3. I have now received your despatches as noted in the margin, giving full information as to the terms of the contract, and the grounds upon which your Government have supported it, as well as the reasons for which it was opposed by the Leader and some members of the Opposition. 4. I do not propose to enter upon a discussion of the details of the contract, or of the various arguments for and against it, but I cannot refrain from expressing my views as to the serious consequences which may result from this extraordinary measure. 5. Under this contract, and the earlier one of 1893, for the construction of the railway, practically all the Crown lands of any value become, with full rights to all minerals, the freehold property of a single individual: the whole of the railways are transferred to him, the telegraphs, the postal service, and the local sea communications, as well as the property in the dock at St. John's. Such an abdication by a Government of some of its most important functions is without parallel. 6. The colony is divested for ever of any control over or power of influencing its own development, and of any direct interest in or direct benefit from that development. It will not even have the guarantee for efficiency and improvement afforded by competition, which would tend to minimize the danger of leaving such services in the hands of private individuals. 7. Of the energy, capacity, and character of Mr Reid, in whose hands the future of the colony is thus placed, both yourself and your predecessor have always spoken in the highest terms, and his interests in the colony are already so enormous that he has every motive to work for and to stimulate its development; but he is already, I believe, advanced in years, and though the contract requires that he shall not assign or sublet it to any person or corporation without the consent of the Government, the risk of its passing into the hands of people less capable and possessing less interest in the development of the colony is by no means remote. 8. All this has been fully pointed out to your Ministers and the Legislature, and I can only conclude that they have satisfied themselves that the danger and evils resulting from the corruption which, according to the statement of the Receiver-General, has attended the administration of these services by the Government, are more serious than any evils that can result from those services being transferred unreservedly to the hands of a private individual or corporation; and that, in fact, they consider that it is beyond the means and capacity of the colony to provide for the honest and efficient maintenance of these services, and that they must, therefore, be got rid of at whatever cost.