No. 114
10th October 1865
I have the honor to acknowledge the receipt of Your despatch No. 48 of 24th July, transmitting a Copy of a Letter from the Lords Commissoners of Her Majesty's Treasury, with a Report from the Commissioners of Audit respecting theBritishManuscript image British Columbia Accounts for 1863.
2. In obedience to your instructions I have the honor to furnish explanations prepared by the Auditor General on the items of expenditure in excess of the Estimate for that year.
3. With reference to that portion of the letter from the Commissioners of Audit which notices the transfer of £368.7.6, the rent of the Water Frontages, New Westminster, to the Municipal Council, I learnthatManuscript image that when these frontages were first leased no Municipal Council existed. After its formation, the Council applied for the control of the Wharf Road, and the rents received for frontages, offering in return to undertake the construction of a substantial plank road by the wharfside, a duty which must otherwise have fallen on the Government. On these considerations Sir James Douglas acceded to the request of the Council and authorized the paymentofManuscript image of the rents to that body.
4. With regard to the amount of Temporary Loan, £37,938 advanced by the Bank of British Columbia. It will be necessary to explain the system pursued in the Colony in regard to the custody of the Public Money. Since 1860, the Colony has never been free from debt to the Bank. All Revenue, therefore, received at the Treasury has been at once paid into the Bank, and all Payments are made by Cheques on the Bank whichallowsManuscript image allows overdrafts, charging interest on the daily debtor balance at the rate of one per cent per month. The legal rate of Interest being fixed at one and a half per cent per month. The greater part of the payments made by Government were due between April and July, and great inconvenience would have been experienced if the Government had not had this accommodation.
5. The Commissioners of Audit further draw attention to a Loan of £9000, made by theGovernmentManuscript image Government of Vancouver Island. I can only presume in explanation that British Columbia being largely in debt to the Bank at the rate of Interest of one per cent per month, and the Colony of Vancouver Island having at the time a surplus Revenue, Sir James Douglas considered the arrangement advantageous to both Colonies. The Interest charged on the Loan being at the rate of one half per cent per month. I may add that the whole amountwasManuscript image was repaid to Vancouver Island by Sir James Douglas a few days before Mr Seymour's assumption of the Government of this Colony.
I have the honor to be,
Your most obedient
humble Servant
Arthur N. Birch
Minutes by CO staff
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Mr Elliot
Send copy of this Desp: & enclosures to the Treasury, in reply to their letter of the 18 of July?
VJ 4 Jan
TFE 4 Jany
Documents enclosed with the main document (not transcribed)
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Statement of claims made in excess of the estimate for the accounts of 1863, with explanatory remarks appended thereto.
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Thomas R. Holmes, for the Auditor General, to Colonial Secretary, 6 October 1865, forwarding statement in explanation of the Treasury Office enquiries.
Other documents included in the file
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Elliot to G.A. Hamilton, Treasury, 15 January 1866, forwarding copy of the despatch and enclosure for information.