It now only remains for me to refer to the last clause in the instructions under which I acted, before entering into an expression of the views which I have formed upon the subject of what appears necessary to be done in the interests of peace and order in the Saskatchewan. The fur trade of the Saskatchewan District has long been in a declining state, great scarcity of the richer descriptions of furs, competition of free traders, and the very heavy expenses incurred in the maintenance of large establishments, have combined to render the district a source of loss to the Hudson Bay Company. This loss has, I believe, varied annually from 2000 to 6000 pounds, but heretofore it has been somewhat counter-balanced by the fact that the Inland Transport Line of the Company was dependent for its supply of provisions upon the buffalo meat, which of late years has only been procurable in the Saskatchewan. Now, however; that buffalo can no longer be procured in numbers, the Upper Saskatchewan becomes more than ever a burden to the Hudson Bay Company; still the abandonment of it by the Company might be attended by more serious loss to the trade than that which is incurred in its retention, Undoubtedly the Saskatchewan, if abandoned by the Hudson Bay Company, would be speedily occupied by traders from the Missouri, who would also tap the trade of the richer fur-producing districts of Lesser Slave Lake and the North. The products-of the Saskatchewan proper principally consists of provisions, including pemmican and dry meat, buffalo robes and leather, linx, cat, and wolf skins. The richer furs; such as otters, minks, beavers, martins, etc., are chiefly procured in the Lesser Slave Lake Division of the Saskatchewan District. With regard to the subject of Free Trade in the Saskatchewan, it is at present conducted upon principles quite different from those existing in Manitoba. The free men or "winterers" are, strictly speaking, free traders, but they dispose of the greater portion of their furs, robes, etc., to the Company. Some, it is true, carry the produce of their trade or hunt (for they are both hunters and traders) to Red River, disposing of it to the merchants in Winnipeg, but I do not imagine that more than one-third of their trade thus finds its way into the market. These free men are nearly all French half-breeds, and are mostly outfitted by the Company. It has frequently occurred that a very considerable trade has been carried on with alcohol, brought by free men from the Settlement of Red River; and distributed to Indians and others in the Upper Saskatchewan. This trade has been productive of the very worst consequences, but the law prohibiting the sale or possession of liquor is now widely known throughout the Western, territory, and its beneficial effects have already been experienced.

I feel convinced that if the proper means are taken the suppression of the liquor traffic of the West can be easily accomplished.

A very important subject is that which has reference to the communication between the Upper Saskatchewan and Missouri Rivers.

Fort Benton on the Missouri has of late become a place of very considerable importance as a post for the supply of the mining districts of Montana. Its geographical position is favourable. Standing at the head of the navigation of the Missouri, it commands: the trade of Idaho and Montana.-'A steamboat, without breaking bulk, can go from New Orleans to Benton, a distance of 4000 miles. Speaking from the recollection of information obtained at Omaha three years ago, it takes about thirty days to ascend the river from that town to Benton, the distance being about 2000 miles. Only boats drawing two or three feet of water can perform the journey, as there are many shoals and shifting sands to obstruct heavier vessels. It has been estimated that between thirty or forty steamboats reached Benton during the course of last summer. The season, for purposes of navigation, may be reckoned as having a duration of about four months. Let us now travel north of the American boundary-line, and see what effect Benton is likely to produce upon the trade of the Saskatchewan. Edmonton lies N.N.W. from Benton about 370 miles. Carlton about the same distance north-east. From both Carlton and Edmonton to Fort Benton the country presents no obstacle whatever to the passage of loaded carts or waggons, but the road from Edmonton is free from Blackfeet during the summer months, and is better provided with wood and water. For the first time in the history of the Saskatchewan, carts passed safely from Edmonton to Benton during the course of last summer. These carts, ten in number, started from Edmonton in the month of May, bringing furs, robes, etc., to the Missouri. They returned in the month of June with a cargo consisting of flour and alcohol.

The furs and robes realized good prices, and altogether the journey was so successful as to hold out high inducements to other persons to attempt it during the coming summer. Already the merchants of Benton are bidding high for the possession of the trade of the Upper Saskatchewan, and estimates have been received by missionaries offering to deliver goods at Edmonton for 7 (American currency) per 100 lbs., all risks being insured. In fact it has only been on account of the absence of a frontier custom house that importations of bonded goods have not already been made via Benton.

These facts speak for themselves.

Without doubt, if the natural outlet to the trade of the Saskatchewan, namely the River Saskatchewan itself, remains in its present neglected state, the trade of the Western territory will seek a new source, and Benton will become to Edmonton what St. Paul in Minnesota is to Manitoba.

With a view to bringing the regions of the Saskatchewan into a state of order and security, and to establish the authority and jurisdiction of the Dominion Government, as well as to promote the colonization of the country known as the "Fertile Belt," and particularly to guard against the deplorable evils arising out of an Indian war, I would recommend the following course for the consideration of your Excellency. 1st--The appointment of a Civil Magistrate or Commissioner, after the model of similar appointments in Ireland and in India. This official would be required to make semi-annual tours through the Saskatchewan for the purpose of holding courts; he would be assisted in the discharge of his judicial functions by the civil magistrates of the Hudson Bay Company who have been already nominated, and by others yet to be appointed from amongst the most influential and respected persons of the French and English half-breed population. This officer should reside in the Upper Saskatchewan.

2nd. The organization of a well-equipped force of from 100 to 150 men, one-third to be mounted, specially recruited and engaged for service in the Saskatchewan; enlisting for two or three years service, and at expiration of that period to become military settlers, receiving grants of land, but still remaining as a reserve force should their services be required.

3rd. The establishment of two Government stations, one on the Upper Saskatchewan, in the neighbourhood of Edmonton, the other at the junctions of the North and South Branches of the River Saskatchewan, below Carlton. The establishment of these stations to be followed by the extinguishment of the Indian title, within certain limits, to be determined by the geographical features of the locality; for instance, say from longitude of Carlton House eastward to junction of-two Saskatchewans, the northern and southern limits being the river banks. Again, at Edmonton, I would recommend the Government to take possession of both banks of the Saskatchewan River, from Edmonton House to Victoria, a distance of about 80 miles, with a depth of, say, from six to eight miles. The districts thus taken possession of would immediately become available for settlement, Government titles being given at rates which would induce immigration. These are the three general propositions, with a few additions to be mentioned hereafter, which I believe will, if acted upon, secure peace and order to the Saskatchewan, encourage settlement, and open up to the influences of civilized man one of the fairest regions of the earth. For the sake of clearness, I have em bodied these three suggestions in the shortest possible forms. I will now review the reasons which recommend their adoption and the benefits likely to accrue from them.