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No. 36. The Agent-General to the Hon. the Prime Minister. Westminister Chambers, 13, Victoria Street, London, S.W., Sib,— 30th January, 1904. I have the honour to enclose for your information an amended estimate of receipts and expenditure of the Pacific cable for the financial year 1903-4, now nearly at an end. You will note that the amended estimate puts both the revenue and the working-expenses somewhat higher than the original estimate. The revenue is now expected to be £2,900 higher, and the workingexpenses £1,052 higher. Personally, I shall be surprised if the receipts do not exceed £77,000. I also enclose estimates of revenue and expenditure for the next financial year —that of 1904-5. You will note that the deficit for that year is estimated at £89,810. I hope, however, that the improved condition of Australia may cause an increase of business there, and so reduce the actual amount of the deficit to be met. You will be glad to know that the two last months' record of business on the line shows an improvement. The New Zealand business from your end has from the first been excellent, and remains so. What we require is better support in Australia and in London, and we ought also to secure our share of continental business. How much we shall get of the last-mentioned will depend upon the view you take of our policy in regard to the agreement with the German Atlantic Cable Company. I have, &c, The Hon. the Prime Minister, Wellington, New Zealand. • W. P. Reeves.

Enclosure 1 in No. 36. Pacific Cable Estimates, Ist April, 1904, to 31st March, 1905. Receipts. £ £ Expenditure. £ Through traffic per week at present rate 1,200 Second annuity-payment .. .. .. 77,545 Weekly allowance for Atlantic com- Head office .. .. .. .. 5,000 panics' charges for insertion of date Stations .. .. .. .. .. 29,722 and time .. .. .. 50 Ship .. .. .. .. .. 19,250 Renewals and depreciation .. .. .. 35,000 Weekly receipt on through traffic .. 1,150 Royalty on instruments .. .. .. 500 Yearly receipt on through traffic .. .. 59,800 Engineers'fees .. .. .. .. 300 Yearly reoeipt on local traffic .. .. 13,600 Provident Fund .. .. .. .. 1,493 Allowance for additional receipts .. .. 5,600 Estimated deficit .. .. .. .. 89,810 £168,810 £168,810

Enclosure 2 in No. 36. The Pacific Cable Board : Comparison of Estimates for 1903-4 and 1904-5. 1903-4 Estimate. Receipts. £ Expenditure. £ Traffic revenue ... ... ... 73,400 Annuity-payment and renewals ... 113,045 Deficit ... ... ... ... 92,100 Working-expenses ... ... 52,455 £165,500 £165,500 1903-4 Amended Estimate, after six months' ivorking. Receipts. £ Expenditure. £ Traffic receipts ... ... ... 76,300 Annuity and renewals ... ... 113,045 Deficit ... ... ... ... 90,258 Working-expenses ... ... 53,513 £166,558 £166,558 1904-5 Estimate. Receipts. £ Expenditure. £ Traffic revenue ... ... ... 79,000 ! Annuity and renewals ... ... 112,545 Deficit ... ... ... ... 89,810' Working-expenses ... ... 56,265 £168,810!' £168,810

No. 37. The Hon. the Prime Minister to the Agent-General. Sir, — Prime Minister's Office, Wellington, Ist February, 1904. I have the honour to acknowledge the receipt of your memorandum of the 26th November last, in reference to the payment by you of this colony's contribution of £10,057 lis. 7d. towards the cost of the Pacific cable for the year ended the 31st March last, and also forwarding copy of letter from the Colonial Office on the matter.

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