No. 6, Financial
10 January 1863
Adverting to your Despatches of the numbers and dates as per margin,
No 123, 13 May 1862
No 131, 16 June, and
No 140, 16 September.
I have the honor to report to Your Grace the course I have followed during the year just closed, with the earnest desireofManuscript image of conforming to the fullest extent practicable to the arrangements made by Your Grace with the Lords of the Treasury relative to the financial matters existing between Her Majesty's Government and the Colony of British Columbia.
2. The sum available to the Colony towards the maintenance of the Royal Engineers out of the Parliamentary vote of 1862 is £6000 only. Of this £4000 was drawn in April 1862, prior to thereceiptManuscript image receipt of Your Grace's Despatch No 123 of 13 May. Since April no further Drafts upon the Imperial Treasury have been made.
3. The sum to be repaid by the Colony during 1862, according to the Treasury Despatch of the 16 June are as follows
£6,900. 0.0 for Silver specie
152. 3.8 Overpayment Assay Office
34. 6.0 Passage of the Bishop
35. 7.0 " " "
With respect to those items I cannot refrain from appealingagainstManuscript image against the two latter being charged against the Colony, for they really have no connection with it. In the first place the passages were between places in Vancouver's Island, from Victoria to Nanaimo, and from Victoria to Barclay Sound—and in the second place they were not obtained at the intervention of this Government, but were sought directly by the Bishop from the Admiral commanding in the Station. British Columbia cannot therefore under any circumstances be justly chargeablewithManuscript image with the expense. As the amounts were paid by Her Majesty's Government, I sought to recover them from the Bishop. He however declined repayment on the plea that the charge was excessive. The deduction of these two sums reduces the amount to £7052.3.8.
4. In 1863, the Colony is required to repay £10,704, represented in Your Grace's and the Treasury Despatch aforesaid as an expenditure for Roads, Bridges and Surveys, and thereforeoneManuscript image one improperly defrayed from Imperial Funds. I must beg Your Grace's attention to the items composing this sum, and I venture to submit that they are as justly chargeable to Imperial Funds, as any other expenses in connection with the Military. The details are as follows:
A. Erecting Military Barracks at New Westminster £8758. 6.7
B. Erecting Military Barracks at Langley 320. 0.7
C. Military trail to Burrards Inlet 92. 7.8
D. Reconaissance Fort Hope to Fort Colvile 40.19.6
E. Erecting Hospital & Officers Quarters
New Westminster 1392. 6.1
F. Temporary Buildings & Fittings for Royal
Marines at Esquimalt 100.16.1
TheManuscript image
The works marked A. B. & E. were undertaken by Colonel Moody who represented them to be an indispensable necessity. They are entirely of a Military character, not required by the Colony, but arising out of the compact entered into with the soldier. The only control I could have exercised in the matter would have been to forbid the expenditure. That course would have left the Troops with their wives and families homeless.
The work marked C wasconsideredManuscript image considered requisite by Colonel Moody to open a communication from his Camp to Burrard Inlet in the event of Naval support being required.
The exploration marked D was ordered by Colonel Moody solely on Military considerations during the period of the San Juan occupation.
The expenditure at F was caused by the sudden arrival of the Marines from China in Her Majesty's Ship Tribune, and the urgent necessity of immediately relieving an overcrowded Ship afteraManuscript image a long voyage.
Your Grace considers that for a sum expended in the pay, sustenance and movement of the Engineers, application may be made to Parliament: I trust what I have herein stated may induce Your Grace also to consider that this sum of £10,704.16.7 is not more justly chargeable to the Colony than the other, and that, therefore, for that likewise application may be made to Parliament.
5. Bowing to Your Grace's decision that British ColumbiamustManuscript image must bear a moiety of the expenses of the Royal Engineers, I would yet submit that at this period of her existence she should be relieved from contributing a moiety of the Regimental Pay. For instance in 1862-63 the whole estimated expense of the Corps is £22,000 including Regimental Pay. The Colony is required to contribute £11,000, while the vote by Parliament specially for the Colony is only £7200, the remaining sum of £3800 being borne on the Army Estimates, and so borne whether the Troops be at home or abroad. I am merelydealingManuscript image dealing with the financial question, I do not desire to touch the abstract one of how far a Colony should assist the Mother Country to support Troops detained in the Colony for Imperial purposes. To old and settled Colonies such a question may have an intimate relation, but to a young Colony struggling for development against extra-ordinary difficulties it can have but little application. In proportion as its revenues are applied so will it progress: the more rapid its progression, the sooner will it be in a position to require the leastamountManuscript image amount of Imperial assistance.
6. I trust the weighty reasons I have laid before Your Grace in my Despatch No 58 of the 15 Decr last, will induce Yr Grace to obtain the sanction of the Lords of the Treasury to another loan of £50,000. With that sum I believe I can so arrange my financial scheme for the current year as to carry on without check the reproductive works that have been set afoot, and at the same time to place the Colony at the close of the year in the most satisfactoryrelationManuscript image relation towards Her Majesty's Government in all matters of account.
7. I have carefully abstained during the past year since the receipt of Your Grace's Despatches herein referred to, from drawing upon the Imperial Treasury, but to meet our liabilities both on Military and Civil account I now find myself much pressed for funds; I have therefore drawn upon the Paymaster General for the sum of £5000, on Colonial Pay account, as speciallyreportedManuscript image reported in my Despatch of this date No 4, and I trust Your Grace will not object to this measure, viewing the amount as on account of the Parliamentary vote in aid of the Colony for 1863-64.
I have the honor to be
My Lord Duke
Your Graces most obedient
and humble Servant
James Douglas
Minutes by CO staff
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ABd 2 March
See separate minute.
TFE 27 March
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I am sorry to say that I do not think this can be deemed at all a satisfactory despatch from Governor Douglas. The manner of it impressed me even more unfavorably than the substance, for it appears to me shuffling: it dwells at great length on trifling details, and then passes over evasively such a substantial topic as our claim for £6,900. Governor Douglas asked that this amount out of a former Parliamentary Grant should be sent to him in specie, we did so, upon which he appropriated the cash, but equally drew bills for the same amount in England. One is at a loss for words in which to state such matters clearly in official language. Were the transaction a private one, it could be explained simply enough, for it would merely be like any other of the frauds that are daily reported in the newspapers. Governor Douglas was peremptorily ordered to repay that money this year. In answer he amuses us with a long argumentation whether the Colony ought to pay two sums of about £35 for the Bishop's passage, and merely inserts in one part ofhisManuscript image his despatch a vague and grandiloquent statement that if suffered to borrow an additional £50,000, he doubts not that at the end of the year he would be able to establish a satisfactory relation toward H.M.'s Govt in all matters of account. This is the style of writing which I venture to characterize as shuffling.
About the sum of £10,704 (which he was only called upon to repay in the course of the year 1863) I confess that Governor Douglas seems to me to have a better case. He had drawn bills to that amount under the head of "Roads, Bridges and Surveys," we naturally said that these objects were Colonial and not Military and that he had no right to draw for them in his Bills on account of the Engineers. But he now furnishes explanations which certainly show, if they may be relied upon, that most if not all of the expenditure was military and that it was his own fault not to make this clearer before. If the outlay be really military, I have alwaysthoughtManuscript image thought that this young Colony had a fair excuse for resisting the burthen: the Troops were forced upon it from home without ever being asked for from the spot, and from the first moment the Governor steadily reported that he saw his way towards making the Colony self-supporting, provided only that it were not to be charged with Soldiers for which it did not ask, and which it did not believe itself to require. This however is merely my own impression, and I suppose that the Treasury will be very unwilling to accept the burthen of this £10,704 after it had flattered itself with the idea of being relieved of it. The Governor's Bills, even if admitted to have been for military purposes, were beyond the amount authorized, and have not yet been covered by any Parliamentary vote, so that the Treasury will feel that it can only yield to his present representations by applying to Parliament for a retrospective vote. Nevertheless this is the course which in my humble opinion would be the first one in respectofManuscript image of all such items as may be admitted to be purely military: the so called "Military Trail" from one point to another looks suspicious, and as if it might be in fact a road for general convenience, but on this detail we could get evidence from Coll Gossett if wished.
The practical course which occurs to me would be somewhat as follows: with reference to former correspondence, send this despatch to the Treasury for their consideration. With respect to the minor details consisting of the two charges for the passages of the Bishop, say that the Secretary of State regrets the difficulty experienced in procuring a settlement of the claim, but that he would leave it to their Lordships to consider whether it might be discharged out of Civil Contingencies, as appears to be frequently done in the case of the passages of other Colonial Bishops. (I think that the whole subject of Bishops' passages well deserves revision for it is a fertile source of difficulty and annoyance.)WithManuscript image With regard to the value of the specie, state that the Duke of Newcastle is much displeased with the Governor for not having already made the payment, and that His Grace is disposed to send out more peremptory instructions than before that no part of the contemplated loan for British Columbia must be raised in the Colony, and to announce that as soon as raised in this Country, the claim for the specie will be discharged out of the proceeds. With reference to the sum of £10,704, say that the Duke of Newcastle proposed, in the correspondence passed last year, to charge this amount against the Colony, because the Bills were described as having been drawn for "Roads, Bridges and Surveys," and were supposed to be for objects unequivocally Colonial, but that the Governor by his despatch supplies explanations which appear to show that the works for which these Bills were drawn were really of a militarycharacterManuscript image character. As this is the case, say that the Duke of Newcastle feels much more doubtful whether the expenditure ought to be charged out to the Colony, for it must be remembered that the Troops were sent out at the time of the formation of the Colony by the Queen's Government at home as a measure which they considered advisable, without it's ever having been applied for by any of the authorities already on the spot, and that from the earliest moment Governor Douglas has always consistently declared that he saw the means to make the settlement self-supporting provided that it's government were not to be charged with soldiers for which it did not ask, and which it did not believe itself to require. I should tell the Treasury that the Duke of Newcastle is now taking measures for putting an end to the Military Garrison at thecloseManuscript image close of the present year so that this question will not be prolonged into the future, but that with regard to the past, he is disposed to think that in the infancy of the Colonial Government, there is much force in the reasons for charging it with only a very light proportion of the expenses of a force which it never asked to receive and was always willing to part with.
TFE 27 March
Minutes by CO staff
I agree with Mr Elliot's views on all the points raised in this very unsatisfactory despatch, and will write to the Treasury accordingly.
If the £10,704 have really been spent by Colonel Moody merely on "barracks" it would be hard to charge that sum to the Colony—more especially as they will be vacated in a fewManuscript image months, but why were "barracks" last year called "Roads and Bridges"? By the Governor's own showing there must have been great laxity in giving orders for these works—if indeed they are Barracks. Coll Moody could have had no power to order them without authority from the War Office, and the Govr could have no power to order them if they were to be charged to vote of Parlt.
N 29
Other documents included in the file
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Elliot to Frederick Peel, Treasury, 2 April 1863, forwarding copy of the despatch and discussing various financial matters concerning the colony.