had offered to do the work for £16,000. Mr. Lowe declared he had never heard of the offer; yet Lord Kimberley, the Secretary for the Colonies, knew of it, and the tender was transmitted by the Indian Postmaster-General to Mr. Monsell, the British Postmaster-General, who passed it on to the Treasury. At the Treasury Mr. Lowe concealed the papers relating to the contract from Mr. Baxter, avowedly because he was known to be hostile to it. A Committee of the House investigated the scandal, and disallowed the contract. This affair was also accompanied by the final revelation of the truth as to what was known as the telegraph scandal. In spring the working classes were profoundly disturbed by a rumour that the Government had seized the Savings Banks balances, and were building great extensions of telegraph lines with the money without consulting Parliament on the subject. The foundation for the story was a discovery made by the Auditor-General of Public Accounts. He reported that the Telegraph Department of the Post Office had for some time evaded the control of the House of Commons over its expenditure. Instead of submitting to the House estimates for proposed works, and asking for a vote on account, Mr. Scudamore, the Chief of the Department, a brilliant but too zealous official, took whatever money he wanted from the Post Office receipts, and spent it as he pleased on works of extension and improvement. He submitted no estimates in detail, but always asked the House of Commons for a sum for new works, which enabled him to replace the Post Office receipts which he had used. A large portion of the money thus spent was taken from the Savings Banks balances which everybody understood were always paid in for safety to the Commissioners of National Debt, who invested them in Consols. Though no money was missing, it shook public confidence in the Government to find its administrative power so feeble that it could not prevent its own servants from tampering with the Savings Banks Deposits, and further investigation aggravated the scandal. It was shown that Lord Hartington when Postmaster-General had, like Mr. Monsell, allowed Mr. Scudamore to manage the Telegraph Department without any supervision, and that the Treasury had so far condoned this gross and culpable negligence that when it did business with Mr. Scudamore it communicated with him directly, and not through either Lord Hartington or Mr. Monsell, who had meekly submitted to be treated as official “dummies.” It was shown that the Treasury knew of Mr. Scudamore’s irregularities in 1871, and condoned them; that in 1872 it knew of them again, and acted so feebly that even Mr. Lowe admitted he regretted his lack of firmness. It was utterly impossible to defend the conduct of Mr. Lowe, Lord Hartington, Mr. Monsell, and the Chief Commissioner of National Debt, for countenancing these grave irregularities, and the scandal was simply disastrous to the administrative _prestige_ of the Ministry.