The Chancellor of the Exchequer calls the attention of the Board to the subject of the circulation of British silver coins as an unlimited tender in the Colonies.
The question engaged the consideration of the late Board of Treasury in reference to the West India Colonies ; and Despatches are now before my Lords from the Governors of those Colonies, containing their views regarding the probable effect of such an alteration of the existing system as had been proposed in the interest of the communities under their respective administrations. The opinions stated in these Despatches differ greatly from one another ; and, although the conclusions at which the Chancellor of the Exchequer has arrived coincide with those entertained by the late Board regarding the general impolicy of a practice which is opposed to sound principles of currency, there are difficulties attending the question in the West Indies, from the existence of local laws on the subject, and also from the commercial position of many of the Islands, which would render doubtful the expediency of attempting a revision of their currency at the present time. Mr. Disraeli therefore recommends the postponement of the consideration of any measures for this purpose in regard to the West Indies.
He states, however, to the Board that his attention has been drawn to the effects of this system in another quarter, in consequence of the large exportation of silver coin which has recently taken place to Australia. In the Colonies in that country the usage has prevailed (as in other Colonies) of admitting British silver into circulation as an unlimited tender, though without the sanction of any law.
It does not appear that any inconvenience has arisen from the practice up to the present time ; but the discovery of the gold mines has occasioned an active internal commerce which requires an enlarged circulation ; and it becomes important that the currency of these Colonies should be placed on a sound basis.
The Chancellor of the Exchequer proposes, therefore, to the Board that the Lords of the Privy Council should be requested to submit a Proclamation to the Queen at the next Council, declaring that the coins of the Realm shall circulate in Australia according to the regulations by law established in this country, and that the silver coins shall be legal tender for payment of sums only which do not exceed Forty Shillings. He proposes also that the measure should be extended to the Colonies of New Zealand, Ceylon, Mauritius, and Hong Kong, in none of which any reasons exist for the continuance of the usage which has prevailed regarding the circulation of British silver as an unlimited tender.
He lays before the Board drafts which he has caused to be prepared of a Proclamation and Order in Council for carrying this measure into effect.
My Lords concur in the suggestion of the Chancellor of the Exchequer, and direct that a communication be made to the Clerk of the Council accordingly, transmitting to him the Draft Proclamation and Order in Council, with my Lords' request that the Lords of the Privy Council will submit the same to Her Majesty for confirmation.
WHEREAS there was this day read at the Board the draft of a Proclamation regulating the currency of the coins of the United Kingdom in Her Majesty's colonies in Australia, New Zealand, Ceylon, Mauritius, and Hong Kong: Her Majesty, having taken the same into consideration, was pleased, by and with the advice of Her Privy Council, to approve thereof, and to order, and it is hereby ordered that the said Proclamation do take effect and come into force in Her Majesty's said colonies, or any of them, from and after the date of the publication thereof by the Governor, Lieutenant And the Lords Commissioners of Her Majesty's Treasury, and the Right Honourable Sir John Pakington, Bart., one of Her Majesty's Principal Secretaries of State, are to give the requisite directions herein accordingly
WHEREAS it has been represented to Us that in Our colonies in s which govern the circulation of the coins of Our United Kingdom, as by law established, should be enforced in Our said colonies: Now therefore We, by the advice of Our Privy Council, have thought fit to declare and ordain, and by the advice aforesaid We do hereby declare and ordain, that within and throughout Our colonies in Australia, New Zealand, Ceylon, Mauritius, and Hong Kong the coins of Our United Kingdom shall pass current in the manner directed in the several Acts of Parliament which regulate the, currency of the same, and that the silver coins of Our United Kingdom shall not be a legal tender in payment of sums exceeding forty shillings.
A History of Currency in the British Colonies by Sir Robert Chalmers, Baron, (b. 1858). Published: 1893, London, UK. Full OCR text posted at Archive.org.
Ceylon Currency British Period 1796-1936 by B. W. Fernando, APPENDIX B.
1939, Colombo; Ceylon Government Press. p.37-38
Contents Next APPENDIX B
Coins of Lakdiva, Ceylon and Sri Lanka since 300 BCE.