Beginning with Lieutenant-governor Francis Grose, successive governors of New South Wales had failed to control the excesses of the officers of the New South Wales Corps, granting them land, access to convict labour and a monopoly over the trade in much of the new colony’s food. This led to inflated prices, and in 1798, Governor Hunter found differences of as much as 700 per cent between the landing costs of goods and the price of sale to the public. The military also controlled the liquor trade and, as a result, became known as the Rum Corps.

Rum (a name given to any strong spirit) was used as currency and was both imported and manufactured locally. It arrived in Australia with the First Fleet in 1788. The colony was founded by navy men, so it’s not surprising that the new settlement was awash with the traditional navy drink. In a society where barter was the common form of trade, rum became the favoured currency.

In those early days, rum was imported from the West Indies and, more commonly, from India. Jamaica Rum was highly prized, but most imports were Bengal Rum. This was of variable quality. Rum was made from molasses, a by-product of sugar refining. But in India, the raw product was often not cane sugar but palm sugar, or a mix of both. The resulting product, which might more properly be called arrack, likely had little to recommend it beyond its ability to inebriate the drinker.

When Governor Bligh arrived in Sydney in 1806, he prohibited the use of rum as payment for other commodities. In doing so, and by other high-handed actions to remove some of the traders from public office, he made enemies of most of the Marine Corps and the leading citizens of the day.

One of those enemies was John Macarthur, a former member of the Corps who had significant land and commercial interests in the colony. Bligh had already stopped Macarthur from selling illegal spirits and from importing stills but, when he had the man arrested over a technical matter related to one of his ships, matters came to a head. Macarthur enjoyed the support of the so-called Rum Corps and, on 26 January 1808, Major George Johnston led the Corps to Government House and arrested Bligh, in what became known as the Rum Rebellion. Two years of military rule ensued.

However, word of the chaos reached the British Colonial Office, which ordered both Johnson and Macarthur to be arrested and sent to England for trial. The Marine Corps was recalled in 1810, and the same year, Governor Lachlan Macquarie arrived. He was finally successful in curbing the trade in rum, introducing a licensing system and establishing a stable coin currency.