The Right Hon. J. H. T. Manners-Sutton, who afterwards became Viscount Canterbury by the death of his father, assumed the governorship of Victoria on the 15th of August, 1866 and held it until the 2nd of March, 1873. During his term of office there was a partial lull in the vehemence of party warfare; the fiscal policy of the country had been settled, the revenue was generally prosperous, manufacturing enterprise underwent a considerable expansion, the railway system of the colony was being steadily developed, and the absence of any violent strife in politics, after the settlement of the exciting Darling grant question, proved to be conducive to the welfare and progress of all classes of the community. There were, it is true, six changes of ministry in less than seven years, but the earth continued to "bring forth its kindly fruits in due season" notwithstanding, and the beneficial operations of human industry remained unaffected by the substitution in the Cabinet of one set of men for another. One measure of more than ordinary importance received the Royal assent at the hands of Viscount Canterbury. This was the Education Act of 1872, drafted by Mr. Wilberforce Stephen. Two systems, the national and denominational, had been previously in operation. These were abolished by the law which came into force on the 1st of January, 1873, its fundamental principle being gratuitous, secular and compulsory instruction up, to a certain standard. During the first twelve years of its operation there was an increase of seventy-two per cent in the number of schools opened, of seventy-four per cent in the number of instructors, of sixty-three per cent in that of the scholars on the rolls, of seventy-six per cent in their average attendance, and of sixty-six per cent in the estimated number of distinct children in attendance.

The visit of the Duke of Edinburgh to Victoria occurred during Viscount Canterbury’s term of office, and called forth demonstrations of loyalty from all classes, and a display of enthusiasm in which the inhabitants of all parts of the colony visited by his Royal Highness spontaneously participated. He laid the first stone of the new town hall in Swanston Street and of a spacious hospital on the St. Kilda Road, near the city, which in his honour received the name of the Alfred Hospital.

Sir George Ferguson Bowen succeeded Viscount Canterbury, and took office on the 31st of March, 1873. He, too, soon found himself embroiled in political troubles. The old feud between the two Houses of Parliament had slumbered, but had not ceased. They had differed on the subject of payment of members. On two occasions the Upper House had acquiesced in a measure of this kind to be operative for three years, but in 1877, at the beginning of the third session of the Parliament, a new ministry, at the head of which was Mr. Berry, backed by a powerful majority, announced that it did not intend to introduce a specific measure for the renewal of this payment, but would tack the item to the Appropriation Bill. It did so, and the Council set the Bill aside. Thus there were no funds available for the payment of public servants, and on the 8th of January, 1878, which was thenceforward known as " Black Wednesday," a notice appeared in the Government Gazette dismissing the heads of departments, together with the judges of county courts, courts of mines, courts of insolvency, police magistrates, Crown prosecutors, and a number of other functionaries. The proceeding was admitted to be a " revolutionary " one, and its effect on the community, by impairing confidence and inspiring alarm, was disastrous. Property depreciated in value, business underwent a sudden contraction, there was a considerable exodus of capital and labour to a neighbouring colony, and party feeling was greatly exacerbated by the extreme measures resorted to by the Government. On the 28th of May the Council passed a separate bill for the payment of members, and also an Appropriation Bill with the tack omitted. In the Assembly soon afterwards a measure was introduced which virtually deprived the Upper House of most of its power as a co-ordinate branch of the legislature, and introduced the principle of the Plebiscite. It was thrown out by the Council, and the Lower House voted five thousand sterling to enable Mr. Berry and a colleague to proceed to England for the purpose of conferring with the Secretary of State for the Colonies on the subject of the constitutional difficulties of the colony. On the 4th of December Sir George Bowen received a despatch announcing his recall, and informing him that the Marquis of Normanby had been appointed as his successor. His lordship assumed office on the 27th of February, 1879. In the meantime Messrs. Berry and Pearson had proceeded to England to invoke Imperial interference in the political troubles of the colony. But Sir Michael Hicks-Beach, who was at that time at the head of the Colonial Office, had already signified that, in his opinion, no sufficient case had been made out for the intervention of the British Parliament, and to this opinion he continued to adhere. The right of self-government had been conferred upon the colony of Victoria, and it was for her to work out her own constitutional problems. He advised the Assembly not to introduce foreign elements into supply bills, and he considered that the Council in such a case was not likely to reject them. The despatch, which was shown to Messrs. Berry and Pearson before its transmission to the Governor, concluded by stating that the Imperial Parliament would never alter the constitution of Victoria at the request of one House only. After this the political effervescence which had lasted with little interruption for upwards of a decade subsided. Parties became more evenly balanced, and there was less temptation to resort to " the falsehood of extremes." Happily, moreover, the project of an international exhibition to be held in Melbourne, as the sequence of that which had been so brilliantly successful in Sydney, served to divert men’s minds from the strife and stress of politics. There had previously been five industrial exhibitions in the former city. The first two —those of 1854 and 1861 —had been of a purely local character; the others, held in 1866, 1872, and 1875 respectively, were intercolonial. The number of exhibits in 1854 was four hundred and twenty-eight only; in 1875 it had risen to four thousand eight hundred and twenty-nine, or, in other words, it had decupled.

The Melbourne international exhibition was opened on the 1st of October, 1880, by the Marquis of Normanby in the presence of the Governors of New South Wales, South Australia, Western Australia and Tasmania, the commanders of the British and foreign warships lying in the bay, and the principal personages of the colony. The day had been proclaimed a public holiday, Melbourne was fairly decorated for the occasion, and nothing had been neglected that was calculated to heighten the festive and picturesque character of the ceremonial. Sir W. J. Clarke, as the president of the commission, read the address prepared for the occasion, after the performance of a cantata, specially composed by M. Leon Caron, the words having been written for it by Mr. J. W. Meaden. A telegram was despatched to her Majesty the Queen announcing the successful opening of the exhibition.

To the native born population of the colony, such a display of the products of the looms, factories and workshops of Europe and the East proved a revelation. It was indeed an illustrated lesson-book of economic geography and industrial development, and it brought about quite a revolution in public taste, more especially as regards household furniture and decoration. It created a demand for elegant and artistic cabinet work, ceramics, hangings, and metal ornaments, and many British and foreign houses established branches in Melbourne for the purpose of supplying that demand; while it also stimulated local ingenuity, inventiveness and enterprise, and supplied higher standards of judgement and comparison to colonial artificers than those previously accessible.

During the seven months the exhibition was open, the admissions of all classes numbered one million three hundred and nine thousand four hundred and ninety-six, the receipts amounted to fifty thousand pounds, and the deficiency was, covered by a sum of about six thousand pounds. It closed in May, 1881, and after all the exhibits had been removed, and the annexes disposed of to the railway department, the building was handed over to the control of a body of trustees in order that it might be applied to purposes of popular instruction and recreation.

The only other important event which occurred during the time the Marquis of Normanby was Governor of Victoria, was a reform in the constitution of the Legislative Council. This was effected in 1881. It in creased the number of members from thirty to forty-two, lowered the property qualification required from them, abbreviated the tenure of their seats, and widened the electoral basis upon which that House rests; any person rated on a freehold of the annual value of ten pounds, or leasehold of the annual value of twenty-five pounds, being entitled to exercise the franchise for the Legislative Council. The same year may be said to have witnessed the termination of that epoch of political sturm und drang which the colony had been passing through, with brief intermissions, for a period of thirty years. All the burning questions had burnt themselves out; and after the overthrow of the third Berry administration, in July, 1881, and the advent to office of Sir Bryan O’Loghlen —who announced a policy of "peace, progress, and prosperity" —there was a revival of confidence, and a general feeling that better times were at hand. And this feeling, which events were beginning to justify, was strengthened by the formation, in 1883, of a coalition Government, comprising the leading members on both sides of the Assembly. This was sufficiently strong in Parliamentary support, and in the encouragement which it received from public opinion outside, to apply itself to the preparation and passage of measures of great public utility. One of these enabled the creation of a Harbour Trust, while another vested the administration of the whole of the railways in Victoria in a Board of Commissioners, three in number; a chairman for that board having been procured from England, in the person of Mr. Speight, a gentleman who had acquired his valuable training and experience in the management of one of the great trunk lines in the mother country. Under the prudent and commercial system of working the railways introduced by these gentlemen, the receipts from those undertakings have not merely sufficed to defray the interest on the loans contracted for their construction, as well as the working expenses, but have yielded a small surplus to the general revenue. As the removal of the railways from political influence had been found to be attended by such beneficial consequences, the same method of administration was resorted to for the whole of the public service of the colony; and an Act was passed by which a Board of Commissioners was instituted for this purpose also, so as to remove appointments and promotions out of the hands of the ministry for the time being. The failing health of both the Marquis and Marchioness of Normanby induced his Excellency to apply to the Secretary of State for the Colonies to be relieved from duties which were beginning to press too severely upon him; and on the 18th of April, 1884, the Marquis was authorised to relinquish his high trust into the hands of Sir William Stawell, the Chief Justice, who acted as governor until the arrival of Sir Henry Brougham Loch in the following July. The new governor had held for many years a similar appointment in the Isle of Man, where his Excellency and Lady Loch acquired a high degree of popularity. They cordially accepted the duties and responsibilities as well as the honours of their new position; and were peculiarly well qualified, both by character and temperament, for the leadership of society in this distant land.