cording to the number of letters sent and received
in each year to and from England, to be deter-
mined by the Imperial Government from
returns at the London Post Office. This to in-
clude letters sent and received through what-
ever channel, and whether by Post Office
Steamers or other vessels.

3. The Tariff of Rates for passage and
   freight to be regulated by the Company--the
   whole management to be with them, and the
   profit or loss to be theirs.

4. The Steamers to make Melbourne their
   principal port of arrival and departure.

5. But to be at liberty in compliance with
   the wish of the Company to go on to Sydney.

6. In addition to the Main Service between
   England and Melbourne, Branch Services to be
   maintained between Melbourne and the Co-
   lonies of Van Diemen's Land, South Australia,
   and New Zealand. The mode of arranging
   the Branch Service is left by the Imperial Go-
   vernment to be settled by the Colonies them-
   selves.

7. The cost of such Branch Services to be
   added to the above sum of £175,000, and ap-
   portioned in the aggregate between the Co-
   lonies, according to the above rule.

8. The Melbourne Government has issued
   circulars to the other Colonies, stating proposed
   terms of tender, asking opinions thereon, and
   proposing a conference at Melbourne, but so
   far as I can learn nothing further has been
   done.

9. It appears to me so far as I can judge that
   the course taken by the Melbourne Govern-
   ment is correct, that such a Conference should
   take place between persons properly authorized
   by the respective Governments, or that some
   one Government should be authorized to act on
   behalf of all.

10. If a Conference be held, Melbourne
    seems to be the most convenient place of meet-
    ing.

11. For the general interest of all the Colonies
    who are alike concerned in the Branch Service,
    no delay should take place in completing the
    arrangements.

12. From what I can learn it appears that the
    Service for New Zealand may be more cheaply
    and better performed from Sydney than from
    Melbourne, but this can only be tested by
    tenders.

13. I understand there are only two parties,
    the Australian Steam Packet Company, and the
    "William Denny," capable of contracting for
    the Service. I suggest that it will be desirable
    to test at once the terms on which they will
    perform it from Sydney and Melbourne.

14. If New Zealand should prefer Melbourne
    to Sydney, I assume that the right of choice is
    open to her.

receipt of your letter of the 4th instant, with
the accompanying Copy of a Memorandum
furnished by you to the Government of New
South Wales, on the subject of the establish-
ment of a Steam Mail Service for New
Zealand.

2. As under this head is comprised both the
   extension to New Zealand of the Australian
   Mail Contract lately concluded, and the further
   conveyance of Mails between the various Pro-
   vinces, the main object to be considered is
   the establishment of such a Steam Service as
   will in the most economical manner possible
   ensure a rapid and certain means of communi-
   cation between the several ports of this Colony
   and Australia and Great Britain.

3. This object will most certainly be at-
   tained if the two services were combined, and
   the same vessels ran the whole route; the
   Mails for each Port would thus, without delay,
   be forwarded by the same boat which conveyed
   them to the colony; while at the same time,
   passengers between Australia and the several
   Provinces would be saved the expense, incon-
   venience, and delay, otherwise attendant on a
   change from one vessel to another.

4. With this view it is advisable that Ten-
   ders for the conveyance of Mails—first from
   Sydney to Manukau or Auckland, and se-
   condly from the latter Ports to the Ports
   specified in the draft advertisement herewith
   enclosed—should be called for simultaneously,
   with an intimation that it is the desire of this
   Government that the two services should if
   possible be combined. Were this accomplished,
   two boats could convey the Mails from Sydney
   to Auckland or Manukau, and thence round
   the colony and back to Sydney; to which Port,
   rather than Melbourne, it is desired that the
   New Zealand Steamers should ply, as being at
   the same time cheaper, ensuring a communica-
   tion both with Melbourne and Sydney (through
   the English steamers), and affording a means
   of getting direct from New Zealand to Sydney,
   which will in a few months, from the cessation
   of the subsisting arrangements with the "Wil-
   liam Denny," be otherwise wanting.

5. The three routes specified in the adver-
   tisement, for the Inter-Provincial Service
   would, in the order in which they are respec-
   tively numbered, afford the most rapid medium
   for the distribution both of the English and
   New Zealand Mails. Of these the 1st route
   would effect a saving of four days in time over
   the 2nd, and of nearly a fortnight over the
   3rd. But as some disinclination may be felt
   on the part of the Contractors to engage that
   the steamers should leave Manukau at stated
   periods, owing to the possible state of the bar
   during the prevalence of strong westerly gales,
   the 2nd route may possibly be preferred. The
   3rd route, although affording somewhat more
   communication between the Southern Pro-
   vinces, is objectionable from the additional
   time which would be required, thus delaying
   the transmission of replies to letters from Eng-
   land or Auckland, and increasing, from the
   time involved, the expense of transit. At the

NEW ZEALAND,

Colonial Secretary's Office,
Auckland, November 20th, 1856.

SIR,

I have the honor to acknowledge the