"The 40 per cent. of the net profit of the Company allowed to the factors, in addition to the salaries of considerable amount, is a heavy drain, and involves other considerations opposed to rigid discipline, which need not be further touched upon here, but which are sufficiently obvious. This re-organization can only be effected by giving to the Governor very large and exceptional powers, and without delay. If these powers are given, I am quite confident that the results will be such as abundantly to satisfy the Committee. Hitherto, as it appears to me, far too little discretion has been permitted; and the practice of sending all the accounts home to England, and dealing with them in such a manner that the Governor could not tell from time to time how the financial results of expenses and profits were progressing, has produced its inevitable consequences. In future, I feel convinced, it will be found matter of the utmost consequence to concentrate the accounts at Fort Garry, and to send copies of the vouchers, journals, and ledgers from Fort Garry to England, instead of adopting the reverse practice, and endeavouring, as hitherto, to make the accounts travel as long a distance and be made up over as remote a time as possible. With proper telegraphic and postal communication between the principal posts of the Company and Fort Garry and Montreal, there is no reason why the accounts should ever be two years in arrear in future. "As regards the settlement of the country, and, involved in that important question, the state and prospects of the Red River, the discoveries of gold above alluded to involve very serious considerations. "Assuming a rush of miners to different portions of the territory, the machinery of Government for the preservation of order cannot be for a moment neglected, or its construction be delayed. This involves, again, the question of the establishment of a new colony. Is that colony to be governed by the Hudson's Bay Company, who are essentially a trading and landowning corporation, or is it to be governed in the name of her Majesty, the Hudson's Bay Company, so far as the limits of the Crown Colony are concerned, becoming merely traders and landowners, and ceasing to govern as at present? "All the difficulties at Red River--which, after all, have been much exaggerated, and can be very easily dealt with--would be disposed of at once were a Governor, appointed by the Crown, to be sent out; and it does not follow that representative institutions need at first be granted, though ultimately they would become matter of necessity. The great object of the Governor and Committee--and Governor Dallas and myself perfectly agree in the view--should be to induce the Colonial Government to found a Crown Colony under arrangement with the Hudson's Bay Company with the least possible delay.