Colonial Despatches

In reply to Mr Elliot's letter of the 24th, I am directed by the Lords Commissoners of Her Majesty's Treasury to acquaint you, for the information of the Duke of Newcastle, that My Lords are of opinion that, to meet the pressing emergency described in the Despatch from the Governor of British Columbia, it will be expedient to authorise him to adopt the provisional measure which he recommends of fabricatingPieces Pieces of the intrinsic value, in Gold, of the United States 10 and 20 Dollar Pieces, to pass current as money, and to be received in payment of Government Dues.

Experience has shown that the recognition of Coins or Tokens by accepting them in Government Contracts is, generally, sufficient to give currency to them without declaring them to be Legal Tender, and My Lords think that it would be desirable, if possible, to avoid that step in the case of a provisional Token issued without the controlling authority of the Masterof of Her Majesty's Mint. They would not, however, object to a discretionary authority being given to the Governor to declare the proposed pieces to be Legal Tender for a limited period—say one year—with power to extend the same by Proclamation for further limited periods, in case it should be found that the Tokens do not obtain currency without such sanction.

My Lords suggest that the proposed pieces should bear a distinctive Assay Mark denoting their gross weight and intrinsic value in current money and They consider that the Governoris is quite correct in his opinion that such value should be determined by the quantity of Fine Gold contained in each Piece without regard to the Silver found in the Native Gold.

It is true that the admixture of Silver would give to the Coins additional value in the General Bullion Market, but it is the invariable practice to regard Silver contained in Gold coins as alloy, not affecting their value in current exchange. Such is the case with the British Sovereign commonly called the "Dragon" (from the device ofof St George and the Dragon on the reverse) which contains a considerable portion of silver introduced intentionally as Alloy, and with the Gold Coins of Australia, the native gold of which contains a considerable portion of Silver.

It will, probably, be desirable to protect the circulation of the proposed Pieces by enacting Penalties for the fabrication of the Assay Mark—and for attempting to pass them after they have been chipped or otherwise wilfully deteriorated.Whatever Whatever may be the device adopted, the Pieces should not bear the effigy of Her Majesty the Queen—which is proper to Coins issued from Her Majesty's Mint.

My Lords have confined Their approval to the measure recommended by the Governor of British Columbia, but it may be a question whether Pieces of lower value than 10 Gold Dollars may not be desirable, and They would not object to his being allowed a discretion to issue them of the value of 5 Dollars, which would be equivalent to £1.0.6 in British money.