It was matter of deep regret to me that the Government of the day would
not accept any share of the pecuniary responsibility of adding to the
compactness of the Empire, by connecting the two oceans by telegraph
and by road. The despatch which I copy - dated Downing Street, 5 March,
1863 - distinctly says, in its third paragraph, "Her Majesty's
Government are of opinion that they cannot apply to Parliament to
sanction any share in the proposed subsidy by this country."
"DOWNING STREET,
"5th March, 1863.
"SIR,
"I am directed by the Duke of Newcastle to acknowledge the receipt of
your letter of the 27th of December, and to express his Grace's regret
that so long, though quite unavoidable, a delay should have occurred in
replying to it.
"I am now desired to make to you the following communication: -
"Her Majesty's Government are of opinion that they cannot apply to
Parliament to sanction any share in the proposed subsidy by this
country; and though they take great interest in the project
contemplated with so much public spirit by the gentlemen represented by
you for carrying a telegraphic and postal communication from the
confines of Canada to the Pacific, they do not concur in the opinion of
the Canadian delegates that the work is of such special 'Imperial
importance' as to induce them to introduce for the first time the
principle of subsidizing or guaranteeing telegraphic lines on land.
"Her Majesty's Government are further of opinion that without a
submarine Transatlantic telegraph the proposed line in America will be
of comparatively small value to the Imperial Government, and that
whenever a scheme of the former kind is renewed, it is almost certain
that this country must be called upon to bear a much larger charge for
it than that which it is now proposed to devolve upon the British
Colonies in respect of the land-telegraph and communication.
"As Canada has offered to bear one-half of the proposed guarantee, the
Duke of Newcastle is prepared to recommend, and his Grace has no doubt
of ready acquiescence, that British Columbia and Vancouver Island shall
pay the sum of L10,000 per annum, as their share of L20,000 (being at
the rate of L4 per cent, on a capital of L500,000), to commence when
the line is in working order.
"It will, however, be necessary, before any proposal is made officially
to the Colonies, that the Duke of Newcastle should receive further
details. It is requisite that his Grace should be informed what
provision will be proposed as to the duration of this subsidy; what
conditions as to the right of purchasing the line, and to what
authorities that right should belong; and on what terms the whole
arrangement may be revised in the event of the Hudson's Bay Company
coming to any agreement for the sale of their territory.
"There will doubtless be other provisions which the Colonies will
expect.
"I am, Sir, your obedient Servant,
"T. F. ELLIOT.
"E. W. WATKIN, Esq."
I close this narrative of the Pacific Transit Scheme with the despatch
of the 1st May, 1863, which summarises the proposals made and generally
concurred in. These long discussions were not abortive, for they led up
to the great question of the buying out of the Hudson's Bay Company,
without which neither successful Confederation, nor its child the
Canadian Pacific Railway, would have been achieved in this generation.
"DOWNING STREET,
"1st May, 1863.
"SIR,
"I am directed by the Duke of Newcastle to state that he has had much
satisfaction in receiving your letter of the 28th ultimo, enclosing the
heads of a proposal for establishing telegraphic and postal
communication between Lake Superior and New Westminster, through the
agency of the Atlantic and Pacific Transit and Telegraph Company. These
proposals call for some observations from his Grace.
"New Westminster is named as the Pacific terminus of the road and
telegraph. His Grace takes for granted that if the Imperial Government
and that of British Columbia should find on further inquiry that some
other point on the coast would supply a more convenient terminus, the
Company would be ready to adopt it.
"Article 1. - His Grace sees no objection to the grant of land
contemplated in this Article, but the 'rights' stipulated for are so
indeterminate that without further explanation they could scarcely be
promised in the shape in which they are asked. He anticipates, however,
no practical difficulty on this head.
"Nos. 1 and 2. - The Duke of Newcastle, on the part of
British Columbia and Vancouver Island, sees no objection to the maximum
rate of guarantee proposed by the Company, provided that the liability
of the Colonies is clearly limited to 12,500l. per annum. Nor
does he think it unfair that the Government guarantee should cover
periods of temporary interruption from causes of an exceptional
character, and over which the Company has no control.
"But he thinks it indispensable that the Colonies should be
sufficiently secured against having to pay, for any lengthened period,
an annual sum of 12,500l. without receiving the corresponding
benefit, that is to say, the benefit of direct telegraphic
communication between the seat of government in Canada and the coast of
the Pacific.
"It must, therefore, be understood that the commencement of the
undertaking must depend on the willingness of the Canadian Government
and Legislature to complete telegraphic communication from the seat of
government to the point on Lake Superior at which the Company will take
it up. Nor could his Grace strongly urge on the Colonies of Vancouver
Island and British Columbia the large annual guarantee which this
project contemplates, unless there were good reason to expect that the
kindred enterprise of connecting Halifax and Montreal by railway would
be promptly and vigorously proceeded with.
