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constructed by a company, provided it be undertaken without any Government assistance, and subject to proper conditions for protecting the Government railway system from inconveniences likely to arise from the existence of a private railway in connexion with it.

16. If the European members of the community and the general public share the con- fidence which is expressed in your despatches as to the success of this line, there should be little difficulty in securing subscribers of capital to the amount required; and if difficulty is experienced in forming a company for the purpose, it must be supposed that the doubts which I feel as to the nature of the enterprise are shared by men of business, who regard such schemes as this simply and solely from a commercial aspect.

17. In consequence of my decision on this question, I have of course not advised Her Majesty to sanction the Ordinance No. 2 of 1886 "to raise a loan of 550,0001. sterling" for railway construction, transcript of which was enclosed in your Despatch, No. 258, of the 23rd of June last.**

Sir A. H. Gordon.

I have, &c. (Signed)

EDWARD STANHOPE.

(Confidential,)

GENTLEMEN,

109

No. 16.

COLONIAL OFFICE to CROWN AGENTS.

Downing Street, January 10, 1887. In reply to your letter of the 11th ultimo, I am directed by Mr. Secretary Stanhope to inform you that he approves your proposal to adopt Sir C. Gregory's suggestion that advantage should now be taken of Mr. Waring's presence in England by employing him for the completion of the plans, specifications and other preliminaries of the proposed Haputale extension of the Ceylon railways.

Mr. Stanhope has not sanctioned the execution of this work, but he thinks it desirable that the plans, which he understands are nearly ready, should be made complete, so as to be placed on record for future use in case the question should come up again for consideration.

The Crown Agents.

I am, &c. (Signed)

R. H. MEADE.

GENTLEMEN,

Enclosure in No. 15.

Sir C. H. GREGORY to CROWn Agents. Ceylon Government Railways.-Haputalé Extension.

2, Delahay Street, Westminster, S.W.,

November 23, 1886.

(1). In anticipation of a more full report, which I hope to send you very shortly, I have the honour to state that, adopting as a basis Mr. Waring's final estimate in his report of May 25th, 1885, and modifying it in certain particulars to which I shall hereafter more fully allude, my estimate for the construction and equipment of the line from Nánu-Oya to Haputalé amounts to 6,843,827 rupees. This is on the assumption that the works of construction will be carried out by contract as on the extension to Nánu-Oya.

(2). Provided it should be decided to carry out the works of construction in the Colony departmentally, and under the direction of an engineer of practical railway experience, and well acquainted with all the conditions of work on the ground, such as Mr. Waring, and provided he had the amount of latitude of action allowed him which would be granted by a large contractor in England to his chief agent in Ceylon, I should expect to see a saving of between 300,000 and 400,000 rupees.

(3). The evidence given by Mr. Waring before the late Railway Commission indicates a probable saving upon his previous estimates amounting to 225,358 rupees, of which 200,000 rupees is referred to in paragraph 31 of his report of May 25th, 1885, and 25,358 rupees in paragraph 46 of that report. You inform me that the report of the Commission has reduced Mr. Waring's estimate of rolling stock by 46,100 rupees.

(4). I think it would be safer to leave the 200,000 rupees in the estimate, because that saving is contingent upon the success of certain deviations which have not yet been surveyed. The other two items amounting to 71,458 rupees formed a part of Mr. Waring's estimate, because he understood by communication with the general manager, that they were necessary for the working of the line, and assuming that the general manager has come to the conclusion that this expenditure would not be necessary, it would naturally be struck out of the engineering estimate.

(5) In the estimate that I have submitted, I have thought it my duty to provide adequately for unforeseen contingencies, incidental to the work, although not actually part and parcel of it. It is very possible that I may have exaggerated them, but, past experience in Ceylon has shown that my estimates based upon this principle have not been unreasonably high.

I have, &c. (Signed)

CHARLES HUTTON Gregory,

Consulting Engineer.

SIB,

No. 17.

The RIGHT HON. EDWARD STANHOPE, M.P., to GOVERNOR THE HON. SIR

A. H. GORDON, G.C.M.G, No. 15.

Downing Street, January 10, 1887. I have the honour to inform you that I have received direct from the Colony, copy of a memorial addressed to me by the Ceylon Agricultural Association, on the subject of the proposed railway extension to Haputale. "I shall doubtless receive the original memorial with your observations in due course, but as the matter has been already decided by my Despatch, No. 10, of the 7th instant, I request you to inform the memorialists, in reply to their memorial, of the decision taken.

Sir A. Gordon.

SIR,

I have, &c.

(Signed) EDWARD STANHOPE.

No. 18,

The RIGHT HON. EDWARD Stanhope, M.P., to GOVERNOR THE HON. SI A. H. GORDON, G.C.M.G. No. 16.

Downing Street, January 10, 1887. WITH reference to my Despatch, No. 10, of the 7th instant, I have the honour to forward for your information, copies of correspondence with the Crown Agents for the Colonies regarding the completion of the plans, &c. of the proposed Haputale railway extension for future use, should the question againcome up for consideration.

I have, &c. Sir A. Gordon.

EDWARD STANHOPE.

(Signed)

• No. 4.

• No. 18.

† No. 16.

Nos. 13 and 16.

PUBLIC RECORD OFFICE

Reference:

TELEC.O. 882

4PUBLIC RECORD OFFICE, LONDON

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