Colonial Despatches
The colonial despatches of Vancouver Island and British Columbia 1846-1871
Despatch to London
Douglas, Sir James to Pelham-Clinton, 5th Duke of Newcastle Henry Pelham Fiennes 28 August 1860, CO 60:8, no. 9924, 151.
Abstract
Douglas, Sir James to Pelham-Clinton, 5th Duke of Newcastle Henry Pelham Fiennes 28 August 1860, CO 60:8, no. 9924, 151.
Despatch to London.
Minutes (5), Other documents (4), Marginalia (2).
No. 84, Financial
It being my intention to quit this place to day on a
visit to British Columbia, which may occupy four or five
weeks, I am desirous
before
before my departure of addressing Your
Grace upon a subject of the deepest importance to that Colony.
before my departure of addressing Your
Grace upon a subject of the deepest importance to that Colony.
2. I had the honor of informing Your Grace in my Despatches
Nos 70 and 76 of the 3rd and 16th instant, of the
reported great discoveries of Gold in the Shilmilcomeen, and
on the Southern frontier of British Columbia near Colvile;
of the rush of people to that part of the Country, and of the
urgency
which
which existed for pushing on with vigour the work of
the road from Hope to the New Diggings.
which existed for pushing on with vigour the work of
the road from Hope to the New Diggings.
3. Prodigious efforts have hitherto been made by the
people of Oregon to throw supplies, by means of the Columbia River, into the Southern frontier of the British Possessions,
and since these new discoveries so close to their own Territory,
those efforts have been redoubled, and unless we adopt instant
and
and effective measures, the revenues of the Colony will suffer
to an extent which we can hardly now foresee.
and effective measures, the revenues of the Colony will suffer
to an extent which we can hardly now foresee.
4. Your Grace is aware of our struggles to reduce the cost
of transport by opening roads through the Mountains from
Douglas, Yale and Hope, and I was in hopes of being able to
effect those great and important works through the immediate
revenues of
the
the Colony, and without foreign aid. It would
have been no small satisfaction to have done so, in view of
the magnitude of the undertaking, and I confidently believe
my hopes would have been realized, but for the events
abovementioned, and which render the immediate completion
of these roads a matter of the most urgent necessity.
the Colony, and without foreign aid. It would
have been no small satisfaction to have done so, in view of
the magnitude of the undertaking, and I confidently believe
my hopes would have been realized, but for the events
abovementioned, and which render the immediate completion
of these roads a matter of the most urgent necessity.
5. The whole expense
of
of the Trail from Douglas to Cayoosh,
including 25 miles of Wagon road, which is now finished; the
most expensive part of the road from Yale; and a portion of
the Hope Trail to Shilmilcomeen, have been defrayed out of
the current revenue. The remainder of the Yale road to
Spuzzum, and of the Trail to Shilmilcomeen will be paid, as
arranged with the Contractors, in British Columbia Bonds,
bearing
interest
interest at 6 per cent per annum.
of the Trail from Douglas to Cayoosh,
including 25 miles of Wagon road, which is now finished; the
most expensive part of the road from Yale; and a portion of
the Hope Trail to Shilmilcomeen, have been defrayed out of
the current revenue. The remainder of the Yale road to
Spuzzum, and of the Trail to Shilmilcomeen will be paid, as
arranged with the Contractors, in British Columbia Bonds,
bearing
interest
interest at 6 per cent per annum.
6. In order to complete the communications there remains:
.off On the Douglas route,
From the 28 Mile House to Cayoosh, a distance of about 34 Miles of land carriage. .off On the Yale route,
From Spuzzum to Boston Bar, an exceedingly difficult portion of about 15 miles, and from thence to Yale a
a distance of about 40 miles.
.off end
From the 28 Mile House to Cayoosh, a distance of about 34 Miles of land carriage. .off On the Yale route,
From Spuzzum to Boston Bar, an exceedingly difficult portion of about 15 miles, and from thence to Yale a
a distance of about 40 miles.
.off end
7. The portion of the road from Spuzzum to Boston Bar has
just been contracted for by Colonel Moody for Nine Thousand Pounds,
and it will probably take an additional sum of Five Thousand
pounds to open the remaining portion to Lytton.
8. Thus in addition to the works for which we have provided
the means
of
of payment in the Colony, we would require as follows:
For Road from Yale to Lytton.......14,000
For Road from Douglas to Cayoosh...16,000
£30,000
of payment in the Colony, we would require as follows:
For Road from Yale to Lytton.......14,000
For Road from Douglas to Cayoosh...16,000
£30,000
9. Being unwilling to make a further issue of Bonds,
lest their depreciation should greatly increase the cost
of the roads in progress, I directed the Treasurer to
advertise for a Loan to the extent of Twenty Five Thousand pounds;
but it
resulted
resulted in only one offer, and that for
the sum of Two Thousand pounds at 12 per cent per annum interest.
resulted in only one offer, and that for
the sum of Two Thousand pounds at 12 per cent per annum interest.
10. This circumstance taken in connection with the high
rate of interest, (one and a half to five per cent per mensem)
to be obtained for money loaned for short periods, shews
that there is but a scanty supply of capital for the
every
every
day demands of commerce. There is no currency except coin;
there is no money which can be spared to be locked up in
an advance to the Government, except at a rate of interest
which we could not afford to pay.
every
day demands of commerce. There is no currency except coin;
there is no money which can be spared to be locked up in
an advance to the Government, except at a rate of interest
which we could not afford to pay.
11. Our only resource then is to turn to the Mother
Country to endeavour to effect a Loan to the extent of Fifty
Thousand pounds, and in this I trust Your
Grace
Grace will afford
us your valuable aid. It would naturally be a subject of
gratification if this, the youngest of Her Majesty's Colonies,
could arrange a Loan at rates approaching those paid by other
British Colonies of the same Continent, and as far as the
security is concerned, I venture to submit that the revenue
of British Columbia can give as undoubted security for a small
Loan as the Canadas can offer for a large one.
Grace will afford
us your valuable aid. It would naturally be a subject of
gratification if this, the youngest of Her Majesty's Colonies,
could arrange a Loan at rates approaching those paid by other
British Colonies of the same Continent, and as far as the
security is concerned, I venture to submit that the revenue
of British Columbia can give as undoubted security for a small
Loan as the Canadas can offer for a large one.
The
The revenue of the year was calculated to exceed the
expenditure, and it has surpassed the estimate, while the
expenditure has been successfully kept hitherto within the
prescribed limits, excepting of course the heavy charge on
Military account, which it is my anxious endeavour that the
Colony should be placed in a position both to defray and to
utilize as soon as possible. But it is sufficiently
evident
evident
to Your Grace that neither can the expense of the Military
Establishments be defrayed by the Colony, nor can Soldiers
be moved from one point to another, until roads and communications
be opened so as to make the Country practicable for the Merchant
and the Baggage Train.
The revenue of the year was calculated to exceed the
expenditure, and it has surpassed the estimate, while the
expenditure has been successfully kept hitherto within the
prescribed limits, excepting of course the heavy charge on
Military account, which it is my anxious endeavour that the
Colony should be placed in a position both to defray and to
utilize as soon as possible. But it is sufficiently
evident
evident
to Your Grace that neither can the expense of the Military
Establishments be defrayed by the Colony, nor can Soldiers
be moved from one point to another, until roads and communications
be opened so as to make the Country practicable for the Merchant
and the Baggage Train.
12. I believe that the ordinary course in effecting Colonial
Loans is to place the matter in the hands
of
of an Agent in London,
who undertakes to pay the interests, redeem such portions of
the principal as become payable &c on the terms of a fixed
commission. The terms as to the interest, commission etc.,
must be settled, I presume, through or with, such Agent, to
whom the Colonial Government find themselves to make from
time to time, such remittances as may seem
proper
proper.
of an Agent in London,
who undertakes to pay the interests, redeem such portions of
the principal as become payable &c on the terms of a fixed
commission. The terms as to the interest, commission etc.,
must be settled, I presume, through or with, such Agent, to
whom the Colonial Government find themselves to make from
time to time, such remittances as may seem
proper
proper.
13. The assistance which I venture to solicit of Your
Grace, is the selection of an Agent through whom the details
of the transaction may be managed; and to whose integrity
and ability may be entrusted the negociation of the terms to
which such a Loan would have to submit; whether such a Loan,
from its
amount
amount, is best fitted for being raised by subscription
or by public advertisement, or by private tender, e.g. to
Insurance Offices, or other Bodies having large amounts of
available capital seeking investment.
amount, is best fitted for being raised by subscription
or by public advertisement, or by private tender, e.g. to
Insurance Offices, or other Bodies having large amounts of
available capital seeking investment.
14. I should hope that such an Agent might be found, and
as I should expect to have to follow
his
his advice and experience
in such a matter, I presume that there would be nothing rash
in undertaking to acquiesce in such terms as he may be able
to obtain, the necessary details for carrying out those terms,
and for pledging the resources of this Colony for their
fulfilment,
being
being contained in a Proclamation having the force of Law.
his advice and experience
in such a matter, I presume that there would be nothing rash
in undertaking to acquiesce in such terms as he may be able
to obtain, the necessary details for carrying out those terms,
and for pledging the resources of this Colony for their
fulfilment,
being
being contained in a Proclamation having the force of Law.
Minutes by CO staff
Sir F. Rogers
It would be the making of B. Columbia to have a sum of money to spend in the construction of roads, or even paths capable of conveying provisions & merchandize into the inaccessible interior of the Country in return for the gold, the produce of the Miners labor. But money cannot be obtained on the spot. The Governor hence appeals to the S. of State to help him to effect a loan here. He wants £50,000, and does not ask for an Imperial guarantee, which has been already refused by The Duke of Newcastle. The Revenue of the Colony is £50,000 a year and increasing. The expenditure, about which the Governor keeps us a good deal in the dark, corresponds. Such being the case and the Colony with no other security to offer than tracts of wild land, at present almost valueless, I had misgivings as to the possibility of the Colony getting the money it wants on any terms in London; but happening to meet an eminent Banker and acquaintance of my own, I endeavored to ascertain from him whether it was at all likely that the loan cd be effected. I explained to him fully the state of the case, and having succeeded in enlisting his interests on behalf of the Colony he very obligingly offered, if I would
furnish him with the necessary
materials, to give me his opinion on the matter. I, therefore,
availed myself of the opportunity, conceiving that this
gentleman's opinion might guide us in our future proceeding,
should the Duke of Newcastle think it desirable for the
interest of the Colony to comply with the Governor's application.
Of course Mr Bosauquet's letter which I annex would not prevent
our obtaining the advice of the Treasury, whom it wd be
necessary and proper to consult on the subject. That
gentleman's Letter is chiefly to be regarded as the mercantile
view of the case, and valuable accordingly. I have only to
add that I think that, if a Loan should be obtained for the
Colony, it would be prudent to require that the distribution
of the money should be settled by the Governor in concert
with some of the principal officials of B. Columbia. In
making that suggestion I by no means wish to depreciate the
honor and integrity of Governor Douglas. I offer it on the
contrary to prevent the possibility of those virtues having
a whisper raised against them, which, in a Colony where he
is perfectly despotic in power, might, in money matters, not
improbably be the result if he were left alone in the
distribution.
It would be the making of B. Columbia to have a sum of money to spend in the construction of roads, or even paths capable of conveying provisions & merchandize into the inaccessible interior of the Country in return for the gold, the produce of the Miners labor. But money cannot be obtained on the spot. The Governor hence appeals to the S. of State to help him to effect a loan here. He wants £50,000, and does not ask for an Imperial guarantee, which has been already refused by The Duke of Newcastle. The Revenue of the Colony is £50,000 a year and increasing. The expenditure, about which the Governor keeps us a good deal in the dark, corresponds. Such being the case and the Colony with no other security to offer than tracts of wild land, at present almost valueless, I had misgivings as to the possibility of the Colony getting the money it wants on any terms in London; but happening to meet an eminent Banker and acquaintance of my own, I endeavored to ascertain from him whether it was at all likely that the loan cd be effected. I explained to him fully the state of the case, and having succeeded in enlisting his interests on behalf of the Colony he very obligingly offered, if I would
furnish him with the necessary
materials, to give me his opinion on the matter. I, therefore,
availed myself of the opportunity, conceiving that this
gentleman's opinion might guide us in our future proceeding,
should the Duke of Newcastle think it desirable for the
interest of the Colony to comply with the Governor's application.
Of course Mr Bosauquet's letter which I annex would not prevent
our obtaining the advice of the Treasury, whom it wd be
necessary and proper to consult on the subject. That
gentleman's Letter is chiefly to be regarded as the mercantile
view of the case, and valuable accordingly. I have only to
add that I think that, if a Loan should be obtained for the
Colony, it would be prudent to require that the distribution
of the money should be settled by the Governor in concert
with some of the principal officials of B. Columbia. In
making that suggestion I by no means wish to depreciate the
honor and integrity of Governor Douglas. I offer it on the
contrary to prevent the possibility of those virtues having
a whisper raised against them, which, in a Colony where he
is perfectly despotic in power, might, in money matters, not
improbably be the result if he were left alone in the
distribution.
ABd
24 October/60
Other documents included in the file
73 Lombard Street
23rd Octr 1860
My dear Sir
I return you Governor Douglas' Despatch of the 28th August,
together with the Blue Book and other documents forwarded to me for
perusal, and I have read them with very great interest.
With regard to the question of raising money in this country
for the Colony of British Columbia, I think there ought to be no
difficulty in raising the sum named in the Despatch on bonds of the
Colony bearing 6 Pr Ct Interest payable in London. The
peculiar political circumstances attending that locality alone
could throw doubt on such a conclusion. With the guarantee of the
British Government such a loan might
of course be effected with
ease at 4 or 4 1/2 Pr Ct. But I observe that the Duke of
Newcastle in his Despatch of the 25th of February last holds out
no prospect of such a guarantee being obtained. It is therefore
proposed to pledge "the resources of the Colony by Proclamation
bearing the force of law" as security for the amount.
of course be effected with
ease at 4 or 4 1/2 Pr Ct. But I observe that the Duke of
Newcastle in his Despatch of the 25th of February last holds out
no prospect of such a guarantee being obtained. It is therefore
proposed to pledge "the resources of the Colony by Proclamation
bearing the force of law" as security for the amount.
Such a Proclamation charging the revenues and Crown property
of British Columbia, & Vancouvers Island (which I presume is included)
in the usual form of mortgage, would I think form an efficient
security: and as evidence of the sanction of Her Majesty's
Government, and also as affording the Government a proper control
over the amount
of issue, I would suggest that it would be
expedient that the seal of the Colonial Office and the signature of
the Colonial Minister should be attached to the bonds.
Certainly not.
of issue, I would suggest that it would be
expedient that the seal of the Colonial Office and the signature of
the Colonial Minister should be attached to the bonds.
The bonds might be made payable in 20 years from the 1st of
January next, and the interest made payable at the Agents in London
half yearly from that date: and to avoid unnecessary delay they
might be prepared in London in anticipation of the arrival of the Proclamation from the Colony.
With a view to preserve the market value of the bonds, of
which probably none will hereafter be issued, it would be expedient
to set aside annually a sum equal say to 2 Pr Ct upon the
amount raised, as a Sinking Fund to be applied in redemption of the
bonds at any price under par. Perhaps also there should be some
restriction upon the issue of local bonds in the Colony, of which I
observe by the Despatch some are already in existence.
With regard to the Agency in London, I may observe, that the
Banking House of which I am a Member has had experience in raising
several hundred thousand pounds for Corporations in Canada, and in
paying the half yearly interest upon their bonds; and should no other
source of agency more advantageous to the interest
of the Colony occur to
you, we should be ready to undertake the negociation of the
proposed loan under the payment of interest subject to our usual
conditions viz—
1st On receiving a commission of 2 1/2 Pr Ct
beyond the usual charges of brokerage &c.
2nd Retaining in hand the amount of the first years
interest on the bonds.
3rd The punctual remittance to us from the Colony of the
subsequent half yearly dividends three months before they become
due, charging no commission on the payment.
4th Charging at the rate of 1 1/2 Pr Ct on the
amount of dividend for any part of the three months during which
the provision for the dividend should not be in our hands.
of the Colony occur to
you, we should be ready to undertake the negociation of the
proposed loan under the payment of interest subject to our usual
conditions viz—
1st On receiving a commission of 2 1/2 Pr Ct
beyond the usual charges of brokerage &c.
2nd Retaining in hand the amount of the first years
interest on the bonds.
3rd The punctual remittance to us from the Colony of the
subsequent half yearly dividends three months before they become
due, charging no commission on the payment.
4th Charging at the rate of 1 1/2 Pr Ct on the
amount of dividend for any part of the three months during which
the provision for the dividend should not be in our hands.
I hope that these suggestions may be of use to you towards
effecting the objects you have in view, and I shall have much
pleasure in calling upon you in Downing Street at any time
should you wish for farther explanation.
Arthur Blackwood Esqre
Minutes by CO staff
Sir F. Rogers
Roadmaking is so vital an object in B. Columbia, that I think we may encourage this scheme.
Roadmaking is so vital an object in B. Columbia, that I think we may encourage this scheme.
The question of representative institutions for B. Columbia
will have to be considered on the Duke's return. But if they
are held to be premature, I am much
inclined to think—with
Mr Blackwood—that a Council of some kind sh. be associated
with the Govr, the reasons for which wd. be increased by the
fact of his having a Loan to expand on Road-making.
inclined to think—with
Mr Blackwood—that a Council of some kind sh. be associated
with the Govr, the reasons for which wd. be increased by the
fact of his having a Loan to expand on Road-making.
CF
27
Mr Fortescue
This despatch has been sent down to me amongst those reserved for the consideration of the Duke on his return. If this Colony were able to defray it's current services and had any balance of revenue to spare, it might be a legitimate question whether it should raise a loan, looking to that balance of revenue as security for the interest. But considering that as yet the Colony is unable to provide for it's current wants, and that a Government is only maintained there by means of aid from the British Exchequer,
I would submit that to plunge it into debt, so long as these
circumstances last, would be unjustifiable. Loans are for
those who at least can pay the interest. Roads are
doubtless very important
and so are many other things which
the Colony might have if it were richer, but this would not
warrant incurring liabilities without a well assured prospect
of being able to meet them. A man who has one thousand a
year would have more comforts and luxuries if he spent two,
and a man of ten thousand a year might have greater
enjoyments for twenty thousand, but people learn that they
must confine their expenditure within their income.
This despatch has been sent down to me amongst those reserved for the consideration of the Duke on his return. If this Colony were able to defray it's current services and had any balance of revenue to spare, it might be a legitimate question whether it should raise a loan, looking to that balance of revenue as security for the interest. But considering that as yet the Colony is unable to provide for it's current wants, and that a Government is only maintained there by means of aid from the British Exchequer,
They pay their
way—except the Engineers.
and so are many other things which
the Colony might have if it were richer, but this would not
warrant incurring liabilities without a well assured prospect
of being able to meet them. A man who has one thousand a
year would have more comforts and luxuries if he spent two,
and a man of ten thousand a year might have greater
enjoyments for twenty thousand, but people learn that they
must confine their expenditure within their income.
TFE
21 Novr
Other documents included in the file
Draft, Elliot to G.A. Hamilton, Treasury, 27 December 1860,
forwarding copy of the despatch for consideration.
Other documents included in the file
*
People in this document
Fortescue, 1st Baron Carlingford Chichester
Hamilton, William Alexander Baille
Moody, Colonel Richard Clement