Julyan to Rogers (Permanent Under-Secretary)

It is a matter of regret to the Crown Agents to be again under
the necessity of bringing under the notice of the Secretary of
State for the Colonies, the state of the British Columbia
account with this Office.

At the present moment the available assets are as follows:

Cash balance
£ 110:0:0

Acceptance of the Bank of British
Columbia, maturing 12th December
1000:0:0

Total
£1110:0:0

Liabilities

Due to the Sinking Fund on the 1st July 1868
£1000:0:0

Due to the Sinking Fund on the 1st October 1868
1125:0:0

Ditto (Vancouver) 1st Jany/69
800:0:0

Ditto    do   Interest 1st Jany/69
1200:0:0

Ditto (British Columbia) Interest 1st Jany/69
3000:0:0

Ditto  do  do Sinking Fund
3250:0:0

Total liabilities
£10375:0:0

Deduct assets
1110:0:0

Deficit
£ 9265:0:0

Of the liabilities, £1000 have been due since 1st July last,
and £1125 since the 1st of October, and we are now only three
weeks from the time when the whole amount should be forthcoming.

I would observe that all this money is in respect of Public
Loans—the Colony having ceased to supply any of their general
wants through the Crown Agents—and although to save the credit
of the Colonial Government the sums long past due have been
borne as deficits on the Sinking Fund, in preference to allowing
the Interest to go unpaid, yet it now becomes a matter of
serious consideration whether the Trustees would be justified
before the public in quietly acquiescing in the continuation of
this state of things.

Judging from the Minute dated 13th July last, which formed an
enclosure to Governor Seymour's despatch of the 5th August
following, it is evident that the gravity of the position in
which the Government of British Columbia is placed with respect
to its financial affairs is but very imperfectly understood by
the Secretary of the Colony.

Without going into details it is sufficient to say that
notwithstanding Mr Young therein endeavours to make it appear
that sufficient remittances had been made to the Crown Agents, yet
up to the present moment
there has not been sufficient money received to discharge the
debt which ought to have been paid twelve days before he penned
that Memorandum.

Under these circumstances the Crown Agents can do no more than
submit the matter to the consideration of the Secretary of State
for the Colonies, and to request to be informed whether they are
to pay the £1000 which will come into their possesion on the
12th instant to the Trustees of the Sinking Fund, or whether
they are to reserve it towards paying interest on the 1st
proximo. They will be glad to be informed from whence they are
to derive the further sum of £9265 which will be due on the same
date—
.us£4200
of which, including the above named sum, will be for interest.

The question of keeping faith in this matter is not one which
concerns either the Government, or the creditors of British
Columbia only. Once let it be known that British Columbia is
unable to pay the interest on its loans contracted in this
Country, and the prejudicial effects will immediately be felt by
every borrowing Colony under the dominion of the Crown. And not
only that, but a vast concourse of people in the United Kingdom,
among whom something like seventy millions sterling of Colonial
Debentures are held, will find their securities seriously
depreciated in value.

It is scarcely necessary to state therefore that the maintenance
of the credit of a borrowing Colony—comparatively insignificant
though its debts may be—is a matter of very great concern to
some millions of people whose interests are thereby affected,
and the Crown Agents feel that they would be wanting in their
duty to the many Colonial Governments whose financial
representatives in London they are, if they failed to urge upon
the Secretary of State the adoption of such measures as will
ensure the punctual discharge of the liabilities, which British
Columbia has contracted in this Country, under their several
Loan Ordinances.

These representations are not made in any spirit of complaint,
and the Crown Agents would much regret that Governor Seymour
should look upon them in that light. They most sincerely
sympathize with him in the financial difficulties in which he
finds himself placed, and would not willingly do anything to
aggravate them. Still without intending the slightest
discourtesy towards him, they may perhaps be allowed to add
that the deplorable condition in which the public highways of
New Westminster and Victoria are represented to be would have little
effect in mitigating the disappointment of the Debenture holders
if their interest should not be forthcoming at the appointed
time; nor would such facts tend in ever so slight a degree to
ward off the blow which the credit of the Colonial Government
would sustain by such a calamity.

The enquiries made from time to time as to the state of the
Sinking Fund, tend to produce a belief that a deficit is at least
suspected, and the feeling exhibited in the tone of the enclosed
paragraph—cut from one of the daily London papers—shows that
there is no lack of ill disposed persons who would readily avail
themselves of the knowledge of such deficit, in order to injure
the Colony.