Colonial Despatches

We have to acknowledge your letter of 7th instant, enclosing for our Report a letter from the Admiralty, on the subject of the reservation by the Crown of Coal and Timber for Government purposes in VanCouvers Island and British Columbia.

2. In respect to Coal we presume that it would never be contemplated by Government to reserve any mine to be worked at itsits own expense for its own service. The only way in which a reservation could be made would be by inserting a condition in any Lease, that the Coal required for Government purposes should be furnished either gratuitously or below the market price.

3. If there were a large demand for Coal and no other means of meeting it, such a condition would have the effect of throwing on the Revenue of the Colony (to which the Royalty of the Coal Mine would belong) a portion of the expense of supplying the Government with Coal, but it would not necessarily prevent the working of the Mines. Unless the quantity toto be supplied were accurately specified, it would probably cause more injury to the Colonial Revenue than benefit to the Government Service, inasmuch as an indefinite liability is naturally calculated at a maximum. Nevertheless, if there were a large private demand the profits upon it might be sufficient to counter balance the loss on the public demand. But this is not the case at VanCouvers Island. The Hudson's Bay Company are already in possession of and are working, a mine at Nanaimo. They will probably for a long time find no difficulty in supplyingsupplying all the Coal that is wanted, and as they pay no Royalty it may be doubted whether any other persons, even with an ordinary Royalty, will be able to compete with them. It is quite certain that no one burthened with a Government reservation would be able to do so. The effect, therefore, of such a reservation would be to drive away private enterprize from the Coal Fields of these colonies and to perpetuate the monopoly of the Hudson's Bay Company. Of course under such circumstances the Admiralty would be at the mercy of the Hudson'sHudson's Bay Company for their Coal supplies. We cannot, therefore, recommend that any reservation should be made of Coal.

4. In respect to Timber for ship building it is obvious to remark, that as such Timber could only be brought to this Country round Cape Horn—a voyage considerably longer than that from Australia and New Zealand where there are inexhaustible supplies of the finest Timber—it is scarcely conceivable that the Admiralty should ever have recourse to the Forests of VanCouvers Island or British Columbia. For the small quantity that might fromfrom time to time be required for the repair of the Ships on the Station, it would not be worth while to make any reservations.

5. But even if this were not the case it may be doubted whether reservations of this description are of any practical use. Assuming them to be made the Admiralty must still depend for the felling and conversion of the Timber on the ordinary Lumberers of the Country. And where the required Timber is on Land for which a Timber License has been granted, it must, as a general rule, depend on the Licensee. ForFor in order to get Timber out of the Forest it is necessary to construct roads and ways along which it may be hauled—and for the accommodation and subsistence of the Lumberers while thus employed temporary huts must be erected and provisions must be laid in. If the Admiralty were to employ any other person than the Licensee to haul their Timber, they must provide other Laborers with other huts and Stores of provisions, and other roads and ways. It is clear that to do so would involve an unnecessary expenditure probably greater than the value of the Timber toto be obtained, and there would be besides a constant risk of Collision between their Lumberers and those of the Licensee, which, removed as they would be from the control of the usual Tribunals, might give rise to serious consequences.

6. But if the Admiralty is to operate through a Contract with the Licensee there is no necessity for a reservation. The Timber required for Ship building, and especially for Masts, is more valuable for that purpose than for any other. And the Licensee would for his own sake reserve it for Sale to the Admiralty if he knewknew that they would want it. The chance moreover of obtaining a contract with the Admiralty would stimulate those engaged in the Lumber Trade to explore the woods for Trees suited for the purpose—instead of leaving the Admiralty Agents to discover the Trees for themselves. It may perhaps be said that the Admiralty would get the Timber cheaper if it were forbidden to all but the Admiralty Agents. This advantage, however, if any, must be very small. Timber on the ground in a new country has no marketable value—its price consists almost entirely of the cost of felling it and bringing it to market, and contractscontracts made by means of open Tenders would protect the Admiralty against exorbitant demands on the part of individuals. Or at worst the Admiralty, if it thought the demands of Licensees exorbitant, might employ its own people on the Crown Lands where Licenses had not been granted, and on which, therefore, it would have every advantage that the proposed reservations could have provided.

7. But while we believe that such reservations would be useless for good, they would not be powerless for harm. Although, as wewe have said, it is extremely unlikely that Timber should be brought from VanCouvers Island or British Columbia to build Ships in this Country, it is very probable that as the Country advances Ship Building might become a considerable business in it. But the proposed reservations could scarcely fail, it they had any effect at all, to retard and embarrass this business and in so far to interfere with the progress of the Colony.

8. Reservations of Timber fit for ship building were formerly universal in Licenses to cut Timber in the British ColoniesColonies, especially in Canada and New Brunswick, but they have, we believe, been for many years discontinued as vexatious and unnecessary. We do not think it would be desirable to revive them in VanCouvers Island and British Columbia.