The Sun.
London, England, 1858-08-10 00:00:00

RAILWAYS.

We were enabled last month to announce the acceptance
of a tender for one of our two trunk lines of railway, and
on this the work of formation has now commenced. Some
delay in signing the contract was occasioned by the illness
of the President of the Beard of Land and Works, and from
the same cause no official turning of the first sod has taken
place; but, without waiting for this ceremony, the con-
tractors have now broken ground on the two sections of the
line of which they are in possession. It is not their inten-
tion to take on a very large number of men at first, but to be
prepared to employ all those whose services may be dispensed
with on other Government works through the winter, and so,
by constant additions, to make up their full complement
before the beginning of next summer. By proceeding In this
way all confusion will be avoided, and other branches of
industry will be undisturbed by any sudden draught on the
labour resources of the colony. At present there is no diffi-
culty iu getting as many men as are required; nor is such
likely to occur during the winter; bat before next summer
is over we may expect that an advance on the present rate
of wages will have to be given by the contractors, or they
will scarcely keep in their service the number which they
have calculated on constantly employing to ensure the com-
pletion of the works within the time specified. We have
thus actually commenced the construction of one of our
main lines, and no long time will elapse before the
first sod of the other is turned. The second batch
of tenders for the line o.rom Geelong to Ballarat
bas been analysed, and the declaration of the suc-
cessful tenderer's name is daily looked for by the
public. As in the case of the first line, some weeks
will be required for the preparation and signing of the con-
tract; but we shall doubtless have soon to announce that
we are engaged in the simultaneous construction of the two
trunk lines to the interior.

The Government Lave arrange] for the lean for thr nerve
sary funds for the first 12 months by entering into an agree-
ment with the managers of the Union Bank of Australia,
the Bank of Victoria, the London Chartered Bank of Atr-
tralia, the Bank of Australasia, the Bank of New South
Wales, and the Colonial Bank of Australasia, for the supply
of £1,500,000, in sums not exceeding £150,000 per month.
The combination of banking interests thus established is to
represent the colony in the London money market, to in-
troduce the bonds, and to operate with them at a minimum
of 5 premium. The art angement, as settled, stands thus :
" That, in consideration of their appointment as netts,
the subscribing banks shall, on and after the lst October
next, advance to the Government a sum not exceeding in
any one month £150,000.
" That, on such advances being made, the Government
shall transmit to London, by the earliest opportunity occur-
ring thereafter, to the order of the respective representa-
tives of the contracting banks, au equivalent amount of
debentures, to be disposed of as hereinafter provided.
" The., for the amount of debentures so transmitted, the
said banks shall negotiate the draughts of the Government
on the repre r itaiivcs of the banks in London at an ex-
change of one-half the margin between the buying and
selling rates then ruling.
"That the Government shall pay to the banks interest at
the rate of 6 per cent. per annum from the date of advances
here to the period of the reelisation of the debentures in
London.
"That each hank shall' appoint a representative, to form
a committee, by whom the debantures shall be disposed of
in London ; and that such committee be authorised to take
steps for introducing the debentures into the market in the
most advantageous manner.
"That the committee Audi not dispose of the debentures
at a lower price than 103, until permission to do so shall be
shilroakieprall
given by the Government, except as hereinafter provided.
brokerage
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"That on all sales of debentures effected the Government
charges.
"That the interest on the lean shall be paid by the said
banks at a commission of per cent.
" That the advance to the Government by the banks on
debentures shall not at any one time exceed £1,800,000
sterling.
"That the payment of debentures at maturity, or the re-
purchase of any portion of them during their currency on
behalf of the Government, shall be performed by the banks
at a commission charge of per cent.
" That in the event of the Government requiring remit-
tances for any of the above pu-poses, draughts shall be pro-
vided by the banks at per cent. below their then-selling
rate on London.
" That as the Government may require, before the first of
October next, funds for the prosecution. of railway works,
the banks will be prepared to make such advances as may
be required, not exceeding the monthly maximum of
£150,000 sterling in all; and that in charging interest
theteon, the banks will allow the same rate of interest on
the ' Public Account' as charged on tbia special advance;
provided such allowance shall not exceed the amount due
by the Government to the banks."
- _

A contract embodying these conditions has been drawn
up and signed, and certified copies will be despatched by
this present mail to England.
Several other tenders were submitted to the Government,
including one from Messrs. Baring Brothers, by their
agent, Mr. Childers, to purchase debentures to the value of
£1,500,000 during the first year, at £10310s.; the bonds for
one-half (L 750,000) to bear interest from July 1, 1858, and
those for the second half to bear interest from January 1,
1859. They also offered £lO-1 if they were allowed the op-
tion of taking, at the same rate, an additio:-.al amount of
£1,500,000, to be issued in the ensuing year. They also, in
reply to a previous invitation from the former treasurer, Mr.
Ebden, offered to become the agents of the colony in ne-
gotiating the loan, and in the subsequent payment of inte-
rest. They were willing to undertake the agency for the
sale of the bonds, £7,000,000 sterling, at a commission of 1
per cent. on the amount of sale, one quarter per cent.
brokerage, and the repayment of other incidental expenses
actually disbursed. They agreed to grant to the Govern-
ment the power of drawing upon them to the amount
of £lOO,OOO per month, in anticipation of ad vices recel% ed in
Melbourne, at an additional banking commission of 1 pa.
tent. on thy Amount oo drawn. Mem. Baring prothere,