4. Pending the existence of a permanent arrangement, of this nature, the Government considering that it would be most disadvantageous that steam communication between New Zealand and Australia should, just when it has been established to the latter place from London, absolutely cease, owing to the termination of the contract with the William Denny,* and that without a subsidy she would be placed on another line, has made an engagement, (a copy of which is enclosed) with the agents of that vessel to run two more trips on the same terms as heretofore, under her contract with the Provincial Government, subject to a proviso for the cessation of the subsidy, should Dr. Campbell and yourself have succeeded in establishing the Branch Service, or do so before these trips have been made.

5. Should you therefore have entered into any contract when you receive this, or should you do so before the two trips have been made, you will give immediate notice thereof to the agents of the William Denny in Sydney, and forward to this Government a copy of the notice served.

I have, &c.,

(Signed) E. W. STAFFORD.

The Hon. Henry Sewell, Esq.

*Note.—The Auckland contract with the William Denny expired on the 25th December.

Colonial Secretary’s Office,
Auckland, Dec. 17th, 1856.

GENTLEMEN,—With reference to the interview which took place this morning between His Excellency’s Government and yourselves on the subject of the Steam Postal Service between this Colony and Australia, I am now desired by the Colonial Secretary to address you to the following effect.

You have been made generally aware of the views entertained by His Excellency’s Government with regard to the Branch Service to be established between Australia and New Zealand under the recent Mail Contract with the Imperial Government. In accordance with those views, it has been proposed to combine the Inter-Colonial service with the Inter-Provincial communication between the several settlements, and to have both services performed by the same steam vessels, and to invite tenders in Sydney and Melbourne for carrying this proposal into effect. But at the last dates from Australia, no copy of the contract entered into by the Imperial Government had been received there, and until that necessary information reaches the several Governments interested in the contract, no final steps can be taken for the permanent establishment of the Branch Service in New Zealand: in the meantime, however, the gentlemen who represent this Government in Australia have been authorised to enter into certain arrangements for the present conduct of that service.

His Excellency’s Government is therefore unable to enter into a permanent contract with the owners of the William Denny on the same terms as that with the Provincial Government of Auckland, or on any terms which would confine the Steam Postal Service to this Colony to one steamer; whilst it is not unlikely that arrangements may have actually been made on behalf of the Government for conducting that service for the next twelve months.

But as the Government is unwilling that the Steam Mail Service between New Zealand and Sydney should suddenly cease, at the very time when it is established between the latter place and Great Britain, they have to propose to you that the same amount of subsidy hitherto paid by the Provincial Government to the William Denny, and the existing conditions thereof, shall be continued for the period required to make two trips of that steamer: Provided always that in the event of any other arrangement for constituting the Branch Service under the Imperial Mail Contract being effected before the conclusion of these trips, the subsidy now offered, or so much of it as shall not be due at the time of giving notice, either here or in Sydney, shall not be paid.

I have, &c.,

(Signed) W. GISBORNE,
Under Secretary.

J. A. Gilfillan, Esq., and
David Graham, Esq., Auckland.

Wellington Chamber of Commerce,
24th November, 1856.

SIR,—

Enclosed I do myself the honor to wait upon you with two Memorials addressed to His Excellency the Governor on the subject of the contemplated postal arrangements.

I beg leave also to bring under the notice of His Excellency’s Government the following circumstance in relation to the mail service which has just occur