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The reason is that the Union Bank of
Australia offered to negotiate the loan
upon terms fair and reasonable in all
respects but one—namely, to charge
the same commission upon monies
raised in England and to be spent in
England in immigration, as upon monies
raised in England and sent out to the
colony. It is clear that the two trans-
actions differ by the cost of transmit-
ting money to the colony. Subject to
this deduction, I agreed with the
Bank for the loan; but on being re-
ferred to Sydney, the managers, to my
great surprise, declined to ratify the
agreement. A good many months
were thus lost. I sent immediately to
Melbourne to have the debentures pre-
pared, and am now daily awaiting
them. But so long as the land-fund
retains its present rate, it will not be
possible to borrow money with any ad-
vantage in this country. The Trea-
sury is, in fact, more than supplied.
I shall propose, therefore, to raise the
whole loan in ships, for shipping, and
wanted to pay for ships, and providing
that, if there should be any necessity
for money in the colony, the Local Go-
vernment can draw upon the English
agent for what is required. But I be-
lieve that with sufficient Immigration,
the land fund will more than supply
all that can be spent in the country, and
that the whole of the loan will be avail-
able in England for Immigration, to
be expended as it is voted by the Pro-
vincial Council year by year.

I have transmitted the Bill for the
Extension of the Provincial Council
and the re-arrangement of the Electo-
ral Districts to Auckland with a request
that the Writs for the new elections
may be returned by the next steamer.
And I will make every arrangement
to facilitate the making up of the Elec-
toral Rolls, so that the elections may
take place as soon as possible.

The Public Works are being carried
on as speedily as the supply of labor
will admit. The Sumner-road will be
open for the passage of carts by the
temporary track over the head of the
tunnel, on the 1st of September.
The Weka Pass will, I hope, be
open by the same time; as soon
as that is done a cart will be able to
travel from Lyttelton to the Hu-
runui river without obstruction.
This, gentlemen, is the line of road
on which you may anticipate most of
your future land sales will take place.
The other line is the Lower Lincoln-

road, and I am arranging for carrying
on that work with the greatest expe-
dition. I think within the year you
will be able to ride from Christchurch
into Lyttelton by that road, and even
from Christchurch to Akaroa harbor;
both branches passing through a very
fertile district, in which several thou-
sands of acres of land will be open for
sale in the neighbourhood of good
wood and water.

With respect to the vote for a bridge
over the Waimakariri river, which you
rejected, it is my duty to acquaint you
that I have had a report from the Pro-
vincial Engineer, from which it be-
comes apparent that the river is silting
up so rapidly that no ferry will much
longer be possible anywhere near the
line of the north road, and a bridge
will become indispensable. The site for
the proposed new ferry, which was
selected two years ago, is now de-
stroyed. The present ferry has been
sold to a person who is willing to work
it on the present fares, taking a lease
from the Government for two years. I
think it will not be desirable to go to
any expense for an object so uncertain;
I therefore propose to make such a
lease, in the hope that you will deter-
mine in the mean time to build a sub-
stantial bridge.

I am sorry that the Council has not
re-considered the question of selling a
site for a mill in Hagley Park or the
Government Domain, as suggested by
the Message which I addressed to it
upon that subject. A severer blow to
the prosperity of the Province cannot
be inflicted than the creation or encou-
ragement of monopoly, or the placing
restrictions on mercantile or manufac-
turing enterprise. The refusal of the
Council to allow the occupation of the
best, I may say the only available site
for the erection of a mill in the neigh-
bourhood of Christchurch, will be a
great drawback to agricultural enter-
prise for the next year:—not for more
than a year, for I am satisfied the next
Council will reverse this decision.

The Government will consider what
steps it will be most proper to take to
get rid of the nuisance created by
watercresses in the rivers in the neigh-
bourhood of Christchurch. But the
first thing to be done, is to collect in-
formation on the subject from all quar-
ters. The Government has therefore de-
termined to first offer a reward for the
best plan which can be suggested be-
fore committing itself to any operations