No. 66

On the Union of the Colonies, (with other papers)
Mr Secretary Cardwell's despatch Vancouver Island, No. 10
of 2nd June 1864, came into my hands. It contains a letter
addressed by the Secretary of the Admiralty to the Vancouver
Island Dock Company relative to the concession of water rights
in connection with the proposed work.

2. I learn that in addition to the proposed concession
of water rights the Lords of the Admiralty offered to grant
twenty thousand pounds, by way of a loan. The present depressed
state of the Colony renders it very difficult to raise
sufficient money for the undertaking, but I am convinced that it
would be true economy if Her Majesty's Government were to
increase the amount of the loan so as to cause the work to be
performed. Within the short time that has elapsed since my
return to the Colony two of Her Majesty's ships, the flag ship
"Sutlej" and the "Scout" have had to proceed for repairs to
the only dock yard available, at Mare Island, San Francisco,
to be repaired at an enormous expense. Two gun boats, the
"Grappler" and the "Forward" are lying in Esquimalt Harbour
hardly fit to go to sea.

3. Rear Admiral Denman will shortly be in England and would
I have no doubt, if referred to, support the recommendation I now
venture to make.

4. I need hardly say how important to the interests of the
Commercial community the possession of a dock yard in the
immediate neighbourhood of Victoria would be.