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off of that revenue, or for the heavy obligations which the colony was contracting for the future in the shape of claims on the part of the civil servants to pensions under the arrangements which was then made.

When Lord Torrington arrived in Ceylon, in the summer of 1847, he found that the inevitable revul- sion had taken place. Not owing to any change in the commercial policy of this country, for the coffee duties had not been altered since 1845, but as the necessary consequence of over speculation. The immense increase in the produce of coffee* had occasioned a ruinous fall in its price, and the planters and merchants were thus reduced to a state of extreme distress and too often of bank-.

ruptcy.

The revenue of course experienced a sudden and alarming diminution, not only by the entire cessa- tion of land sales (the amount received from which never ought to have been carried to the credit of the ordinary revenue), but also by the great falling off in the produce of the ordinary taxes. Lord Torrington further found that during the years of prosperity the public works which they would have afforded so good an opportunity of effecting, had been neglected, even to the necessary repairs of the Government House; while the revenue had fallen so far below the regular fixed expenditure, that the surplus which had previously been accumulated was being rapidly absorbed. Nor was this all; upon examining into the state of the finances he found that in calculating the available surplus in the Treasury, the accounts transmitted by his pre- decessor had reckoned as money a large sum in Government notes payable on demand, which were lying in the Treasury, so that the balance in hand upon which he had been encouraged to rely, re- quired to be diminished by this large sum.

To add to his difficulties it was clearly proved that in order to prevent the production of cinnamon, the ancient staple of the colony, from being alto- gether discontinued, it was absolutely necessary that the duty upon its export, which formed one of

The number of acres planted with coffee was about doubled in two years.

PUBLIC RECORD OFFICE

Reference -

LHC.O.

885

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO

PUBLIC RECORD OFFICE, LONDON,