(75)

risk of erring upon this side than of leading
your Lordship to form too favourable an opinion
of the present financial state of New Zealand.
The next question that arises for considera-
tion is the probable expenditure that must ulti-
mately be incurred for the naval and military
protection of this colony. So soon as there is
an adequate military force in the country, I think
that the naval force can be very considerably
reduced, possibly to one steamer, and one vessel
of war; but the presence of a steamer will cer-
tainly be always indispensable upon these coasts.
I will, upon the arrival of a sufficient military
force, lose no time in communicating with the se-
nior naval officer upon these subjects, and in
reporting my final determination to your lord-
ship.

I propose to address another Despatch to your
lordship upon the subject of the military force
which I at present think requisite for the main-
tenance of British supremacy in these islands.
But I may state here that I have no doubt that
the local revenue will shortly afford the means
of supporting so considerable and efficient a
police force, partly composed of natives, that it
will be in the power of the local government in
three or four years to dispense with the pre-
sence of a considerable portion of the military
force which recent occurrences have rendered
it necessary temporarily to stationhere.

I have, &c.,
(Signed)
G. GREY.

The Right Hon. Lord STANLEY,
&c., &c.

(No. 32.)
COPY OF A DESPATCH FROM THE RIGHT HON. EARL
GREY TO LIEUT.-GOVERNOR GREY,

Downing-street, 1st February, 1847.

Sir, I have to acknowledge the receipt of
your despatch, (No. 46) of the 12th May last,
containing a report upon the general financial
arrangement of New Zealand, and the princi-
ples on which you consider it will be proper
that they should be conducted, and adverting
likewise to the means of securing the future
order and tranquility of the settlement.

It has been a source of satisfaction to me to
receive in the clear aud comprehensive form in
which it has been brought under my notice,
-the favourable account you have there given,
of the financial condition, present and perspec-
tive, of the colony committed to your govern-
ment. In the views you have expressed on this
subject generally, as well as the line of policy
pointed out by you as the best calculated in
your opinion for securing a permanent and pro-
gressive increase in the local revenue, I entirely
concur, and you may depend upon my support
in carrying out the measures by which this end
is sought to be accomplished.

I also approve of the proposed enlistment of
the Natives as a Police Force, and of the imme-
diate execution of those public works, which are
necessary for the promotion of peace and order,
and with them, of wealth and social improve-
ment.

I now proceed to advert to your statement re-
specting the probable amount of Revenue and
Expenditure of the colony during the present
year: and from the calculations on which that
statement is made, I have inferred that the total
amount of aid which will be required from the
Imperial Treasury, to enable you to carry on the
service of your government, for the year 1847,
is £38,865 15s. Od., thereby covering your es-
timated deficiency of £36,000, and allowing you
a probable surplus of £2,865 15s. Od.

On this subject I have purposely delayed ad-
dressing you until I should have transmitted to
you the instruments by which the intended
change in the form of Government of New Zea-
land will be effected, in order that I might at
the same time explain to you the bearing of
that measure upon your financial arrangements.
Those instruments were conveyed to you in my
despatch of the 23rd ultimo, it now therefore
remains for me to acquaint you that an esti-
mate to the extent of £38,865 15s. Od., will be
submitted to Parliament in the present session,
for the service of New Zealand; and it is scarcely
necessary to add, that I place a firm reliance on
your availing yourself of every practicable op-
portunity which an augmentation of the colo-.
nial revenue may offer, for economising the ap-
plication of that amount, you will moreover bear
in mind that, except the small sum to be re-
tained for the Civil list, the revenue will, when
the new constitution shall come into operation,
be placed at the disposal of the Legislature;
but that no grants are to be made not recom-
mended by yourself. It must likewise be ex-
plained to those bodies that they are expected
to provide for the public service of the colony,
to the full extent of their power, and that hav-
ing the advantage of self government, they must
not calculate upon the continuance, for more than
a very brief period, of the Parliamentary grant.

With reference to your Despatch (No. 34), of
the 16th April last, relative to the present state
of the Southern settlements, and the means of
holding possession of the territory between Port
Nicholson and Taranaki, I have to signify to
you my approval of the steps you have taken for
opening the land communication between Wel-
lington and Porirua, and of the sanction of Her
Majesty's Government for the expenditure in-
curred for that purpose.

I have, &c., &c.,
(Signed)
GREY.

To Governor Grey, &c., &c.,
New Zealand.

MILITARY.
No. 12.

(No. 47.)
COPY OF A DESPATCH FROM LIEUT. - GOVERNOR
GREY TO THE RIGHT HON. LORD STANLEY.

Government House,
Auckland, May 14th, 1846.

My Lord,

Upon the 12th instant I addressed a Des-
patch to your Lordship (No. 46,) in which I
stated I would take an early opportunity of re-
porting upon the strength of the military force
which I considered at present requisite for the
maintenance of British supremacy in these is-
lands.

I have now the honor to transmit copies of the
correspondence which has passed between the
Lieut.-General commanding the forces in New
South Wales and myself upon this subject.
Your Lordship will find, from this correspon-
dence, that I consider that a force of 2,500 troops
of the line should for the present be stationed in
New Zealand.

I find that my predecessor, in his despateh
No. 27, of the 9th of April, 1845, stated it as his
opinion that two regiments were required for
the maintenance of these islands, which would
amount to a force of about 2000 men; but after
having now visited many portions of the islands,
I should recommend that the force here should be
increased to 2,500 men.