No. 16. [Separate.]

Government House,
Wellington, 8th March, 1849.

SIR,~

I have the honor to enclose for your Excellency’s consideration, copies of a correspondence which has taken place between myself and the Principal Agent of the New Zealand Company, on the subject of providing funds necessary to meet the expenses connected with the acquisition of land from the natives for that body.

2. From that correspondence your Excellency will gather that Mr. Fox repudiates the idea of the New Zealand Company being liable for the expenses necessarily attendant upon the acquisition of lands from the natives, and which are, in point of fact, as essentially a part of the cost of such lands as the instalments paid to the natives are themselves, since it is quite clear that no available purchases could be effected from the natives without the requisite arrangements being made to secure to themselves suitable and sufficient reserves, and to see pointed out and defined the localities where those reserves are situated, and their respective boundaries.

3. Recently, as your Excellency is aware, the Local Government have had no less than three separate officers exclusively engaged in different directions, in attempting to effect negotiations for the acquisition of certain districts for the New Zealand Company, and at their especial request; the additional pay which it has been found necessary to allow those officers for travelling expenses, and in consideration of the peculiar, difficult, and laborious nature of the service, considerably exceeds the rate of £1000 per annum; there are also many collateral incidental expenses, as presents to natives, rations supplied to them, passages by sea from one place to another, and many others, all of which are exclusive of the ordinary salaries of the officers in question (excepting one) which still go on, and form a charge upon the Local Revenue, although their time and services are wholly devoted to the interests of the New Zealand Company.

4. For a Province where the revenue is so limited, and in the absence of any provision made by Parliament to meet an expenditure of the kind alluded to above, I would respectfully submit, either that the New Zealand Company should be required to provide the requisite funds, or that the Local Government should not be liable to be called upon to undertake negotiations from which, after incurring very heavy expenses, they derive no corresponding advantages.

5. It is true the Act of Parliament only contemplates the selection by the New Zealand Company of 1,300,000 acres from amongst the whole districts purchased from the natives, and that consequently large tracts may eventually revert to the Government; but as the New Zealand Company are not called upon to exercise their right of selection within any given period, and as the Act even contemplates the possibility of more extended arrangements being entered into with them upon the termination of the present one in April, 1850, it is quite clear that in practice the Local Government are unable to make any such surplus lands available, or in any way to reimburse themselves for the heavy outlay they are called upon to incur.

6. Moreover, in the despatches of the Right Honorable the Secretary of State for the Colonies, and in the correspondence which took place between his Lordship and the Directors of the New Zealand Company on this subject (copies of which your Excellency supplied me with last December,) it is evident that Earl Grey contemplates throughout that the onus of providing funds to acquire lands for the purpose of enabling the New Zealand Company to carry on their colonising operations would appropriately and justly attach to that body. I would beg, therefore, to receive from your Excellency such instructions in reference to this question as may put me fully in possession of the course your Excellency wishes should be adopted, and as may point out the specific source from which the funds required are to be obtained.

7. To put before your Excellency at once all the information relating to the subject, I have caused to be prepared a statement shewing the expenditure incurred by the Government in arranging the different land questions: I have also added a statement shewing the sums expended in presents to natives, and on account of the Special Commission under Lieut.-Colonel M’Cleverty; for although these, or at least the former of them, cannot perhaps be directly charged against any particular land purchase, they have a relative connection with those arrangements, and will at least shew that the Government are subjected to other contingent outlays, all tending to promote or facilitate the arrangement of the New Zealand Company, besides those which can be classified under particular and distinct purchases.

8. In concluding my despatch upon the subject, I would bring under your Excellency’s notice, that by the arrangement entered into between Her Majesty’s Government in England, and the Directors of the New Zealand Company, the last instalment of the loan to that body would become due after April, 1849; and that, as it is uncertain whether their existence as a chartered Company may not terminate at the expiration of the three years, for which the Crown waived in their favour its right over the demesne lands in the Southern Province, it may be necessary to bring under the notice of the Secretary of State for the Colonies, a statement shewing the expenditure which has been incurred in the colony on account of land purchases, with a view to its being taken into consideration should any new arrangements be entered into between the Crown and the New Zealand Company, or should they at the termination of the three years find it necessary to wind up their affairs.

I have, &c.,
(Signed) E. Eyre.

To His Excellency the Governor-in-Chief, &c., &c., &c.