No. 30, Financial
14 May 1863
I have the honour to receive Your Grace's Despatch No 14 of the 12th March 1863 in reply to mine of 15th December last No 58 in which I solicited permission to raise upon the credit of the Colony
a
a further Loan of £50,000, to be devoted to the work of opening up the communications of the Country.  
2. I am gratified that the reasons I adduced appear to Her Majesty's Government to justify such a measure, and I feel deeply grateful to Your Grace for your valuable co-operation in advocating and supporting the step.  
3. In accordance with
Your
Your Grace's permission I have accordingly passed a Law similar to the British Columbia Loan Act of 1862, for raising a further sum of £50,000 by Loan upon the security of the General Revenue of the Colony, and I transmit herewith the duly certified copy of the said Law to be laid before The Queen for confirmation. The Debentures issued under that Law are to be redeemable in Twenty years instead of Ten
as
as provided in the 1862 Act, as by such arrangement it is considered that the Loan will obtain a position in the market as good, if not better, than the first Loan. Provision is also made in the Law for the redemption out of the proceeds of the Loan of the Bonds falling due on the 31st December 1863, under the "Roads Bonds Act 1863" and the further issue of Bonds under that Act is prohibited, so as to constitute the
present
present Loan virtually a second mortgage upon the Revenue until the redemption of the 1862 Loan, and a first charge afterwards.  
4. I shall according to the provisions of the Law authorize the Agents General to dispose of the Debentures, and shall realize the proceeds by drawing upon them from time to time in the manner as was suggested could have been done in respect of the 1862 Loan.  
5. The statement desired
by
by Your Grace as to the application of the 1862 Loan shall be duly prepared and transmitted at an early day. With reference thereto, however, I may now mention that the expenditure in 1862 under the head of "Roads Streets and Bridges" amounts in round numbers to £92,000. This affords conclusive evidence of the just application of the Loan to the purposes for which it was raised.  
I
6. I have noted with due attention Your Grace's suggestion as to suspending the works of one of the lines of road to Alexandria. I at one time feared that I should be compelled to adopt this course, serious as it might [be] in retarding the progress of the Colony, but subsequent events, almost providential in their character, relieved the pressure and enabled me to prosecute the works with renewed activity. Before describing these events I would desire to explain for Your Grace's
information
information that the two lines of roads starting respectively from Lillooet and Lytton, are only carried separately as far as "Clinton," the site of a proposed Town in honor of Your Grace. They here unite and thereforth to Alexandria there is but one line of road. The distance from Lillooet to Clinton is 47 miles, from Lytton to Clinton 67 miles. This latter line bends to the Southward through the valley of the Thompson to the debouche of
the
the Buonaparte which it follows as far as Grave Creek, (now Glen Hart), and from thence it keeps a northerly direction to Clinton. The Lillooet road was finished last season nearly as far as Bridge Creek, 100 miles: and I trust that before the end of July next it will be completed to the Terminus at Alexandria. About 39 miles of the Lytton Line were finished last year, and there remained only two sections of 7 and 21
miles
miles respectively to complete the line to the junction at Clinton. As I have already informed Your Grace the Contractor on this line failed in carrying out the work he had undertaken. Its accomplishment was a necessity to the progress of the Country, and such being the case Your Grace will conclude that after having fought our way through the mountain passes, and overcome so many difficulties in our progress, I would not readily succumb before minor obstacles, when so near
the
the completion of a glorious work. Every effort was made to transfer the Charter forfeited by Messrs Oppenheimer to substantial parties, but without success. Tenders were called for, but none could be accepted on account of their unreasonable terms. Almost despairing of success I was gratified by the appearance at the last moment of a fresh candidate. This was a Mr Hood, a respectable Englishman for some years resident in California and possessing a large property there, who tendered to complete the 21 mile section for
the
the sum of £8,500, payable in 6 per Cent road Bonds, redeemable in equal proportions in 1, 2, and 3 years after the completion of the work; an offer most advantageous in every respect, being considerably below the lowest offer previously received, and from the official Estimates apparently below the actual value of the work. I therefore did not hesitate to accept it. The 7 mile section which involves much blasting is to be constructed by a detachment of the Royal Engineers, and both
parties
parties were in full operation before the receipt of Your Grace's Despatch now under reply; and I feel assured that under the circumstances herein described these arrangements will not be displeasing to Your Grace; for considering the reasonableness of Mr Hood's offer, the great importance of the road to the Colony, the interests already involved and that had grown up in anticipation of its early completion, the impulse given to population and settlement, to
the
the introduction of machinery and the cultivation of land, its effect in rendering transport practicable and comparatively inexpensive, all tending to increase the Revenue, the actual amount of Revenue arising from the Road Tolls, and lastly the earnest wish of the people and their willingness to be taxed for the completion of the road, I had no alternative left, I conceive, but to complete without delay the line from Lytton to Clinton. An opposite course would have been simply disastrous to the country and nothing short of stern necessity
would
would have justified its adoption. It would in its effect have tended to defeat the great object for which we have been struggling—the throwing of supplies into the upper country at such rates that men can live in it. The healthy competition carefully fostered hitherto by which freight is kept at the minimum would have been destroyed. The enterprise already enlisted, and the settlement already made over a large and important portion of the country would have been checked and killed; and one of the two
natural
natural passes through an otherwise almost impassible country would have become inoperative. By the completion of this road, the two great thoroughfares of the country will be established. From the Coast to Douglas, and from the Coast to Yale, the Fraser is navigable. From these two points roads are carried to Alexandria, by which a vast district which has no water communication is rendered accessible. From Alexandria to the Rocky Mountains even, the Fraser is again navigable, and private
enterprise
enterprise has already launched a Steamer on the Fraser at Alexandria.  
7. These great road works being accomplished, the Government has faithfully done its duty to the Country, and the development of its valuable resources may safely be left to the energy & enterprise of the people governed by wise and wholesome laws.  
I have the honor to be
My Lord Duke
Your Grace's most obedient
and humble Servant
James Douglas
Minutes by CO staff
Mr Elliot
The Governor writes in terms of hope and confidence in the future progress of the Colony. Having, by means of the two £50,000 loans, been enabled to contruct the arterial roads the Imperial & Colonial Authorities have performed their part towards the development of the Country. The rest must mainly depend on the Inhabitants themselves.  
This desph will be interesting to His Grace to peruse previously to his moving the 2nd reading of the B.C. Bill.  
N.B. Sir F. Rogers will have to examine the Proclamation: the destination of wh: will be the Treasury.  
ABd
30 June/63
Mr Fortescue
It will be desirable to begin by forwarding this without delay to the Duke, although I have reason to believe that His Grace has received much the same information in a private letter from Governor Douglas.  
When the despatch returns, it will be necessary that it should go
to
to Sir F. Rogers and (I presume) to the Treasury, and that the Agent General should in due time be instructed to raise the loan. When that time comes, I think that we should review the debts of the Colonial Govt to the Agents and to the British Treasury and consider whether any of them are of such character that we ought by summary process to discharge them out of the proceeds of this loan.  
TFE
30 June
CF
1 July
N
2
Sir F. Rogers
Refer the Loan Act to the Treasury? & say that we propose to confirm, if their Lordships see no objection.  
TFE
2 July
At once.  
FR
3/7
Other documents included in the file
  • Elliot to G.A. Hamilton, Treasury, 7 July 1863, forwarding copy of the despatch and advising that Newcastle would propose confirmation of the loan should their lordships have no objection.  
 
Despatch to London:
Douglas to Newcastle, 14 May 1863, National Archives of the UK, 6336, CO 60/15. The Colonial Despatches of Vancouver Island and British Columbia 1846-1871. Ed. James Hendrickson and the Colonial Despatches project. Victoria: University of Victoria. http://bcgenesis.uvic.ca/getDoc.htm?id=B63030.scx. Accessed 20 June 2018. 

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