In the early years of the settlement, particularly during the three years between Governor Phillip’s retirement in December 1792 and the arrival of Hunter his successor in mid-1795, when Grose and then Paterson administered the colony, alcohol, generically referred to as rum, was a readily tradable item in the barter-based, economy operating beyond the bureaucratic, requisition system at the government store. Rum became a substitute for currency. The shortage of currency in the colony was aggravated by the fact that William Bassett Chinnery, the agent appointed by the British Government to operate the colony’s accounts from London was in the process of embezzling some £80,000. The NSW Corps officers’ early trading success was based on the fact that were paid in London and could draw bills that would be honoured there. They alone had access to sterling for purposes of trade and a trading cabal that operated as an extension of the officers’ mess was able profitably to exploit a monopoly position in rum and other goods and they vigorously defended this under both Hunter and King. This was no longer the case in 1808 as competition now ensured that monopoly profits were substantially reduced, although high prices were retained by the penumbra of illegality that surrounded the trade.
It is likely that William Bligh was selected by the British Government as governor because of his reputation as a strict but fair disciplinarian though in the public and subsequent historical consciousness he will forever be remembered for the infamous ‘Mutiny on the Bounty’. The critical figure in his appointment was Sir Joseph Banks who had accompanied Captain James Cook on his first voyage and was the government’s unofficial adviser on matters relating to Australia. Banks had formed an intense dislike of John Macarthur. This occurred in 1801 when Macarthur, already one of the wealthiest men in the colony, applied for permission to export some of the king’s merino sheep to NSW and for an enormous land grant to help establish a wool industry. Banks did not favour a large land grant to one person but thought the wool industry should be developed by an English company. He also knew that Macarthur, due to a thrusting desire for personal enrichment, was a disruptive force in the colony. When Macarthur’s requests for sheep and land were granted, Banks was upset and recommended Bligh for the job of governor because he though he could deal with Macarthur. On 15 March 1805, he wrote to Bligh requesting him to consider the post. He wrote that King’s successor must have the following qualities:
…one who had integrity unimpeached, a mind capable of providing its own resources in difficulties without leening on others for advice, firm in discipline, civil in deportment and not subject to whimper and whine when severity of discipline is wanted to meet emergencies.
Sir Joseph Banks
Banks proceeded to offer a number of inducements for Bligh to accept. The Governor’s salary would be doubled from £1,000 to £2,000 and, in addition, Banks believed Bligh need spend less than half of this because he would have ‘the whole of the Government power and stores’ at his disposal. His seniority and pension rights would continue. Banks even added that there would be better marriage prospects for his six daughters in NSW. He was not simply using his influence to help Bligh; he was exerting pressure on Bligh to accept the governorship. He was not ignorant of Bligh’s reputation as a disciplinarian: he chose him for that reason. Bligh, Banks believed stood a good chance of standing up to and reining in the maverick NSW Corps, something that his predecessors had been unable to do. So did Earl Camden, Secretary of State for War and the Colonies, who wrote to Banks that he was recommending Bligh for appointment because of Bligh’s ‘merit & ability & of the character he bears, for firmness & Integrity’. Bligh was persuaded and left for Sydney with his daughter, Mary Putland, and her husband who died on 4 January 1808 of tuberculosis. Bligh’s wife remained in England.
Even before his arrival, Bligh’s style of governance led to problems with his subordinates. The Admiralty gave command of the Porpoise and the convoy to the lower ranked Captain Joseph Short and Bligh took command of a transport ship. This led to quarrels which eventually resulted in Captain Short firing across Bligh’s bow in order to force Bligh to obey his signals. When this failed, Short tried to give an order to Lieutenant Putland, Bligh’s son-in-law to stand by to fire on Bligh’s ship. Bligh boarded the Porpoise and seized control of the convoy. When they arrived in Sydney, Bligh, backed up by statements from two of Short’s officers, had Short stripped of the captaincy of the Porpoise that he gave to his son-in-law. He also cancelled the land grant Short had been promised as payment for the voyage and shipped him back to England for court martial, at which he was acquitted. The president of the court, Sir Isaac Coffin, wrote to the Admiralty and made several serious accusations against Bligh, including that he had influenced the officers to testify against Short. Bligh’s wife obtained a statement from one of the officers denying this and Banks and other supporters of Bligh lobbied successfully against his recall. The secretary of state thought the dispute arose from ‘very trivial causes’ and ‘proceeded to a length to which it could not possibly have advanced had you both been impressed with a just sense...of the propriety...of preserving a good understanding with each other.
 William Bassett Chinnery, who was appointed Agent for New South Wales on 1 May 1787, was enabled to embezzle more than £80,000 of Treasury funds prior to his dismissal on 17 March 1812. For Chinnery’s private life and his love of music, see, Yim, Denise, Viotti and the Chinnerys: a relationship charted through letters, (Ashgate), 2004. Chinnery was able to avoid detection for a long time because the accounting and control systems used at the British Treasury and the function and operation of the Audit Office established in 1785 were inadequate.
 See Scorgie, Michel E., Wilkinson David J. and Rowe, Julie D., ‘The Rise and Fall of a Treasury Clerk: William Bassett Chinnery’, paper presented to the Conference of the British Accounting Association, April 1998; compare with Scorgie, Michel E., ‘The rise and fall of William Bassett Chinnery’, Abacus, Vol. 43, (2007), pp. 76-93. See also ibid, Whitaker, Anne-Maree, Joseph Foveaux: Power and Patronage in Early New South Wales, pp.155-156.
 This crucial letter was first quoted, in full, in the HRNSW, Vol. 6, pp. xxxv–xxxvi. The editor gave no specific location for this letter, but stated that he had had access to manuscripts in the possession of W.R. Bligh of Sydney, William Bligh’s grandson. Bligh presented some of these to the Public (now State) Library of New South Wales in 1902 and they were transferred to the Mitchell Library in 1910. This letter was not amongst the collection and its present location is unknown.
 Camden to Bligh, 18 April 1805, ML Banks Papers, Series 59.01.
 Bligh’s commission, instructions and additional instructions are in HRA, Series I, Vol. 6, pp. 1-19.
 Short to Secretary Marsden, 12 March 1806, HRNSW, Vol. 6, pp. 31-34, Bligh to Secretary Marsden, 30 May 1806, HRNSW, Vol. 6, pp. 81-84 and Bligh to Castlereagh, 1 April 1806, HRNSW, Vol. 6, pp. 55-57 provide the protagonists’ stances. Short to Bligh, 15 May 1806, HRNSW, Vol. 6, pp. 74-75 explains Short’s position and his offer of an apology.
 Lieutenant Tetley to Bligh, 15 November 1806, HRA, Series I, Vol. 6, p. 40 and Daniel Lye to Bligh, 22 November 1806, 9 December 1806, HRA, Series I, Vol. 6, pp. 41-42.
 Bligh to Secretary Marsden, 12 December 1806, HRNSW, Vol. 6, pp. 208-221 details the enquiry.
 Bligh to Windham, 5 November 1806, HRA, Series I, Vol. 6, p. 30.
 Rear-Admiral Isaac Coffin to W.W. Pole, 13 December 1807, HRNSW, Vol. 6, p. 388.
 Windham to Bligh, 31 October 1807, HRA, Series I, Vol. 6, p. 80.