A Bright New Day - The New Treasury (1824 - 1850)

The first Colonial Treasurer, William Balcombe (1779 - 1829), was appointed on 2 October 1823 by Lord Bathurst under His Majesty's Commission. Balcombe had been a merchant on the island of St. Helena in the South Atlantic Ocean since 1804 where he was also a superintendent of public sales for the East India Company. When the Emperor Napoleon was exiled to St. Helena by the victorious Allies after his defeat at Waterloo, he lived in a pavilion on Balcombeƒ­s estate, 'The Briars'­. Balcombe was also appointed Purveyor to the ex-Emperor'­s establishment. During the time he lived with the Balcombes, Napoleon became attached to the family, especially the younger daughter Betsy who later wrote Recollections of the Emperor Napoleon.

This friendly association ended abruptly in March 1818 when Balcombe was dismissed from the island on suspicion of acting as an intermediary in clandestine French correspondence with Paris and negotiating bills drawn by Napoleon. Although never charged with any offence, Balcombe was looked on with great suspicion by the British Government until his wife'­s powerful friends in Parliament pressured the government to relent and give Balcombe some government office or another. Possibly as a punishment or maybe just as a means to rid England of an embarrassment, Balcombe was appointed Colonial Treasurer of New South Wales in October 1823.

Balcombe arrived in Sydney Cove in the Hibernia on 5 April 1824, the same ship which carried the new Attorney - General, Saxe Bannister (1790 - 1877) who was coming to the Colony with the new Charter of Justice which set up the legal and judicial framework within which the Colony was to develop from hereon. Balcombe'­s appointment was announced from the Colonial Secretary's Office on 28 April 1824 and the Department being set up on 12 May 1824. From 27 May 1824 payments were made through the Colonial Treasurer's Office.

Lord Bathurst had informed Governor Brisbane of Balcombe'­s appointment in 1823, saying that he would 'leave it to you to submit a proposition to me [relating to the new Treasurer'­s salary] ... founded upon the view of the duties which the Colonial Treasurer will have to perform ...'   It appears from this despatch that Bathurst had little knowledge as to the scale or scope of the Colonial Treasurer'­s duties as he was leaving the definition of both salary and duties to the Governor.

The colony's finances had been administered by the Commissary, the Treasurer of the Police Fund, the Naval Officer and the Treasurer of the Orphan Fund. Colonial revenue was raised by royalties on timber and coal, fees on shipping, import duties, wharf taxes, auction duties, market and fair dues, fees paid on cattle slaughtering and tolls on public bridges and roads. Monies from import duties, wharf taxes and duties on timber and coal were collected by the Naval Officer, the others by the Treasurer of the Police Fund. At the end of each quarter, seven-eighths of the revenue collected by the Naval Officer were paid to the Police Fund, and one-eighth to the Orphans Fund (which also financed the purchase of tools and implements used in public works).

In addition to consolidating all the above duties, the new Colonial Treasurer was also to collect Quit Rents due; he was to be Treasurer for the corporation formed for the management of the church and school estates and he was to receive all monies due from the sale of Crown Lands. In fact, the collection of all internal revenue, including that due  from duties on spirits and all licences, was to be vested in the Colonial Treasurer. In addition he exercised direct control over the Surveyor of Distilleries in New South Wales.

Between 1827 and 1836 revenue, except that from customs duties and court fees, was collected by the newly established Collector of Internal Revenue. This office subsequently became the Revenue Branch of the Treasury.

The Treasurer's initial concern with the actual collection and disbursement of revenue meant that he had close relations with all departments through which revenue was collected including the Lands Department, Customs Department, Post Office, Chief Inspector of Distilleries and Harbour Master. The Treasurer was thus responsible for collecting fees payable for many licences, such as Publican's Licences and Depasturing Licences.

The new Treasurer had a staff of three and he had been issued with specific instructions by the British Treasury. The Colonial Treasurer had to render an account each quarter with full particulars of all public monies. All vouchers had to be in duplicate, one for the Commissioner of Colonial Audit in England. Careful double-entry bookkeeping procedures had to be adhered to.

Quite soon after being appointed, Balcombe was requested to provide an explanation regarding the banking arrangements with the Bank of New South Wales; the circumstances in which he paid a large sum of money, by cheque, to that bank at a time when the bank was 'in a state of embarrassment'; and his practice of discounting the bills of merchants, using public funds. Balcombe explained that in keeping the public funds in the bank he was merely following a precedent already established and was also complying with a standing order of Governor Macquarie that Notes of the bank should be received in payment of duties. He also defended his practice of having deposited some money with merchants by stating that, following a recent robbery at the Commissariat Stores he considered it 'safer under their custody than it would have been at my House, where there was no money vault whatever to secure it in ...' 

Following this the Governor decided to put the Colonial Treasury on a more secure footing and to increase the staff, arrangements with which Lord Bathurst approved. The Secretary of State for the Colonies had also thought more deeply on financial arrangements for New South Wales and sent a despatch in December 1826 giving specific instructions.

Notwithstanding the fact that a Legislative Council had been erected in New South Wales in 1824 to advise the Governor and approve legislation, the Secretary of State made it quite clear that control lay in London with the specific instruction that no expenditure over £200 could be made without approval from the Lords Commissioners of the Treasury; an instruction which caused the Governor much pain as it would 'be attended with great inconvenience and injury to the service'.

The other instructions were that all officers concerned with financial collection were to pay monies to the Colonial Treasurer on a set day each week, in country areas each month. A fireproof vault was to be built with three keys (one for the Treasurer; one for the Auditors; and one for the Colonial Secretary) and the vault was only to be opened in the presence of all three. The Colonial Treasurer was to keep an account at each of the two banks and all demands made on him over £5 were to be paid by bank draft. The Colonial Treasurer was to furnish accounts on the sixth day of each month giving the banking position. Any sums in excess of £10, 000 were to be deposited in the vault and this reserve was only to be used by Governor'­s Warrant. Finally, a committee of five, to be appointed by the Governor, was to examine the contents of the vault, at least annually.

Throughout the 1830's the Government in London and the Governor in Sydney acted slowly to improve the administration of the Treasury. It was necessarily slow as every recommendation from the Governor had to travel 16, 000 sea miles and took about three months; conversely every despatch from the Secretary of State took as long. If there were disagreements they could take months, if not years, to resolve. Consequently in 1836 the Office of Collector of Internal Revenue was subsumed within the office of Colonial Treasurer. Colonial Treasurer Campbell Drummond Riddell immediately claimed an increase in his salary.  This action occasioned a protest from within the Legislative Council when John Blaxland gave it as his opinion that 'the duties of that office [ie the Colonial Treasurer] demand little talent or acquirement of any kind'. The Governor gave it as his opinion that this was merely an attempt's to assert the right of the Colonial legislature to appropriate the land revenues'.