Peel to Rogers (Permanent Under-Secretary)
[1474, CO 60/23, p. 150; received 14 February
]
Treasury Chambers
13th February 1865
Sir
I am desired by the Lords Commissioners of Her Majesty's
Treasury to acquaint you, for the information of Mr
Secretary Cardwell, that Their Lordships have had under Their
consideration Mr Elliot's letter of the 27th Ultimo
on the subject of the claim against British Columbia for the
sum of £10,704—the cost of certain services therein, and
I am to request that you will observe to Mr Cardwell
that the statement in Mr Elliot's letter, that the cost
of those services has been defrayed, is not correct—an advance only,
[*](#marg1)
in acceptance ofthe the Governor's Bills having
been made from the Treasury Chest, and that the sum
outstanding must either be paid by the Colony or by means
of a Grant to be made by Parliament;
My Lords have already stated to the Colonial Office
that They are unable to submit a further Vote to Parliament
on account of the Excess of the Expenditure in British
Columbia in the two years 1859 & 1860 beyond what was
authorized by Parliament, and They would refer Mr Cardwell
to Their letter of 11th September 1863, in which They
stated that They had considered the Colonial Government to
be liable for the whole excess—a sum of £22,026; and to
the letters from the Colonial Office of 22 March & 22
April 1862expressing expressing the Duke of Newcastle's opinion that
"the portion of the overdrafts, amounting to £10,704,
which was for the items of Public Works, was evidently
inadmissible, ought evidently never to have been charged
except to the Colony," and "should be charged against
the Colony as a debt which the Governor will be instructed
immediately to repay," but that the remainder of the
excess being strictly for maintenance of the Garrison
might—notwithstanding it was an excess of the Governor's—be
permitted to be defrayed by Parliament;
The latter portion of the arrangement thus proposed by
Mr Cardwell's Predecessor in Office, and assented to
by this Board, having since been carried out on the distinct
understanding that the whole arrangement would becarried out carried out,
My Lords are of opinion that the Colony should fulfil the
other portion, and They do not find in the new Governor's
despatches any ground whatever for transferring the charge
in question from Colonial to Imperial Funds;
My Lords were informed by Mr Elliot's letter of 26 May
last that instructions had been given to the Crown Agents to
pay the sum of £10704.16.7 from the proceeds of the Loan of
£100,000 to be raised under the Ordinance No 7 of 1864,
and They must express Their hope that the payment will be
made at an early date.
I am - Sir
Your obedient Servant
F. Peel
See Minute annexed.
TFE
Feby
Mr Fortescue
I have no design to ask you and Mr Cardwell to
take the trouble of considering whether we should enter
into a controversy with the Treasury on this subject.
We have not done so yet, although the contrary might
be imagined from the terms of their letter. I would
beg leave however very briefly indeed to recall the
leading facts of the case.
Sir James Douglas drew Bills very heavily in excess
of the amount granted by Parliament for British Columbia.
Some of those Bills, amounting to about £11,300, were
for the pay and allowances of the Royal Engineers, others,
amounting to £10,700, were for works and buildings and
surveys on which they had been employed.The The Duke of
Newcastle recommended the Treasury to obtain a Vote from
Parliament for the former, but to require repayment of
the latter. The Treasury assented; and it is perfectly
true therefore that this course was agreed upon by both
Departments in the year 1862.
But in the year 1864, a new Governor having gone
out to the Colony, submitted new facts. He said that the
buildings for which he understood the repayment to be
chiefly claimable, were of little value, and he quoted
precedents of transferring better Barrack's to richer
Colonies gratuitously. We thought it only fair to
consider how far the new facts gave reason for anew new
decision, and we sent them on with our impressions to
the Treasury, but pointedly treating it as a matter for
their own judgement: "Mr Cardwell would be very glad
if their Lordships should feel at liberty to waive
&c &c." They refuse, and stand on the original intention.
As this is the case, our course is simple: we must
instruct the Agents to pay the money out of the first
proceeds of the Loan (or if instructed already, we
must remind them), we must apprize the Governor of the
failure of his appeal, and must tell the Treasury what we have done.
There is no practical subject for controversy. Buton
on one point I must beg to let you and Mr Cardwell
have an explanation. The Treasury say that one statement
in our letter is incorrect; I will give it in our own
words—These fabrics "have long been built and their cost
defrayed, and the only question is whether the Colony
should be forced to repay the amount." This is what the
Treasury call incorrect. Now what are the facts? Governor
Douglas drew Bills in order to defray the alleged cost of the
several public Works, and obtained cash for those Bills
in British Columbia from the Treasury Chest, and his
Government has ever since been called upon for repayment
to the Treasury. No one eversuggests suggests that he did not
make the original payments with the cash he obtained for
the purpose. What the Treasury must really mean is that
they themselves have not been paid, but this of course we
knew and admitted, since the very question put to them was
whether or not they would forego repayment. Whilst
therefore I do not a bit want to re-argue the merit of
that suggestion, I assert that our statement was perfectly
accurate, and that the Treasury contradiction of it is not
owing to a better knowledge of the facts, but to a
confusion of ideas.
TFE
17 Feby
Mr Cardwell
Mr Elliot's meaning was, of course, clear enough. But
it is also true, as the Try. letter says, that the advance,
if not repaid by the Colony, must be repaid by a Vote of
Parlmt. The provoking part of the Treasury letter is
the way in wh. it treats GovrGovernor Seymour's representations
as deserving of no attention at all. To me they seem
very weighty on behalf of the Colony. They amount to this;
that a Colony wh. is now costing the Imp. GovtGovernment nothing
for its military defence, & has lately suppressed an
Indian insurrection at its own expense, is to be required
to repay the cost of temporary barracks, erected for the use
of troops wh. were sent out by the Imp. GovtGovernment and since
withdrawn. But you will judge whether it is worthwhile
to carry the controversy with the Try. any further.
CF
17
Mr Blackwood
Drafts therefore to be prepared in accordance with
the passage I have marked at page 3 of my Minute.