No. 7, Financial

I have much pleasure in transmitting herewith a synopsis
of the Revenue and Expenditure of the Colony of British Columbia
for the year ending on the 31st day of December 1860, which I have caused to be compiled in the Audit Office from the
Public Accounts for the purpose of laying approximately before
Your Grace at the earliest moment such information as may be
desirable, in anticipation of the formal Estimates which are
in course of preparation, and will be forwarded by the next Mail.

Although the December Returns and some of the back accounts of the distant out Stations have not been received and are merely estimated in this account, yet it exhibits very closely
the actual Revenue and Expenditure, and may, for all practical
purposes, be assumed as a true statement of the financial
position of the Colony.

The principal item of Revenue in that account will be
found under the head of Customs, classified as follows, vizt Duties on Imports £29,702—Harbour and Tonnage Dues, Head Money, the Roads Tolls at Yale and Douglas for the month of
November, and other minor receipts, collectively £5817,
making in all the sum of £35.519.

The increase of Revenue from duties on Imports is about 70 per cent, as compared with the Revenue derived from the same source in 1859; and it may be fairly assumed, considering the increase of population and the progressive state of the Colony, that the Customs Returns
of 1861 will be in excess of those of 1860.

The amount of land Sales for the Year 1860, is £10962,
which is less by £7915. than the sales of 1859; a difference explained by the large sums received for building lots at New Westminster and other Towns where land was required for commercial purposes, and sold at high prices. A larger quantity of Country Land has been sold in 1860, but from the comparatively low price, did not yield a proportionate revenue.

There is no prospect of a material increase in Land Sales
for 1861, except through the effect of emigration from Canada and Great Britain, as there is a very small farming population in the Colony; the working classes being chiefly miners,
accustomed to excitement, fond of adventure, and entertaining
generally a thorough contempt for the quiet pursuits of life.

The minor items of Revenue in the synopsis will probably
not vary much in 1861 from the sums in the present Return; and cannot, in any case, be expected greatly to affect the amount of the general revenue.

On the other side of the account is the sum of £16,736
expended for "Establishments"—the most rigid economy having
been exercised in this department, the amount is not susceptible
of reduction—but might with advantage to the public service be
increased by some very necessary additions to the emoluments
of the principal executive officers of the Colony; their
present Salaries being not only inadequate to the relative
importance and responsibility of the offices they hold, but
literally insufficient to maintain them in a respectable position; a subject which I will take the liberty of bringing
before Your Grace in a separate Despatch.

The outlay on Works and Buildings amounts to the sum of
£3513, and in the formation of Roads and Bridges there has
been expended the sum of £18,935; a profitable investment
for the Colony, as is apparent from its increasing revenue,
which will no doubt keep pace with the improvement of its
internal communications and the facilities afforded to trade
and commerce. A detail of those Works is given in Statement
No 2—and the outlay on each is approximately shewn.

The other items of disbursement, being separately of small amount, need no comment.

The entire expenditure amounting to £44,124:
has been defrayed out of the current revenue, and there remains a balance of £8886 in the Treasury, which will be sufficient
to meet the outstanding liabilities of the Colony for the
unfinished Contracts of the Roads in progress.

The Works we propose to execute this year, are as follows;

A Cart Road from Pemberton to Cayoosh, length about 36 Miles

Ditto from Hope to Shimilkomeen ................ 74 "
Improvement of Navigation of Shimilkomeen River…60 Miles

Horse Road from Boston Bar to Lytton............... 30 Miles

Ditto from Lytton to Alexandria ............... 150 "

Ditto from Cayoosh to junction with Lytton Road 30 "

In Progress

Road from New Westminster to Langley ................ 15 Miles

Ditto from New Westminster to Burrards Inlet ..... 9 "

Ditto to Boundary Line at Semiahmoo Bay ........... 14 "

Ditto from Spuzzum to Boston Bar (nearly finished) 20 "

For the execution of these highly necessary works, we may,
I believe, safely estimate that the sum of £25,000 can be
provided out of the revenue of the Colony, without at all
impairing its capacity to defray the whole Civil expenses of
the Government. Much more than that sum is however required to
complete such extensive public works; and I therefore addressed
Your Grace on the subject of a Loan of £50,000 in my Despatch No 84 of the 28th of August last.

If that project can be carried out, we shall enter the
field with larger means, and the Colony will sooner experience
the impulse thereby given to trade and industry; if on the
contrary the Loan is not procurable, the extent of those
undertakings will be regulated by the means actually at my disposal.

I see no probability, short of an almost absolute abandonment
of all the essential public works upon which we are engaged, of
our being able, this year to maintain out of the Colonial Revenue,
the Detachment of Royal Engineers stationed here; and I rely
with confidence upon the Mother Country again affording her
assistance in our difficulties, by providing for them as
heretofore, out of Imperial Funds, so that I may be free to
apply the whole surplus revenue of the Colony, after paying all
its own Governmental expenses, to the opening of Roads and other
public works indispensable to its development.