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A—No. 6a

War Office, November, 1861. Sir,— With reference to my letter of this day's date, respecting the special allowances granted to the Troops, I am directed by the Secretary of State for War to instruct you that, if by reason of any special circumstances arising out of the state of affairs in New Zealand when that letter reaches you, you should deem it expedient to extend temporarily to the soldier any greater advantages than are hereby sanctioned, you are to apply to the local Government for a grant from Colonial funds to cover the same, it being very undesirable, for many reasons, that any but an uniform scale of allowances chargeable to Imperial funds should henceforth prevail in any part of Australasia. A communication on this subject will be addressed to Sir George Grey by the Colonial Office. I am, however, to impress upon you that, under no circumstances, is this permission to be held to apply to the money allowances of Officers and others, which are to be reduced, as already ordered; nor will the Secretary of State approve of any application on behalf of the soldier, except on the clearest grounds of policy or of necessity. I have, &c.,

GEXEEAr. CAMEBON. CONFIDEXTUX.

No. 5. MEMORANDUM BY MR. FOX. The Military Secretary (Major Whitmore) having intimated through His Excellency's Private Secretary the wish of Lieut.-General Cameron, that the Colonial Secretary should give him in writing the opinions which the latter expressed at a late meeting of the Executive Council, in reference to the Despatches received by His Excellency and by the Lieut.-General from Her Majesty's Government in reference to special allowance to soldiers, the Colonial Secretary does so to the following effect. The Colonial Government, while anxious to meet to the utmost of its ability the wishes of Her Majesty's Government, is unable to pursue any other course than that indicated by a Resolution passed by the House of Representatives on the recommendation of a Joint Committee of both Houses of the Legislature, which investigated the subject of Local Defence during the last Session of the Assembly. It will be seen from the Report of the Joint Committee, that while it recommended the confirmation of the arrangement which bad bsen negociated between the late Colonial Secretary, Mr. Stafford, and Her Majesty's Government, to the effect that the Colony should contribute towards the cost of maintaining Imperial Troops in the Colony at the rate of £5 (five pounds) per head, and also should agree to pay a disputed sum of about £7,001) for Barracks at Taranaki; it could not recommend that the Colony should undertake the further charge of the special allowances to soldiers, which, at the scale then in operation, would have amounted to at least £5 per head more, and which sum it had only been proposed that the Colony should pay, subsequently to the Imperial Government having tendered as an ultimatum the proposal to pay the £5 a head towards the maintenance of the Troops ; and which ultimatum was virtually accepted by the Colony, when the second charge (that for special allowances) was heard of for the first time. As the Colonial Government is bound by the Resolution of the Legislature based on the Report above referred to, it is compelled most respectfully to decline to make provision for the special allowances. The Colonial Secretary desires to guard the Government of which he is a member, and the Colony, against any possible imputation of being desirous to evade the legitimate liabilities of the Colony in respect of Military protection afforded to it at the present crisis by the Imperial Government. Their refusal to pay the special allowances is made in no such spirit, but is dictated simply by a practical consideration of the ability of the Colony to bear the heavy burdens which the Native Insurrection has imposed upon it, and which will prospeotively be permanently increased by provisions which it is proposed to make towards the Government of the Natives. Ttie ultimate adjustment of these burdens must be determined on broad grounds, which it will be for the Imperial Government to consider. A Memorandum which His Excellency's Advisers laid before him on the 27th of September last, on this important subject, has already been forwarded to Her Majesty's Government by His Excellency. As it indicates the deliberate opinion of the Colonial Government, arrived at unanimously after much consideration, the Colonial Secretary begs to refer Lieut.-General Cameron to the following extract from that document. William Fox.

[ The Memorandum here referred to will be found printed in Sess. Pap. 1862, E — Noi 2, p. 17.]

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FURTHER PAPERS RELATIVE TO Enclosure in No. 4. THE WAR OFFICE TO LIEUTENANT-GENERAL CAMERON.