Copy of a Despatch from Governor Sir George Grey to Earl Grey. Government House, Wellington, January 6, 1852.

New Zealand Spectator and Cook's Strait Guardian, Volume IX, Issue 786, 12 February 1853, Page 4

Copy of a Despatch from Governor Sir George Grey to Earl Grey. Government House, Wellington, January 6, 1852.

Mt Lord, — Upon the 3d instant I bad tbe honour of receiving the copy of the despatch which your Lordship addressed to me upon the Bth of August last, No. 72, which copy had been transmitted here, addressed to tbe officer administering the government of New Munster. 2. Not having yet received your Lordship's original despatch, enclosing the Act of Parliament 14 and 15 Victoria, cap. 86, " to regulate the affairs of certain settlements established by the New Zealand Company," or the various despatches which accompany it, I am unaware of the full and precise scope of your Lordship's intentions ; but I beg to be permitted to make one suggestion, in reference to a passage in yonc Lordship's despatch, No. 72, of the Bth of August. 3. In reference to the commuted sum of £200,000 which it was proposed to pay to the New Zealand Company, your Lordship observes, " that such debt, in the form in which her Majesty's Government proposed to utabjisb it, would not have proved any more serions obstacle to tbe progress of New Zealand than a debt incurred under somewhat similar circumstances, and which has already bren in a great measure liquidated, did to that of South Australia." 4. From this passage in your despatch, I think that if in the case of the New Zealand debt a slight* change was made in the details which were ratde in reference to the South Australian debt, such a plan might receive tbe sanction of Parliament, whilst I think it would be satisfactory to tbe inhabitants of this country, and .would afford a complete and easy solution of the Whole difficulty. 5. Tbe portion of tbe South Australian debt alluded to amounted to £85,000. In that case tbe Lords of tbe Treasury intimated, in Sir Charles Trevelyan's letter to Sir James Stephen of the 26th of April, ] 842, that it w»s their opinion that this debt should bear interest at the rae of £3 10s. for every £100 ; that tbe guarantee of the United Kingdom for tbe payment of tbe principal and interest should be added to that of the colony ; and that provision should bemad* for the payment of the interest in England nntil the state of the finances of the colony allowed of tbe remittance through tbe colonial agent of the sum necessary for tbe payment of the annual interest. Finally, by the 6th and 6th Viet. cap. 61, it was enacted, that for so long a time as the Lords Commissioners of her Majesty's Treasury were satisfied that tbe genera) revenue of South AustiaUa was insufficient for the payment of tbe interest on the South Australian debt, it ahould be lawful for them to direct tbe payment of such interest out of the consolidated fond of tbe United of Great Britain and Ireland, although the revenues of the colony wereultimately made chargeable with the payment of .both principal and interest, and with such sums ai might have been paid by the Treasury upon account of interest. 6. What I would recommend in the case of New Zealand is, that a similar course should be pursued in all respects, except that tbe payment of the principal and interest which may be admitted to be due to the New Zealand Company should be made an ultimate-charge upon the land revenue ; not upon the general revenue of the colony ; and in the meantime that it sbonld be provided, that it should be lawful for the Lords Commissioner! of the Treasury, if they should be satisfied that the land revenue of the New Zealand islands was insufficient (after defraying the necessary costs aud charges payable from snob land revenue) for the payment of the interest upon tbe sum due to the New Zealand Company, to authorize and direct tbe payment of tbe interest due upon such sum out of the consolidated fund of the United Kingdom of Great Britain and Ireland, or out of the growing produce of aucb fund ; provided always that the principal sum due to the New Zealand Company should remain and be a charge upon the land revenue of the New Zealand islands, at also the interest due, or that may hereafter become due, in Tetpect thereof, and any portion of such interest v as might be paid otjt of the consolidated fund in the manner above mentioned. 7. If such an arrangement as this obtained the sanction of Parliament, and the British Treasury under its authority continued for a very few 'years to advance the interest due upon tbe debtto the New Zealand Company, I believe that the land revenue of this colony wouH *brnJj^^jf h a prosperous state that it could ,sjHHPR^ defray the annual charge for in^^t^^Jm^ 1 year pay off a considerable yotlioja^j^incl* pal of the debt ; whilst as the «W«i.^sv«iwi from the Company so considerable a tract of land, I apprehend that it would be generally felt that some payment should be made for this advantage, and that upon the whole such an arrangement as I have proposed was an unobjectionable one, and the most advantageous which could under all tbe circumstances have been concluded. I have, &c, (Signed) G. Grey. The Right Hon. Earl Grey, &c, &c, &c.