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The history of South Australia from its foundation to the year of its jubilee (Volume 1) online

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their reception, and the colonists pledged themselves
not to employ any persons thenceforth who might
arrive in the province under sentence of transportation
for crime committed in Europe; to prevent by all
lawful means the establishment of English prisons or
penal settlements; not only to refuse assent to any
projects to facilitate the administration of such penal
settlements, but to seek the repeal of all regulations and
establishments for the purpose ; and, finally, to support
by countenance, advice, and money, all who might
suffer in the promotion of this cause.

The feeling had become strong and fairly general
that the total cessation of transportation to the colonies
was essential to their honour, happiness, and prosperity,
and that to secure this desideratum it was necessary
that the Australian colonies should join in one great
confederation to obtain deliverance from this curse of
civilization, and, as we shall see, it was not long before
this great end was practically obtained. Of course,
having taken this important step, South Australia
could not with any show of consistency continue to
transport its own felons to Van Diemen's Land, and a
measure was therefore adopted for the employment of
convicts within the province, who should henceforth
be sentenced to hard labour instead of " transportation
beyond the seas." This led to the establishment of a
stockade at Cox's Creek, and, subsequently, of the
Labour Prison at the Dry Creek.

While these matters were going on, while excitement
was running high on the questions brought forward in
the new Legislative Council, already chronicled in this
chapter, news reached the colony of the increasing
richness of the gold discoveries in New South Wales,
and of the still greater yield of the more recently found
gold-fields in Victoria. At once there was a stampede
of such working men in South Australia as could raise
sufficient money for their passage and outfit, and they
left for Victoria, at first by fifties, then by hundreds,
and at last by thousands.


Soon after the exodus commenced, Mr. J. M. Solomon
advocated following the example of Victoria and
offering a reward for the discovery of a workable and
paying gold-field in South Australia, and 300 was
guaranteed by private subscription; while the Legislative
Council not only determined to permit licences to be
issued for the search for gold on unsold waste lands, and
also to appropriate a sum of money for a geological
survey of the colony, but offered 1000 for the dis-
covery of a gold-field in the colony, the produce of
which in two months should amount to 10,000. To
this there was a poor response a bird in the hand, like
the Victoria fields, was considered to be better than
half a dozen in the bush and the exodus continued.
" It is perhaps no exaggeration to say," said the report
of the Chamber of Commerce for 1851, " that at least
15,000 to 20,000 individuals left South Australia
during the prevalence of the gold mania," and this
included the greater part of the most useful labourers,
involving a cessation of almost all industrial production.

On the 27th of November a notice appeared in the
Adelaide Times, stating that after the next issue it
would be published weekly instead of daily, "in con-
sequence of the falling off of business and the de-
partures for the diggings." One by one the other
papers were stopped, until the Register, Observer, Times,
and Morning Chronicle were left the sole representatives
of the press.

In 1852 came a crisis in the history of the colony.
An abundant harvest had been gathered in with some
difficulty, owing to the scarcity of labour ; and hundreds
of gold-diggers had returned with their rich gains and
findings. But, with a surfeit of wealth, it could not be
put into circulation. The banks had been drained of
coin by the numbers who had left the colony, and with
the absorption of a medium of circulation there came
a stagnation of trade, and with it the discharge of
nearly all those employed who had not voluntarily left
their occupations and pursuits to proceed to the
diggings. It thus happened that there was not in many

VOL. I. 6


instances sufficient business to occupy the time of even
the former employer of labour, and one after another
shops were closed, business suspended, and they too
followed in the general wake and went to the gold-
fields. Shepherds left their flocks in the sheep-yards ;
stockmen deserted the cattle-stations; farm labourers
abandoned their teams and ploughs ; dairy cows were
left to run untended in the bush, and servants of all
classes left their employers. The hands employed at
the Burra-Burra mines were reduced from 1042 to 366,
and subsequently to 100 Pumping engines were
stopped, and dry levels only worked.

.Rapidly and extraordinarily the contagion spread.
In one week in January, 1852, no fewer than thirteen
Government officers, and again in one week in February
seventeen others, sent in their resignations. So many
persons were leaving the colony in debt that a Bill was
hastily passed to obtain summary payment of small
debts, but it was rendered almost nugatory by the dis-
charge of officers from the local court.

A great part of the police force resigned, and those
who were left were in a state of disorganization, so that
grave fears were entertained that in distant and unpro-
tected stations the natives would commit depredations
and otherwise become troublesome. For the city no
fears were felt, as the thieves and bad characters
generally had made their way to the diggings, a more
lucrative field for their operations.

But for the intervention of the Chamber of Commerce,
many of the letter-carriers would have been dismissed,
at a time, too, when the business of the post-office was
largely increased by the number of letters passing
between the absentees and their families. Several of
the minor departments were left without any clerical
assistance whatever. The Labour Office was removed
to the Port, as if ready to take its departure with those
for whose use it was established. The relieving officer
and health officer were discharged. The Destitute
l>oard, finding that the asylum was likely to be filled to
overflowing with deserted wives and families, advertised


that such as were left behind by men who had pro-
ceeded to the diggings would not be supported. The
city surveyor, the inspector of weights and measures,
and many others were under notice that their services
would probably soon be dispensed with.

The city and suburbs presented a most desolate and
forsaken appearance. Some fifty or sixty shops were
closed in Hindley Street and Bundle Street alone.*
Many private houses were deserted in consequence of
the occupants having left the colony, or, in a great
number of cases, because they had joined some other
family, left without its male members, for company and
protection. Sixty women and several families were
thrown upon the asylum despite the notice of the
Destitute Board. The Port was left with only one
water-carrier, and Thebarton with only one man !

The great difficulty, putting all others in the shade,
was, however, the want of cash. It was calculated
that " each man must have taken with him on an
average ten pounds in specie, to pay his travelling
expenses and provide the necessaries of life until his
labour at the diggings should be productive. This
amounted to a drain of gold sovereigns from the bank
vaults. Every bank-note in the possession of the
intending emigrant would be converted into coin, as
the only circulating medium on which he could rely
over the border. Taking the lowest estimate of fifteen
thousand emigrants, this would imply a drain on the
banks of 150,000. Such a drain as this involved the
necessity on the part of the banks of restricting their
note circulation, and of diminishing their discounts of
commercial bills, which had the effect of paralyzing
trade, and left the already glutted markets without
purchasers for their commodities." f

Several plans were proposed, such as allowing the
banks an extended circulation ; the issue of Government

* On one of these deserted houses the following facetious notice
was posted up for the information of the tax-gatherer : " Mr.
Collector, gone to the diggings, hope to pay you when 1 return."

t Finniss's " Constitutional History of South Australia," p. 71.


notes having twelve months' currency ; the transmission
of gold to England for conversion into sovereigns, and
the assay of gold in the colony.

The Governor was memorialized to establish the latter,
but he declined to do so, and urged a forbearance of
creditors to debtors as the best remedy for the evil.
The managers of the South Australian Coiripany
adopted the plan of taking wheat for rent, and some
few tradesmen took gold-dust for goods, although, if
this system of barter had become universal, the ruin
of the colony, at least for a time, would have been
inevitable. As it was, large numbers were continuing
to leave the colony, who would have remained if there
had been trade and employment in proportion to the
gold lying useless.

It cannot be denied that the attractions of the gold-
fields were very great, the news from Forest Creek
being to the effect that five Adelaide men had procured
no less than 250 Ibs. weight of gold, which, at 60s. per
ounce (the price then given in Adelaide), was worth
about 9000. On receipt of this news thirteen out
of the twenty-two vessels in harbour were laid on for

A letter from a well-known colonist,* written about
this time, gives a graphic picture of the state of
affairs :

" February 25th, 1852.

" What changes have taken place in this colony since
Christmas ! The discovery of gold has turned our little
world upside down ; thousands have left the settlement
for the diggings. ... In Adelaide windows are bricked
up, and outside is written, ' Gone to the diggings.'
Vessels are crowded with passengers to Melbourne, and
the road to the Port is like a fair ministers, shop-
keepers, policemen, masons, carpenters, clerks, coun-
cillors, labourers, farmers, doctors, lawyers, boys, and
even some women, have gone either by sea or land to

* Mrs. Evans, of Evandale, daughter of Mr. George Fife
An gas.


try their fortunes at the diggings. . . . Somewhere
about 16,000 worth of gold has in less than two
weeks found its way here. Many have done uncom-
monly well, earning 200 perhaps, or more, in a week,
while some have not earned enough to pay for their
food. ... It is quite ludicrous to see how these
labourers spend their gold. One man bought six silk
dresses and six bonnets for his ' missus.' "

Early in the year (1852) one or two far-seeing men,
foremost among whom was Mr. George Tiiiline, manager
of the Bank of South Australia, became convinced that
the assay of gold into stamped ingots of a fixed value
was the only immediate and effectual way out of the
financial difficulty. Again the Governor was memo-
rialized by the Chamber of Commerce, and also by
the merchants and traders of Port Adelaide, on the

Long, elaborate and ingenious replies were returned,
arguing the position but declining to entertain the
proposition. The following, read in the light of sub-
sequent events, is an extremely interesting specimen.
The Governor directed the colonial secretary to
" Acknowledge the receipt of the memorial urging the
local Government to receive, assay, and coin, that is,
stamp gold, as a measure calculated to relieve the
depression of the mercantile and trading community.
Say that the depression under which the colony is
labouring is not owing to an insufficient circulating
medium, or to a want of banking accommodation.
Eemotely the depression is owing to credit having been
obtained far beyond the value of the article on which
that credit was given. More immediately the de-
pression is owing to a great diminution or total
cessation of the demand for property or merchandise
of any kind resulting from the migration of the popu-
lation to the gold diggings. Assaying and stamping
gold would put the metal in a convenient and desirable
shape for the merchants to purchase, and the banks to
advance upon, but it would not relieve the commercial
pressure. The discoverer of gold is no more entitled


to claim a mint, or an assay office to give a circulating
fixed value to his gold, than the wool-producer can
demand a manufactory for his raw produce. To give
a fixed and circulating value to gold-dust would make
money more plentiful, but investments of money would
not be made here in the absence of population, or
during a drain of it from the colony. The gold-dust
to which additional value is proposed to be given by
affixing to it the character of a circulating medium,
would circulate back again for re-investment in gold-
dust, to be again raised in value by the assay office in
Adelaide, during the short period in which, under these
circumstances, an assay office in the adjacent colonies
should be non-existent. Whilst this additional value
was received by gold-dust, and the trade in it con-
sequently increased, all other kinds of property would
still remain unattractive as investments; for, in the
absence of population, or during the drain of it from
the colony, other investments would yield no current
income or profit. In short, if even sovereigns, instead
of gold-dust, were extracted from the bowels of the
earth of the adjacent colonies, these coins would not be
invested in South Australia, because they could be
more profitably invested where the capital would
be more productive than it is at present in this colony,
owing to the drain of the population and the consequent
stagnation of all industrial pursuits. Capital would
follow labour. Under present circumstances, gold
brought here is brought by mistake, and must inevitably
go back again. The amount of the currency is fixed
or regulated, not by legislative enactments, but by the
natural law or course of business. In a colony in
which trade is conducted upon an extensive system
of credit, every temporary diminution of capital or
wealth has the effect of lessening or annihilating the
demand for, and the consequent value of property, and
must be inevitably followed by a proportionate extent
of temporary loss. The banks have it not in their
power to deal with anything more than the temporarily
diminished capital of the community. No support

1862.] THE BULLION BILL. 263

which they can attempt to afford to the trade in gold
will prevent individual "members of the community
from participating in the loss which the colony at
large has suffered by the migration of the population
and the temporary stagnation of trade."

Excellent as, in many respects, the arguments of the
Governor were, he was wise enough to know that the
opinions of men better versed than himself in practical
business might be more valuable than his own, and he
never at any time put himself in direct antagonism to
such opinions. Immediately on receipt of the com-
munication we have quoted above, the Chamber of
Commerce again urged the absolute importance of
immediate steps being taken to meet the crisis which
threatened the doom of the colony. The arguments
used were so conclusive, the scheme for carrying out
the proposal so well digested, that a special session of
the Legislative Council was summoned to meet at an
early date, "in order to the enactment of such a
measure as may be best calculated to meet the present

On the 28th of January the Council met to discuss
a Bill to enable the banks, temporarily, in addition to
the notes issued by them and then in circulation within
the province, to issue notes in exchange for, or to the
amount of, any gold bullion purchased or acquired by
the banks, at a fixed rate ; to enable persons to demand
from the banks notes in exchange for bullion at a fixed
value ; and to make the notes of the banks a legal
tender, except at the banks, so long as the notes were
paid on demand in specie or in bullion. The Bill
further provided for the establishment of an assay office,
in order, on payment of the cost of assay, to facilitate
to the banks and other buyers and sellers of bullion,
the ascertaining of the weight and fineness of bullion
sent them for assay, and to constitute such assayed
gold, when stamped, a legal tender.

It was remarkable that the Governor, who had shown
so much shrewdness and capacity on almost every other
matter brought before him for the good of the colony,


was still opposed to this somewhat daring scheme, and
in his address to the Council 'he stated :

"The banking, commercial, trading, and other moneyed
classes of the community, and also my official advisers
in Council, concur in the utility of the specific measure
now introduced. Whilst my unaltered views, as already
published in replies to the memorials that have been
presented to me, do not coincide with the common
expectations that legislation can be made, or will prove,
a means of speedy and general relief to the existing
depression, my judgment is nevertheless entirely satisfied
that the present measure is alike safe and innocuous,
and confers on the colonists of South Australia only an
approximation to the advantages, as regards the pos-
session of bullion, which holders of that commodity
would obtain on application at the British Mint."

After the address the Council at once proceeded to
the sole and important business of the special session,
and the Bullion Bill was read a first, second, and
third time, passed, and assented to, on the same

Of course in assenting to this Bill the Governor took
upon himself an enormous responsibility, and ran the
chance of an immediate recall, but he was not the first
Governor who had exercised discretionary power at a
critical time, and, as we shall see, his action met with
the warm approval of the Home Government.

" The responsibility assumed by Sir Henry Young,
in assenting to the Act," says Mr. Anthony Forster,*
" was far greater than that assumed by Colonel Gawler
in drawing upon the Lords of the Treasury, for it sub-
verted the currency laws of the Empire, and was clearly
repugnant to Imperial statutes. To make it obligatory
upon the subjects of her Majesty to accept, as money,
gold which did not bear the Imperial effigy ; and, worse
still, to oblige them to receive, as equal in value to
the Queen's sterling sovereigns, the promissory notes of
any or of all the banks of the colony, was such an

* " South Australia : its Progress and Prosperity." London :

1852.] GOLD FEVER. 265

interference with the circulating medium as had seldom
before been attempted."

The Government Assay Office was opened on the
10th of February, and Mr. B. H. Babbage (son of Mr.
Babbage, the celebrated inventor of the calculating
machine), and Dr. Davy were appointed Government
assayer and assistant assayer respectively. Success set
in at once. On the first day of opening the office, gold
to the value of upwards of 10,000 was deposited by
twenty-nine persons, and day after day it continued to
pour in to an extent beyond the most sanguine expec-
tations, so that premises had to be enlarged almost at
once, and the staff increased.

No doubt the inducements held out to depositors of
gold-dust were great, the value given to the ingots and
proportionately to crude gold being far in excess of the
ruling price in Melbourne, where, at the time of passing
the Bullion Act, it was from 58s. to 60s. per ounce,
whereas the standard value of assayed gold fixed by
the Act in South Australia was 72s. This price, of
course, became the great attraction to owners and
traders to bring their gold-dust or nuggets to South
Australia, while the high price there fixed in com-
parison with the Melbourne quotations still left a
sufficient margin of profit to make the traffic in gold a
profitable trade. Almost everybody dabbled in it, and
a walk through the streets of Adelaide left the im| res-
sion that the city was transformed into El Dorado,
shop windows being placarded all along the line of
streets, "Gold bought," "Cash for gold," "Advances
on gold," " Highest price given for gold," and so forth.

Shortly after the passing of the Bullion Act and
the opening of the Assay Office, large quantities of gold
began to arrive by vessels from Melbourne, one bringing
11,000 worth, and another 25,000 worth. These
importations were not so much the property of the
South Australian diggers as they were profitable
purchases on the part of merchants and traders. A
plan was, however, soon devised to reach these diggers
direct by means of an overland escort, and with praise-


worthy promptitude the plan was put into execution,
Mr. Tolmer, commissioner of police, being entrusted
with the important undertaking. As this route was
being largely used by parties going to the diggings
the journey with bullock drays sometimes occupying
from six weeks to two months and as small farmers
found it more profitable to sell their wheat ground into
flour at 40 per ton on the diggings rather than at
12 10s. in Adelaide, the road was put into order.
During the month of February no less than 1234
passengers, 1266 horses and bullocks, and 164 vehicles
of all descriptions had crossed the Murray by the
Wellington Ferry. The arrival of the first overland
gold escort, a spring-cart drawn by four horses and
laden with over a quarter of a ton of gold, was witnessed
by multitudes of excited people. To be exact, the first
escort brought gold valued at 18,456 9s., which had
been sent by three hundred diggers. Mr. Tolmer, who
was some time afterwards made the recipient of a
handsome testimonial for his public services, reported
having accomplished the distance (338 miles) between
Adelaide and Mount Alexander in eight days. Arrange-
ments were made for the escort to run monthly so long
as it continued to be of benefit to the South Australian
diggers, and a Commissioner was appointed to receive
and take charge of deposits of gold and direct postal
communication on the gold-fields.

The second overland gold escort arrived at Adelaide
on the 4th of May, with 1620 Ibs. weight of gold, valued
at 70,000, sent by 851 diggers, together with 1350
letters, and was welcomed by some thousands of people,
who proceeded to the eastern part of the city to get
the first glimpse of the cavalcade, which was greeted
with thundering cheers and the strains of music.*

Many stories of extraordinary adventure have been

Valued at

* Third arrival, May 5th, with 28,206* ozs. 100,131

Fourth arrival, August 10th, with gold
Fifth arrival, September 16th
Sixth arrival, October 9th

Seventh arrival, November 20th


189,884 4

199,170 2 3

154,758 6


told of the times of which we now write, but few are
more interesting than those in connection with the
overland gold escort. One incident, as a specimen of
many, may be recorded here. During a season of
pitiless rain Mr. Tolmer made his arrangements to
leave the gold-fields with 28,000 ounces of the precious
metal, consigned to 1021 families. Through storm
and tempest, and under the eyes of a notorious gang
who endeavoured to steal his horses and thus cripple
his means to resist an attack, he reached Forest Creek.
Then, when he was about to make his homeward start,
in crossing an alluvial fiat the horses plunged a good deal
on account of the soft nature of the ground ; but when
the heavily laden cart came quickly down the hill
and reached the level ground, down it went into a
perfect bog. The wheels cut into the soil and sank
until they could go no deeper, the flat bottom of the
cart resting on the surface, and the horses plunging
the while, but unable to move their load. Many
men had prophesied that the escort would never
reach Adelaide, and Mr. Tolmer was greeted with
loud laughter from some of the spectators and en-
treaties from others not to proceed, while those who
had bet champagne that he would not accomplish
his journey suggested that he should pay for the
champagne before he started. But the ex-com-
missioner of police was a man of resource, and how
he dealt with the difficulty may best be told in his

Online LibraryEdwin HodderThe history of South Australia from its foundation to the year of its jubilee (Volume 1) → online text (page 23 of 34)