Colonial Despatches

I have the honor to acknowledge your Grace's Despatch No 10 of the 3rd September, transmitting a copy of a letter from the Hudson's Bay Company, and of the reply you had caused to be addressed to Mr Berens, inin which your Grace intimates that it is with much satisfaction that you have heard of the refusal on the part of the Company's Manager in Vancouver's Island, to accede to my application for Advances on account of Government subsequent to the 30th May.

2. In reference thereto, I beg to inform your Grace that in consequence of the refusal of the Hudson's Bay Company to liquidate the current expenses of the Colony, and in the absence of any instructions from Her Majesty's Government uponupon the subject, I have been forced to apply the monies arising from the sale of Public Land to that purpose, though those funds should properly be paid into the hands of the Hudson's Bay Company until the Charter of Grant is determined as it is evident that until then, no Title to Land would be legal even if sold by the Crown.

3. No official announcement has been yet made to me of the revocation of the Grant. I have at present therefore no power either to grant a legal Title or to make sales of Public LandLand, and I am in consequence placed in a position of extreme embarrassment.

4. I have contrived hitherto to pay all the civil expenses of the Colony out of monies raised from its own Revenues, but should these fail before the House of Assembly provides a Revenue, and before I am legally empowered to dispose of the Public Land, there will be no alternative left to me but to draw upon Her Majesty's Government.

5. The annual expenses of the Colony are moderate, and your GraceGrace will observe from an abstract herewith enclosed of the revenue and expenditure for the fiscal year ending the 31st day of October 1858, that the Income of the Colony exceeded the expenditure by the sum of over Three Thousand Two Hundred Pounds (£3200), and that too, at a period when much unusual expense was incurred in consequence of the discovery of Gold in Fraser River, and the number of people who were attracted to this place by that discovery.

6. The Public Accounts for the twelve months ending on the 31st dayday of October last not being completed, it is not in my power to forward a statement of the expenditure for that period by the present mail, but I will not fail to furnish your Grace with that information as soon as it can be received from the Agents of the Hudson's Bay Company. The Income derived from the sale of Public Land and from other sources of revenue will I am of opinion come short of the sum collected for the preceding twelve months and will probably be unequal to the expenditure, but the deficit will II think not greatly exceed the excess of Income over Expenditure appearing in favour of the Colony for the year 1858.

7. By analysing the expenditure for the year 1858 it will be observed that a proportion exceeding two fifths of the whole outlay for that period was incurred for the construction of buildings and other indispensable public works of a permanent character and of the nature of investments, and not of simple expenditures the value being represented and remaining for the benefit of the Colony. The actual expenditureexpenditure for carrying on the Government of the Colony is thus reduced to the sum of Five Thousand Six Hundred Pounds (£5600).

8. Before closing this despatch I have to request that I may be informed whether the Charter granting Vancouver's Island to the Hudson's Bay Company be revoked, and whether I may legally make sales of and grant Titles for the public lands on the part of the Crown.

Trusting that these explanations may prove satisfactory.