No. 5

I have to acknowledge the receipt of your despatch No. 16 of the
21st of August reporting on the state and prospects of Vancouver's Island.

I have to express to you my thanks for this useful report and at the
same time to signify to you my approval of your prudent and determined
conduct towards the Indians who visited the Settlement in the summer.

2. I concur in your remarks on the utility of a Police force for
the preservation of order in the settlement and I see no objection to
the establishment of a sufficient force for that purpose, but you must
understand that all expenses connected with its formation and
maintenance must be defrayed from the local Revenue or by the Hudson's
Bay Company.

3. The Commercial restrictions which militate against the
developement of the trade of Vancouvers Island are engaging the
attention of Her Majesty's Government who are not unmindful of the
interests of this distant dependency of the British Crown, and they are
not altogether without hopes that negotiations which have been commenced
with the Government of the United States may terminate in an extension
of the Reciprocity Treaty to the Island under your Government.