Colonial Despatches
The colonial despatches of Vancouver Island and British Columbia 1846-1871
Public Offices document
Hamilton, George Alexander to
Carnarvon, Earl 27 May 1859, CO 60:6, no. 5331, 148.
Abstract
Hamilton, George Alexander to
Carnarvon, Earl 27 May 1859, CO 60:6, no. 5331, 148.
Public Offices document.
Minutes (1), Other documents (1), Marginalia (4).
Hamilton to Carnarvon (Parliamentary Under-Secretary)
Treasury Chambers
27 May 1859
My Lord,
With reference to your letter of the 14th Instant, I am
directed by the Lords Commissioners of Her Majesty's Treasury
to acquaint you, for the information of Secretary Sir E. Bulwer
Lytton, that My Lords think it desirable, before any Measures
are taken with a view to the Establishment of a Government Assay
and Mint in British Columbia, that the opinions of the local
Authorities on the subject, and the sufficiency of the local
Revenues to bear the cost, should be ascertained. My Lords are
not prepared to sanction any preliminary expense out of Imperial
funds for an object of uncertain advantage, and the first
first
principles of which have yet to be considered.
Now arrived despes 8th and 11 April.
first
principles of which have yet to be considered.
As Sir E.B. Lytton is aware, the only instance of the
institution of a Colonial Mint is afforded in the case of New
South Wales, and their Lordships think that the circumstances
which gave rise to the demand from that Colony and other Colonies
in Australia for the Establishment of local Mints, and the proceedings
consequent thereon, may be referred to with advantage, in order to
ascertain how far the precedent justified the hope entertained by Sir
E.B. Lytton of the success of a similar experiment in British Columbia.
The discoveries of gold fields in New South Wales afford an
example of a new source of mineral wealth having been suddenly
opened amidst communities
communities already far advanced in wealth and
commerce, and possessing the advantages of a sound currency and
established Banking institutions owing to the scattered condition
of a great portion of the people in agricultural pursuits, and the
adaptation of the Banking System to their wants, the greater part
of the payments arising in trade were discharged by means of
checks or the transfer of book audits, and there was perhaps no
community in which so small an amount of circulating medium was
employed in proportion to its trade and population.
communities already far advanced in wealth and
commerce, and possessing the advantages of a sound currency and
established Banking institutions owing to the scattered condition
of a great portion of the people in agricultural pursuits, and the
adaptation of the Banking System to their wants, the greater part
of the payments arising in trade were discharged by means of
checks or the transfer of book audits, and there was perhaps no
community in which so small an amount of circulating medium was
employed in proportion to its trade and population.
This State of things was at once changed by the gold
discoveries, which drew together a large portion of the population
and effected a complete revolution
revolution in their habits and pursuits.
revolution in their habits and pursuits.
A great immigration followed, and an active retail trade
sprang up which could only be carried on by means of a larger
circulation of coins or notes.
At that time, the metallic circulation of
Australia consisted solely of British Money. Public and Mercantile
Accounts were kept as they are still in the denominations of that Money;
and the necessary supplies of specie were obtained, as they
were required, by Moderate exports from this Country, chiefly
through the Agency of the Banks.
In B. Columbia & V.C. Isd the circulation consists of U.
States, & perhaps Mexican Dollars.
The Country, therefore, in which an extraordinary demand
had suddenly arisen for a large additional quantity of coin
was far
far removed from its sources of supply, and the phenomenon
was exhibited of a course of exchange which encouraged large
shipments of Gold Sovereigns from England to Australia at the
same time when gold bullion was imported thence in great
quantity. The effect practically was that the gold dust was
sent from Australia to the British Mint for coinage, causing
great loss of time and the cost of a double voyage. During
the interval which ensued, between the discoveries of gold and
the receipt of the Coin transmitted hence, the Colonies were
driven to great shifts for the maintenance of a temporary
circulating Medium. The Banks were empowered either by tacit
agreement or regulation to issue promissory Notes against
bullion held by them: and this practice
practice was reduced to system
in South Australia by the Establishment of a Government
Refinery and Assay, for stamping small ingots of Standard
Gold which were used as substitutes for Coin, and latterly
assumed its form and character.
far removed from its sources of supply, and the phenomenon
was exhibited of a course of exchange which encouraged large
shipments of Gold Sovereigns from England to Australia at the
same time when gold bullion was imported thence in great
quantity. The effect practically was that the gold dust was
sent from Australia to the British Mint for coinage, causing
great loss of time and the cost of a double voyage. During
the interval which ensued, between the discoveries of gold and
the receipt of the Coin transmitted hence, the Colonies were
driven to great shifts for the maintenance of a temporary
circulating Medium. The Banks were empowered either by tacit
agreement or regulation to issue promissory Notes against
bullion held by them: and this practice
practice was reduced to system
in South Australia by the Establishment of a Government
Refinery and Assay, for stamping small ingots of Standard
Gold which were used as substitutes for Coin, and latterly
assumed its form and character.
The inconveniences arising from the transitory condition
of the circulation led to applications from New South Wales,
Victoria, and South Australia for the establishment of local
Mints in those Colonies, and after much consideration Her
Majesty's Government consented to a compliance with those
applications subject to regulations detailed in the Treasury
Minute of 22nd March 1853, and on condition that the
Colonies should bear the whole expense of the necessary
Machinery and Establishments, New South Wales having obtained
obtained
a start over the other Colonies by a remittence to this Country
of a sum to meet the preliminary Outlay, the Experiment was
Commenced by setting up a Mint at Sydney. The result has been
that the Institution has been found sufficient for the
requirements of all the Australasian Colonies, and has also
supplied gold coins for Ceylon and Mauritius. Victoria and
South Australia have allowed the question which they had raised
for the establishment of local Mints to drop, and My Lords are
under the impression that the Government Refinery and Assay
which had been established for a temporary purpose in the
latter Colony, has been abolished.
obtained
a start over the other Colonies by a remittence to this Country
of a sum to meet the preliminary Outlay, the Experiment was
Commenced by setting up a Mint at Sydney. The result has been
that the Institution has been found sufficient for the
requirements of all the Australasian Colonies, and has also
supplied gold coins for Ceylon and Mauritius. Victoria and
South Australia have allowed the question which they had raised
for the establishment of local Mints to drop, and My Lords are
under the impression that the Government Refinery and Assay
which had been established for a temporary purpose in the
latter Colony, has been abolished.
In effect it has been found from Experience that
that one
Mint is sufficient for the requirements of all the Eastern
Colonies excepting Hong Kong: and it may be observed, as
bearing on one of the arguments used by Sir E.B. Lytton in
favor of the Establishment of a Mint in British Columbia,
that the Colony of Victoria in which the system of an export
duty of gold was first instituted, has not found it necessary
to establish a local Mint for the purpose of facilitating the
Collection of a Revenue from that source.
that one
Mint is sufficient for the requirements of all the Eastern
Colonies excepting Hong Kong: and it may be observed, as
bearing on one of the arguments used by Sir E.B. Lytton in
favor of the Establishment of a Mint in British Columbia,
that the Colony of Victoria in which the system of an export
duty of gold was first instituted, has not found it necessary
to establish a local Mint for the purpose of facilitating the
Collection of a Revenue from that source.
It will be seen from this statement that the circumstances
of British Columbia are entirely different from those which
led to the successful Establishment of a Mint at Sydney: indeed,
except in the fact of both being Gold producing Colonies, there
are no points of resemblance in their
their condition. It does not
appear that there is any want of coin in British Columbia,
and if the community can readily obtain their supplies of coin
from the United States, My Lords consider it doubtful whether
a local Mint in the Colony could compete successfully with
the Established Mints of the adjoining Country.
their condition. It does not
appear that there is any want of coin in British Columbia,
and if the community can readily obtain their supplies of coin
from the United States, My Lords consider it doubtful whether
a local Mint in the Colony could compete successfully with
the Established Mints of the adjoining Country.
If this supposition be correct, the utility of the proposed
Mint would be confined to that anticipated by Sir E.B. Lytton
of restraining the diggers from leaving the Colony with their
produce for the purpose of disposing of it in California.
My Lords are not apprized of the source of the information
obtained by Sir E.B. Lytton on this point,
but from the despatch enclosed in your Letter, Their Lordships would
have inferred that
that this departure of the Miners might have been
ascribed to the severity of the weather,
which suspended their operations
and may have induced them to go with their produce to a
Country where they could find not only a better market but a
more genial climate.
I had this from ordinary general
information; which is confirmed by the Governor's two despes
recd on the 28 May.
that this departure of the Miners might have been
ascribed to the severity of the weather,
The Miners left on acct of weather, but independently of
weather they travel backwards & forwards with the gold they have
collected which they are unwilling to trust to other hands.
Allowing, however, that there may be an evil in the present
state of things which it is desirable and possible to remove or
mitigate, My Lords confess that they are not satisfied that the
Establishment of a Mint would produce the effect which is desired.
It is clear that in order to obtain a return for the gold it must
be exported in some shape. My Lords apprehend that in the present
state of communications with Columbia, California affords the only
available or at least the most convenient market for this
this purpose.
The Californian dealers who buy the gold in the colony no doubt
strive to obtain the highest profit that they can by their operations,
but from the large amount of gold purchased and exported by them,
My Lords would infer that, in the main, the percentage charged by
them is not excessive. If it be, the correction will no doubt be
found in private enterprize and competition. It cannot be for
the interest of the dealers to drive away miners from the Colony
and thus diminish production.
this purpose.
The Californian dealers who buy the gold in the colony no doubt
strive to obtain the highest profit that they can by their operations,
but from the large amount of gold purchased and exported by them,
My Lords would infer that, in the main, the percentage charged by
them is not excessive. If it be, the correction will no doubt be
found in private enterprize and competition. It cannot be for
the interest of the dealers to drive away miners from the Colony
and thus diminish production.
The Assay and Mint, for the object in view would afford no
other facility to the Miner than that of enabling him to ascertain
at a regulated charge, the intrinsive value of his Treasure, and of
getting it converted into a form convenient for
for exchange. But a
very important question here arises which is not touched upon in
Your Lordship's letter. Of what form and of what standard should
the proposed Coinage consist?
for exchange. But a
very important question here arises which is not touched upon in
Your Lordship's letter. Of what form and of what standard should
the proposed Coinage consist?
In the case of Australia there was no question on this point.
The currency of the Colonies in that part of the world was British
and the coin required was one corresponding in weight and fineness
with the British Gold Sovereign. But in the North American Colonies
the case, as Sir E.B. Lytton is aware, is very different. In
Canada and New Brunswick the Currency has been made to conform to
that of the United States and My Lords apprehend that it is based
principally on the gold coins of that Country, though British
Coins are a legal tender 
at specified rates. In the other Colonies
the Currency is mixed and the money of Account is peculiar
to each: but United States gold coins enter largely into the
circulation of all. The efforts of Her Majesty's Government to
obtain the concurrence of those Colonies in any uniform System
of Currency were unavailing: and if it be proposed to establish
a Mint in British Columbia for their general convenience, My Lords
apprehend that there would be no less difficulty in bringing them
to an agreement regarding the description of coinage that would be
best adapted to their requirements.
at specified rates. In the other Colonies
the Currency is mixed and the money of Account is peculiar
to each: but United States gold coins enter largely into the
circulation of all. The efforts of Her Majesty's Government to
obtain the concurrence of those Colonies in any uniform System
of Currency were unavailing: and if it be proposed to establish
a Mint in British Columbia for their general convenience, My Lords
apprehend that there would be no less difficulty in bringing them
to an agreement regarding the description of coinage that would be
best adapted to their requirements.
In these circumstances it would be necessary to decide whether
it would be expedient to make Coins to be issued from the proposed
Mint comformable
conformable to those of this Country or to those of the
United States.
conformable to those of this Country or to those of the
United States.
In either case it is doubtful whether they would find ready
Currency beyond the limits of British Columbia.
The Standard of fineness moreover of the Coins of the two
Countries differs: that of Great Britain being 11/12ths
and that of the United States 9/10ths fine. Independently
of the denomination of the Coin, therefore, it would be necessary
to decide which standard would be preferable for the object in view.
In answer to the enquiry of Sir E.B. Lytton regarding the cost
of establishing a Mint, My Lords have to observe that that must
depend on the character and extent of the Machinery set
set up. They
observe that when arrangements for establishing a Mint at Sydney
were under discussion, the Master of the Mint furnished two
Estimates one for a small Mint to be worked by animal power, the cost
of which would have been about £10000. The other for larger
Machinery worked by Steam, the cost of which was estimated at
£30,000. The total Cost incurred at Sydney for the Refinery
and Mint buildings and Machinery was more that £40,000.
set up. They
observe that when arrangements for establishing a Mint at Sydney
were under discussion, the Master of the Mint furnished two
Estimates one for a small Mint to be worked by animal power, the cost
of which would have been about £10000. The other for larger
Machinery worked by Steam, the cost of which was estimated at
£30,000. The total Cost incurred at Sydney for the Refinery
and Mint buildings and Machinery was more that £40,000.
Minutes by CO staff
Mr Merivale
I am obliged to send you the duplicate of the despatch from the Governor of B. Columbia (10 March /59), as the original is not to be found just now, on whh were written the minutes which gave rise to the Letter to the T-y (14 May), to which this is the answer. In the absence of those minutes I have to say briefly that in writing to the T-y this Office had in view 1st to represent to that Dt how much time & money was apparently wasted by the absence of the requisite facilities for assaying & coining the gold produced in the Colony; & secondly (always bearing in mind that these establishments were to be paid for out of local resources) to elicit from the Treasury the expression of their opinion on the whole subject. We took the initiative in this matter in the interest of the Colony rather in anticipation of a full developement of the subject by the Governor: and perhaps it might have been better if we had waited for an application from the Governor before addressing the T-y. Be that, however, as it may we have now received two despes from B. Columbia, 8th and 11th April, in which an Assay Office is represented as being urgently requisite, & as costing little money, whilst a Mint is also [shadoried?] forth. These despatches singularly corroborate, almost in the very words, the observations contained in the Minutes I am not now able to send you. I would submit to you that these despatches shd be sent
to the Treasury, requesting that the contents
thereof may be considered by the Lords Commissioners before the
S. of State writes to the Govr; and, without attempting
to dispute the axioms
of the Treasury with respect to
the establishment yet a while of a mint in the Colony,
enquiring whether the representation by the Governor of the
necessity for an Assay Office is founded on grounds
sufficiently conclusive to justify H.M. Govt in
authorizing its being set up.
I am obliged to send you the duplicate of the despatch from the Governor of B. Columbia (10 March /59), as the original is not to be found just now, on whh were written the minutes which gave rise to the Letter to the T-y (14 May), to which this is the answer. In the absence of those minutes I have to say briefly that in writing to the T-y this Office had in view 1st to represent to that Dt how much time & money was apparently wasted by the absence of the requisite facilities for assaying & coining the gold produced in the Colony; & secondly (always bearing in mind that these establishments were to be paid for out of local resources) to elicit from the Treasury the expression of their opinion on the whole subject. We took the initiative in this matter in the interest of the Colony rather in anticipation of a full developement of the subject by the Governor: and perhaps it might have been better if we had waited for an application from the Governor before addressing the T-y. Be that, however, as it may we have now received two despes from B. Columbia, 8th and 11th April, in which an Assay Office is represented as being urgently requisite, & as costing little money, whilst a Mint is also [shadoried?] forth. These despatches singularly corroborate, almost in the very words, the observations contained in the Minutes I am not now able to send you. I would submit to you that these despatches shd be sent
to the Treasury, requesting that the contents
thereof may be considered by the Lords Commissioners before the
S. of State writes to the Govr; and, without attempting
to dispute the axioms
of the Treasury with respect to
the establishment yet a while of a mint in the Colony,
enquiring whether the representation by the Governor of the
necessity for an Assay Office is founded on grounds
sufficiently conclusive to justify H.M. Govt in
authorizing its being set up.
ABd
1 June
