Fourteen or fifteen hundred prisoners used here to be employed in digging and removing to the wharf pit coal, which is found here in great purity and plenty, within gun shot of the water. The men have since been removed to the settlement of Port Macquarie, and Newcastle in the interval, between its occupation by the prisoners, and the residence of free emigrants, to whom building allotments are cheerfully given, is going to ruin! The appearance of the town is in its favour, looking at its natural position, on the brow of a hill; and an excellent supply of good water and a tolerable harbour, when you are in it, added to the immense importance of its staple commodity, coal, all tend to excite one’s surprise, and regret that the place should be in such a state of decay. The coal, however, being in the hands of government, may be considered the cause of the wretched state of Newcastle. Instead of having a steam engine and substantial waggons to run down an inclined plain, and empty their contents into the vessels hold, as is done on the banks of the Tyne and Wear, the coal is here doled out in miserable thimbles full and drawn about the wharf by hand barrows! Five or six prisoners to a barrow is quite a common number of hands, and so often is the coal shifted about from baskets to bullock carts, from bullock carts to the wharf, from the wharf to the pier, from the pier to the lighter; and from the lighter to the ship, that, by the time it arrives in Sydney for sale, this fine coal is nothing but dust; and even this dust is difficult to be had, at any price, sometimes, in the winter months. Such a waste of labour was never, seen as at the government coal work of Newcastle, and the sooner they get quit of them the better for themselves and the Colony. In other hands than theirs a great part of our debts in India might be paid in coals, which are now paid in dollars. Let the government at once cut down that worse than useless establishment, and give a seven years’ lease, at a rent to be determined by public auction, with all their engagements and remove from Newcastle the wretched remnant of prisoners that are hovering about it to other settlements; for whoever takes a lease of the pit will find it their interest to employ free labourers, in preference to bond. 

The church at Newcastle, which some years ago was a highly respectable place of worship, with a lofty steeple, serving for a land mark at the entrance of the harbour, is now shorn of its beauty, and remains without a spire, a monument to the truth of the old adage, “penny wise, pound foolish.” The black population of Newcastle is as great, if not greater, than the white, which cannot be said of any other place in the Colony—they carry wood and water, and in short are the willing servants of the lowest classes, and look for their reward in small pieces of tobacco or a cob of corn. They go perfectly naked, and walk in and out of the houses before the eyes of English females, without creating the smallest notice or concern. Such is habit. 

When the half finished break water is completed, it is supposed that the harbour will be much improved. There is a small establishment near it on the sea shore for making salt, but the proprietor has evidently never been at St. Ubes or Lymington. When he goes to England, either of these salt works would be worth his examination, and the improvements he would be able to introduce on his return to New South Wales, would amply repay him every expense or loss of time.

After seeing the various lions of Newcastle, and not forgetting to pay our respect to the Commandant, than whom there can hardly be a more worthy or amiable man in existence, our luggage was put into a boat, and about eleven o’clock we started up the river, amidst mangroves and low marshy shores, hardly boasting an inhabitant for thirty-five miles, to what is usually the end of the navigation — Wallis’s Plains or Molly Morgan’s. Why a low flooded forest should be called Plains, or a woman of the name of Hunt should be called Molly Morgan, I will not detain you to enquire, but leave it to the dark researches of the future antiquarians and sea vans of this rising empire. Nothing to relieve the eye — all in a state of nature — one uninteresting flat— a bad beginning to what afterwards turned out to be one of the finest countries upon earth — the description of which I must leave to another letter.

— X. Y. Z.