Colonial Despatches

I have the honor to acknowledge the receipt of your letter of the 30th ultimo forwarding for any suggestions or observations the Crown Agents may have to offer a copy of a despatch from the Governor of British Columbia, recommending that future remittances on account of Interest and Sinking Fund of the Loans of that Colony should be made through the Admiralty.

So far as the Crown Agents are concerned theysee see no objection whatever to the adoption of such a course, but from what is stated in the Colonial Secretarys Memorandum which accompany's the Governor's despatch, it appears to be expected that the Admiralty will give £100 in London for every £100 the Colonial Government may pay to the Naval department in the Colony, while in the same document it is stated that Bank Bills (less valuable than those of the Navy) are only to be obtained at a premium of 3 per cent.

It can hardly be expected therefore that the Admiralty will consent to such terms at a cost of at least £750 per annum.

As a further reason why such an arrangement is considered desirable it is stated that the Banks and the local Government now compete for Navy Bills in the Market, and that if the Colony supplied the Naval department with money, "the charge of encroaching upon the legitimate business of the Banks would be removed."

Surely there must be some mistake in such asupposition supposition.

The Banks now have their fair chance of competing with the Government for Navy Bills, whereas under the proposed arrangement they would to the extent of the Government wants be entirely excluded from all chance of participation, and so far from allaying dissatisfaction it would be much more likely to increase it.

Still the two Governments have a perfect right to make such an arrangement for supplying themselves with money if they think fit without regard to theinterests interests of the local Banks, and if the Admiralty consent to do so, the Crown Agents recommend its being entered upon without loss of time.