Wellington 15 May 1866 My dear McLean I have your note of the 7th, and tho hard pressed - as usual - for time do not wish the mail to leave without writing to remove the erroneous impression on your mind as to Catchpool's instructions there was no exception made as to these - Similar instructions have been given, and are strictly enforced, to all sub treasurers that no payments whatever not approved by ministers are to be made - Neither Whitaker or Richmond (the Govt. Agents at Auckd. and Taranaki respectively) can, or ever did, authorize a penny to be paid by the sub treasurer. You cannot expect that when we are borrowing money, every shilling of which we have a squabble about with the Bank, and with no decision or knowledge as to where funds are to come from to maintain (not the fearful expenditure of the last three years) but some fair means of defence, any Govt. should allow its accountants at a distance to make payments which it had not authorized and in many cases did not even know of till several months afterwards! At all times such a system is bad finance, and without a precedent either at home or in the colonies, and in the present state of New Z. finances should only result in Bankruptcy or dis graceful repudiation - I have been for some time examining the mode of issuing monies from the Public Chest in Gt. Britain and elsewhere with a view to assimilate our practice to it, and in a few days orders will be issued which will in many ways alter our practice, and amongst other changes no payments will be made but by the Col. Treasurer on his I note what you say as to injudicious reductions at times aften leading to increased expenditure afterwards. No one can be more aware of this than myself, but "needs must - etc." When a country has neither money nor credit it is to reduce its expenses, just as private people are in similar circumstances, even 'tho' the result may be loss in the present and still more in the future. Every Minister now is stopped by the Treasury from spending - simply because the Treasury has not got the money to pay - No true friend of the Northern island, or of any portion of it, but will see that the very worst and most dangerous course for its interests is just before the Parlt. meets to frighten the Southern members by the expenses of the North. The proposal to change the whole of the wost of the Native and Defence services in each Province on the Province where they are incurred is fast gaining supporters, and, as the last straw broke the camel's back, a very little additional change will serve to make it impossible to withstand this proposal. I am sorry to have to write thus but an intimate knowledge of what many members are meditating forbids my ignoring it. You appear to have changed your mind from what you first proposed to me as to the settlement of the lands on the East Coast lately the seat of hostilities - As the session is now so near at hand it is just as well - if not indeed necessary - that the whole question should be brought before the Legislature which may desire to alter the existing law. Beleive me, dear McLean Faithfully yours E. W. Stafford