It will be remembered that the first jarring note in the relations between Great Britain and Canada concerning mail services arose when Canada declined to fall in with the proposition that the British government should arrange for the conveyance of the mails across the Atlantic, and that Canada should pay its share of the resulting outlay. The colonial secretary submitted, as the model arrangement, one which had been made between the governments of Great Britain and the Australian colonies, under which each government should pay half the cost of the service. The contract was to be arranged for entirely by Great Britain, and the colonies were assured that such care should be exercised in the arrangements that they could depend on their interests being safeguarded. How the government acquitted itself of the trust it assumed on the behalf of Australia, the parliamentary report shall relate. "That contract involved a yearly subsidy of L185,000, of which one-half was to be paid by the Australian colonies, who had no opportunities of being consulted in the framing of the contract; so that special circumspection was required. The tender accepted was that of a new company without experience, and who had no ships fit for the work. "One of their vessels," continues the report of the committee, "the 'Oneida' which was reported against, by the professional officer of the admiralty, and had not the horse power or tonnage required by the contract, broke down on her first voyage. Time was not kept, and though the colonies complained, it appears that no steps were taken to ensure the fulfilment of the contract with suitable vessels." "The company," added the report of 1860, "in one year lost their capital, L400,000; the service proved a complete failure, and great risk of an interruption in postal communication was incurred. This contract had been entirely arranged by the then financial secretary, whose acts in these matters do not appear to have received confirmation by any other authority." It is not perhaps surprising, with the Australian venture in mind, that an explanation involving the same sort of incompetence on the part of the departments of government should be made regarding the Cunard contract. The explanation of the Cunard contract was that when the decision of the treasury granting the renewal was made, the then financial secretary, who had only entered office with the change of ministry in the month of March immediately preceding, was not aware of the existence of the correspondence between the home government and that of Canada in 1856; nor, though that correspondence was among the records of the treasury, and the authority on which the colonial secretary had written his despatch of December 3, 1856, was a minute of the treasury, did the proceedings appear to have been known to any of the officers of the department charged with this branch of the business.