiations have been attended by complete success. Taking first the most important question of the transit-rates for the special service, I am to remind the Secretary of State that the rates per kilogramme at present in force for that service are: For letters and postcards—To France, lOfr. ; to Italy, 6fr. 50c.: total, 16fr. 50c. For printed papers, &c. —To France, 50c.; to Italy, 37-Jc.: total, 87-J-c. But, in pursuance of an arrangement made since these rates were settled, they are only charged for a certain fixed amount of the correspondence, and the remainder is paid for at the ordinary Postal-Union transit rates of 2fr. per kilogramme for letters and postcards, and 25c. per kilogramme for printed papers, &c. The result of this arrangement is that, according to the latest figures, the average rates actually paid are as follow : For letters and postcards —To France, Bfr. 66c.; to Italy, 6fr. 15c. : total, 14fr. 81c. For printed papers, &c.—To France, 43c.; to Italy, 36c.: total, 79c. The rates which it has now been arranged to pay for the next two years commencing on the Ist January, 1888, are: For letters and postcards—To France, 6fr.; to Italy, 4fr. 80c.: total, lOfr. 80c. For printed papers, &c.—To France, 40c.; to Italy, 32-Jc.: total, 72fc. Thus, the actual reduction of rates is to be expressed as 4fr. lc. for letters and cards, and 6-J-c. for other articles; but it is possible that, in application, the reduction may be greater still; for an undertaking has been exacted from the French and Italian Post Offices that, if the weight of the correspondence sent in 1888 or 1889 should exceed the weight of that sent in 1886, only the ordinary Union rates of 2fr. and 25c. shall be paid for the excess.