Peel to Rogers (Permanent Under-Secretary)

With reference to your letter of the 21st Inst. I am
directed by the Lords Commissoners of Her Majesty's Treasury
to acquaint you that My Lords concur in the terms of the Despatch
which the Duke of Newcastle proposes to address to the Governor
of British Columbia in reply to his Despatch, No 74, of 13 November last on the subject of the Estimates of Revenue and Expenditure
of that Colony for the year 1862, conveying to him instructions to
curtail some of the different services proposed in those Estimates,
so as to admit of the payment, during the year 1862, from the Colonial
Revenue, of a moiety of the expense of the Royal Engineers;

Their Lordships will not object to that part of the other
Draft Despatch to the Governor which undertakes to discharge out of
Imperial Funds the other moiety of the cost of maintaining during
the year 1862/3 the Detachment of Royal Engineers serving in the
Colony, amounting to £11,000, of which the sum of £7200 is to be
provided by a Parliamentary Grant, the remainder, viz £3800, being
already borne on the Army Estimates.

My Lords will not object to provision being made, in the Civil
Service Estimates for the same year, for the Salary of the Governor
to the end of that year—the Salary after that date to be paid from
the Colonial Revenue.

With reference, however, to the past expenditure from Imperial
Funds, Their Lordships desire to draw His Grace's attention to the
Returns transmitted in Governor Douglas' Despatch No 56, of 16 September 1861, enclosed in Mr Elliot's letter of 7 November last, of the bills drawn upon the Paymaster General, and of the Expenditure of the sums drawn on account of the Detachment of
Royal Engineers for the years 1859 and 1860.

For the service of the year 1859 The Governor has drawn Bills
to the extent of £39,320—viz

For Colonial Pay £15189. 8.6

other Expenses £24130.11.6

£39320. 0.0

against the sum of £27,000 which was provided in the Parliamentary
Estimates—viz

Estimate 1859/60 For Colonial Pay £11000

Do To meet Bills drawn for

current service in 1859 £16000

£27 000

Thus involving an excess of payments beyond sums voted, for
the service of the year 1859 of £12,320—viz

Colonial Pay £ 4 189. 8.6

Other Expenses £ 8 130.11.6

£12,320. 0.0

For the year 1860 the Governor has drawn for £22,856.6.4—viz

For Colonial Pay £11,929. 8. 2

Other Expenses £10 926.18. 2

£22,856. 6. 4

against the sum voted for 1860/1 viz £11,000 for Colonial Pay
only—thus involving an excess of payments beyonds the sum voted for
1860/1 of £11,856.6.4

viz Colonial Pay £ 929. 8. 2

other Expenses £10,926.18. 2

£11,856. 6. 4

Payments have also been made in this country in excess of the sums
provided on account of the expenses of the Royal Engineers prior to
their arrival in British Columbia, as well as on account of the Salaries of the Governor and Commissioner of Duties.

I am to enclose a statement which has been prepared in this
Department, showing the particulars of the several payments, and
exhibiting an amount unprovided for, to the extent of
£26,958.9s10d.
This is exclusive of the claim of £6,900 for the Silver Coins which
were sent to British Columbia in October 1860, and though the Governor
was told that that claim would be settled out of the grant, and that
he must instruct his Treasurer to diminish his Drafts accordingly,
he has continued to draw Bills as if no such claim existed.

My Lords request that the attention of the Governor may be drawn
to the large amount of expenditure from Imperial Funds on his
Requisitions in excess of the sums provided by Parliament, and that
he may be called upon to furnish the fullest explanations in his power
of his proceedings in the matter.

Their Lordships request also that His Grace's attention may be
called to the subject—with a view to some prompt arrangement being
made for the repayment of the whole excess from the Funds of the Colony.

My Lords would further observe, with reference to the Governor's
Despatch, No 72, of 23 November last relating to the above-mentioned
sum of £6900 supplied in specie in 1860, that he has already
authorized the Treasurer to draw Bills on account of the year
1861/2 to the extent of £9000 against the grant of £11000
for the Colonial Pay of the Royal Engineers, and he remarks that,
if the Coin is not to be deducted from the grant, there will remain
a sum of £2000 available before the 31 March 1862 for that service.

My Lords apprehend that the Despatch informing him that Her
Majesty's Government must be repaid the value of that specie
will not arrive in time to prevent the drawing for the sum of £2000.

The sum of £6900, for the specie, will be chargeable to the
grant His Grace proposes to limit to £7,200.
*

According to this arrangement the sum remaining to be drawn
against the grant for 1862/3 will amount to £300 only;

My Lords would further observe that the Salary of £1200 a
year, of the Commanding Officer of the Royal Engineers, Colonel Moody, has been hitherto paid in this country.

After the 31 March next there will be no funds, except the sum of £300 above mentioned, to meet the Salary in England and
Their Lordships will, therefore, be unable to direct any further
issues on that account beyond the 31 March next.