At the time of the exodus the notes of Banks were presented in large quantities for payment in specie, of which the Bank of South Australia, although wealthy, was nearly drained; but the demand was so sudden that there was no time to procure supplies from abroad. The Bank of Australasia held at that time about £90,000 in gold, and was prepared to aid the other Bank for mutual protection, when fortunately the scheme of the “Bullion Act” was brought into operation, and effected an immediate and wonderful change.
This Act was devised by Mr. G. S. Walters, a gentleman of great experience in monetary affairs. It provided that the gold dust already deposited in the Treasury, amounting to a large sum, should be smelted into ingots of various sizes, stamped with the Queen’s head, and the accurate assay, and declared to be legal tenders at the rate of £3 14s. per ounce—gold dust then selling in Melbourne at £3 7s. This immediately stopped the demand for sovereigns, caused large additional quantities of gold dust to be introduced from Melbourne, and quieted the public mind. Some of the gold was so pure that it afterwards realized over £4 per ounce in London.
There is no doubt that the Bullion Act was a direct infringement of the Royal prerogative as to coinage, and demanded anxious consideration. Sir Henry Young was then Governor, and the Bank Managers were requested on different occasions to meet him in Executive Council to consider the subject. Mr. Tinline (Bank of South Australia) and myself (Bank of Australasia) urgently supported the adoption of the Bill; the Manager of the Union Bank opposed it. The responsibility was very great, but the Executive Government submitted it to the Legislature, and the Bill was passed into an Act for two years. The Home Government approved of it, considering that it was warranted by the great emergency.
Another very useful measure was adopted about this time. A strong, well-armed body of mounted police was sent periodically to the gold diggings at Bendigo, in Victoria, to escort the gold found by South Australian diggers to Adelaide. The service was continued for a considerable time, and the gold thus introduced exceeded two millions sterling.
The successful gold diggers would, in all probability, have remained in Victoria and removed their families from hence had it not been that many of them were owners of land, which tied them to the province; and they ultimately returned with their unexpected wealth and purchased additional lands.
There can be no doubt that the land system of South Australia, which provided that the country should be surveyed and sold in sections of eighty acres, was the means of saving the province from temporary ruin. The facilities for acquiring land by the labouring classes were very considerable. The discovery of the Burra Copper Mine gave the first great impulse to the progress of the colony; the produce of that mine alone having exceeded £4,000,000 sterling up to a recent period.
It is curious to follow the career of an immigrant after that discovery. He became a labourer for one or two years, when his saving of wages enabled him to purchase a team of oxen and a dray. He then commenced carrying copper ore from the Burra Mine to Port Adelaide, taking back stores and provisions, and in one or two years more was in a position to purchase an eighty-acre section of land and become a farmer. While his crops were growing, and at other spare times, he again carried ore from the mine and was soon able to purchase more land, and became a man of some consequence in his district. This man was the type of a considerable class of yeomen, who, having property to protect became Conservatives, and exercised a material influence on the peace and prosperity of the country.
The transactions of the Burra Mine were on a great scale at that time, employing upwards of 1,100 men, who, with their families, numbered over 4,000 souls supported by that mine. At one period the shareholders divided annually 800 per cent. on their £5 shares. Their Bank account, however, absorbed a large amount of capital; at one period it was overdrawn about £72,000, as they calculated on the value of the ore as soon as it was raised to the surface at the mine, but before it could be shipped to England and bills drawn against it. The Bank Directors in London objected strongly to this, and even suggested more than once that the accounts had better be closed. I, however, feeling how very prejudicial to the interests of the Bank such a course would be, and having visited the mine and satisfied myself as to its great value, took the responsibility of continuing the account—the Burra Directors having engaged on my representation gradually to diminish the overdraft to a moderate amount. I felt quite convinced of the correctness of the views entertained by the London Board, as no single establishment should absorb so large a proportion of the capital allotted to each branch.
There were also a few mercantile accounts the advances to which the London Board objected as being too large, and they appeared to think that I was not sufficiently cautious in conducting their business, although they had sustained no losses, and their business had been quadrupled. Some irregularity had also occurred in the office, and I was offered the option of removing to some other branch or receiving compensation on resigning, but was requested to remain at the Bank for some time in order to aid my successor until he became acquainted with the customers and the nature of their transactions. I remained for some time, but no other branch becoming vacant, and being also unwilling to leave South Australia, I accepted compensation and retired.
Some time afterwards, having sold a property in Western Australia for £3,000, I agreed to join in a mercantile business with a gentleman connected with my family. On this becoming known to Mr. John Ellis, he very handsomely and spontaneously presented me with a letter of credit for £5,000 on the wealthy firm of Morrisson & Co., of London; and Mr. G. S. Walters, in a similar manner, introduced me to his father-in-law, Mr. Frederick Huth, of the great firm of Frederick Huth & Co., of London, who opened credits for the new firm with their several correspondents at Mauritius, Calcutta, Bombay, Ceylon, Singapore, and China, for £2,000 each. The business was thus commenced with a fair prospect, but not proving very successful after a trial of a few years, I retired from the firm.