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LOS ANGELJiS

LBRARY

COLONIAL CONFERENCE, 1907.

MINUTES OF PROCEEDINGS

OF THE

COLONIAL CONFERENCE,

1 9 0 7.

(Papers laid before the Conference are printed separately in [Cd. 3524].)

{Sr^eenteD to fiotf) ^omti of I^AVliammt bp ComnmnH of ^19 iVtaie^ttf.

May 1907.

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[Cd. 3523.] Price os. Od.

TABLE OF CONTENTS.

MINUTES OF PROCEEDINGS.

Date.

April 15

April 17
April 18 -

April 20 -

Api il 23

April 25

April 26

April 30

May 1

May 2

May 6

May 7

Mav 8

Muv y

Mav 14 -

Subjects.

ii-age.

Openiiic; Meeting. Address by the Prime Minister welcoming'
the Colonial Prime Ministers, and their replies. Position of
Colonial Ministers other than Prime Ministers

Constitution of the Conference. Organisation of Colonial Office

a. Constitution of the Conference - - .

b. Colonial representation on Committee of Imperial Defence -

a. Constitution of the Conference - - -

b. Military Defence - . - - -

a. Military Defence - - - - -

b. Naval Defence . - . . .

a. Emigration . . . . -

b. Naturalization .-..-.

c. Double Income Tax . . . .

d. Profit on Silver Coinage -----

e. Decimal currency and Metric System - - -

Imperial Court of Appeal -----

Preferential Trade - - - - -

Preferential Trade ------

Preferential Trade - . - - -

Imperial Surtax on Foreign Imports - - - -

Preferential Trade ------

Preferential Trade and Commercial Relations - - -

a. Imperial Surtax on Foreign Imports - -

b. Coastwise Trade . -

c. Commercial Treaties

d. Naval Defence ------

e. Uniformity in Trade Marks and Patents - -

f. Uniformity in Trade Statistics - - -

g. Unifoimity in Company Law - - - -
h. Reciprocity in admission of Barristers to practice -

i. Reciprocity in admission of Land Survej'ors to practice

a. Pro|iosal for a surtax on Foreign Imports to create Common

Fund for Imjierial purposes . - - -

b. International Penny Postage - - -

c. Imperial Cable Communication - - . -

d. Naturalization - . - - -

c. Naval Defence ------

_/'. Double Income Tax - . - -

(/. Profit on Silver Coinage - - - - -

h. Islands of the Pacific - . - -

a. Improvement of Mail Communication with Australasia, via

Canada -------

b. Newfoundland Fisheries Question - -

r. Wireless Telegraphy Convention - - - -

d. Organisation of Colonial Office. Interchangcof Permanent Staff

3

24

49
83

86
94

122

128

152

178
183
190
192

199

227

252

295
351

356

399

*43
445
467
469
484
490
491
491
502

509
529
533
533
541
543
546
548

565

587
601
611

The Agenda pro])Osed for the Conference of 1907 will be fo\iud in [Cd. 3337] and further
]>a[)ers were published in [Cd. 3340].

The Summary of the Pro(^eedings of the Conference an<l the Precis arc published iu [Cd. 3104]
and [Cd. 3406].' .

The preliminary correspondence will be found iu [Cd. 2785] and [CM. 2973].

'A

111

INDEX.

CO
CM

Appeals, Jiidicidly \y\i. 200-226.

Colonial Judges on Court, of Final

Appeal, pp. 213, 215-21".
Commonwealth Constitution Act, appeals

under, pp. 204-20(5, 20i», 211, 212, 214.
Conference as to Ap])eals in 1901, |)p. 200,

201, 203.
Defects In existing system, pp. 202, 207,

210, 212-214, 217, 21H, 22.3.
Imperial Court of Ajipoal, pp. 200—203,

212, 2 IB, 217, 223. 221-226.
Judicial Committee and House i>f Lonls,

relative positions of, pp. 201-207, 210,

214, 21.5, 22.5.
South African Appeal Court, pp. 207-209,

910 '^'^l *>•>'> 224

Barristers, reciprocity in ;ulmission of, to
practice, pp. 491 -.502.

Cable Communication, Imperial, p. 533.

Canadian cattle, importation of, p. 41.5.

Mr. Chamherlain, Telegram expressing sym-
pathy with, p. 23.

Coaslicise Trade, pp. 446-4(57.
Australasian, pp. 454-4.58.
In the Pacific, pp. 460-462.

Colonial Conference (1887), pp. 4, 229-232
2.54, 281.

Colonial Conference (Ottawa, 1894), pj). 231,
232, 281, 283.

Colonial Conference (1897), pp. 6, 8, 14, 73,
231,232. ' -

Colonial Conference (1902). pp. 6, 8, 14, 15,
17-21, 2.5," 3.5, 41, 47, 57, 73, 87,99, 143,
228-232, 248, 256-259 ,304, 325, 356, 410-
413,426-432.

Committee of Imperial Defence, Colonial
re|)resentation on, pp. 83, 84, 107, 117, 118,
120, 121.

Company Law, Uniformity in, p. 491.

Constitution of the Conference, pp. 2(>-48,
49-94.

Colonial Ministers other than Prime

Minister, position of, ])p. 1.5-17, .50-55,

84, 85, 88.
Colonial Office, pp. 28-31, 35,38,39,41,

42, 44-4(>, 55, 63-77, 83, 90-93.
" Dominions " instead of Colonies, pp. 79-

83, 89.
(iovcrnors, constitutioiuil position of,

pp. 37, 46.
High Commissioners and Agents-(ieneral,

pp. 31, 34, 35, 69-71, 73, 7.5, 1.5(5, 162,

168, 169.
Imperial Conference, pj). 27, 29, 38, 47, 52,

82, 88, 90.
Imperial Council, pp. 25-27, 29, 31-33,

35-37, 45, 88.
Interval between Conferences, pp, 5(>-58,

61, (52.
Mr. Lytteltou's despatch, pp. 29, 35, 36,

67.

E 48G68. Wt.

Constitution of the Conference — conl.

Prime Minister of United Kiiigdont, as
President of Conference, pp. 10, 40,
42-44, 46, 52, 54, .59-(51 ; proposed con-
trol by him of Secretariat, p[). 28-30,
34, 39, 40, 4.3. 44, 63, 64, 66-69, 72, 91.

Procedure of Conference, pp. 14, 15,24-26,
61.

.Secretariat of Conference, pp. 27-3.5, .39—
47, (52-77, 90-92, 284, 297.

Sul)sidiarv Conferein'cs, pp. 6, 9, .39, 77-80,
92-91, '181, 200, 485, 528.

Copyright, p. 489.

Decimal Currency, pp. 192-195.

Defence {Military), pp. 94-120, 123-128.

Arms and Annnunition, manufacture in

the Colonies, pp. 101, 105, 108, 133, 134 ;

identity of pattern, pp. 98, 101. lOH.
Cadet movement, p]). 106, 107, 109, 113.
Colonial troops for general service, pp. 99,

100, 108, 112, 114-116.
Exchange of militarv units within the

Empire, pp. 103, 109, 110-112.
Exchange of Officers, pp. 97, 100, 103,

104, 109, 110, 113.
General Staffi. pp. 96, 97, 100. 103, 108,

110, 111, 11(5-119.
Military Organisation of Empire, i)p. 97-99,

102,' 108.
Military Schools, ]>. 101.
Military Stores, purchase of through War

Office, pp.98, 101, 106.
Reserve of Officers, p. 98.
Rifle Clubs, p. 107.
South African Defence, pp. 11 1-1 14.

Defence (Naval), pp. 128-151, 469-483,
.541-2.

Australasian Xaval Agreement, pp. 128,

132, 136.
Coaling facilities for His Majesty's Ships

pp. 131, 137, 145, 146.
Defence on American Lakes, p. 140.
Dock and Harbour Accommodation, pp.

131, 132, 136, 137, 141, 143, 141. 146.
150.

Naval Contributions, Colonial, pi>. 130,

132, 13(5, 1.38. 1.39-144. 14(5, 147.
Reserves, Colonial Xaval, pp. 112, 110.

142. 143-146, 148, 1.50, 470(ipiestion ot

payment), pp. 138, 149.
Simonstown Dock, jip. 143, 150.
Sfinailnms, separate Colonial, pp, 130, 13;,

135, 142, 146, 474, 478.
Submarines, pp. 131, 142, 469, 473, 477»

482.
Wireless Telegraphy, p. 140.

Emigration, pp. 153-178, 292, 323, 344.
Alien immigration, j)]). 161, 1(54, 166.
Building trade, pp. 170, 382, 384.
Child emigration, pp. 172, 175.
Colonisation by large bodies, j>. 174.
Emigrants' Infornnition Office, ]ip. 1.56-

1(50, 1(56-169, 172-174, 17(5.
Emigration Agencies, pp. 170, 172.
Inter-departmental Committee (Report),
pp. 153, 161, 172, 176.

a 2

IV

EmigvatioH — coat.

Labour, white and coloured, relative advan-
tage, pp. 158, 159, 161, 16i, 165.
Relative cost, pp. 164, 165, 167.
Means of extending, pp. 172, 174-178.
Queensland sugar plantations (employment

of white labour), pp. 156-160.
United States, emigration to, compared
with Canada, p. 170. ,

His Majesty the King, message from and reply,

pp. 3, 4, 23.
Income Tax, Double, pp. 183-190, 196-198.

De Beers Company, pp. 184-186, 188-189.
Interchange of rcrmajicnt Staf, pp. 611-621.
Land Surveyors, reciprocity in admission of, to

practice, pp. 502-506.
Mail Conimiimrations, improvement of, with
Australasia via Canada, pp. 565-586, and
see under Preferential Trade.
Metric System, pp. 192-195.
Naturalization, Imperial, pp. 178-182, and

pp. 533 -541.
Naviffation Conference. See Shipping Con-
ference.
Neicfoundland Fishery question, pp. 587-600.
New Hebrides Convention, pp. 548-563.
Organisation of Colonial Office, pp. 611-621.
See Colonial Office under Constitution of
Conferenee.
Pacific, British Interests in the, pp. 548-563.
Patents, uniformity in, pp. 484-489.
Penny Postage, International, pp. 529-533.
Preferential Trade, pp. 33, 228, 432, 434-441.
British exports of manufactured goods,

pp. 364, 365.
British shipping, British goods carried in,

p. 433.
Duties on food and raw materials, pp. 233,

266, 318-322, 347, 405, 406.
Duties on wine, spirits, and tobacco, pp.
286-289, 291, 320, 321, 343, 345-347,
350, 417.
Commercial representatives in British

Colonies, pp. 272-274, 323, 390.
Communication with Australasia via
Canadii, pp. 276-279, 323, 344, 565-586.
Dumping, pi>. 242, 243.
Fiscal independence of Colonies, pp. 306,

307.
Foreign trade subsidized, pp. 243-245, 249,

250, 270, 290, 322, 391-395.
Free Trade within the Empire, pp. 318,

40S, 423.
Government Contracts, preference to British

manufacturers, p. 348.
Imperial and foreign trade statistics,
pp. 239-251, 256-7, 264-5, 267-8, 286,
298-301, 311-2, 318-9, 327-330, 332,
338, 350, 364 seq., 410, 416, 441.
Import duties on corn, pp. 381, 383.
IncMcasc of Cotton Trade, p. 386.
Inter-iinperial communication, improved,
i)!). 174, 23H, 263, 274-9, 292-3, 323,
351, 352, 390-396, 400, 407, 509-529.
Intcrniediato tarilf (Canada), p. 288, 414.
Market, British, value of, pp. 235, 255.

Preferential Trade — cont.

" Political eft'ect of system of preference,

p. 400, seq., 419, seq.

Preference not Protection, nor intended to

raise price of food, pp. 266, 269, 321,

324, 326.

Protected Countries, British trade with,

pp. 310, 375.
Reciprocal preference between Colonies,
pp. 258-9, 262, 281, 283, 287-288, 304,
347, 484.
Restriction of preference to goods in

British Shipping, pp. 260, 314.
Retaliation, pp. 248, 254, 256, 310.
Shi])ping, British, pp. 237, 308, 329, 389.
Subsidies to shipping, pp. 174, 176, 177,
2(i3, 270-1, 274, 290,328, 339, 391, 392,
396.
Suez Canal Dues, pp. 263, 274-276, 323.
Surtax on foreign imports for Imperial
purposes, pp. 231-2, 281, 283-4, 324,
351-4, 443-446, 509-529.
Tariffs, Colonial Preferential —

Australia, pp. 257-262, 293, 313-

316, 325-6, 342-3.
South Africa, pp. 263, 281-286, 304,

312, 320,348, 361.
Canada, pp. 234, 288, 312-3, 409,

413, 414.
New Zealand, pp. 259, 261-2, 266-7,

312.
India, pp. 236, 297-303, 345.
Treatv questions and preferential trade,

pi.."292, 293, 350.
Wages and hours of labour in United
Kingdom and protectionist countries,
p. 375.
Wheat, price of, afl'ected by duty, pp. 376-

380.
White Labour Clause in Australian Pre-
ference Bill, pp. 260, 293, 301-2, 314,
325, 331-2.

Publication of Proceedings, pp. 8-9, 1 3, 1 8-22,
102, lll-l'l2, 117, 120,351,541.

Resolutions of Conference. See p. \'.

Submitted to Conference. See [Cd. 3337].

Mr. Scddon, Resolution of regret at death of,
p. 48.

Shipping Conference, pp. 6, 10,21-2,302,328,
447, 450, 454, 456.

Silver Coinage, profits on, pp. 190-192, 546,

547; Colonial Mints, 191.
South African Federation, pp. \2. 78, 113-4,

145, l'47, 270, 286, 339.
Stamp Charges on Colonial Bonds, pp. 195,

196.
State and Provincial (jovrrnments in Australia

and Canada, ])osition of, pp. 92-94.
Surveyors, Reciprocity in admission of, to

practice, pp. 502-506.
Stock Act, Colonial, pp. 195, 196.
Trade Marks, Uniformity in, p. 488.
Trade Statistics, Uniformity in, p. 490.
Treaties, Consultation of Colonies, pp. 41, 42,

483.
Treaty Obligations, pp. 467, 483.
Wireless Telegraphy Convention, pp. 601-610.

RESOLUTIONS

The following Resolutions were unanimously agreed to
by the Conference, except where otherwise stated :—

I.

Constitution of the iMPERi.Ui Confki{ence.

Tliat it Avill be to the advantage of the Empire if a Conference, to be April 20.
called the Imperial Conference, is held every four years, at which questions See p. 94.
of common interest may be discussed and considered as between His
Majesty's Government and His Crovernments of the self-governing Dominions
beyond the seas. The Prime Minister of the United Kingdom will be
ex officio President, and the Prime Ministers of the self-governing Dominions
ex officio memljers, of the Conference. The Secretaiy of State for the C'olouies
will be an ex officio member of the Conference and will take the chair in the
absence of the President. He will arrange for such Imperial Conferences
after communication Avith the Prime Ministers of the respective Dominions.

Such other Ministers as the respective Govermnents may appoint will
also be members of the Conference — it being imderstood that, except by
special permission of the Conference, each discussion will be conducted by
not more than two representatives from each Government, and that each
Government will have only one vote.

That it is desirable to establish a system by which the several Govern-
ments represented shall be kept informed during the periods between the
Conferences in regard to matters which have been or maj'- be subjects for
discussion, by means of a permanent secretarial staff, charged, under the
direction of the Secretary of State for the Colonies, with the duty of ol)taining
informaiion for the use of the Conference, of attending to its resolutions^ and
of conducting correspondence on matters relating to its affairs.

Tiiat upon naatters of importance requiring consultation between two
or more Governments which cannot conveniently be postponed until the next
Conference, or involving subjects of a minor character or such as call for
detailed consideration, sul)sidiary Conferences should be held between
representatives of the Governments concerned specially chosen for the
purpose.

11.

CoLONi.\L Representation on the Committee of Imperial Defence.

That the Colonies be authorised to refer to the Committee of Imperial April 20.
Defence, through the Secretary of State, for advice any local questions in See p. 121.
regard to which expert assistance is deemed desirable.

That whenever so desired, a representative of the Colony which may
wish for advice should be summoned to attend as a member of the Conmiittee
during the discussion of the questions raised.

III.

General Staff for the Service of the Empire.

That this Conference welcomes and cordially approves the exposition April 23.
of general principles embodied in the statement of the Secretary of State for See p. 128.
War, and, without wishing to commit any of the Governments represented,

a 3

VI

recognises and affirms the need of developing for the service of the Empire
a General Staff, selected from the forces of the Empire as a whole, which
shall study military science in all its branches, shall collect and disseminate
to the various Governments military information and intelligence, shall
undertake the preparation of schemes of defence on a common principle, and,
without in the least interfering in questions connected with command and
administration, shall, at the request of the respective Governments, advise as
to the training, education, and war organisation of the military forces of the
Crown in every part of the Empire.

IV.

Emigration.

April 25. That it is desirable to encourage British emigrants to jDroceed to British

See p. 177. Colonies rather than foreign countries.

That the Imperial Government be requested to co-operate with any
Colonies desiring immigrants in assisting suitable persons to emigrate.

V.

Judicial Appeals.

April 26. The Conference agreed to the following finding : —

See p. 225. The Resolution of the Commonwealth of Australia, " That it is desirable^

to establish an Imperial Court of Appeal," was submitted and fully discussed.

The Resolution submitted l3y the Government of Cape Colony was
accepted, amended as follows : —

This Conference, recognising the importance to all parts of the Empire

of the appellate jurisdiction of His Majesty the King in Council,

desires to place upon record its opinion —

(1) That in the interests of His Majesty's subjects beyond the
seas it is expedient that the practice and procedure of the Right
Honourable the Lords of the Judicial Committee of the Privy
Council be definitely laid down in the fonn of a code of rules and
regulations.

(2) That in the codification of the rules regard should be
had to the necessity for the removal of anachronisms and anomalies,
the possibility of the curtailment of expense, and the desirability
of the establishment of courses of procedure which Avould minimise
d.elays.

(3) That, with a view to the extension of uniform rights of
appeal to all Colonial subjects of His Majesty, the various Orders in
Coimcil, instructions to Governors, charters of justice, orcbnances,
and proclamations iipon the subject of the appellate jurisdiction of
the SovereigTi, should be taken into consideration for the purpose of
determining the desirability of eqiialising the conditions which gave
right of appeal to His Majesty.

(4) That much uncertainty, expense, and delay would be
avoided if some portion of His Majesty's prerogative to grant special
leave to appeal in cases where there exists no right of appeal were
exercised under definite rules and restrictions.

The following Resolutions, presented to the Conference by General Botha
and supi)orted by the representatives of Cape Colony and Natal, were
accepted :—

(1) That when a Court of Appeal has been established for any
group of Colonies geographically connected, whether federated or

vu

not, to wliicli appeals lie from the decisions of the Supreme Courts
of such Colonies, it shall be competent for the Legislature of each
such Colony to abolish any existing right of appeal from its Supreme
Court to the Judicial Committee of the Privy Council.

(2) That the decisions of such Court of Appeal shall bo final,
but leave to appeal from such decisions may be granted by the said
Court in certain cases prescribed by the statute under which it is
established.

(3) That the right of any person to apply to the Judicial
Committee of the Privy Council for leave to appeal to it from the
decision of such Aj^peal Court shall not be curtailed.

VI.

Preferential Trade.

[The follou-'uKj h'esolutiona of iha Conference of 19(J- were reaffirmed May 7.
hi) the Members of the Conference, unth the exception of His Majestifs See p. 429.
Government, who teas unahh' to give its assent, so far as the United
KiiKjdoni was concerned, to a reaffirmation of the Resolutions in so far as
they imphj that it is necessary or expedient to alter the fiscal system of the
United Kingdom?^

1. That this Conference recognises that the principle of preferential
trade between the United Kingdom and His Majesty's Dominions beyond
the seas would stimulate and facilitate mutual commercial intercourse, and
would, by promoting the development of the resources and industries
of the several parts, strengthen the Empire.

2. That this Conference recognises that, in the present circumstances of
the Colonies, it is not practicable to adopt a general system of Free Trade as
between the Mother C'oimtry and the liritish Dominions beyond tlie seas.

3. That with a view, however, to pronaoting the increase of trade within
the Empire, it is desirable that those Colonies which have not already
adopted such a policy should, as far as their circumstances permit, give
substantial preferential treatment to the products and manufactures of the
United Kingdom.

■i. That the Prime Ministers of the Colonies respectfully urge on His
Majesty's Government the expediency of granting in the United Kingdom
preferential treatment to the products and manufactures of the Colonies, either
by exemption from or reduction of chities now or hereafter imposed.

5. That the Prime Ministers present at the Conference undertake to
submit to their respective Governments, at the earliest opportunitj% the
principle of the resolution, and to request them to take such measures as
may be necessary to give effect to it.

VII.

Commercial Relations.

That, without prejudice to the Resolutions ah'eady accepted or the May 7.
reservation of His Majesty's Government, this Conference, recognising the See p, 43S.
importance of promoting greater freedom and fuller development of com-
mercial intercourse within the Empii-e, believes that these objects iwaj be
best secured by leaving to each part of the Empire liberty of action in
selecting the most suitable means for attaining them, having regard to its
own special conditions and requirements, and that every effort should be
made to bring about co-operation in matters of mutual interest.

a 1

VIU

VIII.

Commercial Relations and British Shipping.

May 7. That it is advisable, in the interests both of the United Kingdom and

See p. 434. His Majesty's Dominions beyond the seas, that eiiorts in favour of British

manufactured goods and British shipping should be supported as far as is.

practicable.

IX.
Preferential Trade.
May 7. [The folJoicmg Resolution toas agreed to hy the memhers of the

See\>.iiO. Conference, with the exception of Sir Wilfrid Laurier, icho was absent,
and whose vote was not recorded, of General Botha, icho did not support it,
and of the representatives of Eis Majesty s Government, ivho dissented.]

That while affirming the Resolution of 1902, this Conference is of
opinion that, as the British Government, through the South African Customs
Union — which comprises Basutoland and the Bechuanaland Protectorate —
do at present allow a preference against foreign countries to the United
Kingdom, Canada, Australia, New Zealand, and all other British Possessions
granting reciprocity. His Majesty's Government shoidd now take into con-
sideration the possibility of granting a like preference to all portions of the
Empire on the present dutiable articles in the British tariff.

X.

Xavigation Laws and Coastwise Trade.
May 8. [The folloiving Resolution was agreed to by the members of the

See p. 466. Conference, loith the exception of Bis Majesty's Government, who dissented,
in respect of the inclusion of the icords dealing with trade between the Mother
Country and the Colonies^

That the Resolution of the Conference of 1902, which was in the following
temis, be reaffirmed : —

"That it is desirable that the attention of the Governments of the
Colonies and the United Kingdom should be called to the present state of
the Navigation Laws in the Empire, and in other countries, and to the
advisability of refusing the privileges of coastwise trade, including trade
between the Mother Country and its Colonies and possessions, and between
one Colony or possession and another, to countries in which the corre-
sponding trade is confined to ships of their own nationality, and also to the
laws affecting shipping, with a view of seeing whether any other steps should
be taken to promote Imperial trade in British vessels."

XL

Treaty Obligations.
May 8. That the Imperial Government be requested to prepare, for the

See p. 468. information of Colonial Governments, statements showing the privileges
conferred and the obligations imposed on the Colonies by existing com-
mercial treaties, and that inquiries be instituted to ascertain how far it is
possible to make those obligations and benefits uniform throughout the
Empire.

XII.

Preferential Trade Arrangements and Treaty Questions.
May 8. That all doubts shotdd be removed as to the right of the self-governing

See p. 484. Dependencies to make reciprocal and preferential fiscal agreements with each
other and with the United Kingdom, and further, that such right should not
be fettered by Imperial treaties or conventions without their concurrence.

xm.

Uniformity i\ Tuvde Marks and Patknts.

That it is desirable that His Majesty's Govemmeut, after full consulta- Muy 8.
tion with the self-goveruiag Domiuious, should endeavour to provide for such Sce p. 488.
uniformity as may be practicable iu the granting and protection of trade
marks and patents.

XIV.

Uniformity in Tkaok Statistics.

That it is desirable, so far as circuiiistancps permit, to secure greater Miiy 8.
miiformity iu the trade statistics of the Empire, and that the note prepared on Sec p. -190.
this subject bj^ the Imperial Government be commended to the consideration
of the various Governments represented at this Conference.

XV.

Uniformity in Company Law.

Tliat it is desirable, so far as circumstances permit, to secure greater Mar 8.
uniformity in the company laws of the Empire, and that the memorandum .sv^ p. 491.
and analysis prepared on this subject by the Imperial Crovermnent be
commended to the consideration of the various Governments represented at
this Conference.

XVI.

RicciPROciTY IN Admission of Land Surveyors to Practice.

That it is desirable that reciprocity should l)e established between May 8.
the respective Governments and examining authorities throughout the Empire Ser p. 506.
with regard to the examination and authorisation of land surveyors, and that
the meaiorandmn of the Surveyors' Institute on this subject be commended
for the favoural:)le consideration of the respective Governments.

XVII.

International Penny Postage.

That in view of the social and political advantages and the material May 9.
commercial advantages to accrue from a system of international penny See p. 533.
postage, this Conference recommends to His Majesty's (iovernment the
advisal)ility, if and when a suitable opportunity occurs, of approaching the
Governments of other States, members of the Universal Postal Union, in
order to ol)tain further reductions of postage rates, with a view to a more
general, and, if possible, a universal, adoption of the penny I'ate.

XVIII.

Imperial Cable Communication.

1. That in the opinion of this Conference the provision of alternative May 9.
routes of cable communication is desirable ; but in deciding upon such See p. 533.
routes, the question of the strategic advantage should receive the fullest
consideration.

2. That landing licences should not operate for a longer period than
20 years, and that when subsidies are agreed to be paid, they should be
arranged on the "standard revenue" principle — i.e., half the receipts after
a fixed gross revenue has been earned to be utilised for the extinguishment
of the subsidy and, by agreement, for the reduction of rates.

E 13(508. A

XIX.

Naturalisation.

May 9. That with a view to attain uniformity so far as practicable, an enquiry

5eep. 541. should be held to consider further the question of naturalisation, and in
particular to consider how far and under what conditions naturalisation in
one part of His jMajesty's dominions should be effective in other parts of
those dominions, a subsidiary Conference to be held if necessary under the
terms of the Resolution adopted by this Conference on 20th April last.

XX.

Development of Communications within the Empire.

May 14. That in the opinion of this Conference the interests of the Empire demand

See p. 586, that in SO far as practicable its different portions should be connected by the
best possilile means of mail comiuimication, travel, and transportation :

That to this end it is advisable that Great Britain should be connected
with Canada, and through Canada with Australia and New Zealand, by the
best service available within reasonable cost :

That for the purpose of carrying the above project into eifect such finan-
cial support as may be necessary should be contributed by Great Britain,
Canada, Australia, and New Zealand in equitable proportions.

XXI.

May 14. The members of this Conference, representing the Self -Governing Colonies,

See p. 621. desire, before they separate, to convey to Lord Elgin their warm and sincere
appreciation of the manner in which he has presided over their deliberations,
as well as of the many courtesies which they have received from him : they
desire also to put on record the deep sense of gratitude which they feel for the
generous hospitality which has been extended to them by the Government and
people of the United Kingdom.

COLONIAL CONraRENCE, 1907.

Miniites of Proceedings of the Colonial Conference, 1907. ''''''" ^"y-

15 April 1907

FIRST DAY.

Held at the Colonial Office, Downing Street,
Monday, 15tu April 1907.

The following Members of the Conference were present : — The Secretary
of State for the Colonies (the Right Hon. the Eai!L of Elgin, K.G.) in the
chair ; the Prime Minister of Canada (the Right Hon. Sir Wilfrid Laurier,
G.C.M.G.) ; the Prime Minister of Australia (the Hon. Alfred Deakin) ;
the Prime Minister oE New Zealand (the Hon. Sir J. G. Ward, K.C.M.G.) ;
the Prime Minister of Cape Colony (the Hon. L. S. Jameson, C.B.) ; the
Prime Minister of Natal (the Hon. R. F. Moor) ; and the Prime Minister of
the Transvaal (General the Hon. Louis Botha).

The following Colonial Ministers were present : — The Hon. Sir F. W.
Borden, K.C.M.G. (Canada) ; the Hon. Sir W. Lyne, K.C.M.G. (AustraUa) ;
and the Hon. Dr. Smartt (Cape Colony).

The Prime Minister of the United Kingdom (the Right Hon. Sir H.
Campbell-Bannerman, G.C.B.) was present, together with the following
Members of His Majesty's Government : — The Right Hon. John ^Iorley,
CM. ; the Right Hon. R. B. Haldane, K.C. ; the Right Hon. Lord
Tweedmouth ; the Right Hon. John Burns; and the Right lion. D. Lloyd-
George. There were also present Mr. Winston Churchill, Parliamentary
Under-Secretary of State for the Colonies ; Sir Francis Hopwood, K.C.B.,
the Permanent Under-Secretary of State for the Colonies ; Sir J. L. Mackay,
G.C.M.G., K.C.LE., on behalf of the India Olhce ; the Assistant Under-
Secretaries of State for the Colonies ; the Secretaries to the Conference ;
the Private Secretaries to the Secretary of State for the Colonies and to
the Colonial representatives.

CHAIRMAN : Gentlemen, the Members of the Conference having all
assembled, with the exception of Sir Robert Bond, who is detained for a day
or two, I assume that we may now proceed to business. Before doing so, I
have the honour to read the following telegram which has been received from
His Majesty the King : " At the iirst meeting to-day of the Colonial
" Conference, I wish you to convey to the Prime Ministers and representatives
" of my self-governing Colonies, a warm welcome on my behalf, and to

A 2

First Day. " inform tliem that I shall look forward with pleasiire to receiving them ou
15 April 1907. " my return to England. The questions which will be submitted to the
CCha T -1 " Conference for discussion, involving mattei'S of Aveighty interest, not
" merely to the Colonies there represented, but to the British Empire at
" large, will, I am sure, receive the most careful attention, and I am
" confident that the decisions arrived at will tend towards the closer luiion
" of my Colonies to the Mother Country and to each other,, and to the
" strengthening and consolidation of my Empire."

Gentlemen, may I, in a single word on nay own behalf, offer a welcome to
tliose who have come to attend this Conference. For the rest it is, I am
sure, a gratification to all — as it is especially to myself — that my Right Hon.
friend on my right has been al)le to attend this meeting, and without further
preface I will ask the Prime Minister to address the Conference.

The PRIME MINISTER : It is a great pleasure to me to respond to
the invitation of Lord Elgin that I should welcome, as I do most sincerely in
the name of His Majesty's Government, the Prime Ministers of the great
self-governing communities beyond the seas, who are now for the fourth
time gathered together in the capital of the Mother Country for consultation on
matters affecting their common interests and ours. You are all of you friends,
most of you personal friends, some of you old personal friends of myself
and the Ministers with whom you have come to confer. Sir Wilfrid Laurier
has, if I ma.y use a slaug expression of the day, a " i-ecord performance "; he has
been here on each occasion. Mr. Deakin, now speaking for the Common-
wealth of Australia, attended as Chief Secretary of the Colony of Victoria,
the earliest Conference in 1887, a gathering, which, as we all remember,
was not restricted to the self-governing Colonies or to the Prime Ministers.
Sir Robert Bond, as I^ord Elgin has said, has not yet arrived. He took part
in the previous Conference ; but the other Prime Ministers are here foi the
first time in this capacity, and I wish to extend a special greeting to General
Botha, the Benjamin of the Brotherhood, if I may use that phrase, the first
Prime i\Iinister of the Transvaal, whose presence in our councils 1 am sure
you will welcome as cordially as do His Majesty's Government. I should have
been glad if he could have been accompanied by the Prime Minister of the
Orange River Colony, l^ut that has been impossible because its constitution
coidd not be brought into effect in time, and I may perhaps throw in the
observation that there will be no avoidable delay in establishing it. The
absence of the heads of so many Governments from the sphere of their
activity, must, I am afi'aid, have occasioned great inconvenience and con-
siderable pulilic as Avell as personal sacrifices, but we sincerely trust that your
presence in council will justify these sacrifices, that it will offer solid
compensation for the long journey you have undertaken, and for the time
which you are about to devote to a discussion of the matters which are of
common concern to us all.

Gentlemen, whatever be the value and whatever be the issue of your
deliberations, it is with tlie greatest gratification that we welcoiye you, and
warm as I know your attachment and devotion to the Mother Country to be,
I can assure you the feeling of affectionate interest and jn'ide entertained
within tlie shores of the Old Country is not to he surpassed even by your
warmest sentiments. But I need not dwell \ipon tlie expression of our
cordial relations ; in fact, I am not sure that in private life those who are
imited l)y the most sacred ties of relationship and the sincerest affection gain
in the estimation of their neighliours l)y the too frequent and effusive
protestation or exhibition of their feeling towards each other. I am not
therefore disposed to occupy much of your time in mere declarations of our
friendly attachment to each other, and our coinnicm solicitude for our joint and

5

iivllvidnal interests, but I would rather follow, what I think is reallj- the First Uhj.
more sigiiilieant course, of takinsf all this for granted. s, 1^ April 1907.

You will have a long progranune of business before you, and I do not ,.

propose to do more — I do not think I am railed upon to do more — than just Campbell-
to glance at some of the matters which have brougiit you together; bull Bannekman.)
should like to observe at this point — and there is sometimes, apparently, in
the minds of men a mistake on this subject — that this is not a conference
between the Premiers and the Colonial Secretary, but between the Premiers and
members of the Imperial Government under the presidency of the Secretary of
State for the Colonies, which is a very different matter. In regard to questions
of military dei'ence, for instance, the Secretary of State for War will come
and confer with you, and the First Lord of the Admiralty, in the same way,
will be present when naval questions are discussed. On this I may saj-,
that I think the views sometimes taken of the proper relations of the Colonies
to the Mother Country with respect to expenditure on armaments have been,
of late, somewhat modified. We do not meet j'ou to-day as claimants for
monej^ although we cordially recognise the spirit in which contributions
have been made in the past, and will, no doubt, be made in the future. It
is, of course, possible to over-estimate the importance of the requirements of
the over-sea dominions as a factor in our expenditure ; but however this may
be, the cost of naval defence and the responsibility for the conduct ol' foreign
affairs hang together. On the question of emigration, a matter which is of
the utmost moment to you as well as to the Mother Country, Mr. John Burns,
the President of the Local Government Board, will join in your councils ;
and if any question should arise Avith regard to India, you will have the
advice of a most distinguished Member of Council, Sir James Mackay ; and I
am sure that you wiU be glad to see my Right Hon. friend, Mr. John Morley,
amongst xis this morning.

Then, when you come to discuss matters of finance, trade, and commerce,
my colleagues, the Chancellor of the Exchequer and the President of the
I>oard of Trade, will be present to state the views which His ^lajesty's
Government entertain on these important matters. Amongst them the
question of Preference must hold a prominent ijosition, and I am sure you
will find that my Right Hon. friends are prepared fully to recognise the
friendly action which has jjeen taken bj'' some of the Colonies, and to enter
upon this subject in the fullest and frankest manner.

I hope that an agreement may be arrived at as to many of these points,
and if in regard to others you are compelled to differ amongst yours(dves, or
to differ from us, you will agree to differ not merely in a perfectly friendly
way (so much may be assumed) but with mutual respect for the grounds and
motives on which differences of opinion may be founded. You in connnon
with us are representatives of self-governing communities. We have no
power here in this room, as you know, to arrive at any binding decisions.
If is Majesty's Government cannot go behind the declared opinions of this
country and of our Parliament. No more can you go behind the opinions
and wishes of your communities and Parliaments ; but, suljject to this
governing limitation, there remain, as I have said, and as I linnly believe,
many matters of great moment in which there is room for arrangement and
advance.

These Conferences Avere formerly more or less identiii(>d with great
ceremonial occasions. This is, I believe, the first that has been speeilically
summoned for the purpose of business. I wish to say a wonl here about a
desire that has been felt with regard to the period between the Conferences
that there should be greater means than at present to continue in the interval
the definite communications which the Conferences make necessary. We
shall hope to find some method of meeting this desire. I am not going to ,
enumerate, still less discuss and criticise, the various schemes moro or less

48«G8. A 3

6

First Day. amoilious wiiich have beea put forward, but I will just make a remark
15 April 1907. applicable to all such, proposals. We found ourselves, Gentlemen, upon

freedom and independence — that is the essence of the British Imperial

(Sir H. connection. Freedom of action on the part of the individiial state, freedom

Bavn^o/a^'^ in their relations with each other, and with the Mother Country. Anything
which militates against that principal would be wholly contrary to the genius
of our race and our political ideals, and would sooner or later be disastrous.
There are some words which perfectly express what I have in my mind and
which were used in this place five years ago by Mr. Chamberlain ; and I
cannot mention Mr. Chamberlain without expressing on my own part and the
part of my colleagues, and indeed I think I am authorised to say on behaK of
the whole of the public of this country irrespective of political opinion, our
deep and sincere regret, which I know is heartily felt all over the British
Dominions, that he is for the present unable to take an active part in our
public aifairs. These are his words to which I refer : " The link " he said
" which xmites us, almost invisible as it is, sentimental in its character, is
" one which we would gladly strengthen, but at the same time it has proved
" itself to be so strong that certainly we would not wish to substitute for it a
" chain which might be galling in its incidence."

Gentlemen, freedom does not necessarilj'- mean letting things drift, and
in my opinion some provision should be made for maintaining the impetus
which these Conferences will give to the consideration and settlement of
questions which have been discussed here. I would also refer for a moment
to the precedent that Iras recently been made for holding what I may call
subsidiary Conferences upon matters of importance. I refer to the Navi-
gation Conference that is sitting mider the presidency of my friend, the
President of the Board of Trade, and at which I observe that Sir Joseph
Ward, Sir William Lyne, and other representatives are rendering great
service in the discussion of very difficult problems. To my mind the
precedent set is of high importance, and I should like to see these ancillary
Conferences held fi'om time to time as matters arise Avhich require more
time and treatment in gi'eater detail than is possible in the Colonial
Conference itself.

Well, Gentlemen, I have no more to say. I am fully confident that
your coming here will not have been in vain. You will not judge of the
feeling entertained towards you by acclamations and festivities alone,
although of those there will be abundance, but by the mutual spirit of
friendship, the desire to stretch every point that can be stretched in order
to meet the views of each constituent part of the Empire, the desire, equally
strong I hope, to avoid prejudicing in any way the interests of each other ;
and over and above all, you will be inspired and invigorated by our common
pride in the great beneficent mission which the British people in all parts
of the world are, as we believe, appointed and destined to fulfil.

Sir WILFRID LAURIER : Lord Elgin, Sir Henry Campbell-Bannerman,
and Gentlemen, it so happens that I am about the oldest Member of this
Conference and, as has been said by Sir Henry Campbell-Bannerman, I can
almost boast of a record performance, having been here twice, in 1897 and
in 1902, and it is not without some sense of regret I must say that I find
myself about the only man who attended those Conferences. I share
altogetlier the sentiments which have been expressed by the Prime Minister,
that it is a matter of deep regret, not only in this coimtry but all through the
Britisli Empire, that at this time the man who presided over the last two
Conferences which I attended, Mr. Chamberlain, should not be able to take
any part in public affairs ; and I am sure that I express the same sentiment
when I say that we all hope, in the most distant homes of the British Empire,

that his licalth will he quite restored, and that lie Avill take his place again in P'"' Day.

the public all'airs of tliis great country and Empire. Nothing coidd he more 'i* April 1907.

gi-ateful to us, no better commencement of this Conference could take place, ~

than the message which has been read to us coming from His Majesty the Laurier^)"*

King ; and next to this message we welcome the presence of the Prinm

Minister of the Crown. This Conference is not, as I understand it (I give

mj' owji views) a Conference simph' of the Prime Ministers of the different

self-governing Colonies and the Secretary of State, but it is, if 1 may give

my own mind, a conference between government and governments ; it is

a Confereu(^e between the Lnperial Government and the Ciovernnieuts of

the seK-governing dependencies of England. I recognise all the difficulties

which beset us ; they have been expressed by Sir Henry Campbell-

Bannerman. We all hope and we all believe in the future of the British

Empire. There are w'ays and ways by which it can be increased and

improved. We are here to discuss those questions. Upon many things

we can agree ; upon many things, I believe, we cannot agree at this

moment ; but, above all things, we all agree we all move towards the same

goal and the same end. The observations which have been offered to us

by Sir Ileniy Campbell-Banner man upon this subject have been excellent,

and could not be improved upon, 1 ain sure. He recognises that there are

things upon which public opinion is not in the same groove that it is perhaps

in the Colonies. We must recognise that there are many questi(jns xipon

which public opinion in our own respective countries may not be the same as

in this country. But upon one thing we are all agreed, and I believe that if

we can keep this in view we can never go astray, that is to say, that if the

basis of the union which now binds the British Emi:)ire remains as it is now,

a proper and always permanent recognition of the principle that every

community knows best what does for itself, then we cannot go wrong, and our

deliberations must be fruitful. This is the spirit, at all events for my part,

in which I approach the great subjects we have to discuss. The time is

not fitting to-day to take these subjects in detail, and I will confine my

few remarks upon this point to the same spirit which has inspired the

observations of the Prime Minister ; but I have only one word to say, to

express my great satisfaction that our proceedings are commencing imder

such favourable auspices.

Mr. DEAKIN : My Lord, Mr. Prime ]\rinister, and Gentlemen, the
wise and weighty words which you have been good enough to address to
us to-day, furnish a fitting opening, and, if I may be pardoned for saying
so, coming from your lij)?, the most fitting opening for a Conference whose
character and principle you have aptly defined. Your address. Sir, contains
many memora!)le sentences, summing up with felicity some of the aspects
from which this gathering will, we hojw, come to be generally regarded. .

Wc acknowledge your presence as a recognition of the principle alluded to
by juy friend and senior. Sir WiKrid Laurier, as one which we are anxious
to ui)hc)ld, that this is a Conference between governments and governments,
due recognition, of course, being had to the seniority and scope of those
governments. In addition, we owe to you a propitious and happy exposition
of the nature of this Conference for those to whom we, at all events,
naturally turn our eyes. We nuij' be pardoned for laying what might apjjear
to many residents of this country an undue stress upon the importance of
your sj^eech, not that it will fail of adequate recognition, but because to
the distant communities from whom we come, for Avhom we speak, and in
whose name alone we wish to be heard, it means much more than it can to
the people of this countr}^ accustomed as they are continuallj' to hear from
your lips political utterances relating to what 1 may term the home politics of
the United Kingdom.

A 4

8

First Day. But utterances of yourself and of leaders like yourself relating to those

15 April 1907. larger jDolitics which Ave share -with you are, first of all, rare, and next fail

to be conveyed to those Avhom we represent, as these undoubtedly Avill be.

(Mr. Deakin.) We are hapj^y to think that millions in AustraHa — I use the word, although
it is large, in reference to our population, advisedly — practically the whole
population of Australia to-morrow will have the opportunity of reading in
exteiiso the remarks wliich you have been good enougli to' make to-day.
Wliat does that mean? The subjects with which you have dealt have
probably been but lightly touched upon there since six weeks ago the
Parliament of the Commonwealth was closed in order to permit of the
attendance of its representatives at this table. During those six weeks I
venture to say, without any very intimate knowledge of detail, that local
public events in Australia have not stood still, and that the interest of our
people in those events has not diminished. Consequently the tendency has
been to overlay whatever impression was made bj^ the action of our
Parliament in adjourning to permit of the attendance of my colleague and
myself at this Conference by the more insistent demands of the everyday
politics of our country. After these proceedings close, five weeks vnW elapse
before either of us will have the opportunity of addressing the people of
Australia in order to explain what we think has been done here, and also
what has been attempted to be done. Now all this interval requires to be
bridged over by some such strong influence as you. Sir, by your address,
are, fortunately, bringing to bear. It will revive that interest of theirs in
the Proceedings of this Conference, an interest as deep as is the interest
of the people of this country ; you refresh that interest and thus enable the
Proceedings of this Conference to become to them actual, concrete, and
indeed living.

On our side of the sea, with the ample self-government that happily we
enjoy, and, perhaps, largely becai;se we are still a smaller community, our
electors, men and women both, share and share intimately with us so far as
they choose in every stage and every step of our political action. If that
intimacy be withdrawn from them, or rather, if the knowledge which enables
them to follow us step by step be withdrawn from them, those political
questions disappear over their horizon and are replaced by others closer and
more pressing, although probably of far less importance. Consequently, to
us publicity is of great importance. If this Conference is to exercise that
educational influence to which, in your concluding remarks, you referred
as one of its chief functions — if it is to exercise it at all elHciently, it can
only be by convincing Australia that the Government of Great Britain, the
Government of the Empire, realises the significance of this gathering,
however hniited its practical powers may be. That you do recognise its
importance we have proof in that you not only think fit to attend it, but
honour it by addressing to us such words of experience and counsel as you
have been good enough to speak to-day. You will, therefore, realise that
much natural anxiety felt by us has been dispelled by your appearance and
by your address, and will also perhaps realise how, at a later stage, we shall
be inclined to ask your colleagues to remember that our people (m the other
side of the world, unless kept in close touch with the proceedings of this
Conference, will not derive from it anything like the benefit we are desirous
they should obtain. The preceding Conferences, at which Sir Wilfrid
Laurier has been present, and in which he has played so honourable and
conspicuous a part, may have produced great results in this country and in
Canada, which, as compared with us, is your next-door neighbour ; but to
our communities at the Antipodes, separated by half the globe, I regret to
say that those Conferences failed of anything like their liill effect. Their
results were carefully studied by some politicians and bj^ those directly
concerned, but they made little or no impression upon our people ; and the

iinprpssiou \\]xm our people is what, in the lon^ nin, will (leteriiiino very First Day.
largely the attention paid even by public men. What the electors disreganl, 15 April 1907.

and cannot be practically invited to regard, tends always to become obscnred

by more inimodiate diMuands. ^^^'^' "'■•'*'»'"'•)

I trust that in this Conference we shall realise that although we have
been likened and happily likened to a Cabinet of Cabinets, we differ
absolutely froni all Caliinets inasmuch as we have not a tittle of executive
power ; neither legislative nor executive authority is ours ; and therefore
the strict confidence necessarily observed in Cabinets has no analogical
relation to the proceedings here. There are always risks in regard to
publicity, and there are some matters in which reticence and private discus-
sions are umloubtedly desirable ; but it appears to me that the major part
of the subjects for our discussion are not of that kind. Ijooking at our
agenda paper, 1 observe that those subjects are few, and of those few
subjects only some few parts call for secrecy. The great bulk of our deli-
berations might, as it appears to me, be held in public, or as nearly in public
as the sense of this Conference authorises. Of course there are perils in
publicity, but the greatest risk this Conference can run is the risk of being
ignored or misunderstood. The more it is now ignored, or its publication
postponed, the greater will be the liability to misunderstandings. These,
w^hen once they obtain currency, are hard to correct. Especially is this
the case when you have to travel half rouiid the globe before you begin
the task of correction, and when you undertake that task are subject to the
daily demands of local politics, Avliich, as most of us here realise, may easily
tend to conceal from constituents the Imperial issues at stake.

But, Sir, I do not rise for the purpose of endeavouring to add anything
to your address or to criticise it, though your recognition of the value of
subsidiary conferences, which would have a more technical and more detailed
character, and call for a different class of representation, you have nuide a
pregnant comment. There are many matters of this kind which can be better
dealt with by such subsidiary conferences. Some of those matters may be
so better dealt with, because such governments as Sir Wilfrid Laurier and
myself represent, not being unitary but federal governments, have a limited
though very large jurisdiction. There are questions bej^ond their jurisdiction
falling within the control of the local governing bodies — the State Govern-
ments in our case ; the provincial governments in the case of Canada. On
certain particular suljjects, such, for instance, as Education — and an educa-
tional gathering of some kind is shortly to take place here — our local
governments require to be, and ought to be, represented.

The further remark made that it is our good fortime on this occasion
not to be identified with any exceptional ceremonial is also timely. If it
did not sound imgrateful, I could wish that we had not been identified
with a London season or with a Session of the Imperial Parliament. If
possible, these Conferences should assemble when Ministers of the Imperial
Parliament are at leisure, and when the additional advantage might present
itself of our having the public attention of the people of Great Britain to
ourselves for a little time rather than come as we do now imdcr the shadow
of the great questions which are being debated in both Houses of the British
Parliament. This Conference occupies a niche quite large enough for us
individually, but too small for the great conimimities which we represent,
especially if their possibilities are to be taken into account. We are not
the representatives of to-day, though to-day we claim to speak for them ;
we are also the representatives of to-morrow, and of the day after to-
morrow, of those portions of the British Empire in which the vastest
opportunities of expansion, of aggrandisement, and of peaceful development
exist, and which in view of those possibilities desire for their own sakes,
as well as for yours, to be knit closer together. We aspire to the attainment

10

First Day. of a mutual understanding, one of those ties whicli was happily referred to by
15 April 1907. the late Lord Granville, when, following Lord Salisbury at the first Conference

in 1887, he referred to them as " ties of steel and of silk." It was at that

( r. EAKiN.j Conference, to which my memory returns, that the precedent was set which
you have happily followed by addressing us as a Prime Minister. Lord
Granville, representing the then Opposition, also did us the honour to
speak on that occasion. The chivalrous reference Avhich •you made to
Mr. Chamberlain, the statesman who lately presided over these gatherings,
may almost be taken as equivalent to a representation here of the present
Opposition in the British Parliament.

Li the future. Sir, we hope that the principle to which you have given
your adherence, which has led to your presence here to-day, will be given
a still further expansion. We may consider whether the Prime Minister of
Great Britain, if not the actual, ought not to be the titular President of all
these gatherings, so that the principle of governments conferring with
governments would be recognised. Such a course would not detract in any
sense or by any possible suggestion from any future Secretary of State
for the Colonies, and, certainly least of all, the Right Hon. statesman of
experience who occupies that post to-day, but merely in order to impress
upon the public the cardinal fact that these are meetings of governments
with governments for the sake of the Empire.

f Sir JOSEPH WARD : My Lord, Mr. Prime Minister, and gentlemen,

unlike my two friends, Sir Wilfrid Laurier and Mr. iJeakin, this is the first
occasion upon which it has been my privilege and honour to attend this great
Conference, which is looked forward to by the people whom I represent with
the deepest possible interest, and I want to say how much I appreciate the
sentiments conveyed in the address delivered by the Prime Minister. We
approach this Conference with a full recognition of the difiiculties that must
necessarily exist, not only in Great Britain, but in each of our countries, upon
matters concerning which there is very great room for differences of opinion,
and it is because of the fact in the outlying countries that those difi'erences of
opinion and difficulties attending them exist, that we are anxious to have the
benefit at the consultation and the discussion of them, of the ripened judg-
ment of the men who are responsible for the govermnent of the Empire. For
my own part I want to say how much I appreciate that reference to perhaps
a minor matter made by the Prime Minister. I refer to the Conference
which is sitting in another place for the purpose of regulating and dealing
with the Navigation Laws of the Empire, and I take the opportunity of
saying that, under the able presidency of Mr. Lloyd George, that Conference
already has dealt with some of the most complex matters, and has arrived at
decisions which, before we went into Conference, appeared to be ahnost
impossible (to my mind, at least) of solution. It is from a knowledge of
Avhat we have already done in one great dejjartment affecting various x)arts
of Britain and her possessions there, and the solutions that have been arrived
at, that I look forward with some confidence to the discussions, and the
results from those discussions, which nmst take place upon matters doubtless
of wider and greater moment and of very great difficulty that will come up
for consideration at this Conference.

New Zealand is far distant from the seat of the Empire. One arrives in
the old land and feels on every side that one is amongst New Zealanders in
the sense that they are British. The sentiment of the people, the desires
and aml)itioiis of tlie people here, though coveriug a very mucli wider area,
are very similar to what we find in our own country, and it is one of the
fine sides to being a member of the British Empire tliat one realises on
coming to tlie old land that there is amongst every class a desire to bring all
parts of our dominions as closely together as possible for the purpose of our

11

common good. I waut to say, my Lord Presideut and gentlemen, that First Day.

however one from time to time may observe that the questions of the 15 April 1907.

Colonies get drawn into the position of being su])jects for political fighting — -

either here or eisowliere, I regard the question of the future of the I'^nipire (^"

as one that should be kept entirely al)ove and clear of party warfare. There "*^''" -*""•)

must 1)6 no ([uestiou of party introduced into it. I am perfectly certain that

the members of the Imperial Government view the matter in the same light,

and I, for one, look forward with very great hope to the time when all

questions afl'ecting the Colonies may get into that happy position which the

Foreign OIKce occupies in regard to the affairs of the iMnpire. Governments

come and governments go ; parties come and parties go, but our Great

Empire we trust will last for ever ; and the continuity of policy dealing with

the great foreign affairs of this Old World is one of the things we admire

so much, and which we would much like to get to the position of, so far as

it affects the Colonies.

Sir Henry Cam])bell-l?annerman in the course of his admirable speech
expressed a desire that we should approach matters appertaining to each of
our countries without prejudice to one another. I am perfectly certain, Sir,
that that will prevail in the whole of the discussions that take place at this
Conference. I will not go into any details. The agenda is a long one ; it
contains most important matters, and I can only say that some of them I regard
as of the most vital consequence, perhaps I may say without egotism, to the
Old Country and certainly to the newer ones, that I believe the most important
matters submitted AviU be decided upon, and that the ripe judgments of
the gentlemen representing the Old Country, co-operating with the men
from the younger countries, whose positions are so often misunderstood,
will surmount difficulties that have seemed incapable of settlement. I
recognise that the machinery required for carrying on an old country with
a huge population is quite a different business to that which we have in
bringing into active life tlie younger countries for the administration
of which we are for the moment responsible. In our countries we can do
things in a day or a year that it naturally takes a long time to effect in the
Old Land, and sometimes, perhaps, we are rather restive in wondering whj'
it is that matters that we conceive to be for the good of our people in our
own portion of the British Empire, that we think might be applied to the
Old World itself, have been so long in being brought into operation. But on
examination into facts we realize that it is infinitely more difficult to turn
the machinery of the Old World such as exists to meet the diverse interests
and requirements of such a huge population, than the machinery of a
young countrjr, especially when we liave history and example by which we
can steer clear of the difficulties that present themselves to the Old Country,
and we get into a position of greater comfort in our younger communities
than can be expected to be achieved in an old land. I want to express my
regret that the ill-health of the gentleman who took such an active part in a
former Government in connection with Colonial matters has, for the moment,
laid him aside, and those sentiments, so very finely expressed by Sir Henry
Campbell-Bannerman, I think will be re-echoed certainly in the country
I represent, where a great deal of sympathy is felt in connection with
Mr. Chamberlain's iUness.

I wish to thank the Lord President and the Prime Minister for that
cordial reception which I feel that from British representative gentlemen we
would, under ordinary conditions, receive, but coming from them at this
great Conference it is to me personally a very great pleasure indeed to
acknowledge it. I know the New Zealanders Avill look forward with very
great concern to the doings, when they are made public, of this important
Conference, which I believe, and, I certainly hope, will be in the tlirection of

12

First Day. hvingiiig the Old Land and the great and growing self-governing colonies
15 April 1907. "^^0 much closer connection than they have attained now.

(Sir^ Dr. JAMESON : Lord Elgin, Sir Henry Campbell-Lanuernian, and

Joseph Ward.) Gentlemen, in the words of appreciation used by Sir Wilfred Laurier as to
the message of welcome we have received from the hands of the King, I
think he was speaking for all of iis. Again, the graceful words used in
connection with Mr. Chamberlain, who presided at the former Conference,
I am sure we all join in expressing, and I hope, before we go to-day, that
those words will take formal expression in some message of sympathy froni
the Conference to that great statesman. The representatives of the greatest
colonies have spoken, and I feel — and I think my colleagues, General Botha
and Mr. Moor, will feel — that we, representatives of South Africa, must
naturally labour under a certain disadvantage, not only on this occasion, but
on every occasion of a meeting of the Conference when these important subjects
on the agenda paper are brought up. We cannot each individually speak for
South Africa. We have not attained out destiny-, as those two great colonies,
Australia and Canada, have already done. New Zealand, I believe, can live
within itself, it requires no further consolidation, iinless it is that great
consolidation which this Conference, we hope, will take a long step
towards bringing about, that is the consolidation of the whole of the
component parts of the Empire. But we in South Africa, I hope and
1 thoroughly believe, will minimise that disadvantage by the unanimity with
which we will approach every subject which is brought forward, and we
may further get a local advantage, I think, in that if possible we, seeing
that we do suffer from that disadvantage here, will go back to our countries
in South Africa more earnest than ever in endeavouring to consolidate
our local interests, so that at our next Conference South Africa also shall
be represented by one representative. In thanking you. Sir, on behalf of
Cape Colonj^, for the kind welcome you have extended to us to-day, I wish to
say that I Avas very glad to see that, though, of course, you expressed in very
kind words of sympathy, not only of the English Government, but of the
whole of the English people with the Colonies and their representatives, you
also reminded us that it was not merely sympathy that was expected from
this Conference, but solid business. Therefore, I take it that we will get
further, propably, in this Conference than in past Conferences, that we will
get beyond the simple discussion of the methods of unity within the Empire.
I look forward with that expression of yours. Sir, and with the trouble which
you took to lightly pass over the whole of the agenda paper before the
Conference, as far as it exists at the present time, to resolutions being passed,
not merely as resolutions which may be forgotten, but resolutions put into
such a form that they will bring some real result. It is quite true, as you,
Sir, said, that of course, at this Conference, resolutions may be passed but no
action can Ije taken. But there are various kinds of resolutions, and resolutions
may be put in such a form at this C'onference — always supposing we, the
Colonial representatives, come into agreement with the representatives of
His Majesty's Government — that they can go to the various Legislatures, with
Avhom alone the power rests, and that we should be able to take some step
forward — some practical step towards further imity, not only in the sentimental
feeling, but in the practical material interests of the various component parts
of the Empire.

I thank you, Sir, again for your kind welcome.

Mr. F. R. MOOR : Lord Elgin, Sir Henry ( 'ampbcU-Bannerman, and
Gentlemen, — On behalf of the Colony I represent, 1 liave to sincerely thank
Sir Henry Campbell-Banncrman, the head of your Government, for the
welcome we have received here this morning, and I sincerely hope and

lo

<J

.sinccrel.y Lelicvo that this great gathering is going to be for tlic gooil, not tirstDay.
only of the Empire as a whole, but also for the good of that little Colony ^^ -^P'"'* '^^'^•
which I have the honour of representing here this morning. ,^^ F K Moon )

General BOTILV : My Lord, may I express myself in Dutch, as I find it
a little difficult to express myself in English.

(The folloicing statement teas made hy General Botha througli an interpreter.)

The circumstances under which I am present here this morning are
someAvhat different from those under which the other Prime Ministers are
lierc. They have all been long in the saddle in the Colonies which they
represent. I have just got into the saddle and I am not lirinly seated yet.
When the invitation arrived to attend this Conference my Coverument did
not hesitate to express the opinion that the invitation should be accepteil
at once. Of course always having been the leader of the Boer popidation
there, and because the Government have now received great privileges from
the Imperial Government, it was a source of great pleasure to me to attend
this Conference on behalf of the Transvaal people, and to prove by such
attendance at the Conference that the old Dutch population of the Transvaal
Avould work ecpially loyally with the English population for the welfare of
the Transvaal and of the whole British Empire. I am very grateful for the
sentiments expressed by Sir Henry Campbell-Banuerman in his address.
I am here with an open mind on the various points raised, and with a iixed
purpose of assisting my colleagues as far as 1 can, to forward the interests
of the various portions of the British Empire.

CHAIRJMAN : Gentlemen, the rest of the business which I have to lay
before this meeting, consists of arrangements which the Conference will
have to make in order to carry out their business at the further meetings
which it will hold. Amongst those of course will be the subject to which
Mr. Deakin has referred, namely, the cpiestion of the publicity which will
attach to our meetings. I only refer to it just now to make one observation,
that it was understood between some of us who met last week — and I think I
exijlaincd it also to Sir Wilfrid Laui-ier and General Botha afterwards— that
as far as regards the proceedings of this meeting they are being recortled
verbatim, and Avill, as soon as it is practicable, be put in the hands of the
Press. The rest of that subject, it is perfectly understood, is one for the
decision of the Conference itself and not in any way for His IMajesty's
Government. The rest of this business, I take it, would, therefore, be of a
nature which the Conference would consider, if I niaj'- so exx)ress it, in
Committee, and I imagine that some of those present will not desire to be
detained.

Sir WILFRID LAURIER : May I suggest that the Conference should
adjourn now, and that the other subjects as to publicity and the future sittings
of the Conference should come up for discussion at a subsequent meeting V
At the present time I wish to move a vote of thanks to the Prime Minister for
his attendance.

Mr. DEAKIN : I have pleasure in seconding that.

Sir HENRY CAMPBELI^BANNERMAN : Gentl.>nun, I am much
obliged to you for your kindness in moving this vote of thanks. I think that
I should rather like, although I do not know that it would be quite in form,
to move a vote of thanks to the Conference and to Lord Elgin for allowing

14

First Day ^le to be present, and that is much more the sentiment which I entertain than

15 April 1907. the idea that I have done any favour to the Conference by coming. It has

,jr~ been an unmixed pleasure for me to be here, and personally, individtially, to

Campbell- S^^^ ^^ official countenance to it. My whole object will be to do all I can to

Bannekmax.) further the interests of the Conference, to help in bringing it through a

successful career, in the hope that it may make a lasting impression upon the

great questions which you have to discuss.

(The Ministers of the Crown having retired, the Conference then proceeded

with its business in Committee.)

Lord ELGIN in the Chair.

Akrangement chairman : An amended agenda paper has been circulated, but I am

>iNEss. afraid even that will have to be taken subject to amendments again. Before
we get to the actual agenda, may I just say that, with regard to the days of
meeting, we have arranged, as you will see, for three or four days in a week, but
not always regularly the same days. That follows the precedent of former
Conferences, in which, though they had certain days which they aimed at,
they were not able, owing to various other engagements which the members
of the Conference had to fulfil, to keep invariably to those days. There is
another cause for a variation, namely. Cabinet meetings, which I and my
colleagues are obliged to attend. During the last Conference there Avas, I
believe, a fixed day in the u'eek on which the Cabinet meeting was
generally held. Owing to circumstances that arrangement does not prevail
so regularly now, and I shall be obliged, I am afraid, to ask the Conference
to allow me to be absent fi'om time to time without fixing a regular day ;
but I have si;)oken to the Prime Minister, and, as far as possible, he will
endeavour to avoid inconveniencing the Conference in that respect. From a
study of the proceedings at the last Conference, thoiigh they may haA^e had,
and I daresay, did have, an agenda paper something like this indicating the
days, in general, the practice was — Sir Wilfrid Laurier will correct me if
I am wrong — to fix finally at one meeting the business that was to be taken
at the next, or the next following meeting, without too great an adherence to
the general scheme. That, I think, was the practice, and, as far as the
Colonial members are concerned, it probably will be as convenient for them,
as it is almost necessary for us. We can take this agenda, therefore, as a
general scheme ; and it will be understood that it does not follow that
the particular subject piit down for April 25tli will be the subject which is
then dealt with, but Ave Avill settle far enough ahead, so that everybody may
be ready, the subjects to be taken in their order. As regards the business for
Friday of this Aveek, I should have to ask for an alteration, and it is proposed
to sit on Saturday instead of Friday. •*

Sir WILFRID LAURIER : I may say that I have fixeil several engage-
ments for Saturday. The next meeting of the Conference is on Wednesday
and I suppose that is satisfactory to all.

CHAIRMAN: On Wednesday antl Tliursday we can hold meetings fur
discussion ; but on Friday I am afraid Ave cannot meet as there is a Cabinet
Council. The First Lord of the Admiralty is also engaged on Friday and
Saturday. The next thing to arrange is Avith regard to the time of the

16

meetings. I am not quite sure what the hours were on tlie occasion of the First Day.
previous Conferences. 15 April 1907.

Sir Wfl.FRID LAUlilER : From 11 o'clock to 1 o'clock. ^rBr^N^E^r

(Chainnan.)
CHAIRMAN : And not in the afternoon ?

Sir WILFRID LAURIER : No.

CK4IRMAN : I think we might meet at 11 o'clock and sit till half-
past 1 on the understanding that if on any occasion there was a necessity for
it we coidd arrange to sit in the afternoon. It appears to me that if the
Conference meets in the morning, a good deal of business connected with the
Conference can be got through in the afternoon separately, and in this I
think Mr. Deakin agrees because there might ])e smaller meetings in the
afternoon.

Sir JOSEPH WARD : I am sure we would fall in with any arrangements
as to the sittings so long as we have enough time while we are here to get
through the work.

'»

Sir WILFRID LAURIER : We will leave it in that way. Whenever
tlie Conference wishes to meet we are ready to be here.

CHAIRMAN: Then we Avill try it this week, sitting from 11 to half-
past 1 on Wednesday and Thursday.

Sir WILFRID LAURIER : There is a question as to the attendance of
the gentlemen who are with the Prime Ministers and the colleagues of Prime
Ministers. I should like to have- my two colleagues present with me at the
Conference. It woidd be a great convenience to them and to me, at all
events, and I suppose also to Mr. Deakin, to have the benefit of the presence
of our colleagues.

"o^

Ml-. DEAKIN : Certainly.

Sir WILFRID LAURIER : Is there any objection to that ?

Mr. DEAKIN : Does not it follow from the principle which the IMme
Minister laid down to-day, that this was a consultation of governments Avith
governments. Although it is a case of one government one vote, it is
immaterial how many members of that government come so long as the
Prime JMinister of each State is the responsible spokesman who calls upon his
colleagues when he desires their assistance.

Sir WILFRID LAURIER : You have expressed my own opinion on the
point.

CHAIRMAN : May I explain my position in this matter ? When I
received the despatch fi-om Canada asking that the Ministers who came from
Canada should be treated as members of the Conference, I naturally referred
to the proceedings of the last Conference, and I found that it had been dis-
tinctly ruled that the Conference was a Conference between the Prime ^Ministers
and the Secretary of State. This particular question of the admission of other
Ministers was taken exception to at the last Conference, not by His Majesty's

16

First Day. Government, or by the representatives of it, but by one of the other repre-
15 April j907. seutatives, and Mr. Chamberlain ruled that if the Conference was not nnani-

mous on the point they could not be admitted. Speaking for His Majesty's

Arrangement Govermnent we felt that the Ministers from the Colonies under the
OF isiNEss. present system really occupy the same position as my own coUeages who
(t airmail.; come into the Conference on any occasion on which any subjects in which
they are interested are brought up, and they sit here and take part in the
debates, as I imderstand it. The only difference is that they do not sit at
the table and take part in the general debates unless the subject of them is
one in which they are specially intei-ested. Personally, I should be only
too pleased to see all the j\Iinisters from the Colonies who are good enough
to attend these meetings in this countrj^ sitting at our table. The only
thing I would like to point out as a matter of convenience is this : AVe are
at present an assembly of eight gentlemen sitting round this table. The
conversations which can take place between eight people sitting round a
table can be conducted in a more familiar strain and with less formality
than those of a larger meeting. I had rather Avished to take up the whole
of this subject in connection with the matter of the next meeting and the
constitution of the Coirfei-ence as a whole ; but as Sir Wilfrid Laurier has
mentioned it I have pointed out what I think ought not to be overlooked.
As far as this Conference is concerned, if the Colonial representatives desire
that other members beside the Prime Ministers shoidd be recognised as full
members of the Conference in a more distinct way than they already
are — because I consider that they are already so recognised — I
personally have no objection except on the pure matter of convenience.
I quite recognise that there is a difference between your colleag^les and
mine. My colleagues have other occupations here, and your colleagues
come specially for this Conference and nothing else, and they naturally
would desire to see and hear all that is going on. I would suggest, as a
possible solution of the matter, that if all Ministers from the Colonies are
recognised as full members of the Conference, that is to saj^, with the full
right of entry to this room, it should be understood that the Prime ]\IiDisters
have the assistance, for the purpose of a debate, of the one Minister interested
in the subject, and that the others, though present, should not intervene. I
only suggest that as a possible solution in order to keep the numbers of the
Conference within bounds. I hope the members present will clearly
understand that this is a point on which I do not wish to give any ruling
whatever ; but I was following the principle laid down by Mr. Chamberlain.
If the Conference itself desires the presence of others, I, of course, acquiesce.

Sir WILFRID LAURIER : I would say that Mr. Chamberlain ruled, I
think rather against his own inclination, that as a question of order, the point
being taken, as other Ministers had not been invited they should not be
admitted. I think he was rather favourable to their being present. I ask
the question now, because at this Conference the whole subject of the
constitution of the Conference is one thing to be discussed, and it woidd
apply to the next one. I think it would be verj^ satisfactory *to Mr. Deakin
if he could have a colleague of his with him, and it would be very satisfactory
to me if I coidd have my two colleagues so that we might have the benefit
of their assistance.

Mr. DEAKIN : I accept the suggestion of His Lordship.

Sir WILFRID LAURIER : And I, certainly.

CHiVIRMAN : My suggestion is that one member only will take part
iu the debate except liy leave of the Conference.

17

Mr. DEAKIN : For instance, on the question of Preferential Trade, no First Day.
doubt Sir Wilfrid Lauricr would tlesire to speak, and at the same time 15 April 1907
Mr. Fielding. So also I should desire to have the assistance of Sir William
Lyne.

Arkangement
OK Business.

CHAIRMAN : So that the two have a right to speak ?.

Sir WIT.FRID LAURIER : The Priiiie Minister has a right to speak
always, but upon the question of Defence, for instance, I should desire to
have the assistance of my colleague.

Dr. JAMESON : The next point in connection with that, which I want
to bring forward, is that General J3otha's Government have deputed Sir
Richard Solomon to act with him in the Conference, and owing to his position,
as he told us in his speech this morning, General Botha is verj'' anxious
constantly to have the advice of Sir Richard Solomon. Of course. Sir
Richard Solomon could not be a member of the Conference, or take any part
in it in any way, but I thought it possible the Conference might agree that
the Prime Ministers should have their secretaries present Avith papers, and so
on, Avhich would be a very great convenience, and is a thing which is allowed
in most other Conferences. In that w^ay Sir Richard Solomon could come in
and be a help to General Botha.

General BOTHA : If it involves a wrong principle I wiU not press it at
all, because I am a man for principles, and I do not want to lay down wrong
principles. Sir Richard Solomon is now here to assist me, and if possible I
would like to have him present, but, as I say, I do not Avant to see
wrong principles laid down for this Conference which will bind future
Conferences.

Sir WILFRID LAURIER: With all due deference, and with every
desire to oblige my colleagues, I hardly think Sir Richard Solomon could give
this Conference any assistance. If he were in a position of a secretary, I
think it might have been done.

Mr. DEAKIN : The Colonial Office secretaries are here. They take no
part, though they come in freely to produce papers and supply infonnatiou.

Sir AVILFRID LAURIER : That is not taking part in the Conference.
Mr. DEAKIN : No, and that is all that is proposed in this case.

Dr. JAMESON : General Botha does not ask that Sir Richard Solomon
should open his mouth except to whisper in General Botha's ear.

Sir WILFRID LAURIER : That is not taking part in the Conference.

Mr. DEAKIN : No. There is no objection to the secretaries being
present.

Sir WILFRID LALRU'^K : Al the last Courercnce my Secretary- used to
bring my papers and bag up to the door, but never'further.

Mr. DEAKIN : If our secretaries were present, they could pass us
papers and sort out what we wanted.

E 48668. B

18

First Day. Sir JOSEPH WARD : Are the secretaries to be admitted ?

15 April 1907.

Arkankemext chairman : I do not know ; Sir Wilfrid Laurier says it was not the

OF BusiNEri.s. practice to admit them at the previous Conferences.

General BOTHA : I will not press the point now.

Sir WILFRID LAURIER : A secretary would act as a secretary, and
would come simply as an assistant to supply papers, and so forth. If Sir
Richard Solomon comes under those circumstances it would be different.

General BOTHA : I do not think Sir Richard Solomon is in the same
position.

Mr. F. R. MOOR : Personally it would be a convenience to me, as I
have no colleague here, if my secretary could be handy to assist me. Of
course, I shall not expect him to take any part in the proceedings, but he
woidd be of assistance to me in referring to papers or anything of that sort.

Sir WILFRID LAURIER : The secretaries are always in attendance,
and if one wants anything a message can be sent out to them to bring the
necessary papers, and so on.

Mr. WINSTON CHURCHILL: I believe at the last Conference the
private secretaries of the late Colonial Secretary were here in the room aU
the time.

Sir WILFRID LAURIER: I do not think the menib(;rs of the
Conference can have secretaries in attendance upon them at all times.

Sir JOSEPH WARD : I think, perhaps, our secretaries might be allowed
to come in. We have all of us a good deal to attend to one way or another.

CHAIRMAN : Yes, they certainly might be in attendance.

Sir WILFRID LAURIER : They can be caUed in if need be.

CHAIRMAN : I think we might consider the point further about Sir
Richard Solomon, and see if Ave can make some other arrangei5ient. Then
there is the question of the publication of our Proceedings.

Sir WILFRID LAURIER : Mr. Deakin could give us his views upon
that question as he seems to have given some thought to the subject.

Mr. DEAKIN : The thought that I have given to it is due to our
circumstances. Distant communities are absolutely dependent upon publicity
for maintaining any real interest in the doings of the Conference and

1!)

ediicating the people on Imperial questions. I should personally be very ^"''■*' ^"3'-
glad if the Conference would lay down a general principle on the matter 15 April 1907.
of publicity, retaining the right at the request of any member of going into ^ ~~
Committee, as we have done lo-day, whi(;h means report, imless thought tit „j. lJl:sl^■E^'8.
afterwards. In the ordinary course, and on ordinarj- subjects, either the ,^ij. Ugjikin \
Press should l)e admitted, or the course pursued to-day of giving the Press a
verbatim report afterwards should be followed. Whenever it is thought that
a discussion is likely to evoke feeling here or elsewhere which would be
prejudicial to the conduct of our debates, that of course would be omitted
from the current report, and retained until the full report were published
later.

Sir WILFRID LAURIER : At the last Conference we did not publish
anything except ihe bare resolutions, and for my part I have come to the
conclusion that these were very meagre reports, and that it is better that the
discussions should be published, but I am not prepared to say whether they
shoidd be published from day to day. If everything is recorded here, and if
at the end of the Conference it is published with the resolutions, I tliink the
object Avould be satisfactorilj'- served in that way. I am afraid if published
from day to day there might perhaps arise a premature discussion upon
certain matters, but I quite agree with Mr. Deakin that we shoidd have a
daily report of what is taking place and that it should be published with the
resolutions of the Conference at the end of it.

CHAIRMAN : I might read what the Secretary of State said at the
beginning of the last Conference : " I have made arrangements to have
" a fidl shorthand report of the Avhole of our proceedings and I shall
" endeavour as far as possible to arrange that each day's report shall be
" sent to each of you before the next meeting. These reports will, of
" course, be treated by all of us as absoluteljr confidential ; at all events
" for the present. What we desire is a perfectly free discussion which
" we could hardly expect if that understanding were not arrived at ;
" but at the close of your pi'oceedings we wiU then consider whether
" anything, and, if so, what, should be given to the pidilic. No doubt
" some of our conclusions will be made pid^lic, and it may possi]:)ly
" be found, on looking through the reports, that it may be desirable that
" more should be published. At all events, what T wish to explain is that
" that will be a matter for subsequent decision, and nothing will be published
" without the consent of the persons concerned." That was the arrangement,
and that is what we intended to continue. At the end of the last Conference,
as Sir Wilfrid Laurier explains, a very small part of tlie proceedings was
published. It may be that at the end of this Conference we shall wish to
publish more, but I agree with Sir Wilfrid Laurier that it woidd b(> inexpedient
to publish day bj^ day. After all, this must partake largelj' of the character
of a confidential discussion across the table, unless we are having set
opportunities like the way in which these proceedings Ijegan to-day. That,
of course, stands on a different footing ; but the ordinary course of the
procedure will be surely confidential and conversational discussion across this
table, and therefore I think it is essential that each member of the Conference
should have, not only an opportunity of seeing, but of revising, the report of
what he has said. That can always be done, and we have seen it constantly
done in the proceedings of commissions and otherwise, if you combine it, as
Sir Wilfrid Laurier proposes, with the report as a whole, but it cannot be
done day by day, as that is ahnost impracticable.

Mr. DEAKIN : I do not wish to conduct this whole argument myself,
but cannot admit the analogy between this Conference and any Royal

B2

20

First Day. Commission whether for inquiry or otherwise. The difference is fundamental.
15 April 1907. First of all, this is a Conference of representatives ; it is a Conference of
_ ~"~ representatives who have no power to do anything ; they have only power

o"" Bi''-;^NE-i'^ to discuss and recommend. Anything to be done must be authorised by
CM- D-kin) those whom they represent — that is their Governments, Parliaments, and
idtimately the electors, and it is these who need information and conviction,
if it could be imparted to them, just as much as we do. If we here succeed
in convincing each other alisolutely and return to our countries imanimous,
that amounts to a great deal, but it leaves an immense amount to be done
when Ave are endeavouring to convince majorities in our Legislatures in
b<jth Chand:)ers and majorities of our colleagues. We have then to commence
the work all over again. Want of knowledge delays it, impedes it, and
obstructs it. Secrecy appears to me foreign to the nature of this gathering.
It would be a legitimate criticism to say that if this Conference is treated
as a Parliament you will have Parliamentary speeches, and it is desirable,
perhaps, that our expressions here shoidd be reconsidered and matured, and
therefore that nothing should be completely j)ub]ished until you have had
an opportunity of revision. That is a good point, but it seems to me that
could he met by saying "If no verbatim report from day to day can be
" given, let us have a fidl report such as is given in the first columns of a
" newspaper where they are referring to the reports in the other pages.
" Let them say, ' Lord Elgin presided to-day when the question under
" ' discussion was the constitution of the Conference. A resolution to tliis
" ' effect was proposed. Sir Wilfrid Laurier followed, and in the course of
" • his remarks he took exception to such and such parts of the resolution,
" ' and submitted such an amendment, and he was followed again by
" ' Mr. Botha (or any otlier Member), who proposed this. After consideration
" ' these amendments were withdrawn and something suggested by Sir
"' ' Joseph Ward was introduced, who gave as his reasons so on ' — something
" like that."

Mr. WINSTON CHURCHILL: Who do you suggest should take the
responsiljility of making the summarj^ ?

Mr. DEAKIN : I suggest the secretaries here should prepare a summary
which they ought to submit to each member as to his own remarks, and
as a whole to the Chairman, or to yourself, as his active assistant in these
matters. It should be looked at from the point of view of the British
Government, while each man would see that the short statement submitted
to him was at all events so far correct as to convey the general drift of his
remarks.

Mr. WINSTON CHURCHILL: You would not suggest that anything
should be published in any case until after the member making the speech
had had an opportunity of seeiug what was to be pul^lished and attributed to
him.

Mr. I)EAK1N : No, but as far as I can see a great deal of our debates,
even if there was a great deal of friction, might bo carried on before all
the Press representatives of the United Kingdom, as far as I arri concerned.
^\'ith regard to the precis, each member would reqiure to see his part of it.
That coidd be done Ijeforc we left, especially if our sittings were only in the
morning, as it is only a digest of no great length. What I mean is, that
every word of that would be cabled to Australia and New Zealand ; every
morning they would know what we have been discussing ; every morning

21

tliey would know what the principal men here were proposing ; and every P''"*t Car.

few days they would hear what the final outcome had been. Then they would 16 April 1907.

have their interest kept alive. They would later see in extenso what tbey

had only before seen in epitome. Arranoememt

OF Business.

Sir JOSEPH WARD : That was the procedure at the Navigation Con- ^^'- Deakin.)
ference, my Lord, and I think that to defer until the end of the Conference
the expectancy of having everything said here j)ublished would be rather a
mistake. I am inclined to suggest that in the absence of the press a synopsis
of what took place here every day is a proper thing to issue.

Dr. JAMESON : At the Navigation Conference, was it found necessary
to submit to each member of the Conference what he had said ?

Sir JOSEPH WARD : There were three secretaries appointed, one
representing the Board of Trade, Sir William Lyne, and myself.

Dr. JAMESON : It was all submitted to yon ?

Sir JOSEPH WARD : They prepared an outline of the proceedings, and
it was submitted to the Board of Trade, and then submitted to Sir William
Lyne and myself.

Dr. JAMESON : Before it was published ?

Sir JOSEPH WARD : Yes.

Mr. WLN'STON CHURCHH^L : Taking about half a column of a
newspaper, and this would take longer.

Mr. DEAKIN : This ought to be quite twice as long.

Sir JOSEPH Wx\RD : I think that publishing the bare resolutions, as
was done last time without a report of the discussion on them, would be a
great mistake ; the people would not know what was taking place and would
have not the slightest idea of the views of anji-hody.

Sir WILFRID LAURIER : I quite agree ; here is the book of the
Conference that was not given to the public.

Sir JOSEPH WARD : The papers pubhshed were not laid on the
table of both Houses of Parliament imtil two months afterwards.

'Mi. DEAKIN : The last is confidential and has not yet been laid on the
table ; that is worse still.

Sir WILFRID LAURIER: I do not see why this shoidd not be
published and given to the public as the result of the Conference. The book
we had contains the bare proceedings and the official papers, but the
discussions from day to day are contained in tliis book here. I think for ray
part that tlii^; hook should be given to the j)ublic. ^\^^at took place at the
Conference last time. Dr. Jameson, was that the stenographer took down
everything, but the reports were given to each member the following
day and corrected by the member, and so corrected they are printed in
this book.

48668. B 3

22

First Day. Dr. JAMESON : That would be tlioroughly satisfactory. The only

15 April 1907. thing I feel, with Mr. Deakin and Sir Joseph Ward, is, that people would be

very well satisfied if they got a short precis every day of some kind or

Arrangement •'.^^^ -^ '^ -^ J J

OF Business. another.

(Mr. Deakin.)

Mr. DEAKIN : Otherwise, they lose touch with it altogether, and we
have to begin all over again.

Sir JOSEPH WARD : They look for something.

Mr. DEAKIN : We live in the light of a publicity which you gentlemen
are hardly accustomed to.

Dr. JAMESON : Still more important than anything else is Avhat
Sir Wilfrid Laurier says — that that White Book, not the Blue Book, should
be published immediately after the Conference in full. That is the most
important of all.

Mr. F. R. MOOR: You do not mean that particular book there— the
past Conference — but the present one.

Dr. JAMESON : No ; on those lines.

CHAIRMAN : I understand, at any rate, that .there is an agreement that
we shall not have a verbatim report each day.

Mr. DEAKIN : I am in a hopeless minority.

Dr. JAMESON : Another thing is, we cannot get it.

Sir WILFRID LAURIER : I think the suggestion made on the last
occasion in the words of Mr. Chamberlain is the best one, and I see no reason
to depart from it.

CHAIRMAN : This is an illustration of what was done at the Shij^ping
Conference the other day {indicating a newspaper pavmjrapli).

Dr. JAMESON : I think a very short precis might very well be trusted
to be given each day.

Sir WILFRID LAURIER : We might perhaps, compromise upon
that.

CHAIRMAN : That there is to be a precis ?

Sir WILFRID LAURIER : Yes.

CHAIRMAN (to Sir Francis Ilupuuod) : WiU you undertake to prepare
a precis ?

Sir FRANCIS HOPWOOD : I shall be very happy to try at the end of
each day's proceedings.

Sir WILFRID LAURIER : W'c can see how that works without coming
to a formal conclusion at this moment.

23

Mr. DEAKIN : It is veiy good of you, Sir Wilfrid, liolding the views First Day.

you do, to meet us so kindly in the matter. I just took the liberty of handing 15 April 1907.

to the Secretary of State a cablegram I have just received from the Acting ^^^^

Prime Minister of the Colony, Sir John Forrest. ^^^, bcsiness.

CHAIRMAN : May I read it ?

Mr. DEAKIN : Certainly : " Colleagues wish to express to you a fervent
" hope that the labours of the Conference will assist in promoting the
" increase of trade and commerce amongst the British peoples, the niain-
'■ tenauce of the British supremacy on the sea, and the closer union in the
" bonds of loyalty, and affection of tlie British race throughout the world.
" —Forrest."

CHiVIR]iIAN : Is there any other point ?

Sir WILFRID LAURIER : I propose that the following telegram be
sent to ^Ir. Chamberlain : " This Conference begs to express its deep sympathy
" with you in your illness, and earnestly hopes that you may be speedily
" restored to active public life."

Dr. Jx\ MESON : I beg to second that proposition.

CHAIRMAN : No doubt the Conference wiU agree to this telegram."-'"
(Unanimously.)

Sir WILFRID LAURIER: I suppose that is all that is on the pro-
gramme for to-day ?

CHAIRMAN : That is all that we can usefully do, and we %vill adjourn
to Wednesday for the consideration of the special constitution of the
Conference.

Will this do for the answer to His Majesty's telegram? "The Prime
" Ministers of Self-Govern ing Colonies present their humble duty to your
" Majesty, and desire to acknowledge gratefully your ]\Iajesty's gracious
" telegram, which will be a source of great encouragement in their labours."

Sir WILFRID LAURIER : That is very well expressed. Sir.

CHAIRMAN : I think that is all wx can do to-day.

Adjourned to Wednesday next at 11 o'clock.

"•'■■ The reply fi-om Mr. Chamberlain was in the following terms : —
" Sincerely thank Prinic ^Ministers for good wishes ; am promised com-
plete restoration to health, in which case hope speedily resume public
work. Meanwhile gratefully appreciate kind resolution of Conference."

B i

24

Second Day.
17 April 1907.

SECOND DAY.

Held at the Colonial Office, Downing Street,
Wednesday, 17th April 1907.

Present :
The Right Honourable The EARL OF ELGIN, K.G. (President).

The Right Honourable Sir Wilfrid Laurier, G.C.M.G., Prime Minister

of Canada.
The Honourable Sir F. W. Borden, K.C.M.G., Minister of Militia and

Defence (Canada).
The Honourable L. P. Brodeur, Minister of Marine and Fisheries

(Canada).
The Honourable Alfred Deakin, Prime Minister of the Commonwealth

of Australia.
The Honourable Sir William Lyne, K.C.M.G., Minister of State for

Trade and Customs (Australia).
The Honourable Sir Joseph Ward, K.C.M.G., Prime Minister of New

Zealand.
The Honourable L. S. Jameson, C.B., Prime Minister of Cape Colony.
The Honourable Dr. Smartt, Connnissioner of Public Works (Cape

Colony).
The Honourable F. R. Moor, Prime Minister of Natal.
General The Honourable Louis Botha, Prime Minister of the Transvaal.
Mr. Winston S. Churchill, M.P., Parliamentary Under-Secretary of

State for the Colonies.
Sir Francis Hopwood, K.C.M.G., Permanent Under-Secretary of State

for the Colonies.

Mr. H. W. Just, C.B., C.M.G.,

Joint Secretary.
Mr. W. A. Robinson,

Assistant Secretary.

CHAIRMAN : The Conference now proceeds to the active business for
which we have been assembled, and we will deal with the subjects which
have been put down for the first business meeting. From a study of the
former proceedings I rather gatlier that it has been the practice at these
Conferences to discuss a suljject not under the strict presentation of a
resolution, such as you would have in a House of Parliament, but to discuss
the subject generally, with, of course, the resolutions which may have been

2b

sent in in view, and then at the conchision of the discusfiion, to endeavour to
adjust such a representation of the decision, or an expression, at any rate, of
the views of the Conference, as may be recorded in our proceedings.

In this case therefore we start with certain rcsohitions which liave been
sent in in reply to the invitation which 1 addressed to the various Colonies,
and 1 think it would probably be the most convenient course if 1 asked one
of those representatives of the Colonies who have submitted a resolution to
open the discussion. I think that is in accordance with the practice on
former occasions. I do not know whether those who represent Australia,
New Zealand anrl Cape Colony have agreed among themselves as to the order
in which that should be done. The first on my list is the Commonwealth of
Australia, and unless it is otherwise arranged I should suggest that perhaps
Mr. Deakin would open the discussion.

Mr. DEAKIN : SubjectHo Sir]Joseph's approval and that of Dr. Jameson,
what I was about to propose was this, to pass by the resolutions as framed,
except so far as they furnish material for discussion upon them point bj''
point ; for instance, ours says, " That it is desirable to establish an Liiperial
Council." Directly we read that, the question of title is raised. Would it not
be a business-like method to take first of all the question of the title of
any future conference, discuss that and settle it ? Then it passes on to say
that the Council or Conference, or whatever it may be teniied, shall " consist
of certain members " — take that next, and decide how they are to be chosen,
or the position of other Ministers which we settled amongst ourselves on
Monday. That should be formulated, and so on, taking point by point the

various matters that these resolutions suggest,

It

shorten the discussion.

might be necessary

dealing with each in turn.

y to alter their order slightly, but 1 fancy that would

Second Daj.
17 April 1907.

(Chairman.)

CHAIRMAN : May I first point out that it puts those who have not
passed resolutions at all into rather an invidious position ? There is nothing
on record and it seems to me with all deference that wc shoidd shorten our
proceedings really if Ave had a general discussion first and saw how far we
were able to get to a general agreement on the general discussion. If that
was done I rather think the atljustment of details would be simpler. If we
take the thing at once on the ciuestion of title, we really cannot settle the
question of title without discussing the general constitution.

Dr. JAMESON : I was going to suggest that certain Colonies have put
down certain subjects to be brought forward, and of course they have thought
them of paramount importance. Other Colonies perhaps do not think them
so important, and your objection to Mr. Deakin's proposal would be met, I
think, by taking what has been put down, and then after these are finished
any representatives of the Colonies who had not brought forward any resolu-
tion would go on to consider what they wished to bring forward to cover the
ground, starting with what we have in front of us, and then practically taking
what would be amendments from those representatives who had not brought
forward any resolution on the subject.

Sir JOSEPH WARD : I quite agree with Mr. Deakin that it would
save the time of th(! Conference, and be more advantageous, instead of the
Australian and New Zealand representatives submitting independent resolu-
tions, that we should agree to merge them in some form so as to endeavour to
come to a general imderstauding.

CHAIRMAN : That is the same as I proposed.

26

Second Day. Sir JOSEPH WARD : Yes, if a discussion were to take place as you

17 April 1907. suggest, giviug aii outline of what is in the minds of the different representa-
tives, it might enable iis to arrive at some concrete form of expressing our
desire upon this important matter. For my OAvn part I am quite prepared to
fall in with whatever is the best way of arriving at a decision upon it. I
would just like to say that I am of the opinion that it is perhaps a little
prematiire, Mr. Deakin, to commence to discuss what the term should be.
We first want to see whether we are in accord upon the general principle of
establishing an Imperial Council under some name.

Mr. F. R. MOOR : Would it not promote the object we have in view if
the Colonies who have brought forward these resolutions Avould in brief give
us their ideas each individuallv as to what form this should take ?

Proposed
Impekial
Council.

PROPOSED IMPERIAL COUNCIL.

Sir WILFRID LAURIER : Canada has made no suggestion upon this
point. I may say that in our country, as we have stated in our despatch,
we do not view it with much favour, but wo approach it with an open mind.
I would at this moment observe relative to the suggestion of Mr. Deakin that
we should take up at once the first x^roposal of the Conunonwealth of
Australia. " That it is desirable to establish an Imperial Council to consist
" of reiDresentatives of Great Britain and the self-governing Colonies chosen
" ex-officio from their existing administrations," and that the title should be
the last thing to be determined. We should know beforehand Avhat should be
the functions and the powers and duties of that Council and define those, and
then according to the functions which were deputed to it the title would
depend. It might be a Council or a Conference or anything you please, but
it seems to me that the very first thing, as Mr. Moor suggests, is that we
should settle M^hat we have in our own minds. For my own part I approach
the subject with a perfectly frank mind, but I think the suggestion made is a
good one, that the gentlemen from Australia, the Cape, and New Zealand
should give us their views in a general outline, what they have in mind as to
the functions of this Imperial Council which they think ought to be established.
That woidd bring forward at once the Avhole scope Of the discussion, and we
could determine then how we could agree, but I do not think that we should
give it a name unless we know what it is.

Mr. DEAKIN : If it be your wish, Lord Elgin, I have no possible
objection to state off-hand, and shall endeavour to do so in as few words as
possible, the general purport of this proposal. Our discussion will probably
resolve itself into some such analytical method as I just ventured to suggest.
We found in the despatch from the previous Imperial Government a proposal
to adopt the title " Imperial Council." This we iiuderstood was intended to
be conferred upon the existing Conferences without any substantial alteration
in their powers, or in the principle of their constitution. We werS prepared to
mark our appreciation of the intention by the adoption of that title. It appeared
to us a fitting cognomen for such a body, and if its constitution were
elaborated to some slight degree it might have been a judicious thing to
accept it even at this stage ; but the intention of this general resolution of
oui-s was to retain these Conferences precisely as they have existed — this
Conference as it now exists — unaltered in personnel or in procedure,
except so far as we might with advantage connect its several meetings
during the intervals of its assembling, and provide for a more efl&cient
means of keeping its members in touch with one another, and with the
Government of (h-eat Britain. Our idea was not to endow the new body

27

under -whatever title it was known, with any legislative or executive power
whatever, nor to diminish its immediate dependence upon the Governments
of the Dominions represented here ; but to provide that it should meet
periodically, consist of Prime Ministers, discuss questions of Imperial interest,
and where possible arrive at conclusions to be afterwards reconunended to its
governments and legislatures. But it should have no more power than we
possess here of itself putting into effect any decisions at which it might arrive.
Consequently, when the despatch of the Prime Minister of Canada was placed
in our hands, and the suggestions derived from the experience of that
government of the connotations of the word " Council " were put before us,
we at once agreed that if Sir Wilfrid Laurier thought fit to press that view,
for our own part there would be no objection to adopting the title which he
suggested instead of that which we had projDosed. We accepted the term
" imperial Conference " instead of " Imperial Coimcil." The body we had in
view was a conference that was to have no such powers as, according to the
Government of Canada, are associated in their minds and in the minds
probably of those whom thej- represent, with the name "Imperial Council"
which to us would not have meant more than " Imperial Conference." We
are perfectly prepared to accept that titl(>. I do not need at this stage to
detain the Conference further. Our object is to retain the Conferences as
they at present are, in respect to their authority, to their constitution and to
their periodical meetings. We add a staff, to which allusions will hereafter be
made, for purposes which will then be discussed separately. As to meeting
the expenses of that staff, Ave propose that it should not be cast upon the ex-
chequer of this coimtry. Bej^ond that it seems to me at all events not essential
for us to proceed at this stage. I therefore submit that it is desirable to
establish an Imperial Coimcil or Conference. If the word " establish " be
taken exception to, Ijecause, as matter of fact, the Conference is already in
existence, I have no objection to that criticism. What is sought is to insist
once more upon the regular, and, so far as we can, upon the permanent
existence of this Conference, x^ftcr that we propose a Secretariat with a view
to the consultation through it of the various members of this Conference or
of the Prime J\Iinisters and others who would be members of the Conference
in the intervals between their meetings ; to enable suggestions to proceed
from one or more or aU. of them through the Secretariat to each other and to
the Government of this country, in order that questions likely to be dealt with
at the succeeding meeting may be examined some time ahead, and that aU
necessarj^ information and inquiries may be made and views exchanged, so
that the proposition, after reflection, may either be pressed, modified, or
abandoned when the Conference is entei'cd upon.

Under these circumstances, instead of meeting as we do to-day with only
a very imperfect relation to the Conferences which have preceded this, and
insteaii of taking up the questions l^efore us in an elementary fashion, we
should have an agenda of partly or completely prepared, and sometimes partly
digested matters. This would not only save time, but would enable us to
approach our conclusions with nuich greater confidence. In the same way,
with such a Secretariat after a Conference had closed its labours, the resolu-
tions arrived at would either be the subject for further inquiiy or where the
governments agreed th^t it Avas a matter within their scope or their legislatures
agreed at some time prior to the next Conference that it was a question Avithin
their scope, there might be Avhatever action, small or great, Avas called for.
The action of the Secretariat Avould be subject, as I have ahvaj'^s said, to the real
authorities Avithout Avhom no action is to be proposed to be taken, that is to
say, in each self-governing commimity, to that community itself ; until its
assent was given in the orch'narv Avay by law or by executive act, as the case
might be, there Avould be no poAver in this Secretariat to ask for or to direct
any action. The Secretariat Avould be merely an agency for carrying out the

Second Day.
17 April 1907.

PllOI'OSED
l.MI'ERIAL
CODNCIL.

(Mr. Dciikiii.)

Second Day.
17 April 1907,

Pkoposed

Imperial

Council.

(Mr. Deakin.)

28

instructions of one Conference and for acting as an intermediary at the
sugg;estion of any Prime Minister or any government or governments in order
to prepare for tlie next Conference or between its meetings.

I liope I have not spoken at too great length, but the idea that we had
in our mind was not an extension of power ; it was an extension of inquiry,
an improvement of method, a sj^stem of obtaining complete information and
of enabling us to exchange views with the Government of this country or
with each other. Let me saj in conclusion that there are some matters of
foreign politics, for instance, which occasionally touch closely, either every
Dependency or some of the Dependencies of the Empire, and amongst
them some or all the self-governing communities. At the present time any
communication on those matters is indirect of necessity, bxit it is also
impeded by other considerations. We may appear officious ; we may
appear to lie assimiing without sufficient knowledge that sonae communication
of ours is called for. We desire to be in a position to be able to make such
necessary enquiries in regard to foreign politics as may appear to us to be
urgent and important, to make them direct, to obtain a reply, and if that
reply appears to us to embody any principle, to communicate through
such a Secretariat with the other self-governing communities asking that
they be placed in possession of the same information in order that
they may consider whether in the interests of their own people
they too should not communicate direct with the Government of this
countrj^ in whom the whole control of foreign affairs and defence rests.
I think such occasions would be of rare occurrence, and do not think they
would arise after we had once got into touch with one another more than
once or twice a .year, but when they did arise the.y might be very vital indeed
to some or all of ns. But in all these aspects, what is intended is the con-
tinuation of the present Conference under improved conditions, systematized
procedure, larger information, and whatever extra dignity or prestige would
come from a higher standing, but especially in regard to the greater efficiency
that we might expect from these developments. What we propose is the
continuance of these Conferences with additions which in no waj' alter their
character, principle, or dependence upon the legislative action of our respective
governments.

Sir WILFRID LAURIER
Secretariat ?

Have you thought ol the composition of the

Mr. DEAKIN : Yes, to this extent. My own idea is that, if possible,
the Secretariat should consist either of persons new to the public life of this
country, preferably trained by Colonial experience, and possibty with some
official experience here, but, as far as possible, men who had been selected
for their knowledge of the outer Empire, if I may so term it, of its great
dominions, and of the methods of government obtaining there.

Sir WILFRID LAURIER : To be appointed by whom ?

Mr. DEAKIN : By the Conference practically, for the Secretariat Avould be
its agency. It would necessarily require to be attached to some department,
and when the proper time comes I shall hope to make a suggestion, without
offence to the Colonial < )ffice and certainly not to its chief, which is that there
appear to us to be a great many practical reasons why it is desirable that the
Colonial OiBce in the future should be what it was at its commencement,
simply the office for the Crown Colonies. Any communications that the
self-governing Colonies or self-governing Dominions have with the Mother
Country should pass through another channel preferably to the Prime Minister

29

of this country direct. Tlio numljer of despatches from the self-2[overniug Second Day.
portions of tlie Empire is, I think, comparatively small and woulil require onlj^ a 17 April 1907.

small ofhce. Their communications of a regular character, exchanging infor-

niation, and so on, are frequent. The Prime Minister's attention would he Pkoi-osei)
rarely c-alled for, hut at present we suffer, and sulfer constantly, hecause c,'a^-"*^
ninety-nine hundredths of the time and attention and ahilitv of this office .,, ^^ ,V .
must necessarily he devoted to the enormous area, the immense population, '

and the inmimerahle problems which surround its administration of dilferent
connnunities scattered all over the world. It appears to me that it Avould be
for the advantage of the Colonial Oifice, and it would be to our advantage,
if we were dissociated altogether from the Dependencies which are governed,
and admirably governed, if I may say so, from this office. Taking the
communities that undertake to ^veru themselves, from which the despatches
are rare and which require very much less attention, it would be to their
advantage to he associated, as I am daring enough to suggest, with the Prime
]\Iiuister himself, who I understand, although his responsibilities are almost
beyond descriiition, is not hurdened with much administrative work at the
present time. I did not intend to enter upon that now, but as you asked me,
Sir "Wilfrid, I have answered your inquiry.

Sir WILFinD LAUIilEPv, : I think it is important in the discussion-
When this subiect was first put to the Colonial Governments 1)}^ the despatch
of Mr. Lyttolton, the suggestion was that an Imperial Coimcil should be
created ; and, as we understood it in Canada, it meant this — and I think that
was the thought that JMr. Lyttelton had in his mind at the time — that the
Coimcil should he composed of the mcmliers of the present Conference or of
the Conferences which have taken place up to this date, that is to say, of the
Prime Ministers of all the self-governing Colonies, assisted by a permanent
body to sit here in the City of London, similar to the Lnperial Defence
Committee. If that idea had been accepted, that there should be here a
permanent Imperial Civil Committee instead of an Imperial Defence
Committee, the title " Imperial Council," I think, would have been
appropriate. We demurred at once in Canada to the idea of creating such
a conmiittee as was suggested, biit we thought it preferable to keep the
Conferences to their present composition, without any more power than they
have at the present time ; and therefore we suggested that the name
"Conference" should be retained, substituting for "Colonial" the word
" Imperial," which I think is more in accordance with the fitness of things.
These Conferences are really Imperial in their character, since they are
not composed only of the self-governing Colonies, but of the representatives
of the Imperial Government also. I am very glad to hear from Mr. Dcakin
that he has no objection to that. The next question, as I understand — the
idea of having such a council as was suggested by Mr. Lyttelton — is not
pressed.

Mr. DEAKIN : We have never pressed it.

Sir WILFRID LAURIER: No. I thought that the Imperial Government
woulil press it ; but it is not pressed, as I understand. Therefore Ave are
l)rouglit to the idea of having a Secretariat, sitting here in the City of London.
Even in this modified form 1 am far from being agreeable to it. The Imperial
Conference, if the name is accepted, cannot sit here more than once in four or
five years ; it cannot sit every year, I think everybody admits, nor every
two years ; three years even would be too proximate a date. I may say, for
my part, I thought even four years was too short a space of time, in view of
the fact that nobody can come to this Conference except at great inconvenience ;
and supposing it were decided to sit every four years, you would have here

30

Seeoijd Day.
17 April 1907.

Proposed
Imperial
Council.

(Sir Wilfrid
Laurier.)

the Secretariat, and during the four years the Secretariat to whom ? As i
understand, to the Prime Minister, accortliug to Mr. Deakin's proposaL The
Prime Minister of England is a pretty busy mfui. I am the Prime Minister
of a very small Clolony, lai-ge in territory hut small in population, and 1 am
a pretty busy man, and I imagine that if the Prime Minister of England
could add some 24 hours to the 24 hoiirs of the day it would not be too much
for him ; and I think if you are to burden him with any more duties, I
see some difficulty there. The Colonial Office, Avhich is already divided
into departments, is the proper department to deal, under ministerial
responsibility, with the self-governing Colonies or Crown Colonies. I would
not like to pass by the suggestion of Mr. Deakin. I simply give my
impression, and, as I said a moment ago, I approach the subject' Avith an
absolutely open mind. I am simply pointing out some of the objections
which I see at this moment.

Sir JOSEPH WARD : I Avould like to say a few Avords upon this
important matter. Lord Elgin. \Miether the
or a conference to my mind is not of very great importance

organisation is termed a council
so long as the

position and duties of the Council are defined, and speaking for my Colony I
lay it down as one of the cardinal principles of such an organisation, that
there should be no interference with the present rights and powers of the
governments of those self-governing countries ; and in that resjaect if we are
safeguarded, as I am j)erfectly sure everyone is desirous of doing, what we
term the meeting of the Prime Ministers does not matter. If it is covered by
the term " Conference," in deference to Sir WiKrid Laurier's Avish I have not
the slightest objection, and I should be only too glad to fall into line Avith it.
^Vhy 1 preferred the Avord " Council," is because it indicates permanency,
and it is with the object of having a permanent institution established that
I think we ought if we can to arrive at some decision of a definite
nature in dealing Avith this matter.

Now, upon the jDoint last referred to by Sir Wilfrid Laurier,
and dealt Avith hj Mr. Deakin in the course of his speech (upon Avliich
I should like to add I have had no conference with Mr. Deakin), I should
like to say, in regard to the suggestion of the method of dealing Avith
Governments of the Crown Colonies and those of the self-governing Colonies,
oiir seK-governing Colonies are increasing in population and in power
daily ; during the next 10 or 20 years there is no man sitting at this table
can contemplate Avliat those countries, among them the Dominion of Canada,
are going to attain to, and I am persuaded in my own mind, that although
tlie Avork of the Colonial Office — and I have had a fairly long experience as a
Minister of the CroAvn in our country — Avith regard to our self-governing
coimtries has been of the finest possible character, there is, hoAvever, a feehng,
in the minds of adnunistrators certainly, that we occupy a very different
position to those CroAvn Colonies. We regard the Crown Colonies as being
governed and controlled by the British Government entirely, with the advice
of the experienced representatiA^es AAdio go out as Governors to those Crown
Colonies. We look ujjon them as j^ortions of the British Empire governed
from England, and under their complete control and direction, subject to the
advice, as I say, of the Governor resident there. Our self-governing countries
are not in the same position. We are responsible to our own peoijle and
govern ourselves, and Ave Avant to be regarded as Ave ahvayshave been,
though Avoi'kiiig llirongh the Secretaries of State for the Colonies; We should
be in a diU'enmt category to the Crown Colonies. 1 think the term
" Colony," so far as our countries are concerned, ought to cease, and that
that term ought to aj)p]y to the CroAvn Colonies purclj', and that those of
us who are not at present known as Dominions or CoumionA\-ealths, should

31

be known as Slates of the Empire, or some other expressive word, so as to Second DEy.
make a distinction as between the Crown Colonies and the self-governing 17 April 1907.

Dependencies. I would not presume for a moment to suggest how the \\'^k

of the Colonial Ollice should be arranged, but if we were put under a Ikmi'o^kd
separate category, and necessarilj^ with a separate Administration tor the Council.
Avorking of our self-governing countries, that would be a great improvement, (sir Josieph
and, although perhaps not important in the minds of some people, would be Ward.)

a source of considerable satisfaction, certainly to our country. I should like,
at all events before we finish our discussion, to say something further upon
the suggestion made by Jlr. Dcakin, with a view to arriving at an
imderstanding al)out it.

For iiiy owai part, I want to say that whether it be called an Imperial
Conference or an Imperial Council, in my opinion it should consist of the
Prime Ministers of the self-governing Colonies, the Prime Minister of
England, and the Secretary of State for the Colonies. Tliat is the opinion
I entertain, and I have had that in my mind all along. Now, I suggest that
we should consider the propriety of including tlie Prime Minister of England
upon the Imperial Conference for the reason that it does in the eyes of the
outside world impress upon tlie public at large the fact that the Government
of the Old Land is part and parcel of the Conference. An ordinaiy individual
who takes an interest in the carrying on of the affairs of a countr}- like the
one to which I belong cannot draw a line between the individual designa-
tions of the great Ministers of the Crown ii\ the Old World, and I believe it
would not derogate in any way from either the functions or position of the
Secretary of State for the Colonies and it would add materially to the
importance of the Conference if the Prime Minister of this country were
included.

I want also to say that I think the finictions and powers of the Council
should 1)6 consultative and advisory only on everything — that is on all matters
affecting the Empire or Imperial matters in which the States would be in any
way concerned, and that it should have no executive or administrative powers.

Upon the question of the Secretariat, I am inclined to think that that
is a matter that ought to be deferred for final settlement, and it ought to be
deferred for the reason that if this Conference arrives at the decision that
it is desirable to have a permanent Imperial Conference, then I think
the present Prime Ministers should coiifer as to the best means of
having the gap between the times of the periodical meetings every four
or five years filled up. The meetings should not be too frequent, their
frequency would weaken them to a very material extent and detract from
their influence, but T think that the manner of the filling up of the gap i)y
the permanent officer who is to be here to represent such an Imperial Council,
requires to be very carefully considered before we arrive at a final con-
clusion about it. I am not favourable myself to the creation of what one
might term a separate office, carried on in the Old Country as an inter-
mediary between the respective Prime; ^linisters during the recesses. I
shoxdd feel rather disposed to consider whether the self-governing countries
could not mutually agree to one or two of the more important repre-
sentatives of their Colonies resident in England, that is, the High Commis-
sioners or Agents-General, becoming the recognised channel through
which communications should pass. I want to make it quite clear that the
communications which we now are in the habit of sending from the Colonies
through the Governor to the Secretaiy of State for the Colonies, should
remain absolute, as at present, for the purpose of dealing with all matters of
Imperial concern to our country about which from time to time we require
to communicate, because I think we should be, above all things, strenuous
in our desire to preserve our entity or individuality in the matter of the
control of our own country. Biit a permanent Imperial Conference would

32

Second Day.
17 April 1907.

Proposed
Imperial
Council.

(Sir Joseph
Ward.)

in my opinion be invaluable. Questions which it would be to the interest of
all of us to confer upon, of importance to the different self-governing countries,
could, in the rscess, be subjects for correspondence. I see no reason why, by
correspondence upon many matters of vital concern to our countries, we
should not really perpetuate the advantages that ought to accrue from the
periodical meeting of practical men. My opinion is that during the recesses
enormous good to our respective countries would accrue, if we were able to
recognise that we had all the right to communicate, confidentially if we
wished, thi-ough the Secretariat upon matters that might be of immense
conseqtience to our countries.

Our country is very anxious and willing to assist the Old Land in the
event of trouble arising, to do so voluntarily by men or by money, and, I
think, always woidd be ready to do its share in fighting for the defence of
the Motherland in any portion of the world. We want lo keep clear of the
possibility of being drawn into what one might term Continental troubles
with England itself. We Avant to have a distinct line of demarcation drawn
in that respect between the responsibility we accept of our own free wiU.
and the responsibility that may be imposed upon us without our having had
anj^ opportunity of conference or discussion with regard to it. To my mind
that is one of the matters upon which siich an Imperial Conference or Council
permanently established, Avitli the understanding that the members of it
would correspond with one another during the recess from time to time
should circumstances require it, would be beneficial, so that we might take
joint action for the purpose of helping or working together in critical times.
To secure a position of that sort I regard as of very great importance, and we
in New Zealand should have the benefit of the advice of a gentleman, say in
the position of Sir Wilfred Laurier himself, or of any other who might when
the time comes take his place, which I hope will be a long way oft'. What an
enormous advantage it would he for a country like New Zealand to have the
opportimity of conferring with, perhaps. General Botha or Doctor Jameson,
which we could do with some authority if we had a permanent institution
properly established. As it is at the moment, in carrying on the Governments
of our respective countries, we may have commimications from the Secretary
of State for the Colonies. We act to the best of our judgment ; we act
without consultation with the Premiers of the other self-governing countries.
Occasionally the Prime Ministers of the Commonwealth and of New Zealand
confer as a matter of discussion beforehand, but still we act independently.
With the recognition that we had some sort of — I do not say power, because
power would not be the proper word — but the opportunity of consultation,
if we had an organisation by which we could look upon it as our right to
confer with each other, then, I think, a recommendation coming from us after
mutual discussion and consideration, perhaps by cable, would be invaluable
in arriving at a decision upon very critical and important matters.

I do not propose to take up the time of the Conference further at the
moment, except to say that I do hope that we Avill be able to meet the
ditficullies or to meet the views of Sir Wilfrid Laurier on this question. I
recognise, as the representative of New Zealand, that unless we liave the full
concurrence of the representative of the great Dominion of Canada with us
upon the proposal to establish an Lnperial Conference pemianently, it would
be quite hopeless for us to exj)cct to arrive at anything like a working Ijasis
which would be of any use to us. For my own part 1 shoidd go a long way
to meet any suggestion Sir Wilfrid Laurier has to make in the hope that we
may do something before we i)art on this occasion towards establishing an
institution that ought to be not only helpful but invaluable to our
respective countries in carrying on their functions. We must all be in
agreement regarding the establishment of a Council or Conference.

There is a matter to which I would (jnly allude and then I will conclude.

33

At the present moment we are all anxious to try to assist the intricacies Second Day.

of trade development ; we are all desirous — at all events, the self-governing '"^ April 1907.

Colonies are — to enter into reciprocal treaties with one another on Pboh()sed

matters of trade. If we had an Imperial Conference or Council established Imi>i;i£ial

of which the Prime Minister and Secretary of State of England were members, Council.

that is a matter which might, with enormous advantage both to the Old (Sir Joseph

Land and to the newer ones, be taken up by the Imperial Council, and be Ward.)

gone into with a view to see what anomalies and what difEcidties exist on the

side of the Mother Country and what anomalies exist in the Colonies, to

enable something like a unanimity of decision being arrived at. My opinion

is that wc should give and take upon matters of great importance so as to

bring tlie Mother Country into line with us, on a dithcult question of this

kind. For my own part I do not see why the Imperial Council sJ\ould not

consider among other things, with full information furnished to it from the

Secretariat, the desirability of omitting some items that we are deeply

concerned in from the proposed tariff between our respective countiies,

possibly foodstuffs. That is a matter which a Conference, sitting as we

ai'e now, cannot go into the detail of, but we could get an immense amount

of information concerning it which would be of great use to us in arriving

at a decision. New Zealand has taken up the matter of a Council at

the instigation of the Secretary of State for the Colonies in the despatch

referred to by Sir Wilfrid Laurier, sent out in 1905. Tlie three previous

Conferences to the present one have all felt, though they have derived

practical good from the interchange of ideas between the representative

men in charge of the affairs of the respective countries, a certain amount

of hopelessness owing to the difficulty of putting into some practical effect

the decisions arrived at at the casual Conferences that have been held.

I merely wish to say upon this question that if it is possible as the result
of the discussions for us to arrive at some basis upon which we could construct
an Inaperial Conference of a permanent character, then I think the meeting of
the representative men of the respective coxmtries Avould certainly have done
good.

Dr. JAMESON : Lord Elgin, I would lirst say that I recognise what Sir
Joseph Ward has said, the advantage of having unanimity upon this subject,
or any other subject which conies before this Conference. Nothing will be
done unless we are all unanimous, and I was very glad to hear the extremely
moderate and very lucid statement of Mr. Deakin on the question of
Conferences. I was glad to see from that lucid statement tliat he was able to
remove from the mind of Sir Wilfrid Laurier the idea that he had any
elaborate scheme to propose with regard to the constitution of this so-called
Imperial Council, which 1 may say at once I would l)e glad to see changed in
name to the Imperial Conference. We did not wish to initiate any new
scheme whatever, as Mr. Deakin has explained ; all that we desired was to
make more efficient the work of the Conference, as the Conference stands at
present.

I noticed that Sir Wilfrid Laurier still practical!}' stands to the objection
to the second portion of the scheme, that is the Secretariat, the new office to be
created in England. Sir Joseph Ward says he does not want to see any new
office created in England ; at the same time there is a desire that there should
be some connecting link between the Conferences during tlie three or four
years Avhen we do not sit, and unless you have something in the form of a
Secretariat I do not see how you will get that desirable link. Then I do not
think Mr. Deakin exactly expressed his answer to Sir Wilfrid Laurier. Sir
Wilfrid Laurier asked: "Who is it to iDe the Secretariat of — the Prime
" Minister of England ? " and Mr. Deakin said : " Yes," but I do not think
Mr. Dealdn meant that exactly ; he meant it should be the Secretariat to all

A 48688.. C

34

Second Daj.
17 April 1907.

Pboposed
Impekial
Council.

(Sir Joseph

Ward.)

the Prime Ministers of the Empire, — the Prime Ministers of England and of all
the self-governing Colonies. My idea of the Secretariat was that each of
those Colonies should appoint its representative upon it, the Prime Minister
of England also being represented npon it. I think this the right
arrangement as far as the self-governing Colonies are concerned, because,
after all, at the back of the whole of this is tlie fear of the expense
of any new body here and the possibility that that body might grow in
power so as to interfere Avith the powers as they exist in the self-govern-
ing Colonies themselves. I think we are all unanimous in this room,
and I know how strong the feeling is that we ought not to delegate any
possibilitj^ of any power away from the self-governing Colonies, but that
we ought to increase their powers. What we are anxious to do is, of course,
to get each individually into constitutional equality with the Motherland ;
it may be a very disproportionate equality, but that is our idea, really
that we are going to be nations, not separate from the United Kingdom
but nations within the United Empire. But it is to be nations ; so I want to
disabuse General Botha's mind, he having mentioned the subject to me a
couple of days ago, and also the mind of Sir Wilfrid Laurier, from the idea
that we are not as strong as they are on this subject of maintaining absolute
conti'ol over local affairs in our various Colonies. With that idea, to show that
no power could accumulate to this Secretariat, I would propose, at first at all
events, that that Secretariat should be composed really of our representa-
tives in this country at the present moment, who are entirely imder our
control so far as we are concerned. In the case of Canada, New
Zealand and A ustralia, it would be the High Commissioners, and in the case
of the other Colonies it woidd be our Agents General. Then, as to the work.
What would they do during the three or four years with no guiding hand ?
I think there will be plenty of work for them to do — in lact, I consider each
of these High Commissioners or Agents General probably would create a
department with perhaps one or two clerks under the Agent General to do
the investigation work that would be required in preparing what I call the
brief for the coming Conference. Till then the Secretariat would consist of
either the present or other representatives appointed by the various Colonies
themselves, entirely under the authority of those variovis Colonies, and that
woidd form, I think, a beginning only of the link between the Conferences as
at present established. I understand the 1902 Conference passed a resolution
that the Conference should be every four years, or at all events, should occur
within four years, and I liave no doubt that before we part we will pass
a resolution that we should meet every four or five years, or whatever the term
may be.

On that same point again Mr. Deakin said that in preparation for the
Conference the Secretariat would workout these subjects as, I say, the brief for
the Conference, and at the same time in working up this brief various subjects
might be proposed which on investigation it might be found it was not worth
while bringing forward, and they would be abandoned. Of course that
Secretariat would have no power to abandon or create anything ; they would
be abandoned, as Sir Joseph Ward suggested, by correspondence between
them and all the Prime Ministers, and by the authority of the Conference,
although the Conference might be scattered at that particular tim.e all over
the Empire.

Mr. DEAKIN : Precisely.

Dr. JAMESON : Still the Avhole power is left with the Conference, and
I may say I contemplate that this Conference will not attempt to get any
further than merely consultative work even in the Conference itself ; there is
no possible increase of power. As I say, it is a kind of seed which may grow.

35

Of course, we may have visions a thousand years hence of a closer union, but
we want no more than that at the beginning. We want no new departure.
We know perfectly well how shy any one of the Anglo-Saxon race i.s of a new
departure, and all we want in the self-governing Colonies is that this union
of the Empire should gradually grow, but you must put the seed in first so
that it may begin to grow. What we want is what I think the Secretary of
State for the Colonies suggested — a link between the Colonies.

Second Day.
17 April 1907.

PuOPOsKI>

Impeuiai.

Council.

(Dr. Jiimi?soii.)

General BOTHA : Lord Elgin, and gentlemen, I have read with great
interest the speech made by Mr. Chamberlain at the last Conference, and
there is one point that specially drew my attention, and that is this : " It is
" clear that the object would not be comj^letely secured until there had been
" conferred upon such a Council executive functions, and perhaps also
" legislati\e powers, and it is for you to say, gentlemen, whether you think
" the time has come when any progress can be made in this direction."
Now, when I read this I thought that if the word " Council " was to be
attached, as suggested by Mr. Deakin, to the word " Imperial," this might
make an infraction upon the rights of responsible government of the various
self-governing Colonies. On this point I am conservative, and I do not see
any reason for departing from the name which we have to-day. I should like
to build up, but I should like to build slowly. The circumstances of South
Africa to-day are such that we represent three Colonies there. The fourth
Colony, will, I hope, also be represented at the following Colonial Conference.
I think it is a good thing for us to discuss the point, but I do not think we
should arrive as yet, at this Conference, at a final conclusion on the matter,
although I am inclined to identify myself in a great measure with the
suggestion of Sir Wilfi-id Laurier. On the question as to the Secretariat, I
think the suggestion made in connection with that, with all due deference to
Mr. Deakin, is not quite happy. I do not quite understand what the duties
and functions of those people will be. I also fear that we might afterwards
create more work for ourselves with the officials of the Secretariat than with
the Colonial Office itself, and I want to maintain the bond of connection as
directly as possible between the Colonial Office and the self-governing
possessions. I believe each Colony has its Agent-General here, and I think
we should modify the instructions to the Agents-General in this respect, that
they should have authority to prepare the agenda for us, to work up the facts
for us. That is all I have to say.

CHAIRMAN : Gentlemen, I am sure anyone representing the Imperial
Government must have listened with great satisfaction to the discussion that
has taken place, in one particular, at all events, because it is quite obvious
that every word that has been spoken and every suggestion which has been
made has been made in the spirit of increasing the unity and strength of the
British Empire ; and I feel very much, that if that is so (and I think it is so),
there is no fear, as Sir AVilfrid Laiirier put it on Monday, that this Conference
will be a failure. We may have differences of opinion with regard to
particular methods in which we ought to cany out the purposes, but if we
have the same end in view, I am sure we shall endeavour to adjust our
differences so as to secure that end. Therefore, I do not think it is necessary
for me to go so much into detail as at one time I thought might be necessary
with regard to the various resolutions which were sent into us from the other
Colonies.

We meet in the first place under the resolution of the last Conference ;
that, no doubt, is in the recollection of the Conference, but I have it here
before me. Since that time my predecessor, Mr. Lyttelton has sent out
proposals which have been referred to in this discussion. I mention them

C 2

36

Second Day.
17 April 1907.

Pkoposed
Imperial

Council.

(Chairman.)

with all respect ; they have received support from several Colonies, but
Mr. Lyttelton himself, after the despatch which came from the Canadian
Government, agreed that these proposals must be deferred at any rate until
they had been discussed hereby the Conference which is now assembled. All
therefore that I would say with regard to them is this, that no doubt the
resolutions wliich are on our paper for consideration to-day, do take up both
sides of the proposal which Mr. Lyttelton put forward, and that, therefore,
we have in a sense those j)roposals as well before us. Now it appeared to me
when I first saw these resolutions that there were considerable differences
between the views taken by those who proposed them. In the first place I
came to the conclusion, and I am glad to have it confirmed by what
Mr. Deakiu has said, that the object of the Government of the Australian
Commonwealth was to preserve the chief characteristics of the Conferences as
they have hitherto existed, but I was not quite so sure with regard to the
resolutions from New Zealand and the Cape, and I thought that it was
possible to read in them a proposal to establish in place of the Conference a
permanent body or Council, which was, of course, an entire alteration from
the principle under which we assemble. But from what Sir Joseph Ward has
said, and 1 think also from what Dr. Jameson has said, I ma)' assume that that
is not the intention of those Governments ; they do also, as Mr. Deakin has put
it, desire to preserve these Conferences — I will not say exactly on the same
basis, but at any rate on the same principle on Avhich they have existed hitherto
as Conferences, as the Prime Minister described them, between the Imperial
Government and the self-governing Colonies through the representatives of
the Imperial Government and the Prime Ministers of the Colonies. I notice,
again, that the Australian resolution does say distinctly that the representatives
of the self-governing Colonies should be chosen ex officio from their existing
administrations, and I think I gathered from Mr. Deakin that by that he does
mean the Prime Ministers essentially.

might

Mr. DEAKIN ; The phrase " ex officio " was used only because it
be physically impossible for the Prime Minister to be there, in which case
a second Minister would take the place of the Prime Minister and speak
for him.

CHAIRMAN : Quite so. New Zealand does not enter into any qualifi-
cation ; but I do not wish to press that, or any other difference between the
resolutions, unduly. I quite expected to have, as we have had, full explanation
from the representatives of the Colonies when they came, and I do not
understand that on that point there is any difference between Sir Josej)h
Ward and Mr. Deakin.

Now I come to a very important matter indeed, and that is the functions
of what is called, in the resolutions, the Imperial Council, but which, from
what I have already said, really means the Conference. New Zealand, again,
gave no definition of the fxmctions, but the Australian resolution did define
them and defined them in a very interesting manner, because it puts it very
distinctly that the objects of the Council are to discuss at regular Conferences
matters of common Imperial interest, and went on to say : " and to establish
" a system by wdiich members of the Council shall be kept informed during
" the periods between the Conferences in regard to mattei's whiclf have been,
" or may be, subjects for discussion." Discussion at the Conferences is at
the root of the whole business. I venture to think that the point is of
importance, for this reason, that on the one hand, so long as we are dealing
with the question of the methods by which we may improve the machinery of
the Conference systomi, we are doing one thing, but as soon as we begin to
discuss any question of establishing a body with powers independent of the
Conference, we are doing a perfectly different thing. That second thing is a

37

new thing. It is not what we have have had, and I am afraid it woukl be
very difficult for me to agree, on behalf of His Majestj''s Government, to the
estabhshment of a body with independent status or avithority. It would be
contrary to the freedom and independence of which the Prime Minister spoke
at our meeting on Monday. Therefore, it was that we did feel with Canada
that there might be under a proposal of this kind, a danger to the autonomy
of us all — not only us here, but the self-governing Colonies as well. In the
self-governing Colonies, as with us, 1 neetl scarcely remind the members
of the Conference, the basis of all British government is the responsibility
of Ministers to their Parliaments ; not only, as here, our responsibility
to the British Parliament, but your responsibility to your Parliaments.
I venture to think that to do anything to establish a body that might
interpose in any way between Ministers and tlie Parliaments to which they
are responsible might almost endanger the liberties which ought to be
inviolate. I for my part find it difficult to imagine that a body in any way
independent of Ministers here or in the Colonies, established in this country,
could be in accordance with the principles to which I have referred. 1
know it is said that nothing executive is intended, and it is to be nothing
but advisory. I am afraid I do not think that that entirely removes tlie
objection. We have, even in private life, sometimes had experience of the
candid friend, the man whose advice we cannot avoid listening to, though,
perhaps, it does not always strengthen our hands in the process. I venture
to think that there would be a relative danger, but of course under all the
circumstances a much more important danger, in the establishment of a body
in any way independent in connection Avith these Conferences ; and I think I
may say for my colleagues that we all think Ministers must be secured in the
direct responsibility which they hold to their Parliaments.

There is another point which Sir Joseph Ward referred to, and which I
would just like to touch on for a moment, and that is that we already have a
constitutional link between the government of this countiy ami the govern-
ments in the Colonies through the Governor himself. I hesitate to say much
about that in the presence of my colleagues, who have had much greater
experience of the working of it than I have, but I do venture to say that the
Governor's position is an important one, and his influence is often very great,
if I may make one personal allusion, I speak from a recollection of chapters
in my own familj' history, and from my experience of the last eighteen
months in this Office. You must recognise I am sure, every one of you.
that we endeavour to send out to the self-governing Colonies men who are
of a standing and calibre to fulfil those duties. A change in the relations
here might make that very difficult, and there would be a danger, I think,
of the influence of the Governor being destroyed, or, at any rate, his
opportunities of influence restricted, and of course it would not be very difficult
to make the Service less attractive to men of ability and energy. T do not wish
to press that point in any way too far, but I think it is one worth bearing in
mind in the discussion of this question.

In what I have said hitherto, I have, no doubt, rather assumed that I was
speaking of what I imagine possibly might be the idea underlying the New
Zealand resolution as to an Imperial Council in place of this Conference. I
repeat that 1 do not think that that is practicable, at any rate in the
meantime ; I would not put it aside altogether. A time may come
when it may be practicable. I have dwelt on the importance of the
link of responsibility between governments and their parliaments. 1
can appeal to those here who have had experience of federations that
that is borne in mind when the federation itself is called into existence.
It is to a Federal Parliament that the Federal Government is responsible.
If we ever in future ages come to a federation of the Empire, Avhich is
a dream that men have entertained, it must proceed, I maintain, on the same

A 4SC68. C 3

Second L»n_v.
17 April 1907.

PuiiPOSED

Imteuial

CuINCIL.

(Cliiiiriniiii.)

11601

38

Second Day.
17 April 1907.

Proposed
Imperial
CorxciL.

(Chairman.)

principle, and whether the time will come when science and the inventor
may make that practicable — and one feels a doubt Avhether one ought to put
any limit to the triumphs which await science and the inventor — still,
at any rate, that is not a part of the discussion to-day, and we must deal
with the problems as we find them. I would only just say, therefore, that
with regard to this meeting I understand the Conference is, with practical
imanimity, agi-eed — I think I may put it as far as that — to accept the
designation of " Imperial Conference." I think, as far as I am able to speak
for His Majesty's Government, that we would be perfectly prepared to accept
that designation, and to allow the matter to stand as regards that branch of
the siibject, on that footing. I think that designation originally came fi"om
(Canada, and, therefore, I suppose I may assiune that Canada would carry us so
far. I think that can be taken as one result, but I should not like to limit the
resolution to that. The Prime Minister spoke with emphasis on Monday of his
desire for some means of "maintaining the impetus." This is really a discussion
of business relations, not quite on the same grade, perhaps, as the former part of
the subject, but still of immense importance. I should like, with all deference
to Mr. Deakin, to say that I am not prepared to admit that I am ashamed in
any way of the submissions which have been made to this Conference. It is
not only the Colonial Office, but every department, I think I might say, of the
British Government, who have been concerned in la^-iug before the Conference
what I venture to maintain are a remarkable series of papers. It has
been our business in the Colonial Office, of course, to co-ordinate and arrange
them, but we do not profess to take credit for more than it has been our duty
to do. What I hope is that the Conference will now, or, at any rate, when
the business of these meetings has been completed, feel that the Colonial
Office have done all they can to put the subjects before them orderly and
with full information, and will, so far, at any rate, express approval of the
efforts of my friends the Secretaries, who have been mainly responsilole in
this matter. But it is said that even if that is so this work is ephemeral ;
when the Conference is dissolved the organisation disappears and the tln-ead
is lost. I am not quite clear that I should even admit that altogether. I
think, in justice to my office, and in justice to the other offices of the British
Govermnent, that if you stiidy these papers — for instance, this paper laid
before you describing the progress of events — yoi; will find that a good deal
has been done on a number of subjects between the last Conference and tliis.
I am not in the least inclined to dispute that there would be an advantage in
more continuitj^ but I would say so under one condition, that I think that
any organisation established for that purpose must be under a responsible
head. We must remember that many, if not most, of the subjects which
come before the Conference are highly confidential. They are matters which
deal with information from official sources. If we advance so far as to
approach a remedy, that remedy must be obtained, either in this country or
in the Colonies, by the efforts of the legislature.

I may refer to some observations that have lieen made in the course of
this discussion with regard to the position of the Colonial Office. It has been
suggested that the Colonial Office should cease to be in communication with
the responsibly-governed Colonies, and should restrict its energies to the
Crown Colonies. No doubt at one time most of the responsibly-governed
Colonies, if not all of them, were Crown Colonies, and the change has come
gradually. To a certain extent that has been recognised in the Office itseK.
Within the last year we have been brought face to face with the fact that in
the Transvaal, and very shortly in the Orange River Colony, we have two
additions to the number of self-governing Colonies, and some re-organisation
of our office would be desirable, and we have had it under consideration. 1
do not know whether the Conference will call upon the Colonial Office to
provide for the continuity which it desires. If the Conference should so call,

39

T venture to reply that the Colouial DiFicc will do its liest to meet it. I cannot
answer the question as to whether the Conference will so act, but I should
not like to pass this opportunity of thanking Sir Wilfrid Laurier for an
expression of his opinion of the work done, and the spirit in which work had
been done by the Colonial OHice (hiring the long period of his experience.
It is a testimony which we value very much. I would venture on my own
part to say that my experience, so far as it goes, would certainly be in the
same direction, and 1 say that with the greater freedom because I am not a
permanent member of this Othce ; I am only one of those political will-o'-the-
wisps who pass tlii-ough it and have gone. I have found here, 1 am l)ound to
say, in the mendjcrs of the staff of this Office, an absolutely single-minded
devotion to the interests committed to their charge, and a determination to
deal with the affairs of the Colonies as they come to them without fear, or
prejudice, or favour.

Now, gentlemen, 1 say that if the Conference will allow us we are quite
prepared to undertake to do our best to devise methods for securing the
continuity which is desired. As I said, I have had this matter under
consideration, and I might, perhaps, have elaborated a scheme for
submission to this Conference, but 1 thought that on the whole it was better
not to forestall the Conference. I desire to get suggestions from the members
of the Conference, which I shall, of course, be only too pleased to take
advantage of so far as I can. Rut if the principle is accepted, further
conferences of, perhaps, a more confidential character, may take place
during the course of our proceedings, and the matter may be arranged.
If this could be done it appears to me that we should secure the greater
part, if not the whole, of the propositions put before us in the resolution
from Australia. If the Conference should lay stress upon any subject the
consideration of it would be early and would be continuous ; any inquiry
would be completed, and when the inquiry was completed, then the subject
would be fully prejiared with the fullest details, as Mr. Deakiu desires,
for the next Conference ; or, what I think is a suggestion which should
not be overlooked or disregarded, it might in many cases with great
advantage be dealt with, as the shipping question has been dealt with this
year — by a subsidiary conference which could meet with less inconvenience,
no doubt, to the Colonies and Colonial Ministers, but which, as that
Conference to which I have referred shoAvs, may have great results. The
Prime Minister called your attention to that on Monday.

I do not know that I can add very much, and I hope I have not detained
the meeting at too great length as it is. I have endeavoured to put frankly
before you the difliculties which his Majesty's Government Mould feel in
establishing a body independent of the Government of this country. May I
say one word with regard to the suggestion that this secretariat should be
tmder the Prime Minister. I have only to bear mj'^ testimony to Avhat Sir
Wilfrid Laurier has said as to the extreme strain which would l)e put on the
Prime Minister by such a course. I cannot think myself that it can be the
case that the business would be of small dimensions. I hope and believe
that the communications between ourselves and the Ciovernments of the
responsible self-governing Colonies wiU for long be constant, and that we
shall act in concert, and the more we do so, the more important it is that the
business shoidd be transacted in a large office where Ave can command lull
strength.

An observation Avas made, 1 think, by Sir Joseph Ward, with regard to
the opportunities that this system Avhich has been adumbrated miglit give
for communications between the Colonies themselves. I do not quite under-
stand AA'hy there should be a difficulty now. According to our ijresent
system, I think Avhen a subject arises between us and any one Colony, Avhich
may be of interest to others, it is our practice to forward the communication

C 4

Second Day.
IT April 1907.

PkhI'hsED

Tmpekial
CorxiiL.

(Cliairiimn.)

40

Second Day.
17 April 1907

Proposed
Imperial

coitncil.

(Chairiiiaii.)

to the others, and, as far as I know, there are inter-communications between
one Colony and another. I only say that as an explanation arising out of the
observation Sir Joseph Ward made.

I do not know what I can suggest as to the next step, as we have all
expressed our opinions on these matters, but whether we are at this moment
in a position to propose or prepare a resolution for adoption, 1 am not quite
sure.

Sir WILFRID LAURIE R : My Lord and gentlemen, as 1 understand
the discussion so far, upon the first point, that there should be .an Imperial
Conference, there seems to be practical unanimity. Upon the second point,
as to how it should be composed, that is the question next for consideration.
I take it that the Imperial Conference is practically a representation of all
the self-governing Governments to meet periodically with the Imperial
Government here in London. There may be some discussion and valuable
excliange of opinion as to how this Conference should be composed. I
listened with a great deal of attention to the suggestion made by Mr. Deakin,
and, I think, supported by Sir Joseph Ward, that whereas in the past these
conferences have been presided over by the Secretary of State for the Colonies,
the Prime Minister should be joined in order to affirm the fact that it is, as I
ventured to express it the other day, a conference between governments and
governments.

Next, as to what was originally the thought, that there should
be an adjunct body to sit here in London permanently during the
three or four years that the Conference woidd be absent from London.
This point is reduced now to having a secretariat. There is a good deal of
difEerence of opinion amongst us upon that. I have said, and I can only repeat
that I approach this subject with a very open mind. I have listened with
very great attention to the observations of my three colleagues, Mr. Deakin,
Sir Joseph Ward, and Dr. Jameson. They protest, and I am sure they are
quite sincere about that, that such a secretariat would not have any work to
do more than is implied in the word " secretariat," that it would not be an
independent body, but a dependent body. I know that is the intention. But
I cannot bring myseK to see how the organisation of such a body is to be
anything else but that of an independent body. Whom are they going to
advise ? Whose suggestions are they to receive ? On what authority are
they to act? What work shaU they do? What advice shall they give?
Shall they give independent advice ? What reports shall they make ? I can
conceive that a body of that kind might be instructed to prepare some
work here and there occasionally, but during four or five years they would be
here all by themselves taking the suggestions of nobody, so far as I can see.
It was suggested by my friends, Sir Joseph Ward and Mr. Deakin, that they
should be under the control of the Prime Minister, but even that I am not
satisfied is practicable. If Mr. Deakin can satisfy me that it is practicable,
I am prepared to listen to his observations, but at the present time I am not
convinced that this is a practical step which would meet with any substantial
result. On the contrary, I believe such a body would in the necessity of
things be always inclined to act independently, and I share altogether the view
of Lord Elgin that for the present no such body should exist, but that, on
the principle of responsible government, no one should give advice of any
kind except a man who is responsiWe directly to the people.

These are the views I have to present at this moment, and of course we
approach all these points in a confidential manner at this table, being ready
to exchange our views and receive suggestions. As Mr. Deakin and Sir
Joseph Ward have given a great deal of attention to these matters, if they
have any further suggestions to make, I, for my part, shall be very willing
to receive them.

41

Mr. DEAKIN : Lord Elgiu, the emphasis which you laid upon the Second Day.
assertion of the principle that you could not consent to the creation i" April iyi)7
of any body which should be independent of the Government of this ~"~

country is one which will be cordially re-echoed by every representative impekiai,'
from the self-governing colonies. We could take back no proposition more Council.
unpalatable to those whom we represent than one for the creation of an
auttiority which would have control over them and not be subject to their
control. No such suggestion was ever intended. Certainly it was never
present to my mind, and certainly it would be repudiated by our Parliaments.
I do not, however, quite apply the same doctrine as Sir Wilfred Laurie r
did. He, at all events, had not excluded it from Ids mind, when deaUng
with the question of the secretariat. Before coming to that second branch of
the subject, let me hope no remark that I made would bear one interpretation
which you appeared to think possible with regard to the submission of work
to this Conference. I have to say that the first Conference, so far as I am
aware, which has been in any way properly equipped, has been this Confer-
ence. You have been good enough also to add to the information supplied
some other information — I think at the suggestion of some of us — most
of it already complete, which is very valuable. I had not certainly any
intention of implying any defect on the part of the submissions to tliis
Conference under present conditions. The difficulty is that the result of those
submissions reaches us just as we are arriving or have arrived in this
country, and I candidly confess that with the best will in the world and with
long hours of wakefulness, and constant occupation, I have not yet been able
to read a single line of tliem. On coming to Loudon, especially after a long
interval, being met with the overwhelming kindness which all visitors
experience, and also met with a rush of official and business communications
of one kind or another, whicli liave been apparently suspended for the pur-
pose of constituting a shower when we arrive, it has been perfectly impossible,
at least so far as I am concerned, to give that valuable information the
consideration which it deserves. One of the objects of the secretariat is that
not only that the information should be obtained up to date, but that it should
be available at a time and in a place where it could be properly weighed and
criticised beforehand. I have no doubt as we proceed we shall be able to
make use of it.

CHAIRMAN : Of course some part of the information can scarcely be
prepared until the last moment.

Mr. DEAKIN : Some portion of it, Init it is necessary, if we are to come
here equipped for work, that it should be in our possession much longer than
these valuable summaries have yet been.

With respect to one allusion your Lordship made to this very interesting
paper, which is called " Notes upon the action taken pursuant to the resolu-
" tion of the last Colonial Conference of 1902," there is on page 2, the
resolution of 1902 quoted " That so far as may be consistent with the
" confidential negotiations on treaties with Foreign Powers the views of
" the Colonies affected should be obtained, in order that they may be in a
" better position to give ailhesion to such treaties." There is a statement
that a despatch was sent to tlie Colonial Governments, and a memorandum
on the means of facilitating such conunuuications is to be laid before the
present Conference. Wliat I should like to be informed, and am not informed
by this memorandum, is whether any treaties of any kind have been negotiated
since that resolution was carried, and, if so, did any communications pass
with any and which of our governments in relation to them.

42
SecDod Day. CHAIRMAN : Do you want an answer off-hand ?

17 April 1907.

Proposed Mr. DExVKIN : I should not object, but do not expect it. There

Imperial have been treaties. Afy memory, I think, recalls a Roumanian commercial
Council. treaty, and I do not recall from memory — being here absent from my
Office — any communication with regard to it, though I by no means assert
that no communication was sent or received. There are one or two other
treaties which I think have been negotiated since that date, on which I should
be glad to be supplied with information to supplement this interqsting paper.

CHAIRMAN : I am informed by the Secretary that treaties are sent out
in a general despatch.

Mr. DEAKIN : If I might have a list of the treaties sent out to us,
I should be obliged. Further in the course of his remarks. Sir Wilfrid
Laurier allnded to my suggestion of the Presidencj^ of the Prime Minister
at future Conferences. That is one of the conditions which appear to me
to be worthy of deliberation by this Conference, so soon as we pass from
the general question. It appears to me that this suggestion would raise
the status of the Conference ; it would place the Govei'uments represented
here in precisely the same position in every respect, and is therefore of
value and of weight. If the Prime Minister of Great Britain presided
either in fact or by deputy at meetings of future Conferences, there is no
doubt that greater prestige would attach to them where prestige is most
important, especiallj^ in the outlying dominions. That is part of the
proposal which we made as to ex-officio representation. It is not intended
in any way to ask for particular persons or in the least degree to reflect
upon any other members of his Majesty's Government. The Secretary of
State for the Colonies would no doubt b(; the deputy whom for most
purposes the Prime Minister would select. But if the Prime Minister did
not expressly select a deputy, perhaps the character of these meetings
would be emphasised by the adoption of the proposition which I think fell
from my friend on the left at the previous meeting, that the senior Prime
Minister present from over the sea might very fittiugly preside at some, at all
events, of the meetings of conferences of this kind in the absence of the Prime
Minister of this country, and perhaps in the absence of his immediate or
usual deputy. That, too, may appear to some to be a comparatively formal
question, but if it -were needed to convey by means of an object lesson to
the dominions beyond the sea a true perception of the generosity with which
we are treated liere, and of the footing on which the Government of this
country has always consented to meet us, I do not think any object lesson,
more expressive than that could be obtained. I do not dwell upon these
points as of importance in themselves, but the number of people who are able
to be impressed with an idea, or with a suggestion of a principle, only, or
most effectively, by some such means is great. I am sure the Secretaiy of
State for the Colonies does not suspect me of any other motive than that of
adding to the dignity and usefulness of this body.

••

The suggestion which I have the temerity to make as to the association
of the self-governed comnmnities with the Prime Minister, was, I felt fully
aware, open to severe criticisms, but it is recommended very strongly for
special reasons. It is a symbol ; it is a recognition parallel with, and exactly
of the same character as has be^n embodied in the phrase that this is a
meeting of governments with governments, or Prime Ministers with Prime
Ministers, as Sir Wilfred Laurier happily put it. Again, the idea passed

43

tkrough my mind, tlioiigli I have not endeavoured to work it out in detail, SucoikI Day.

that as this Conference was one of governments with governments its it April 1vm)T.

Secretariat is intended to represent all those governments. It should there-

fore be presided over, being in this countrj', by the Prime Minister of Great l'it'>i'"!<Ki>

Britain. I think it was again my friend on the left who put that. /V'.!'" V'

Dr. JAMESON : The Conference is presided over by the Prime
Minister, but the Prime Minister would not preside over the Secretariat.

Mr. DEAKIN : He must, according to my thinking, to this extent,
because the Secretariat is in this country and he is the Prime Minister of
this country and practicallj' the only Prime Minister always in this country.
Sir Wilfrid Laurier takes the practical point, that there must be a head, and
that with us means a responsible Minister, to whom this Secretariat should look.
Even if it were constituted on the plan which Dr. Jameson suggested, there
must still be some person to whom constant reference may be made, and
whose yes or no in the conduct of affairs is final. There must be executive
authority. If an office of that kind were established, the head of it could
only be the Prime Minister of Great Britain. He is the only Prime ^Minister
available for that pur230se. It would be an office of all the Governments, so
to speak, but as an office under the active executive direction, so far as that
is needed, of the Prime Minister himself.

Dr. JAMESON : Under him as representing all the others. You can
put it that way.

Mr. DEAKIN : That is matter of discussion. I am endeavouring to
reply to Sir Wilfrid Laurier's inquiry, at the same time appropriating my
friend's arguments ami suggestions.

Dr. JAMESON : The Prime Minister, as representing all the Prime
Ministers.

Mr. DEAKIN : He represents all the Prime Ministers, but he primarily
represents his own Parliament, and the Parliament of this country would
require to be satisfied that their Prime Minister's authority, so far as it went,
was actual and not nominal. There must be some authority over the
Secretariat, and the proper authority appears to me to be the Prime Minister
of England. I admit, with Sir Wilfrid Laurier, that the tasks of Prime
Ministers, even in outlying countries, are great. Sir Joseph Ward, Dr. Jameson,
and no doubt all round this table, Avould bear almost universal testimony that
none of us having experience of that office find the day long enough, or our
capacities for work equal to what we wish. But that is so in all communities,
and is only proportionately greater in the greatest of communities. Every
Prime Minister in every part of this Empire knows perfectly well that he or his
successor must be prepared, as the years pass by, to take more and more
responsibility. It becomes a matter of selection, putting some responsibilities
aside, and adopting others in their stead. The mere fact that a pi-oposal
means more work i'or an already over-burdened man, if that were the final
argument, would cripple our political development altogether. Lord Elgin
said with perfect accuracy that there would be, and in fact there are, a
great many connnunications passing l)etween the self-governing Colonies
and any central office in London. \\Tien I said there would be only a small
nmnber I meant a small number really calling for the personal attention of
the Prime Minister himself. As you, Lord Elgin, are aware, a great nimiber
of our despatches are requests for information or replies to requests for

44

Secoud Day.
17 April 1907.

Proposed

1MPERIA.L

Council.
(Mr. Deakiii.)

information, or deal with matters of that kind, which, so far as you are
concerned, need not reach you at all, except in the sense that you are satisfied
your officers do their duty.

CHAIRMAN : I think I made an observation with reference to that point
that it woidd mean the creation of a new office of considerable size.

Mr. DEAKIN : The idea we have of it would be that those matters
woidd still go to the departments which now deal with them. There is no
idea of appointing an immense secretariat to cope with them. All the depart-
ments of this Government would remain — the Colonial Office, the Foreign.
Office, the Board of Trade — and matters of inquiry and ordinary communi-
cations w^ould go to those departments as a matter of course. What I thought
might be attached to the Prime Minister personally were those despatches
which have respect to the exercise of the self-governing fvmctions of self-
governing communities, all great constitutional questions or matters involving
constitutional questions. Those happily do not arise frequently, and would
not therefore involve so great a tax upon his time as might at first sight
appear to be implied. As I said at the beginning of this discussion, I have
hesitated to speak at the length that the subject really demands, because I
thought we were rather approaching a general agreement to be followed up
by dealing with points detail by detail. I apologise for having taken so long,
but cherish these ideas believing they can be realised at once with great
profit and with a still stronger conviction that ultimately the development of
these Conferences is likely to be in this direction. I do not belittle the work
of the Colonial Office — it is simply gigantic — but the Colonial Office finds it
necessary to omit India. It was recognised to be perfectly impossible for
this Office to include the administration of that vast country- with its
enoirmous population. In the same way the Colonial Office must expect to
see the self-governing communities outgrow its capacity for control, which is
not capable of being indefinitely extended. I think the Secretary of State has
told us that he has as much work as he can transact at the present time, yet,
so far from the calls upon him diminishing from this great array of countries
whose names I see emblazoned on the outside of those wall maps, I know,
and we all know, that these calls are increasing, owing to the strides being
made in the development of those countries. I had the pleasure of reading
one speech of yours. Lord Elgin, and another by your able associate,
Mr. Winston Churchill, which conveyed to the people of this country and
our people some proper sense of the immensity of the great Crown colonies
of which w^e confess we do not possess much knowledge, any more than the
people here possess much knowledge of us. You have an enormous task of
administration tliere. But the successful administration of those Colonies
calls for methods of administration and treatment and begets an attitude
of mind, based upon presuppositions and preconceptions, which cannot be
escaped from but which do not at aU attach to self-governing states, which
are quite foreign to us, and give us a general sense of discussing a question
with persons wdio have already made up their minds upon it on another
basis altogether. Conseqiiently, I wish to say that it is no reflection to
say that this great department has already ample and growing work on its
hands apart from the self-governing communities, and that in course of time
it must expect to see those comnumities, first of all relieving the Department
by undertaking a good deal more for themselves, and next, by sending
their despatches to the Prime Minister, where they will not be jostled in a
Department over-burdened with administrative work alike and yet different
in character.

45

Sir JOSEPH WARD : lu reference to the resolution moved by New
Zealand, which appears to have conveyed the impression, as I infer from some
observations that have been made, that we wanted to have an Imperial
Council of an executive character, or with some autliority to act independently
of the British Government or of our own Governments, I would just like to
say that on receipt of the despatch from the Secretary of State for the Colonies
asking what resolution the New Zealand Government desired to submit, I
sent a raemorandiim to his Excellency the Governor without any resolutions
at all. I gave him a heading of the subjects that New Zealand thought
should come up here for consideration. My own view was that it was not
desirable to submit resolutions from our Colony, and it was only on further
application fi-om the Governor, requesting that it should be sent in the form
of a resolution, that 1 responded to it. I wanted to make that clear, because the
resolution I submit is " That it woidd be to the advantage of the Empire, and
" facilitate the dealing with questions that affect the Oversea Dominions, if
" an Imperial Council were established to which each of the self-governing
" Colonies could send a representative." I may say that in public utterances
of mine in my own country I have made it clear that such a Council would
be a Council of advice, and of advice only, and I have not suggested at any
time in our country that we should be responsible for the creation of an
Imperial Council which should have executive authority, because I am
personally opposed to it. I believe it Avould be an impossibility for us to
carry on satisfactorily our present system of self-government if any such body
were created with any such authority, between our Government and the
British Government. I do not wish the impression to go abroad that I
have proposed establishing anything of the kind, because I have not. In that
respect I wish to say that the criticisms of the general views put forth in
reference to the body that might be created in England, so far as I am
concerned, really do not apply, and I wish to add that the people in my
country are not favourable to such a suggestion.

Second Day.
17 April 1907.

PltOl'O^EU

Impekial
Council.

CHAIRMAN : I think I put it hypothetically. -^-3

Sir JOSEPH WARD : That is so ; but a hypothetical observation Avhen
seen in cold print might convey an impression that the Colony itself was
desirous of doing something which we are not desirous of doing,
to which I am personally opposed, and to which I have never been
favourable. Then I do not quite understand, and I should like to have
information upon it, what was conveyed by the Secretary of State for the
Colonies when he asked the question " will the Colonial Office provide for the
continuity desired ? "

CHAIRMAN : Will the Conference ask the Colonial Office to provide the
continuity ?

Sir JOSEPH WARD : Do you mean the expense ?

'■ CHAIRMAN : No. I mean that we should provide the organisation.
What I meant was that if the Conference approved we were ])repared to
prepare a scheme for providing the continuity which is aimed at in these
resolutions.

Sir JOSEPH WARD : As a permanency, do you mean ?

CHAIRMAN : Yes, as a permanency.

46

Second Day.
17 April 1907.

Proposed
Imperial
Council.

Sir JOSEPH WARD ; Then, I now quite understand the point. I only-
want to make it perfectly clear as I tried to do during the course of my
observations — and I was limiting my observations necessarily with a view to
having a preliminary discussion upon this matter — that, so far as New
Zealand is concerned, we have never had anything but the highest respect for
the gentlemen who from time to time have tilled the office of governor in our
countiy. We have found the governors sent out from time to time, men of
the liighest integrity, and their desire has been not only to help the Old
Land, but to help the land to which they have been sent as representatives of
the King. In that respect I am not suggesting for a moment a permanency
of advice as between the respective Prime Ministers of the self-governing
countries and the representative appointed by the Old Land itself. In regard
to the machinery that has existed up to now, we are not reflecting upon it in
any way whatever, and, last of all, I neither conveyed, nor have I ever had
any impression that the Colonial Office and the important executive officers
of the Colonial Office have done anything other than their duty in every
possible way and with the greatest possible satisfaction to the people
of our country. I do want to say, however, on that suggestion of Lord
Elgin, that, of course, I was aware of the system of communications being
forwarded to the respective governments, and also of their having the
right to communicate with one another. That is the case ; but there are
subjects upon which, under existing conditions, except privately or semi-
officially, I, for one, would not presiime to send a commimication to the Prime
Minister of another country. There are some matters which I think we ought
to have the right to confer with one another upon. Again, I am not finding
fault with the present machinery or system under which commxmications are
sent to our governments. Far from it ; but in our country there are matters
which crop up, which, in their general bearing, are of importance to ourselves,
upon which I want the opportunity and the right 1o have a consultation with,
or advice from, other Prime Ministers if I so desire. The all-important fact
exists that the present system is incomplete, and if a permanent Conference
is established, including the Prime ]\linister of England, we could be in
consultation with each other on matters of consequence to our countries
which are growing at an enormous rate, and which are so scattered. I wish
to make that clear, because I recognise the difficidties in establishing a basis
to create an Imperial Conference, and those difficulties have presented them-
selves right away in the course of this discussion. I want, as far as I am
concerned, to make it clear that I am broaching this question, not with the
object of being put upon my defence from the point of view of the present
work of the Colonial Office, because that is not in question so far as I am
concerned. On the contrary, I think they do the work in a way that no one
can reasonably find fault with ; but the point is rather the difficulties created
by our self-governing coimtries growing at such an enonnous pace, and,
there being a desire on their part to be brought into closer contact Avith each
other and wdth the Mother Land, and the real issue is can we establish some
permanent institution to enable us to discuss important matters of mutual
concern, and above all, for the strengthening of the Old World and the New
World too. So far as New Zealand is concerned, I wish at once to say that
whatever decision is arrived at as to how the work should be carried on in
the interval between Conferences, we are prepared to adopt any si*ggestion
made to bear our full proportion of the cost entailed.

Mr. DEAKIN : The secretariat will not stand on a popular basis imless
that responsibility is accepted. The contribution may be calculated on any
proportion you like.

47

Sir WILFRID LAURIER : The matter of cost can easily be decided.
The question is, whether such a bodj' as is contemplated would really be
conducive to efficiency for the carrying out of the objects we have in mind.

Mr. WINSTON CHURCHILL : Supposing a secretariat were established
you would utilise that as a machine for inter-colonial communication passing
between one Colony and another in which the Imperial Government were not
directly involved ?

Mr. DEAKIN : Yes.

Dr. JAMESON : And also where the Imperial Government is involved.

Mr. WINSTON CHURCHILL : Quite so ; but that would be one of the
functions of such body.

Mr. DEAKIN : Yes, a sort of nexus.

Mr. F. R. ]\IOOR : I have listened very patiently this morning, and it
seems to me that there is a considerable amount of dissatisfaction as regards
the want of continuity of the interest which obtains with respect to these
Conferences every four years. It is exceedingly interesting to have listened
to all the tentative proposals made here tliis morning, and I think we should,
perhaps, get a better purview of the whole position if Lord Elgin would give
us his idea of the machinery that he would suggest. We would then get a
general view of the whole position, and I think Ave could come to a conclusion
more intelligently after having all the proposals laid before us.

Second Day.
7 April 1907.

Proposed
Imperial

COCNCIL.

Dr. JAMESON ; I was going to suggest the same thing. Some of us
have adumbrated a scheme of our own which certainly has not met with
universal approval all round. You, my Lord, have not a scheme yourself, but
you have practically indicated to ixs that His Majesty's Government is in
favour of doing something to bring about continuity and making a link
between the Conferences. We are not talking about a link between the
Imperial Government and the Governments of the self-governing Colonies,
but a link between the Conferences. You have indicated that the Imperial
Government would be inclined to do that, and we have indicated a link — at
least, Mr. Deakiu, Sir Joseph Ward, and I have — by means of the secretariat
which we have ventured to sketch out. Certainly that has not met with
approval from Sir Wilfrid Laurier, and only a qualified approval £rom
General Botha. If you will help us with some idea of how the Colonial Ofiice
will be able to link up the Conferences, we will be able to get on further.

CHAIRMAN : I said at the beginning that I supposed after the
discussion, following the practice of other Conferences, some attempt would
be made to arrive at a resolution, and, therefore. I thought it my duty to
draft — purely for consideration, of course, — a resolution which I am prepared
to read. I may say that we base this on a resolution of the last Conference
with the necessary alterations. This is the draft which has been prepared :
" That it will be to the advantage of the Empire if (Imperial) Conferences
" are held every four (or five) years at which questions of common interest
" affecting the relation? of the j\lother Country and His Majesty's Dominions
" over the seas may be discussed and considered as between the Government
" of the United Kingdom and the Prime Ministers and Governments of the

48

Second Day.
17 April 1907.

Pkopo sed
Imperial
Council.

(Chairman.)

self-governing Colonies. The Secretary of State for the Colonies is
requested to arrange for such Imperial Conferences after communication
with the Prime Ministers of the respective Colonies. In case of any
emergency arising upon which a special Imperial Conference may have
been deemed necessary, the next ordinary confere]ice to be held not sooner
than three years thereafter. That it is desirable to establish a system by
which the several Governments represented shall be kept infomied during
the pei'iods between the Conferences in regard to matters which have been
or may be subjects for discussion, by means of a permanent secretarial staff,
charged, under the direction of the Secretary of State for the Colonies, with
the duty of obtaining information for the use of the Conference, of attending
to its resolutions, and of conducting correspondence on matters relating to its
aifairs. That upon matters of importance requiring consultation in common
either in this country or in the Colonies between two or more of the
Governments which cannot conveniently be postponed until the next Con-
ference or which involve subjects of a minor character, subsidiary Conferences
should be held between representatives of the Colonies and of the Mother
Country specially chosen for the purpose."

Sir JOSEPH WARD : I assume that in this resolution New Zealand,
now known by the term " Colony," will be included in the expression
" Dominion," which I think it ought to be.

Mr. DEAKIN : I think it would be advantageous if we could have that
in print and commence with it to-morrow morning.

Sir WILFRID LAURIER : I was going to make the very same
suggestion — that we should have it in print, so as to have the opportunitj''
of looking into it.

CHAIRMAN : We approach the hour for adjournment, and perhaps the
Conference would like to adjourn now and consider this resolution to-morrow
morning.

Mr. F. R. MOOR : Could we have a copy of that resolution before it
comes up to-morrow ?

Sir JOSEPH WARD : I beg to submit to the Conference the following
resolution : " That this Conference desires to express its regret at the death
" of the late Mr. Seddon, and its sense of the loss the Empire has thereby
" sustained." No words of mine are necessary to commend this resolution,
expressive of our regret at the demise of a great Imperial and Colonial
statesman. I am sure that will be the opinion of us all.

CHAIRMAN : Certainly.

Tills was carried unanimously.

Adjourned to to-morrow at 11 o'clock.

49

THIRD DAY. Third Day.
18 April 1907.

Held at the Colonial Office, Downing Stueet,
Thursday, 18th April «1907.

Present :

Tli(> Pti-lit, nonourable The EARF. OF ELGIN, K.G., Secretary of State

for the Colonics (President).

The Right Honoural^le Sir Wilfrid LlVURIER, G.O.M.G., Prime Minister
of Canada.

The Hononrahle Sir F. W. Borden, K.C.M.G.. Minister of .Militia and
Defence (Canada).

Th(> Honourable Ij. P. Prodeur, Minister of ^larine and Fisheries
(Canada).

The Honourable Alfred Deakin, Prime Minister of the Commonwealth
of Australia.

The Honourable Sir William Eyne, K.C.M.G., Minister of State for

Trade and Customs (Australia).
The Honourable Sir Joseph Wai:d, K.C.^I.G., Prime Minister of New

Zealand.
The Honourable L. S. Jameson, C.P., Prime Minister of Cape Colony.
The Honourable Dr. Smartt, Commissioner of Public Works (Cape

Colony).
The Honourable F. R. oMoou, Prime ^Minister of Natal.
General The Honourable Louis Botha, Prime Minister of the Transvaal.
Mr. Winston S. Churchill, M.P., Parliamentary Under-Secretary of

State for the Colonies.
Sir Francis Hopwood, K.C.M.G., Permanent Under-Secretaiy of State

for the Colonies.
Sir J. L. Mackay, G.C.M.G., K.C.LE., on behalf of the India Office.

Mr. H. W. Just, C.B C.M.G., V,^.„^ 5^,^,.^,,^^^^^^^^^^
Mr. (i. W. Johnson, C.M.G., )

I\lr. W. A. Robinson,

Assistant Secretarjj.

Also present :

Sir G. S. Clarke, G.C.M.G., Secretan- of the Committee of Imperial

Defence.
Captain J. R. Chancellor, D.S.O., R.E., Secretary of the Colonial

Defence Committee.

/; 1SG68. I)

50

0

Third Day. Sir WILLIAM LYNE : May I be allowed to ask a question ?

18 April 1907.

CHAIRMAN: Certainly.

Sir WILLIAM LYNE : Y''esterday I tried to listen to the discussion
which took place ; I could not hear it very well, and I want to know exactly
what my position, at any rate, is at the Conference. ' If it is to sit and listen I
might as well Ije somewhere else. I am sitting a long way away from my
Prime Minister and I cannot communicate with him when the discussions are
going on ; and what I want to know, Sir, is whether it would be out of order
if I, or anyone who desired to say a word or two upon any cpiestion, were
either to ask to be allowed to do so or to do so. There was a matter yesterday
\\-hich I did not understand was completed until I saw it this morning in
reference to the word "Imperial." 1 wanted to say a word or two about that
because I do not agree with it unless the word " Imperial " is explained
as to what its intended meaning is. All I want to ask you. Sir, now, is
exactly what position I hold at the Conference. I understood we were to
be full members of the Conference, Imt I did not feel I was so yesterday.

CHAIRMAN : I think. Sir William, you were not present when we were
discussing this on the former occasion.

Sir WILLIAM LYNE : I was, part of the time.

CHAIRMAN : What I understood — and I speak in the presence of my
ooUeag-ues — the position to be was this, that in future we would not maintain
the absolute rule which was laid down at the last Conference by which the
membership of the Conference was confined strictly to the Prime Ministers
themselves but that we would admit to the Conference Room freely any
Minister belonging to the Governments of the Colonies who accompanied
their Prime Ministers. They were therefore to come into the room and to be
entitled to sit at the taljle, l)ut I also suggested, and I think it was accepted
by the inembers of the Conference, that we shoidd continue the practice, that
their presence was to assist the Prime Ministers and that, therefore, it
depended on the subject under discussion which of any number of Ministers
in attendance should take part in the particular discussion, and that it shoidd
be an honouralde understanding between us that not more than one Minister
from each Colony should give assistance to his Prime Minister at one and the
same meeting. I think that correctly represents the state of affairs. If there
is anything in which I have not correctly represented it perhaps some one
will correct me.

Sir WILLIAM LYNE : Y'ou will see it is quite impossible for me to
confer with my Prime Minister, and, therefore, I cannot be of any assistance
to bini.

CHAIRMAN : With regard to places at the table, I am entirely in the
hands of the Conference, but as soon as any cpiestion came up on which a
Prime Minister wished to confer with his minister we would place him next
to his Prime Minister. I thought on this occasion as it was a question of the
constitution of the Conference itself it would be more convenient that the
Prime Ministers shoidd sit near this end of the table, but I am entirely in
your hands in that respect.

Sir WILLIAM LY'NE : I do not want to seem persistent, but the position
that I feel myself placed in is this : I am present, my mouth is shut. I have

51

to take iill the responsibilities of what takes place here, and I do not feel at ^^'"^..^.907
all disposed to do it under tliose conditions. "* ^P"

Sir William
Sir WILFrJD I.AURTEll: The position I took up was that the Prime Ltne.

Ministers should be assisted by their colleagues. That was inj^ view from
the first, and it is still my view. My view was that any Prime Minister who
had the benefit of ihe presence of his colleagues here in the city, would bo
very much more satisfied if he had the assistance of those colleagueb at tho
Conference.

Sir WILLIAM LYNE : I cannot hear.

Sir Wn.FRID LAURIER : I say that the position I, for Canada, took
up was that the Prime Ministers should have the privilege of l)eing assisted by
heir colleagues, that was my view from the first. J put it to the Conference,
but I did not press it to a conclusion as there seemed a difference of opinion
prevailing : but so far as I am concerned you are welcome to take part in the
proceedings as if you were the Prime Minister himself.

Sir WILLL4M LYNE : My feeling, if I may express it, is that I came
from Australia expecting to take part in this Conference to a certain extent.
I am here to take all the responsibility which I will have to bear, and the
records will show whether I am present or not, but I am not allowed even to
say two words, excepting it is a case where I miglit be asked to come here,
and I think it would be better not to take that responsibility unless I can sit
close to my Prime Minister, where I should have liked to be yesterday.

Dr. JAMESON : It seems to me, Sir William Lyne, that Lord Elgin has
explained that you have a perfect right, and I understood the Conference to
agree that the Prime Ministers would not on any particular occasion be
assisted by more than one ; but it is between the Prime ]\Iinister and the
colleague how much the Prime Minister should do, and how much the
colleague. We have admitted that the Prune Minister can have his colleague
talking upon one motion, so long as it is one only, as much as the Prime
Minister himself if he likes ; so that I think Sir William Lyne is really part
of the Conference and entitled to speak.

Sir WILLIAM LYNE : I am only a small part. I am not half of myself
quite.

Dr. JAMEISON : HaLE of your Prime Minister.

Sir WILFRID LAURIER : All these arrangements are temporary. We
are discussing the constitution of the Conference, and that is a thing to be
settled, which is before us yet.

Sir WILLIAM LYNE : I did not want to say much on any Init one or
two matters, but at the same time I wanted to know exactly the position I
am in because I do not want to get up and say anything and be called to
order. I desire to know beforehand whether or not I woidd be in order
if I wanted to interject something or speak. I do not know how to get by
my Prime Minister, but if I was able to talk to him at the table it would
obviate a very great deal of the objection I have. Sitting so far away from
my Prime Minister so that I cannot confer with him places me in a very
awkward position, a position I was never placed in before and I am not going
to be now.

D 2

52

Third Day.
18 April 1907.

Future
Constitution

OK THE

Conference.

Sir WILFRID LAURIER : I do not see auy objection to Sir William
Lyne sitting next to Mr. Deakin.

[Another member of the Conference was understood to say that both
Mr. Deakin and Sir W. Lyne could speak on any one subject.]

Sir WILLIAM LYNE : I do not like to disturb anyone, but I do not wish
to have a feeling without expressing it.

FUTURE CONSTITUTION OF THE CONFERENCE.

CHAIRMAN : May we proceed ? We came yesterday to the point at
which a draft resolution was submitted by myself and at the request of the
Conference it was circulated for consideration by the Prime Ministers before
this meeting. It will be for the Conference to say whether they would desire
to consider this in the same form as we did yesterday, that is to say in the
form of a general discussion, or whether they would now proceed to deal with
it more in detail, that is to say by the paragraphs into which it is divided.
I may have myself one or two suggestions to make with regard to the
different parts of it and I have no doubt other members will, but I
might perhaps be permitted to say this much at the beginning that
after the meeting I thought it desirable to inform the Prime Minister
as to the views expressed by, I think I may say, all the members of the
Conference, that it would be desirable that the Prime Minister of the United
Kingdom should be designated a member of the Conference, and I think it
may be satisfactory to the Conference to know that my right honourable
friend would not raise any objection to that course being taken if the
Conference should think fit. If that was done I would venture to suggest —
and I think it is better to mention it now, becaiise it carries out the idea —
that the wordiuff mi.a:ht be a little altered in order to make that effective.

and perhaps
" the

I

advantage

might

read the first paragraph.

That it will be to
of the Empiire if Conferences to be called Imperial
" Conferences are held every four or five years, at which questions of
" common interest affecting the relations of the Mother Country and His
" Majesty's Dominions over the seas may be discussed and considered as
" between Plis Majestj^'s Government and the Governments of the self-
" governing Colonies. The Prime Minister of the United Kingdom will be
" ex-oflficio President, and the Prime Ministers of the self-governing Colonies
" ex-officio members of the Conference. The Secretary of State for the
" Colonies will be an ex-officio member of the Conference, and will take the
" chair in the absence of the President, and will ai-range for such Imperial
" Conferences after communication with the Prime Ministers of the respective
" Colonies." That would give practical effect to the suggestion.

Sir JOSEPH WARD : Lord Elgin, would there be any objection to
commence this Resolution by affirming the desirability of establishing a
permanent Imperial Conference ? My own view, looking for\vard to the
work of regular Conferences, is that we should at this Conference give an
affirmative expression to the establishment of a permanent Imperial Con-
ference, and if you woidd agree (it is on the lines really of what is proposed
in the Resolution) I would suggest that we should commence it by stating
that " in the interests of the Euipire it is desirable to establish a pennauent
Imperial Conference."

CHAIR]\LAlN : What is the meaning of the word " permanent " ?

Sir JOSEPH WARD: The meaning of the word "pemianent" is to
affirm permanent Conferences at regular periods. There is no constitution

53

for a Conference; if it were possible to frame a Constitution by Avhich a 1 bird Day. ^

Conference could beset up the word " pennanent " would be unnecessary 18 April 190..

as the constitution itself would imply permanency. In the absence of a FtxtRE

Constitution I think we ought to affirm permanency or continuity in some Constititiux

way, so that at all events the pidjlic could imderstand that this is intended to ok the

bo a permanent Imperial Conference. I do not attach very great importance Cosfekesck.

to the actual word " permanent," but I think up till now it has been looked (Sir^

upon as a sort of irregular assemblage of the responsible heads of the Joseph ar .;
Governments of the different parts of the Empire, and in my opinion it is
desirable to state that it is a permanent Imperial Conference

Sir WILFRID LAURIER : Do you not think that is met by the new
draft ? Would you please read it again, Lord Elgin ?

CHAIRMAN: "That it will be to the advantage of the Empire if
Conferences, to be called Imperial Conferences, are held every four or five
years, at which questions of common interest affecting the relations of the
Mother Country and His ]\laje3ty's dominions over the seas may be discussed
and considered as between His Majesty's Goverxmient and the Governments of
the seK-governing Colonies. The Prime Minister of the United Kingdom will
be ex-ojjicio President, and the Prime Ministers of the self-governing Colonies
ex-offic'w Members of the Conference. The Secretary of State for the Colonies
will be an ex-officio Member of the Conference, and will take the chair in the
absence of the President, and will arrange for such Imperial Conferences
after coniniunication with the Prime Ministers of the respective Colonies. In
the case of any emergency arising upon which a special Imperial Conference
may have been deemed necessary, the next ordinary Conference to be held
not sooner than three years thereafter."

Sir JOSEPH WARD : Yes, I think that does carry it out cleaHy, Sir.
That is really a detinite proposal to have a permanent series of conferences
eveiy fouj- or five years ; that resolution, if passed, will, I think, meet the
point I have been urging.

Mr. WINSTON CHURCIHLL : You cannot have any higher sanction
for the Conference than the resolution of the previous Conference.

Sir JOSEPH WARD : That is so ; I am perfectly satisfied.

Sir WILFRID LAURIER : I am perfectly satisfied also with the draft
as far as it goes, as far as it has been read, that the Conference should meet
periodically ; but I would like to suggest, on the lines of the suggestion made
by Sir William Lyne, that it would be greatly to the advantage of the
members of the Conference if they coidd have the advice of their colleagues.
We come here to meet questions of general interest, upon which the Prime
Minister is quite able to talk for his Government ; but there are of necessity
questions of a peculiar character which are better dealt Avith by the
Minister of the particular Department concerned — for instance, questions of
war, cpiestions of navigation, and questions of emigration. I feel that upon
all these questions it is greatly to my advantage that I have my colleague, Avho
is the Minister of Militia and Defence, and my colleague who is the Minister of
Marine and Fisheries. I feel, also, the loss of my colleague, the Minister of
Finance. Those gentlemen come for the veiy purpose, and they can simply,
as we have done in the past, talk upon these peculiar subjects in which they
are more directly interested. But their position is rather awkward, because
they have simply to dance attendance, having nothing to do, although they
are qualified to speak more even than I am, and more than my friend,
Mr. Deakin, on the questions of their special departments. It is a position

4866S. D 3

Third Day.
18 April 1907.

Future

Constitution

OF THE

Conference.

(Sir
Wilfrid Laurier.)

54

which is somewhat unsatisfactorj' to them that in the meantime, as Sir
William Lyne pointed out, they have simply to fold their arms and do nothing.
Therefore the amendment I woidd suggest would be that the Conference
should be composed, as stated here, of the Prime Ministers, but with the
privilege (I do not like this word " Colonies " — the Govermnents of the
Dependencies Beyond the Seas) " to be assisted by a certain number of their
" colleagues." say not to exceed three, for instance. I would not like to make
the body unwieldy in its nimiber, and I would limit the number to three.

CHAIRjMAN : May I make a personal explanation, I did not mean in
any way to go back xipon what we had settled, and, therefore, the only thing
I dealt with here is whether they were ex-officio members. When I proposed
that it should be " discussed and considered as between His Majesty's
" Government and the governments of the seK-governing Colonies," I left it
entirely open what the rei^resentation of the self-governing Colonies as of His
Majesty's Government would be.

Sir WHjFRID LAURIER : The Conference should be composed ex-
officio of the Prime Minister of England, the Secretary of State for the
Colonies, also ex-officio, and then the Prime Ministers of the diiferent self-
governing Colonies ex-officio, with the further privilege for the local govern-
ments to determine the number of representatives they should send here, but
I would limit the number so as not to make the Conference unwieldy. If
there were five, or sis, or seven from each government, there Avould be too
large a party to sit at this Board, but if you were to limit it to a certain
number, I would suggest three, subject to amendment, and I think that
would obviate the diflicxdty wliich Sir William Lyne has indicated.

Dr. JAMESON : And that these Ministers should be actual members of
the Conference ?

Sir WILFRID LAURIER : Yes.

General BOTHA : With the right of voting ?

Sir WILFRID LAURIER : No ; I would only give one vote for one
government, but give the right to participate in all discussions.

ilr. DEAKIN : That diiiers from the arrangement adopted on the last
day — I forget on whose proposition — that Ministers should be always heard on
questions affecting their Departments and at other times, but not more than
two in any debate.

Sir WILFRID LAURIER: I do not mean it for this Conference,
!Mr. Deakin, we are settling now the Conference not for this time, but for the
future. We have made special arrangements for the present case, and this
proposal is not to come into force now. This is what I would suggest for the
future.

Mr. DEAKIN : I understand ; you propose a different procedulce.

Sir WILFRID LAURIER: Lord Elgin proposes: "Thai it wiU be
to the advantage of the Empire if conferences to be called Imperial
" Conferences are held every four or five years " (for my part I think
five years a very good period) " at which questions of common interests
" affecting the relations of the Mother Country and His Majesty's dominions
" over the seas may be discussed and considered as between His Majesty's

55

" Government " (I like this expression) " and the governments of the self-
" governing Colonies. The Prime Minister of the United Kingdom will
" be ex-officio President," and I would suggest, not with a view to
framing the resolution to-day, for consideration the point which we have
pressed on the Colonial Dlfice, but which they could not accede to at this
Conference, so as to obviate the difficulty put before us in a very strong way
by Sir William Ljme. I feel, and Mr. Deakin must feel also, the advantage
of having the benefit of colleagues here who are to discuss the questions
affecting navigation and affecting war. 1 miss, as I said before, the presence
of my colleague the Minister of Finance, but I do not like to bring these
colleagues of mine to London simply to be silent and to speak when called
upon.

Dr. JAMESON : I think Mr. Deakin is not quite correct in saying that
we consented at this Con Terence that colleagues should only deal with matters
affecting their own Departments.

Mr. DEAKIN : That is sul^ject to what Lord Elgin has already said.
Lord Elgin has already pointed out that any one Minister can speak with
his chief.

Dr. JAMESON : That would limit it very much as we might want to
bring in the Minister of Defence. I have not been able to bring the Minister
of Defence and I have brought the one who knows most about matters outside
that Department.

CHAIRMAN • For the advice which the Prime Minister wishes he must
make the selection.

Tilird Dny.
18 April 191)7.

KlTLliE
CoNSTITl'TIOV

OF THE
CoNKEKESCE.

(Sir
Wilfrid Laurior.)

Sir JOSEPH WARD : Lord Elgin, I should like to say that personally I
am desirous of seeing this Conference reasonably widened, but I think we
want to look at the matter dispassionately and to approach this subject a little
more cautiously. Taking the proposal of Sir Wilfrid Laurier, whose ^Ministers
I think ought to be here and upon matters appertaining to their Departments
should take the place of the Prime Minister in discussing them, that I agree
with entirely ; but if Ave are to have the principle established of up to three
Ministers coming fronx the self-governing Colonies, each taking part in all
debates, then ol;)viously you place the far distant countries at a complete
disadvantage. In the case of New Zealand it woidd be impossible for three
responsible Ministers to leave our country for the time we have to in order to
attend this Conference ; and if we want to have anything like uniformity of
procedure, then I think the original idea suggested as the outcome of the
former discussion that the colleagues of the Prime ]\Iinister who are here
should undeniably have the right to take part in discussing all matters
affecting their respective Departments, is the right one ; but personally, I woidd
ask for very careful consideration before we affirm the general principle for
the future government of the Conferences of having up to three Ministers
coming here and taking part in all discussions.

Dr. JAMESON : But not in voting ; it is one vote. We want the
best information we can get from any minister.

Sir JOSEPH WARD : "Yes, I concur that one vote is right, but 1 can
only say that in the case of New Zealand — and I am quite prepared to
subordinate my own views upon this matter to the general interests of the
Conference — undeniably we would be here with in all probability one
representative at the future Conferences and that one representative would

D 4

Third Day.
18 April 1907.

Future
Constitution

OF THE

Conference.

(Sir
Joseph Ward.)

56

have to do the best he could with the difficult and intricate matters
afEecting the various Departments that his different ministers control.

Sir WILFRID LAURIER : I see the force of what you say and I
realise, that in this respect, Canada has an advantage over aU the other
Colonies ; we are so near England ; we are next neighbours while you are
far away, and I see the force of your objection. I put it before the Conference
for reflection ; I do not want to have it disposed of to-day. These are matters
upon which I do not want to put anybody to inconvenience. I have put the
matter before the Conference and I would like you to think it over and
perhaps we can take it up at a later stage.

Sir JOSEPH WARD : I quite agree.

Mr. WINSTON CHURCHILL : It does not affect the substantive part of
the Resolution.

Sir WILFRID LAURIER: Not at aU. The new draft proposed by
Lord Elgin, so far as this part of the subject goes, satifies me completely. It
meets, I think, to a large extent, the views of Mr. Deakin also.

Mr. DEAKIN: Yes.

CHAIRMAN : Then we might pass it on the understanding that with
regard to the position and number of members outside the Prime Ministers
we reserve that point for later definition. I should wish just to say, as I
think I said befoi-e, that as far as His Majesty's Government is concerned,
we are delighted to see the Ministers from the different Colonies and to have
the advantage of the knowledge which they bring, but I did feel the point
which Sir Josej^h Ward has put, although I did not think it was for me to
raise it ; I felt that it probably would be raised and that is one of the reasons
why I did not attempt to deal with it in this draft.

Dr. JAMESON : Before we pass it, should we not define the nimiber of
years ; this four or five seems rather loose.

Sir WILFRID LAURIER : This is only tentative, but since Dr. Jameson
has brought that point forward it has seemed to me that even five years is a
very short period. You cannot meet here except at great inconvenience to
some of us, and it is difficult to find a date, but if the Conference think
differently then let the word stand. I suggested myself six years at the last
Conference.

CHAIRMAN : Three was also suggested, and four was taken as a
compromise.

Sir WILFRID LAURIER : Exactly.

CHAIRMAN : I understood one objection to the three or six^is that it
might interfere with the elections in certain cases ; there are triennial
Parliaments as was mentioned by Mr. Scddon.

Sir JOSEPH WARD : Ours is triennial.

CHAIRMAN : Therefore taking it by threes might interfere with the
elections and be an inconvenience.

57

Sir WILFRID LAURTER : Ours is five.

Sir JOSEPH WARD : The world is moving very rapidly and I think
five years would be a sufficient distance between the Conferences ; but I agree
with Dr. Jameson that it ought to be defined.

CHAIRMAN : Yes, that is only put in brackets, and you will observe
that in case of emorgoncy ami a special Imperial Conference special
arrangements would be made.

Dr. JAMESON : Cannot we propose it as five years now ?

Sir JOSEPH WARD : I would not offer any serious objection to five
years.

Mr. DEAKIN : I beg pardon, surely four years is quite long enough ?
It depends, of course, upon and is governed by several considerations, among
them the duration of Parliaments. In New Zealand and Australia, the
duration of Parliament is three years ; that practioallj' means in each case
that either a different Administration or an Administration that has appealed
again to the people and received their confidence would be present. This
period, so far as we are concerned, appears to meet the necessities of the
case. I am far from saying that this ought to govern the period, but
approach the question from that individual experience with the idea that the
meetings of this Conference ought to be rather fixed at their minimum. If
circmnstances arise, as they did in regard to this present meeting, which make
the term five years instead of four, that is a matter for the members of the
proposed Conference, and it can be so resolved, but I venture to suggest that
four years is quite a long enough time to permit, and indeed to call for a
review of previous determinations, if they can be dignified by the use of
that rather strong word.

A further question will arise presently with reference to the bridging of
the interval between Conference and Conference. Obviously, the greater the
interval the greater the difficulty of bridging it and the greater the strain. It
may be that if these gatherings become regidar in the future, if they are
efficiently connected one with another, the question of the time, as it would
be perfectly open to re-consideration at any moment, might come up again,
but for us at this stage, with the Conferences in their present rudimentary
position, with their uncertain influence, and with the many new factors which
may require to be taken into account, it appears to me that four years is
rather a longer than a shorter period than would be desirable. I believe,
Sir WiKrid, you have quinquennial Parliaments.

Tliir.l Day.
18 April 190:.

FtTLRE

Constitution'

OK THE
CONKEKENCE.

Sir WILFRID LAURIER : Yes.

Mr. DEAKIN : I can quite understand that under those circumstances
the longer period Avould haiTOOuise with your circumstances, but, in spile
of the great burden which attendance here imposes upon those who may
liai^pen to be in office at the time, I am inclined to think that four years leaves
quite long enough a gap, and that, save under special circiunstances, that
should be the regular time of meeting. I would rather make it less than
more, but certainly, so far as I am individually advised, not more than
four years.

Sir JOSEPH WARD
Conference ?

What was the resolution passed at the former

Third Day. CHAIRMAN : Four years ; it was a compromise.

18 April 1907.

~ Sir WILFRID LAURIER : So far as I am concerned, the point is not

CoxsTiTUTioN worth pressmg.

OF THE

Conference. CHAIRMAN : As far as His Majesty's Government are concerned, they

are only too pleased to see 3^ou at any time, and what weighed with us
was really the question of the great inconvenience to those who have to
come.

Mr. DEAKIN : It is a great inconvenience, but it has to be f&,ced.

CHAIRMAN : What do you say. Dr. Jameson ?

Dr. JAMESON: I am in favour of the shorter period; I agree with
Mr. Deakin about that.

Mr. F. R. MOOR : It has been aptly put, Sir, that we are here to plant
a seed which may develop into a tree hereafter, and I think the more closely
that tree is being watched and matured the better, and I vote for the shorter
period. In process of time we may find, as the world is developing so
rapidly, that four years is quite a long enoiigh time to elapse before calling
together again such a Conference as this. I therefore vote for the shorter
period.

General BOTHA : I have no serious objection against the shorter period
of four j'ears, although personally I think five years woxold suit me very much
better.

Sir WILFRID LAURIER : You will find in practice great inconvenience,
but I do not care about it ; the point is not worth pressing.

Mr. DEAKIN : The inconvenience is in a greater degree ours.

CHAIRMAN : Then shall we keep it four ?

Sir JOSEPH WARD : Yes ; in deference to the expressions of opinion
from the different members that I have heard I conciu'.

CHAIRMAN : Four years. We are no^v in a position to pass on to the
next point.

Mr. DEAKIN : " Questions of common interest," is perhaps as wide a
phrase as it is desirable to employ, because after all there is no such strict
restriction of common interest as to imply that each must necessarilj' affect
the interest of all. I merely mention this in passing, but the idea ^vith which
we used this phrase was that any qviestion which touches the interests of
more than one of the tlomiuions beyond the seas is a matter of oommon
interest and, further, that any matter which affects even one of those dominions
at a time, if it involves a principle capable of application to other dominions
is also a matter of connuou interest. I assume. Sir, that j^ou wiU take that
broad reading.

CHAIRMAN : I, certainly, myself, should not put a restrictive construc-
tion upon it to limit the force of the expression.

59

Dr. JAMESON: Referring to the words after "common interest" —
" afFectiug the relations of t\n.'. Mother Country and His Majesty's
" dominions over the seas," are those left out?

CHAIR^MAN : Xo. " That it will lie to the advantage of the Empire if
" Conferences, to be called Imperial Conferences, are held everj' four years, at
" which questions of common interest affecting the relations of the Mother
" Country and His Majesty's dominions over the seas may be discussed and
" considered."

Dr. JAMESON : That is the point, Tx)rd P'lgin. Is it necessary to limit
it by saying " affecting the relations " ? It goes without saying, of course,
that anything that happens to the Mother Country is of interest to every
individual nation over the seas. Why put in that limiting paragraph there ?

Mr. DEAKIN : Do j^ou propose to leave down to " the Mother
" Country"?

Dr. JAMESON : I should leave it out altogether, and say, " Questions of
common interest may be discussed and considered as between."

CHAIRMAN : It was taken from the old resolution ; that is how it
conies in.

Dr. JAMESON : I think the whole resolution might be improved upon.

Mr. DEAKIN : Certainly it is of advantage to shorten the resolution ;
that is one advantage.

Sir WILFRID LAURIER : What would be your draft. Dr. Jameson ?

Dr. JAMESON : It would be, " four years, at which questions of coimnon
" interest may be discussed and considered as between the Government of
" the United Kingdom and the Governments," and so forth.

Mr. WINSTON CHURCHILL : Deleting the intermediate words ?
Dr. JAMESON : Yes ; they are superfluous.

Sir WILFRID LAURIER : I do not see that there is any difference. It
is better phrasing, that is all — less words.

Dr. JAMESON : Yes, less words. I am always for the idea of limitation.

CHAIRMAN : " At which questions of common interest may be discussed
" and considered as between His Majesty's Government," and so on ; that is
agreed to. Tlie second sentence begins : " The Prime Minister of the United
" Kingdom will be ex officio President, and the Prime Ministers of the sclf-
" governing Colonies ex officio members of the Conference." The third
sentence is : " The Secretary of State for the Colonies wiU be an ex officio
" member of the Conference, and will take the chair in the absence of the
" President."

Third D»y.
18 April 1907,

FlTTCRE

Constitution

OF THE

Conference.

Mr. DEAKIN : I do not wish to take any objection to the proposal that
the Secretary of State for the Colonies should take the chair in the absence

60

Third Day.
18 April 1907.

Future

constitutiox

OF THE

Conference.
(Mr. Deakiii.)

of tlie President, except again to repeat the suggestion made yesterday that
this, instead of being an aljsohitely iron rule, might perhaps be expressed
less conclusively in order that at certain sittings where it might be thought
appropriate, the senior Prime Minister from one of theDominions over the seas
might have the compliment of presiding. I do not mean merely as a
formal compliment, but as carrying out the principle which has been so
gracefully accepted by the Prime Minister and the present Chairman of this
Conference. Put in this form I take no exception to it, except that it
appears to preclude the possibility of any other presidency than that of
either the Prime Minister of Great Britain, who certainly when present could
not give place to anyone, or his colleague, the Secretary of State for the
Colonies, who is certainly on the great bulk of the questions that will come
before such a Conference the proper person to appear as his representative ;
but need it be fi-amed so precisely ? Can we not put it in some slightly
laxer form which would permit of the Senior Prime Minister present being, if
it were thought fit or desirable, asked to occupj^ the chair by way of illustrating
the fact that this was a meeting, as has been expressed here, between

governraents.

I do not attach fundamental importance to it.

CHAIRMAN : May I say I have very carefully considered Mr. Deakin's
suggestion since he made it. I can only say for myself that nothing would
be more agreeable to me than to serve under the presidency of the present
senior member of the Conference, but I regard this simply as a matter of
convenience. It is quite common in all arrangements of life to have two
officers, one a President and another a Chairman, and I have specially avoided
the use of the word "Presidency" in this case, and said " take the "chair"
rather to put the Secretary of State in the position of the second officer of the
Conference, and for this reason I should be delighted to sit under the
presidency of my friend on the right ; but this is a question really of the man
who is to carry on tlie work ; he must make the whole arrangements for the
Conference, and the thing runs on that he shall do so, and I think, really, as a
matter of business arrangement, it is the most convenient thing that he should
be in the chair.

Mr. DEAKIN

I do not suggest otherwise.

CHAIRMAN : I do not in the least shut out the possibility. At the last
Conference, Mr. Chamberlain, for instance, was prevented by an accident from
presiding, and if such a thing happened to me to-morrow I think it would be
for the Conference to select their own Chairman.

Mr. DEAKIN : That is sufficient ; what I had in my mind was that
there might bo an occasion on Avhich the Prime Minister was necessarily
occupied elsewhere ; the Secretary of State for the Colonies might be
called for if he were a member of the active House to leave the Con-
ference. Under those circumstances I now understand that by this phrase
you leave it open.

CHAIRMAN : It may be left, as far as I am concerned, for the next
Conference to decide.

Mr. DEAKIN : There might be either no member of tlie British
Govermnent present, or simply the representative of some Dej)artnient, whose
subject was under discussion. What I wish to provide against in the most
considerate fashion is, that it should be implied from any statement to which

61

we commit ourselves that the Chairman must be any member of the British Third Day.
Government, and cannot be the senior Prime Minister. 18 April 1907.

CHAIRMAN : I do not wish to put that absolutely, but at the same time coxstitdtion
I must repeat my conviction that a member of the British Government would of the

be the most convenient man to choose. Coxfeeenck.

(Mr. Dcukiu.)

Sir WILFRID LAURIER : For my part, I must say that, according lo
the tituess of things, and according to what is accepted now, that this is a
Conference between Government and Govei'mnents ; the Chairman should be a
member of the British Government.

CHAIRMAN : I suppose this discussion Aviil Ije sufiicient for your
purpose, Mr. Deakin ?

Mr. DEAKIN : It is sufficient.

CHAIRMAN : Have we finished with the third sentence ?

Mr. DEAKIN: Would you mind taking that now?

CILVIR:\IAN : " The Secretary of State for the Colonies will be an
" ex-officio member of the Conference, and will take the chair in the absence
" of the President, and will arrange for such Imperial Conferences after
" coimnunication with the Prime Ministers of the respective Colonies."

]\Ir. DEAKIN : " Arrange " moans arrange as to precise date, arrange as
to agenda, arrange as to anything that may be necessary.

CHAIRMAN: Yes.

Sir JOSEPH WARD : Upon that, I assume. Lord Elgiii, that in
arranging the agenda a similar procedure to that followed on this occasion
would be carrietl out?

CHAIRMAN : Yes, I think so, unless the Conference suggest anything
else.

Sir JOSEPH WARD : That is all. I want to see the present method
followed, because we may have some suggestions to senil for the agenda.

CHAIRMAN : Certainly. " In case of any emergency arising upon
" which a special Imperial Conference may have been deemed necessary,
" the next ordinary Conference to be held not sooner than three years
" thereafter."

Mr. DEAKIX : Is this necessary at aU ? You have fixed the period of
meeting as every four years.

CHAIRMAN : It is in the old resolution.

Mr. DEAKIN : I believe it is, but, having fixed a definite period of four
years, which, of course, is subject to some variation if necessity arises,
and supposing a special Conference to be convened, is it not for that

62

Third Day. Conference to consider in the first place and afterwards for the Secretary of

18 April 1907. State to arrange with the Dominions over the Seas for the date of the next

meeting. What have we to do wdth three years or two years, or any fixed

DTURE period now ? How can Ave iudge now V

Constitution ^ j &

OF THE

Conference. Dr. JAMESON : I think it is useless ; I do not think it matters very

(Mr. Deakiii.) much, because if a special Conference was siuumoned that Conference would

decide whether it was necessary to meet again within six months or four

years.

Mr. DEAKEN : I do not think we gain anything by it ; it is simpler
without it.

CHAIRMAN : That these words be omitted. (Carried.) That disposes
of the first paragraph, and we proceed now to the second paragraph : " That
" it is desirable to establish a system by which the several Governments
" represented shall be kept informed during the periods between the
" Conferences in regard to matters which have been or may be subjects for
" discussion by means of a permanent secretarial staft' charged under the
" direction of the Secretary of State for the Colonies with the duty of
" obtaining information for the use of the Conference, of attending to its
" resolutions and of conducting correspondence on matters relating to its
" affairs."

Mr. DEAIvIN : As to the word " system " — " it is desirable to establish
" a system by which the several Governments represented shall be kept
" informed " — is that intended to cover all that follows, or does that imply
something more than the secretariat?

CHAIRMAN : I think we took it from the Australian resolution ; we
took as much as we could.

Mr. DEAKIN : Yes, but it has possibly a different complexion now.
I do not know that I can suggest any amendment. You have taken the
proposal that it is a system and you attach it then to the next sentence
" by means of a permanent secretarial staff."

CHAIRMAN: Yes.

Mr. DEAKIN : I do not know that this qualifies it.

CHAIRMAN : You want to make it a system ?

Mr. DEAKIN : Yes. The system is fixrther defined in the concluding
portion of the sentence, " obtaining information, attending to resolutions, and
conducting correspondence."

CHAIRMAN : That is also taken from the Australian resolution ?
Mr. DEAKIN: Yes.

CHAIRMAN : I so entirely agreed with it that I wished to foUow it.

Mr. DEAKIN : I am looking at these words in their present association,
in order to endeavour to satisfy my mind as well as I can at the first hasty

63

perusal whether there are any limitations implied in this connection, and I
must say I am luiable to discover them. Tlic one addition which is made
here is, of course, ol the first importance. 'I'liis is to be done by means of a
permanent secretarial staff nuder the direction of the Secretaiy of State for
the Colonies. That means, I assume, that the secretarial staff is to be part of
the Colonial Office.

CHAIRMAN : Yes.

Mr. DEAKIN : I do not know in what sense it will be separated, if
separated at all, or distinguislied, if distinguished at all, from what may be
termed the general staff of the Colonial Office, but T hope I shall not be
considered to be unduly jjressing the point if I refer once more to the fact
that in this great department the gigantic interests with which its Minister and
officers are charged in connection with those dependencies to which allusion
was made yesterday, great in extent and dense in population, impose upon
them serious and incessant responsibilities. To that I have already alluded
in brief, and have no wish to repeat myself, but in addition this department is
associated with methods of government, of administration, of relation to
legislative councils and similar bodies, partially representative, or in some
cases, wholly representative, but which are alwaj's merely advisory, I think,
in the case of Crown Colonies.

CHAIRMAN : Not entirely advisory ; they have powers of legislation.

Tliinl Diiy.
18 April 1907.

FUTUKK
COXSTITUTIOM

OF THE
CONKERE.NCE.

(Mr. Deskiu.)

Mr. DEAKIN : Yes ; but that power of legislation is always subject
to a veto and general control of a verj;- complete character. Speaking
in a familiar way, therefore, the whole tendency of the whole of this
department, and ol its olHcers, is to become imbued, both consciously and
unconsciously, with principles of government properly applicable to the great
countries with which they are dealing day by day and hour l)y hoTir, but
which are very foreign, aud in some cases almost antagonistic, to the
principles on which the affairs of self-governing Colonies are conducted, and
must be conducted. It promotes a certain strangeness in the manner of
address occasionally adopted in the arguments suggestetl to us and the
propositions for their handling, which wovdd not be made by those who
were continually associated with the methods of making law and administtn-
ing law in self-governing countries. We have always felt that we labour
under a disadvantage, which we are quite justified in mentioning, but of
which we can scarcely complain, because it arises so naturally and inevitably
that those most subject to it are very often those who are least conscious of
it. One requires to move in a different constitutional atmosphere, to cope
with pidilic business in free legislatures, and to view questions from their
standpoint, in order to appreciate a contrast which is continually being
brought home to us. The object I had in venturing the suggestion was that
it might be of advantage to the Colonial Office with its ever-gi-owing
responsibilities and certainly woidd be of advantage to us to have the
secretariat under this Conference and working in direct relation to it,
separated from those Crown Colony associations which I have described
and connected directly with some member of the British Government. We
look first, of course, to the Prime Minister, who himself is constantly dealing
with his own Parliament, with his own Chambers of legislature and throngh
them with the electors whom he represents and whose wishes he is able
to interpret by that experience. He is already head of the Committee of
Imperial Defence and not liis coUeagiie the Secretary of State for War.
We, of course, are aware that in the ^Minister who occupies the high ollice

64

Third hsLj.
18 April 1907.

Future
Constitution

OF THE

Conference.
(Mr. Deakin.)

of Minister of State for the Colonies we may obtain whetlier in one Chamber
or the other, snch a statesman, but even he, the longer his stay in the
oiEce may be, is more and more likely to be impregnated with the same methods
and the same associations. I do not wish to labour the point or unduly
elaborate it, but ventured to put it yesterday that it would be no loss to the
Colonial Office in one sense to part with the self-governing communities
whose major communications of a constitutional and important character are
few, and the great bulk of wdiose coi'respondence and despatches relate to
matters of administration that need never come xmder the purview of the
Minister himself. In their great issiies they do feel that the efhciency of the
Governments they are called upon to undertake woidd be assisted hj a more
sympathetic understanding both of the difficidties by which they are con-
fronted, and the means Avhich they must adopt in order to cope with them,
I believe it would be of advantage to us, and no derogation from an office of
this magnitude if it were to part wdth i;s. This it can afford to do and
yet retain a great part of the earth's sm'face and a great portion of its popula-
tion imder its control. Any proposal, therefore, which keeps this secretariat
associated with the Colonial Office will always be hable at all events to the
imputation, and will probably continue to furnish some evidence fi'om time to
time of the fact that there are grounds for that imputation, that it will not
approach us as we would approach each other in matters of that kind. If
Canada and Australia, or Australia and South Africa were exchanging
commmiications their attitude would be different from that often adopted by
this Office, but ours would be the same attitude in each case, because no
matter how far apart we are, or our objects or circumstances, our ends are
always sought subject to the same considerations and in much the same
manner. I do not wish to labour this, but assert that if you wish to give the
greatest confidence to this new secretariat, if you really wish to give it a free
hand and an opportunity of justifjdng itself — if you wish to dissociate it
from the prejudice or prepossession, which now exists, if you wish to see it
established in complete consonance with the principle laid down of govern-
ments consulting goA'ernments, I think it woidd be a distinct advantage to
have it from the outset severed fi'om this Department or any other department
of the kind. Only in its own atmosphere and in suitable surroimdings, and
if possible under the Prime Minister of Great Britain,
impoi-tant functions it will be called iipon to discharge.

detaining the Conference so long.

can it fulfil the
I ask pardon for

Sir WILFRID LAURIER : I certainly prefer this draft to any other that
has yet been offered to the Conference, but I must say I would not like to
express a definite opinion at this moment. It was imderstood yesterday when
this draft was proposed that we should receive it last night, but I did not
receive it imtil 10 o'clock this morning, and did not read it until I came to
this Office.

CHAIRMAN : It was sent to you yesterday at 3 o'clock.

Sir WILFRID LAURIER : Possibly, but I did not get it until this
morning. •

CHAIRMAN : I am in the hands of the Conference, if they wish to
consider it furtlicr.

Sir JOSEPH WARD : I would like to say, Lord Elgin, that while
I would not for a moment presume to piit my oar in and say how it

65

should bo arranged for internally in the Colonial Otltce, there should
certainly be a division of administration. If the self-governing Colonies
were separated from the Crown Colonies to a very large extent the desires
of the country I represent would be met. The matter is one for internal
reform or alteration of the methods carried out in the home Office. As
I said, I will not presume to suggest how tliat should be done. I think
the whole point might be met in this way. I recognise that the Colonial
Office in connection with the work of this important Colonial Conference,
would require to have a veiy great deal of control between the meetings
of tlie Conferences. I would suggest, however, in order to try and arrive
at the point Mr. Deakin is alluding to, that a portion of this motion be
altered. Instead of tying it down by resolution as to under whose direction
it shoidd he, strike out the words " under the direction of the Secretary
of State for the Colonies," and let it stand : " by means of a permanent
" secretarial staff charged with the duty of obtaining information for the
" use of the Conference." Then I take it that after the conclusion of this
Conference the Colonial Office might see its way to separate the adminis-
tration of the Crown Colonies and the self-governing Colonies ; and Avhoever
is charged with the duty of the secretarial work would be under the control
of a responsible Minister, say the Secretary of State for the Colonies. For
my part I think the point referred to by Mr. Deakin would in this way be
met. Tiiere is a natural desire on the part of the Governments of the
self-governing Colonies to have what one may term, a more distinct recog-
nition of what we are trying to carry on in our respective spheres. To a
very large extent what I want woidd be met if we were to get out of the
position of the self-governing countries of being regarded as on a par with
the Crown Colonies. I am not saying a word in derogation of the great
Crown Colonies —very far from it ; they may become as great or greater
than the countries we are referring to at the moment. It has application to
self-governing Colonies generally. I want to impress upon the mendjers
of the Conference that I feel this would be an improvement upon the
present system. We might perhaps arrive at a decision on this important
matter, so that we might go on to some of the other practical matters we
have still to discuss. I merely offer that suggestion with a view to leaving
the method of appointing a permanent secretary open, and the matter
w^ould then l)e under the control of the Secretary of State for the Colonies, to
do what he thought proper after this Conference adjourns.

Third Day.
18 April 1907.

l'"lTi:uE

CoSSTITlTION
OK THE

Conference.

(Sir Joseph
Wiird.)

Sir WILI'RID
improves it?

LAURIER: May I ask you to suggest how that

Sir JOSEPH WARP : I do not suggest that it improves it. I want to
leave it open.

Mr. DEAKIN': At all events, if you take out the words "under the
" direction of the Secretary of State for the Colonies," you postpone the
question for the time being.

Sir JOSEPH WART) : It would be then " by means of a permanent
" secretarial staff charged with the duty of obtaining information for the use
" of the Conference " V

Mr. DEAKIN : Yes.

A' 48(;i)S.

66

Third Day. Sir JOSEPH WARD : What I say is, supposing the Secretary of State

]8 April 1907. for the Colonies (I am speaking in quite an impersonal sense) and the Prime

Minister of England after Ave adjourn decide amongst themselves who was to

Future j^g ^j^g Secretary, who was to compose the secretarial staff, what office he is
o*F 'the' "'^ ^° '-'® "^' *^'^* ^^ ''' "liitter for the control of the Imperial Government. I leave
CoNFEKENCE. ^^ ^^ opcu cjuestiou ; I do not say it shoidd be deferred because the
secretarial staff is essential to connect these Conferences after we adjourn ;
but I wish to leave it an open question so that the Prime Minister and the
Secretary' of State for the Colonies may, as they think proper, select the staff
for the purpose of cariying on the business ; in other words, I think it is all
important in a matter of the kind that there should be unanimity upon a
decision of this character and if we could get it at present I think that it is a
desirable thing to do.

Dr. JAMESON : Lord Elgin, I quite agree with what Sir Joseph Ward
has said that this sentence ought to be left out : " under the direction of the
Secretary of State for the Colonies," not with the purpose of leaving it an
open question how the secretariat is to be formed, but with a view to forming
the seeretai'iat on a perfectly different basis. I am in absolute sympathy with
what Mr. Deakin has said on this subject. I think he used the words: "I
" look upon this secretariat as machinery really to make the Conference
" itself more efficient besides the linking up l^etween the two Conferences,"
and Mr. Deakin said he felt that if it was under the Colonial Office, perhaps
they would not get those preparations for the Conferences done in such a
sympathetic manner. I think he meant really in an "informed " rather more
than in a sjTnpathetic manner ; " informed " would be the better word to be
used. In the country we come from, I think my colleagues will bear me out,
that we have iinfortunately heen under the eye of the public for some years
and what we find is — I am not talking now really of Government Departments,
but of the public — that the difference between the opinion of the man who goes
out to a Colony on Colonial matters after he has had the local colour and
lived amongst them, and the opinion — and the acts, for that matter — ■
of the man who has been at home here and never visited the Colonies, is
enonnous ; and, therefore, in the preparation of the material for the discussion
at these Conferences we think we want somebody who is conversant with the
Colony and with the affairs of the Colony, and that is the reason of our original
l^roposal that the secretariat should be composed of people, at all events
approved, if not appointed, by the several Colonies and, of course, by the United
Kingdom. Of course, whoever was appointed by the United Kingdom w^ould
only, as in the Conference itself, take the position of the Chairman, if wanted,
or the local management of it, but what we feel is that that secretarial staff
should consist of people conversant with our affairs, appointed by the Colonies
and paid for by the Colonies themselves so that they feel practically it is their
own official at work at home. So that I would support what Sir Joseph
Ward says, that after the words " secretarial staff charged " the words
" under the direction of the Secretary of State for the Colonies " shoidd be
left out. Then it would read " charged wdth the duty of obtaining information
for the use of the Conference." Then I hope we would go into the constitution
of that secretarial staff' on the lines I have sketched out. ^

Sir WILFRID LAURIER : Do I understand you to mean that the
secretarial staff or secretariat shoidd not be under direct ministerial
responsibility here ?

Dr. JAMESON : It should be, as Mr. Deakin suggested, under the
Prime Minister. He, being ex officio the President of the Conference, would

67

be ex officio in charge of it also, as representing the Conference. That would Tbinl Day.
be my view. ii April 1907.

Sir WTT.FRTD T.ATTRTER : That does not answer my (|ticstion. Do T (;„j^stitutioh
understand that this body should not l)e under direct ministerial responsibility ? qk the

In this draft resolution it is proposed that tMs staff should be under the direct CusFKusnicE.

fljinisterial, responsibility of the Secretary of State for tl>e Colonies. (Dr. jBmesop.)

Dr. JA;MES0N : It certainly should be under the direct responsibility of
the Conference.

Sir WILFRID LAURIER : I differ in tntn from you. I think any
staff of that kind must be under the direct responsibility of a, Minister. This
is a conference between govenmients and governments, and here, if you have
a body which is under the responsibility of no one, neither the British
Government nor the other governments interested, the Colonial Goveroments,
you create a state within a state.

Dr. JAMESON : I really must say I do not follow you. It is certainly
under the responsibility of all the Prime Ministers of the Empire.

Sir WILFRID LAURIER : How wiU they control it when you are in
South Afi'ica, and I am in Canada ?

Dr. JAMESON : That has to be gone into ; but, as a matter of fact, ()u
the spot here it would be controlled by the Prime Minister here as representing
all the Prime Ministers of the Empire. As to details, all the Prime Ministers
of the Empire would be in commxmication.

Sir WILFRID LAURIER : So long as we are in England it is all right,
but if you have a secretarial staff which remains here when yoti, I, and
everybody else goes back to his own country, who is to control anil direct that
body in the meantime ?

Dr. JAMESON: For the third time I answer, the Prime Minister of
England.

Sir WILFRID LAURIER : If j^ou say it is to be under the direct control
of the Prime Minister here, I can understand it. Then it is under the direct
responsiblity of the Prime Minister of England, who is to direct it.

Dr. JAMESON : I say he is to direct it.

Sir WILFRID LAURIER : That is a matter for debate.

Dr. JAMESON : The other point you asked me about was whether it
shoidd bounder, or away from, the Secretary of State for the Colonies, but
I say "no," not under the Secretary of State, but the Prime :Mmister of
Engla^d as representing all the Prime Ministers.

Sir WILFRID LAURIER : I understood from the moment it was placed
before us by the despatch of ]Mr. Lyttelton, that the staff was to be an
independent body here, and under nobody's contro^, to represent nonunally
the Colonial Governments, but practicaUy to be so far a^yay from them as to
be virtually independent of that control. Lord Elgin proposes that it should

E 2

Third Day.
18 April 1907.

Future
Constitution

OF THE

Conference.

(Sir Wilfred
Laurier.)

68

be under direct Ministerial responsibility of tbe Secretary of State for the
Colonies. That is a very intelligible position. If you say under the direct
responsibility of the Prime Minister, that is equally intelligible.

Mr. WINSTON CHURCHILL: .May I say that it seems both
Dr. Jameson and Sir Wilfrid Laurier are agreed on the point that any
secretariat established in this cotmtry between Conference and Conference
should be under the authority of a responsible Minister of the British
Government.

Sir WILFRID LAURIER : That is my view.

Dr. JAMESON : Yes, the Prime Minister.

Mr. WINSTON CHURCHILL : The only question for the moment in
doubt is whether it should be the Prime Minister or the Secretary of State
for the Colonies.

Dr. JAMESON : May I add, again, in connection with the secretariat,
that it is the servant of this Conference, and should be under the control of
the Prime Minister in his capacity as President of the Conference.

CHAIRMAN : I have consulted the Prime Minister, and the Prime
Minister authorises me to say he does not see his way to agree to that
arrangement.

Mr. WINSTON CHURCHILL : From the point of view of the inner
working of the office, there would be an ahnost insuperable difficulty in the
classification of the different States and Dependencies of the Empire exclu-
sively according to status. There must be a geographical classification as
well, and it would involve a great duplication of machinery if separate
machinery altogether Avere to be set up in the desire to place the secretariat
entirelv under the control of the Prime Minister.

Mr. DEAKIN : Diiplication of interests I can quite understand. Mr.
Churchill's point is incontestable on that, since, supposing Australia is
communicating, no doubt questions affecting the Pacific would be raised,
l^erhaps touching Fiji, which is a Crown Colony. In the same way when
Sir AVilfi'id Laurier's Government is concerned, there Avould be many problems
relating to the AV'est Indies, which he would probably consider the interests
of Canada required should be veiy carefuUy considered. But the interests
overlapping in that way would not, I think, really complicate or duplicate the
work to any extent worth speaking of, because whatever questions are put
foiTvard would be as to the effect upon the self-governing Colonies of action
which is taken in their neighbourhood, whether in regard to Crown Colonies
or in regard to coimtries which are not CroAvn Colonies — perhaps coimtries
under foreign flags, or under no flag. I do not see that there would be any
duplication of work, though I fully admit the duplication of interests.

R. MOOR:

I have nothing to

saj"-, except that I take it that the

Mr. F.
concluding portion of this paragraph is sufficiently wide to cover all
information that may be oC interest to all the various Colonies concerned, and
that this information will be continuously supplied to these different countries
in order that interests may be constantly kept alive in the various industries,
that we are all concerned in. For instance, it would cover aU matters
concerning commerce, shipping, and the various other large concerns that

09

obtain throughout the Empire. If there is acoutinuous stream of iiifomiation Third Day.

flowing from this centre to these different Colonies, and always available not 1« April 1907.

only l)y the Governments of these dilYerent Colonies, hut by their Parliaments, ,

I can see considerable use for such a department as we are here trying to /-..j,^ ^ -^'"^

establish. Also I would like to know whether il would be possible under "\^^. t.,',^.'

this clause for any Colony having a particular interest at stake, and wishing C'csFKUExrE.

to bring it prominently to the notice of the Colonial Governments and the (il,. V. K. Moor.)
Home Government, to he directly represented on its staff by any nominee for
the purpose of hiying their case Ixd'ore the secretariat.

General BtyriLV: 1 have no j)arlicuiar ()i)jection to the article as it
stands. 1 think the link between the Conference and our Agents-General
should be strengthened and drawn closer, because these Agents-General really
represent \is here. They are sent over from our Colonies, and, in my opinion,
it wonld seem that they are somewhat left out in the cohl according to the
wording of this resolution. It occurred to nie whether it was not advisable to
insert after the words " Secretary of State for the Colonies " the following :
"acting in consultation with the Agents-general representing the Colonial
" Goveriunents."

CHAIRMAN : There are two sides to this question, I think ; one the
general proposition, and the other the actual method of working it out.
With regard to the general proposition, my proposal takes a step in advance
of what has hitherto prevailed, in providing a link between Conference and
Conference. We accept that i^roposition which has been put forward with
some persistence, if I may use the word, and has been strongly advocated,
more strongly advocated, in some quarters than in others. We accept the
principle, and must accept the principle, as I said in my speech yesterday,
under the condition of Ministerial responsibility, on which Sir Wilfrid
Lauricr has insisted. Therefore it comes to this, that following his
observations, in which I entirely agree, that .Ministerial responsil)ility must
be vested in the Imperial Government, because the representatives of the
Colonial Governments cannot be in this place. Therefore it is for His
Majesty's Government to determine how they can implement the desire of
the Conference, and secure the necessary ministerial rcsponsil)ility on which
the institution of this link depends. I think that there will really be no
difference of oj)inion on that statement of the case.

Now I put it to the Conference as almost a truism that each govern-
ment must really be left to decide in what way it is most con\'enient
for it to divide the business which is to be put iq>on it. It is dillicult enough
in this country, and I daresay you find it difficult enough in your t)wn
countries, to divide the business of the Government between the dilTeri'ut
ministers ; to provide for the necessaiy and not unnecessary nundjer of
members composing the Cabinet, and various things of that kind. Therefore
I venture to put it very respectfully to this Conference that they shoidd not
enter into the quesl;ion of how in the opinion of His Majesty's GovernnuMit
the ministerial responsibility is to be put into operation. That is a matter
which His Majesty's Govermnent must determine. If you accept our
j)roposition that we should with ministerial responsibility provide the link
which you desire, and which we think you rcasi)nal)ly d(>sire, between Con-
ference and Conference, you should allow us a fr(;e hand in other respects.
Still, in consequence of wdiat was said at yesterday's meeting, 1 did, as 1 say,
inform the Prime ^Minister of the expression of views which Mr. Deakin and
others made, and I am to say for him that he does not see how the Prime
Minister of this country could undertake the direction of the secretariat which
it is proposed to set up. On the other hand, the proposition which I put
forward I put forward on my own responsibility as Secretary of State
48(i(;8. E :?

Tliird Diiy.
18 April 1907.

FUTUKE

Constitution

OF THE

Conference.
(Chairman.)

70

for the Colonies, but with the assent of my colleagues, and 1 hope there-
fore that the Conference will give it at least as faA^ourable consideration
as possible. I do not propose nothing. I propose to do as much as
I possibly can to meet the desire. It is quite true that this Office has grown
considerably, and that the section of it which deals with responsible govern-
ments has not as yet been so clearly differentiated and defined as it may quite
naturally seem reasonable now that it should be, but which everybody will
understand was not at least as necessary in days gone by. I take considerable
responsibility upon myself, but I am prepared to say that we will endeavour,
I think we shall succeed, to so separate the departments of this Office that
you will have in the office in the form which we shall present it to you, a
distinct division dealing with the affairs of the responsibly governed Colonies.
I will not say it will be exactly apart, Ijecause there is, and miist be, at the
head, at any rate, a connecting link l)etween the several parts of any office,
but there will be one division which you will feel will be concerned with the
business of all the self-governing Colonies, and not directly with that of the
Crown Colonies. That is what I aim at. Whetlier I can carry it out to-day
or to-morrow, or at what particular time, I cannot promise. But if 1 can get
any suggestions from any of the Prime Ministers here, with regard to any
particidar arrangements whicli could he made still further to meet their
convenience we shall endeavour to carry them out.

I should just like — and I hope in the most friendly manner possil^le —
to a little demur to the " attitude " which I think Avas the word which
Mr. Deakin attributes to us in this Office. I do not think if we were happy
enough to have his assistance in the Office that he would find it really existed.

Mr. DEAKIN : I should become official too.

CHAIRMAN : At any rate tliat shows tliat the attitude has some
attraction, but I do hope that he wiU believe that we have no wish to be
dictatorial or to be uncivil or anything of that sort in the correspondence we
carry on with the Colonies.

Mr. DEAKIN : Too civil sometimes.

CHAIRMAN : 1 would just point this out. Mr. Deakin said that there was
a difference in the attitude of Canada, if he corresponded with Canada, to the
attitude if he corresponded with us here. As long as we are all members of
the Empire, I suppose the Lnperial Government may on certain occasions
have to use different expi'essions from others, but I assure Mr.. Deakin that
we do not wish to use them in any way to infi'inge the principle wliich the
Prime Minister laid doAvn, that is to say, the freedom and independence of the
different governments which are parts of the Empire.

I hope what 1 have said meets to a large extent what Sir Joseph Ward
wishes. I should prefer not to omit the words from the resolution " under the
direction of the Secretary of State for the Colonies " because it seems to me
we ought to be fair and square in these matters. I am not in a position,
speaking on behalf of His Alajesty's (_}overnnient, to offer more to this Con-
ference than I have offered. I venture to say, as I did at the beginning,
that I am ottering a great advance on former practice, and I am quite
aware that 1 am facing some difficulties in tlie matter, but I am prepared to
go as far as 1 have indicated.

With regard to what General Botha said, I should imagine that one of
the residts of the new arrangement that 1 have under conteinplation would be
to strengthen the getting of information, and the conununication of
information through the Agents-General or any other representatives of the
Colonies. I do not think, just because there is the difficulty with regard

Future

CoNSTITITIOK

iiF THE

71

to ministerial responsil)ility, that we can incorporato them (the Agents- T'''''"' ^"7-
General) in the system in the sense of l)ringiug them within the secretariat, •« April 1907
but that we wish to improve in every way our means of conunuuication with
them anil through them I tliiuk may stand without saying.

With regard to ^Ir. Moor's observations, I am not quite sure if I correctly „

followed them. I thiuk he asked for information on practically all subjects Confekknte,
such as commerce and the like. What this resolution immediately Ijciore us (Clminimu.)
deals with, are the snl)jects which have been or are to be discussed at a
Conference, and the secretariat is to deal with the Conference. Xo douht in
the organisation of the ollice, if it is re-organised in the manner I have
indicated, we shall be only too glad to do all that is in our power to further
the communication of information on all subjects through that part of the
Office to the self-governing Colonies, whether it ilrals with matters connected
with the Conference itself or beyond it.

Those are my views as far as I can form tliem un the spur of the moment
on the opinions expressed. I do not know whether Sir Wilfrid Laurier
would still wish to postpone a decision on this question, or whether we may
decide it now.

Sir WILFRID LAURIER : I am quite satisfied upon the ])rinciple
conceded, that what is done is to lie done on direct responsihility. That is the
only subject, as originally proposed, to which 1 demurred, because it seemed
to be the creation of an independent body. The moment it is recognised
here that it is to be under direct responsi])ility, I am satisfied. I am quite
prepared to accept the new principle, but 1 would not like to commit myself
immediately to the drafting of the resolution, which perhaps may be
improved. Before we go any further, I would like to call Mr. Deakin's
attention to that part which is taken from the ilraft sent by .Vustralia,
"Attending to its resolutions." \Vill Mr. Deakin kindly explain what he
means by that ?

Mr. DEAKIN : May I, without reiteration, say something wliich appears
to be necessary in the way of self-justiiication before answering Sir Wilfrid
Laurier's question. It must be due to my clumsy method of handling my
argiunent, but I appear to have conveyed my meaning so unfortunately as
to suggest to you, my lord, that I have been rudely reflecting upon this
great departnxeut. Of course, I do not speak without laremeditation, but
without a studied clioice of epithets. I should have preferred to handle this
subject without " brushing the dust off a butterfly's wings," if I could have
accomplished my object. I had to convey our sense of dissatisfaction, but
have failed, apparently, to explain its cause. May I sa\- that the dictatorial
attitude, which may be usually properly defended, so far as it exists, does
not, so far as my knowledge goes, exist at all to any notable extent.
That is not our complaint. Our complaint is not that we are treated too
peremptorily, but that representations of ours are met neither with an under-
stantlingof the real causes from which they spring or of our precise intention.
Our responsible and representative governments are dealt witli as you deal
with a well-meaning Oovernor or well-intentioned nominee council. Sutlicient
knowledge of our circumstances on many questions would show thai we
were expressing the sentiments of the great body of our people who have
considered some question or questions which directly and materially alTect
them, and regarding which they have formed strong and clear conclusions.
Our representations are met, as you are quite entitled to meet them if you
please, by an absolute refusal in some cases, or by a (]ualitied refusal in other
cases. With that we have not so much dispute as Avith the fact that we seem
to be refused, not merely upon inadequate, but upon inapprtipriate or unreal
grounds. The particular representations we make are not interpreted as they

E 4

79

Third Day.
18 April 1907.

Future
Constitution'

OF THE

Conference.
(Mr. Deakin.)

Ti'Oiild be if they had been expressed by representative members of the House
of Conunons, who, speaking on behalf of their fellow-members, give utterance
to what they believe to be the wishes of their electorate. It is that kind of
treatment we mean. I hope I am not to be tempted to justify myself, or to
attemj)t to justify mj'self, by giving illustrations of this kind of treatment.
There may be an appropriate time for them, but I doubt if it is just now.
The complaint we have to make is of an attitude of mind. A certain
impenetrability ; a certain remoteness, perhaps geographically justified ; a
certain weariness of people much pressed with affairs, aud greatty ovei'-
burdeued, whose natural desire is to saj' " Kindly postpone this ; do not press
" that, do not troul)le us ; what does it matter ? we have enough to do
" already ; you are a self-governing conununity, why not manage to carry
" on without worrying us ?"

Hoping I have removed any wrong impression, and if 1 have removed
misapprehension, may I say that your reply, Lord Elgin, auiounts to a non
possiimus — not that " We will not " but " We cannot." The Prime Minister
cannot see his way to accept the responsibihties which we were daring-
enough to suggest for him, and you cannot consider it fm-ther. In this case
too I, for one, do not — aud doubt if my friends will — question your right
to malve that reply. But, there again, I qiiestion the applicabilitj' of the
argument which you urge. You say no government is to be dictated to
as to how it shall do its business. Quite true. It must allot that business as
it pleases. Quite true. It will direct it as it pleases. Quite true. No one
suggested anything else ; but -what we did suggest was that oiir business,
so far as it can be distinguished fi'om yours, shoidd be recognised as our
business even to the extent of being paid for by us and discharged by a stafE
Avhich should, through your Prime Minister, be responsible to our Prime
]).Iinisters, and to us. We proposed to you a new thing — not any interference
with your present departments. We have no right to interfere, as you properly
said, with your department, or its divisions, or its methods. I quite agree.
What we have suggested is a new department altogether, with your Prime
Minister at its head, but a responsibility somewhat ilifferent in its origin, as
he would be acting not merely as Prime Minister of (a-eat Britain, but also
acting for all the other Prime Ministers of the Empire. We are prepared
to contribute to the cost of such a department and to pay for the officers that
they employ in order to have our business done. Therefore, though you
would be perfectly right iii. so replying to any one who did claim to interfere
with your business, surely Ave were not trespassing Avhen we suggested
something which is our business as well as yours, and which is to be at our
joint cost aud responsibility ; aud I think on that we were quite entitled to
be heard.

CHAIRMAN : Certainly, and I have heard you.

Mr. DEAKIN : Yes, but while not disputing your right to re])ly, I do not
think it applies, because our proposition was not to trench xipon your depart-
ment or present office, but that we should have a voice in and share the
cost of a new department, Avhich wo^dd be in a sense a joint department,
though under the ministerial direction of the Prime ]\rinister of England.
I hope I have removed any misapprehension on that point. ,•

CHAIP^IAN : I do not quite accept the whole of your argument.

i\Ir. DI'JAKIN : You will also agree that we liaA-o not to accept the
applicability of your reply, which, though reasonable enough in its terms, is
inaii]3]icable, liecause we are not making, and have not made, any such
request as that wliich you have felt laound to decline as if it had been made.

73

Xow, tho suggestion made l\v General Botha appeared to me to be Third Day.
bound up with th(> proposal which some of us have been recommending. 18 April 11)07.
Our idea was that the Prime Ministers at the head of the various Govern- - —

uients would act tliruugh tlicir Agents-General in making such representa- (_'„n8titl"ti«ix
tions as they cliose through such a secretariat. If it had been a joint ok tke

department, and a joint secretariat, such as tliat 1 have been descriliing, Conkhrkxce.
to w'hich wc all conlributed, and in regard to which we had some voice as (Mr. Dcakin.)
to the selection of olliccrs, the Agents-General would have had the utmost
freedom, the fullest riglit and title to enter the ollice to connnunicate with
it and use it when representing their Prime ^linisters. Both they and it
wouhl be agencies of their Governments. For that reason I cordially
support the practical suggestion made l)y General iJotha, which 1 have no
doubt will be given effect to whatever the decision as to the secretariat
may be, though it woidd have been expresslj^ provided for if our idea
had been accepted. Even when this proposed secretariat, instead of being a
joint body, is to be part of your Colonial < )frice xuider your direct control,
there will he an open connnunicatiou from the various Governments through
their Agents-General.

CHAIRMAN : T said so.

Mr. DEAKIX : Exactly. Our suggestion was based on the assumption
tliat it would be so. In the same Avay, the question put by the Premier of
Xatal is also answered. Our proposition implies the widest and completest
freedom on the part of any Prime Minister to propose matters for investiga-
lion and preparation by the secretariat. On that, also, I have no doubt he
will receive a satisfactory assurance from his Lordship. In addition, it is
])lain that the answer to his question was also supplied by the proposition
wo have been submitting, whicii would have given every right and title
to obtain every kind of information. I may be pardoned, perhaps, for
making tliese connnents before replying to the enquirj' put by our senior
member. Sir Wilfrid Laurier.

I have taken out a list of the resolutions passed at previous Conferences,
some of which appear to have been pursued a short way, and one or two of
which I think have been scarcely pursued at all. If such a secretariat as
we proposed had been in existence, when any resolution was arrive(l at by
any Conference in relation to a particular suljject, the duty of that
secretariat would have been to l.)ring that matter to the notice of all th(>
(l(>partments concerned— the Board of Trade, the Admiralty, or whatev(>r
blanches of the British Government might l)e affected— and also to connnuni-
cate with the several Colonial Governments affected, either to ask them^ for
information or to present them with the information it had collected. The
duty of the secretariat would be to take care that a resolution should not
remain a dead letter, but should l)e followetl up to its fullest extent. Any
Prime Minister who was not satislied with what was ilone would connnuni-
cate, eitluM- with the Prime .Minister who started it, or those who agreed with
it, and would again apply to the secretariat contending that certain inronna-
tion supplied was defective, or that certain action indicated or requested had
not l)cen followed. He would say that his Government would take action
or declined to take it, as the case might be, and he would ask to l)e.
informed if other Governments had acted upon it, or not. The secretariat
ought to do whatever is necessary to keep the resolutions alive initil they
were linally disposed of to the satisfaction of all Governments concerned.

Sir AVIT.FRID LAURIER : I am quite satisfied with that reply as to the
meaning of the words I asked about.

-'o

74

Third Day.
18 April 1907.

Future

CONSTITDTIdN

OF THE
COKFEREXCE.

]\Ir. WINSTON CHURCHILL: On the point of payment for the
secretariat, I imderstood that there was a general agreement upon the
assertion of the paramount . responsibility of some minister of the British
Government with regard to the control of snch secretariat. I cannot help
feeling that that would be very much impaired if it was a secretariat supplied
and financed from a joint fund. I am quite sure it would undoubtedly weaken
the control and authority of the minister presiding over the department if
that department was suppHed and financed from a fund collected from a great
many different contributory bodies.

Mr. DEAKIN :• That is quite a fair criticism from my point of view,
except that it must be rememl^ered that the functions of this particular
Department are strictly regulated. It is a small secretariat \vhich is to collect,
receive, and distrilaute information, answer inqiiiries, and follow them out.
Therefore, the only ministerial control reqiured is office management, seeing
that the officers are doing their work, and for that the head of the Department
would l3e responsilile. Our secretariat would have had no executive or any
other kind of power. It would have been a collecting, collating, analysing,
tabulating, and distributing medium.

Mr. WINSTON CHURCHILL : But you would give the head of the
Department administering it power, for instance, to dismiss a member of the
secretarial staff with whom he was dissatisfied ?

Mr. DEAKIN : Certainly.

Mr. WINSTON CHURCHILL : But if you took a different view with
regard to the conduct of that member ?

Mr. DEAKIN : He would have the right of appeal.

Mr. WINSTON CHURCHILL: But the Colonial Govermnent which
took a particular interest in that member, or felt that he had a special reason
or claim to speak on their behalf, might take a strongly different view from
the Home Govermnent in regard to the member's position, and the fact that
they contributed actually a portion of the fimd out of which he was paid
might lead them to assert in a very definite form that division of authority
which you all seem anxious to avoid.

Mr. DEAKIN : I do
head for office purposes.

not think that would occur. There must be one

Dr. JxVMESON : As we said before, the Prime Minister in charge of the
secretariat would represent all the other Prime ilinisters. It is very natural,
if we pay towards the upkeep of the secretariat, to choose some one, in the
absence of the others, to take charge. That is a different position from that
of the Secretary of State for the Colonies, who, of course, is entirely concerned
with the Imperial Govermnent. Mj'- own view was not so much as to the
question of which department of the Government it should be under, but I
was anxious as to the knowledge of the people who fonn the secretariat.
My great point is, that it should be composed of people well informed in
Colonial affairs, and I hope Lord Elgin Avill take that into accouot when he is
forjuing the secretariat, and then I shall be quite satisfied.

Sir JOSEPH WARD : I would
stand from the observations you have
imdertake this duty.

like to say, my Lord, that I under-
made, that the Prime Minister cannot

GHAIRIMAN : I do not think he can.

C'iNKEUEXCE.

75

Sir .lOSEPfl WARD: I imdcistaiid ihat, and also agree that it must Ti,ird Day
he under direct ministerial eoutrol. We all recognise that should be the case. ,j< ^ j, y^^-

Upon the point referred to I)}- Dr. Jameson, may I suggest that I think -

It would be very vahia])le to the t'olonies and also to the Colonial Futuee

Oliice, il' when the secretarial staff is formed, you recognised the importance Constitdtion
of allowing someone connected with that staff to spend some time out ,, ^*' ''"''

in our (Jolonies, if <jnly for the purpose of obtaining information, upon ' ""'"

the methods of carrying on your Inisiness with us, as, on the spot, a
capable officer would get a useful insight into the work and system of
administration of our ( ioveniments. That is a very imixjrtant matter, and
if the suggestion were carried out it would adtl invaluably to the working
of the C'olonial Office at home in connection with the Colonies. Speaking
for my own country I think it would be a matter of very great importance
if such a tiling could he done. In view of the very important statement
made by Lord Elgin as to division of the self-governing and Crown Colonies,
1 have only to say that I very heartily congratulate him and the Conference
upon it. We have his assvirance that he proposes to divide the Administration
of the Colonial Office in such a way as he may think best in his own
De])artment, so that the self-governing Colonies will be treated separately
from the Crown Colonies, and fi-om my point of view 1 regard that txs V(^ry
important. I am veiy glad indeed to find that Lord Elgin concurs in
Avhat I have previously said. In our countries, we consider it of the first
importance in the achninistration of our affairs that from time to time
must come to the Colonial Office. I suggest that the Prime Minister and
Secretary of State for the (^olonies should confer as to what should ])e
done in regard to the secretarial staff. I do not seem to be quite in accord
Av'ith some of my colleagues upon that point, but I should be quite content
with the already important steps we have achievetl towards the continuitv
of the Conference and the creation of a link to be kept up during the period
of four years between meetings, and i think it would be a very great pity
that any difference of opinion should prevent us coming to a unanimous
conclusion on the matter. Umler the circumstances, I shall support the
pi"oposal as it is, and shall look forward to it working out with satisfaction
to all concerned.

I am very glad to know that the important men who carry on the
representation of our countries here — our High Commissioners and Agents-
Ceneral — will l)e recognised as being a medium, at all events, through which
the Colonies may frcnn time to time niake representatit)ns that will be heard,
as they always have been so far as my experience has gone, at the office of
the Secretary of State for the Colonies, in connection with this Imperial
Conference on matters we desire to bring forward.

CHAIRMAN : One of tlie first meetings i had in ihis room was with the
Agents-General of all the t'olonies, anil I specially asked, if they had any
business at any time to bring forwarti, if they would be so good as to let mo
kncv.'.

Sir JOSEPH WARD : I think, Sir, they have the most cordial feeling
towards you, so far as 1 know.

Mr. DEAKIX : Do you propose to omit these words " umler the direction

of the Secretary of State for the Colonies " ?

Sir JOSEPH WARD : No, I propose to leave them in.

0

CHAIRMAN : It is not from any wish to aggravate my office or positicni,
but it seems to me the resolution defines what we are going to do, and it puts

re

Tliiid Day.
18 April 1907.

FUTIKE

CONSTITUTIOX

OF THE

Conference.
(Cliairnian.)

the resjiousibility definitely on my shoulders to
Conference.

(;arry ont the wishes of the

Dr. JAMESON : As I was one of those \Yho objected to it at first, I
should like to say that as I want something definite I quite accept the position
as it has been explained, and I suggest that the words remain in, though I
must say, that I think we have been quite right in giving our opinions. I
now suggest that we pass it as it stands.

Mr. DEAKIN : Shall ^\'e know no more with regard to the policy you
propose to pursue, than the general statement you have made as to some kind
of separation in the Colonial Office ? In this connection too there is the
question of the reorganisation of the Colonial Office.

CHAIRMAN
we pass this.

We will take that separately immediately afterwards, if

Mr. DEAKIN : Sir Joseph Ward has also called attention to it.

CHAIRMAN : What we propose to take is first this matter, and then the
question as to the Imperial Defence Committee, if there is time.

Mr. DEAKIN : So great is our need of securing the local knowledge
of your officers that T have been contemplating the abduction of l 'r Francis
Hopwood ever since I have been here, with the object of turnin/ " ''m into
a citizen of the Commonwealth for a few months so that he may] -stand

rmu

our difliculties for the future.

Sir FRANCIS HOPWOOD
invitation.

I shall be very glad to

ftpei

fent ^t
Id the
(h he

your

Mr. DEAKIN : If your Ministerial Chief endorses that we will consider
it as giA'en and accepted on the spot, and for any time.

Sir JOSEPH WARD : I hope Sir Francis Hopwood will understand that
the same applies to New Zealand.

Mr. DEAKIN : I trust you will not think me unduly insistent, but must
say with regard to the establishment of a secretariat that above all, if it is
to be a part of the Colonial OlHce, and yet have a distinct character, it will
require distinct and separate knowledge which can only be gained by living
in the country, and being associated with it. Our own experience when we
come here is quite sufficient to teach us how very dilTerent familiar names
and familiar things are in this country when compared with our own. A
similar experience, I am sure, would await any member of your staff. Even
if he were the alilest, the most gifted, and best-read person in the»country,
he would iind that your names, phrases, and forms have their distinct
development amongst us. Before passing from this point let nie venture
to remind you that no secretariat in the Colonial Office will give us that
satisfaction which I am sure you desire, unless some of its important officers
are in touch with the self-governing Colonies with which they have to
deal ; and that this touch can only be obtained by personal acquaintance
with the Colonies.

77

CITAIRALVN : Of course if it means a permanent arrangement for certain
members of the staff of the Colonial Ollice Ijuing in the Colonics, it will mean
an increase of the staff for which I should have to apply to my friend the
Chancellor of the Exchequer.

Mr. DEAKIN : That might ])e avoided by the proposal to send you one
or two of our leading men for the time lieing to be employed by you iu order
to understand the mysteries of this department.

Third Day
18 April 1907.

FfTUKE
CONSTITITION

or THE
CONFEKENCE.

CHAIRMAN : That is a thing which would have to be threshed out in
detail, and I should not like to express an opinion upon it just now.

Sir WILFRID LAURIER : This secretariat means the creation of a
new^ department Avhose l)usiness it would be to deal with the self-goveniing
Colonies or Dependencies of the Crown, or, as they are termed " Dominions
beyond the sea," and I think the suggestion which has been made that the
secretary or one of the staff should visit the different parts of those Dominions
is an excellent one.

CHAIRILVN : We have tried it, but there is one unfortimate result, and
that is we lose our best men because you retain them ; I think, however, this
point is one which we coidd scarcely discuss very usefully further than
this. We notice your wish and w'ill consider it.

Mr. DEAKIN : We have iiuished our consideration of this resolution
down to the w'ord " affairs."

CHAIRMAN : I understand it is adopted down to the word " affairs."
The other paragraph is : "That upon matters of importance requiring con-
" sultation in common either in this country or in the Colonies between two
" or more of the governments which cannot conveniently be postponed until
" the next Conference or Avhich involve subjects of a minor character, sub-
" sidiary Conferences should be held between representatives of the Colonies
" and of the Mother Countrj^ especially chosen for the purpose." I do not
know that I need not amplify that. It seems to me to speak for itself.

Sir WILFRID LAURIER : So far as I am concerned I think this is
perfect, but it is a mere matter of course, and I do not see why you shoiUd
put it in. It is a matter which would always be done as a matter of course,
and I do not see any advantage in putting it here.

CHAIRMAN : It is only put in in order to cany out tlie principle of
working it out as much as possible. The secretary suggests that after the
word " character " wo might put in " or such as require detailed considera-
tion." For instance, the Shipping Conference we could scarcely have carried
on at this Conference.

Mr. DEAKIN : That is not a matter of a minor character.

Sir WILFRID LAURIER : It is all quite proper, as I say, but I do not
see the necessity of putting it in this form here, because it seems to me to be
over-burdening a veiy good resolution.

Mr. WINSTON CHURCHILL: The resolution really constitutes one of
the instruments of Imperial organisation, and from a public point of view it

TUiid Daj.
IS April 1907.

Future
Constitution

OP THE

Conference.

(Mr. Winstou
Churchill.)

78

is calculated to interest the piiblic, as showing how far the work has pro-
ceeded ; I think it worth considering whether it oiight not to be as complete
a statement of the stage at which that organisation has arrived as possible.

Sir WILFRID LAURIER : I do not object, but it seems to me putting
on paper what can be done without it.

Mr. DEAKIN : The one criticism I have to offer upon it is that if this
phrase were construed narrowly the reference to Colonies might be limited to
Colonies referred to above. Now we all hope to see the union of South African
States to which several of the representatives here have more than once
alluded. Canada, Australia, and South Africa will then be three Doixdnions or
Commonwealths which will include in themselves, with limited powers, states
or provinces which- occasionally might be entitled to share in some of these
subsidiary Conferences, which, indeed, might be confined to them if the
matters dealt with related only to certain special subjects. I do not know
whether the addition of those words would provide for this contingency quite
clearly. While this shows the general scheme of the Conference, it ought not
to exclude from participation in the subsidiary Conference some of the pro-
vinces or states which would not, or could not, be represented in the major
Conferences to which we have been alluding, because they no longer possess
the powers which would authorise them to speak or act upon the questions
under discussion.

Mr. WINSTON CHURCHILL : As a matter of drafting as we have now
cut out in the first paragraph the words " affecting the relations of the Mother
Country and His Majesty's Dominions over the Seas," would it not be possible
to use the words " His Majesty's Dominions over the Seas," which have not
been previously used in the resolution, in the place of the word " Colonies "
in the third paragraph ?

Sir WILFRID LAURIER: I do not see the necessity of it. A
" resolution " means that you shall do something which you could not do before.
You can do this already. It is mere surplusage, but I do not object to it,
except on the point that there is no necessity for it. I think Mr. Winston
ChurchiU's suggestion on the point of drafting is excellent.

CHAIRMAN : "In this country or in His Majesty's Dominions over
the seas."

Sir JOSEPH WARD : I think with Sir Wilfi'id Laurier, that as a matter
of necessity we could do without it, but, on the other hand, I quite agree with
Mr. Winston Churchill that it would convey a much brighter and stronger
impression on the imaginative observer outside, who is anxious to see that
there is some possibility of dealing with minor matters between the
Colonies.

good.

Sir WILFRID LAURIER : It can do no harm, and possibly may do

Dr. JAMESON : I siippose the " secretariat " in the previous paragraph
is implied in this paragraph also ?

Mr. DEAKIN: Certainly.

thing.

Sir JOSEPH WARD: That is understood, and applies to the whole

79

Mr. DEAKIN : We ask that its head shoiild be connected in everything ThinI Day.
with the self-governing Colonies — Conference or no Conference. 18 April 1907.

Sir JOSEPH WARD : That is uudeistood. ^ ^'-"^''"'^

OF THE

Dr. JAMESON : The " secretariat " refers to the general Conference in Conkeresce.
the paragraph before, and here tlie ^iaragraph goes into minor matters.

CHAIRMAN : Do you mean you would not put it in ?

Dr. JAMESON : Yes, 1 would.

CHAIRMAN : The Secretary suggests that we should simply use the
term " Dominions over the Seas."

Mr. DEAKIN : Are they all dominions ? " Dominion " is a technical
title. In Canada the Avord " Dominion " includes the subordinate Provinces,
just as the word " Commonwealth " with us includes States.

Mr. WINSTON CHURCHILL : But in the plural, " Dominions," it is
quite different.

Mr. DEAKIN : I suggest you should bring in the words " local
administrations " to put it beyond doubt, but am not particular about it — you
might have both expressions.

CHAIRMAN : It stands thus : " That upon matters of importance
requiring consultation in common, either in this country."

Mr. DEAKIN : What does " consultation in common " mean ?

CHAIRMAN : That means between this country and others.

Mr. DEAKIN : You cannot have a consultation without at least two
people.

Mr. WINSTON CHURCHILL : It means consultation in general.

Mr. DEAKIN : Do the words " in common " convey anything ?

CHAIRMAN : It seems to me they are put in in rather a wrong place,
and it would be better if it read in this way : " That upon matters of
" importance either iu this country or in His Majesty's Dominions beyond
" the Seas between two or more of the Governments which require a cuu-
" sultation in common and which cannot be conveniently postponed until the
" next Conference."

Mr. DEAKIN : That is better.

CHAIILMAN : " Or which involve subjects of a minor character or stich
as require detailed consideration subsidiary Couferences should be held
between representatives of His Majesty's Dominions beyond the Seas and
of the Mother Coimtry, specially chosen for the pui-pose."

'J'hird Day.
18 April 1907.

Future
Constitution

OF THE

Conference.

80

Mr. DEAKIN : You do not want the whole phrase over again. It is
siifficient to say " representatives of the Dominions and the Mother Country."

CHAIRMAN : I was using the former words.

Mr. WINSTON CHURCHITX : Representatives of the Dominions
concerned ?

Ivir. DEAKIN : Yes, that is good.

Sir WILFRID LAURIER : I should like to have an opportunity of
considering the wording when it is copied out.

CHAIRMAN : I have no objection to that so long as it is not published.

Mr. DEAKIN : I think Sir Wilfrid Laurier is entitled to make that
suggestion, but hope it will be finished to-day, and that the 'precis can be
pid^lished wliich the Press did not have yesterday.

Sir WILFRID LAURIER : As to this drafting of the resolution, if the
wording is accepted I am quite satisfied, but before giving it to the public I
should like to have further opportunity of considering it. I am not so ready
to give information to the Press as ]\Ir. Deakin seems to be. Fcstina lente is
a good maxim. I would like to defer this. I am not satisfied as to the words
" Dominions beyond the Seas." It is a good expression, but I do not know
that it is correct as it is used here, and I should like to see it in a corrected
draft. I do not laiow that it may not include Trinidad as well as Australia
and Canada. It is not limited, so far as I can see, to the self-governing
Colonies.

CHAIRMAN : That is what is meant in the first place.

Sir WILFRID LAURIER : Yes.

Sir JOSEPH WARD : Why not use the words " self-governing
Colonies?"

Sir WILFRID LAURIER : Or " self-governing Dominions beyond the
Seas." As drafted, it seems to me it would as well apply to Trinidad or
Barbados as to Canada.

CHAIRMAN : I think we will have to introduce the words " self-

Sir WILFRID LAURIER : I would like to use some expression which
woidd make a differentiation between the seK-governing Colonies and the
otlior Colonies. So far as the Colonies represented here are concerned, I wish
we could drop the word " Colonies " and try to invent something whicih would
strike the imagination more.

i\lr. DEAKIN : Certainly ; if anybody can do that it is you, Sir Wilfrid.

Mr. WINSTON CHURCHILL : I unde«-stand Sir Wilfrid Laurier would
like to have a fair copy of the resolution to consider.

81

Sir WILFRID LAURIER : Yes. Wo luive adopted it in subsUuice, and Third buy.
that is great progress ; but before it is sent to the Press I woukl like to have 18 April 1907.
the opportunity of considering it.

Fl TLUE
\2 O \ ST IXI'TI*lV

CILVIR^LVN : Woukl the words " self-governing communities of the ok the

Empire " do ? Conkeuekce.

Sir WILFRID LAURIER : Perhaps they would ; but I would like to
consider the suggestion. It is worth taking twenty-four hours over it. I
talked it over yesterday with a frientl, and we agreed that we have passed \\\v
state when the term " Colony " couhl be applied to Canada, New Zealand,
and Australia. I would like to have suggested the word "State," but for
the fact that in Australia they call states what we call provinces, and it
might lead to confusion. Perhaps one of us can make a Ijotter suggestion.
I woidd rather sleep uiwn it, unless somebody else has any other suggestion
to make to-day.

Mr. DEAKIN : Would this tenn do : " British Dominions possessing
responsible government " ?

Sir WILFRID LAURIER : I would prefer " self-governing dominions
beyond the seas."

Sir JOSEPH WARD : I am agreeable to that.

Mr. DEAKIX : We need not add " beyond the seas." " Self-governing
Dominions " will do.

Sir WILFRID' LAURIER: If you designate all those countries that
have been known up to the present time as self-governing Colonies " self-
governing Dominions," we can then give out to the public that henceforth
tliese are " self-governing Dominions," but I would like to have a single apt
W(ird which may 1)(^ taken to mean "self-governing Colonies."

-Mr. DEAKIX : We recognise that the " Dominion " is the senior of the
" Conuiionwealtli " and, therefore, the name "Dominion" has a elaiui.
Again, we recognise that in his Majesty's official title the word " DomiiuDn "
is used where tli(^ word " CommonweaUh " is not.

Sir WILFRID LAURIER: "Dominion" is a general tenn which covers

many words which it is not possible to define otherwise.

Mr. F. R. MOOR : Can we have the words of the resolution read as

now scuttled ?

Sir JOSEPH WARD : As long as it is understood that New Zealand is
a Dominion, I do not object to the word " Dominion." We oui'selves under-
stand New Zealand is a Dominion, but I would like it understood tliat our
countrj^ is covered by that term here.

CHAIRMAN : Shall I read the resolution through ?

Sir WILFRID LAURIER : For my part I would like to see it before
me. The only reason whj- it is suggested we should finally close the discussiou
to-day is simply in order to give it to the Press.

£ 4866K. F

82

Third Day.
J 8 April 1907.

Foti:re
Constitution

OF THE

Conference.

Mr. F. R. MOOR : May we have the last paragraph read again ?

CHAIRMAN : I will read the whole of it from the beginning : " That it

' will be to the advantage of the Empire if Conferences, to be called Imperial

' Conferences, are held every four years, at which questions of common

' interest may be discussed, and considered as between His Majesty's

' Government and Governments of the self-governing Dominions. The

■ Prime Minister of the United Kingdom will be ex officio President, and the

■ Prime Ministers of the seK-governing Colonies ox officio members of the
' Conference. The Secretary of State for the Colonies will be an ex offiicio

member of the Conferences, and will take the chair in the absence of the

' President, and will arrange for such Imperial Conferences after commimi-

' cation with the Prime Ministers of the respective Dominions. That it is

desirable to establish a system by which the several Governments

represented shall be kept informed during the periods between the

Conferences in regard to matters which have been or may be subjects for

discussion by means of a permanent secretarial staff, charged under the

direction of the Secretary of State for the Colonies with the dutj' of

obtaining information for the use of the Conference, of attending to its

resolutions, and of conducting correspondence on matters relating to its

affairs. That upon matters of importance, either in this country or in His

i\Iajesty's Dominions beyond the seas which require consultation in common

between two or more of the Governments, or which cannot be conveniently

jiostponed until the next Conference, or which involve sidijects of a minor

character, or such as require detailed consideration, subsidiary Conferences

should be held between the representatives of such Dominions and the

Mother Country specially chosen for the piirpose."

Dr. SMARTT : Surely the word " Dominions " would not refer to the
various Colonies in South Africa. It would not be a dominion unless it were
federated like Canada or Australia ; New Zealand might be called a Dominion,
it lieing two islands i;nder one Govermneut, but j'oii could not call Cape
Colony a dominion.

here.

CHAIRMAN: Yes,-

" self-governing Dominion

is what we call yoii

Dr. SMARTT : Is not the word " Dominions " in the title of the King ?

CHAIRMAN : In the King's title the words " Dominions beyond] the
seas " cover everything, and it was in order to restrict the term to self-
governing parts of the Empire beyond the seas that we put in the words
" self-governing."

'' ■• ■ Mr. DEAKIN : I prefer the words "Dominions concerned " which point
back directly to those engaged in the Conference. The words " sucli
Douiinions " leave it at large.

CHAIRMAN : Personally, I agree with Sir Wilfrid Laurier, and should
like to look through it when it is copied.

Sir WILFRID LAURIER : I think we should consider it. It is too
important a matter to pass over without having a moment of reflection about
it. We know the importance of this document, and I think it is worth while
to be a little careful about its wording.

83

Mr. F. 1\. MOOli: I'er.soually, I ahoiiM like to usn a liaiipicr term as Third r):iy.

leflecting the Coloiiios wo represent in Sdiith Al'riea. Wo have not yet got 1h April 1907.

to that coutlition of things wlien we might he safely designate(i as l)oniinions, ,

and I think, with Sir Wilirid Laurior, it might bo iust as well to think the r^ ^lTlKE

,11 ' o .1 CoSSTlTl TloN

matter over earelully. ,,^, ^„g

CONKEKEXCE.

Mr. DEAKIX: There is no possil)le ol)jeeti()n to that, exee))t the natnral
disappointment of the pnl)lic, whieh, however, might 1)0 mitigated i! the precis
of the discnssion were now presented without giving the resolution arrived
at — just the outliiuM)!' tli(> discussion in a general way. Otherwise, if lliey
have to Avait luitil Saturday, it means that Australia will not have the
information until Monday or Tuesday.

Mr. WINSTON CHURCHILL : As I nnderstand, we have really got
through the eommittee stage and the report stage, anil all that remains, with
regard to the resohition, is the third reading; so that we shall not have to
begin detailed eoiisitleration again.

CHAIRMxVN : I understand that Ave pass the Resolution, and it is only a
question of wording which remains open.

Sir WILFRID LAURIER : It stamls for third reading, as Mr. Churchill
says, and wo have time to consider the expressions.

Mr. DEAKIN : There is no objection now to a precis being given to the
I'ress.

Sir AVILFRIl) LAURIER : I would not give the prcci.'i until we give
the Resolution itself.

CHAIRMAN : The next meeting of the Conferenec is iixed for Saturday,
at 11 o'clock. There were two other ])oints on the agenda paper for to-ckiy.
One is as to the organisation of the Colonial Office which was incidentally
mentioned in the discussion, and I do not know that I have any more to say
than I have said, but if Mr. Deakiu wishes to have it further discussed wo had
better defer it to another day.

Mr. DEAKIN : I woidd like some furtlier discu.-sion upon it.

CHAIRMAN : The other resolution is with regard to Imperial Di^feuco.
That Resolution is from Australia: "That it is desirable that the Colonics
" should be represented on the Imperial Council of Defence, antl that the
" Colonies be authorised to refer to that Council for advice any local (picstions
" in regard to which any expert opinion or assistance is deemed <h>sirable."
Perhaps if 1 make the statement whicli the I'rime .Minister lias given me, it
w^ould meet the whole case. The Prime Minister considers that it might be
with advantage made clear to the representatives of the Colonies at the
coming Conference that tlie Connnittee of Imperial Defence is intentled to
provide the means of discussing questions of a general or local charac-tcr
relating to d(>fence. It shouhl, therefore, be open to the Government of
any self-governing C!olony to sul)niit these questions tiirough tlie Colonial
Otiice and to obtain such advice as the Committee is abh^ to give. If so
desired any representative of a colony whicdi may wish for advice may be
summoned to attend as a member of the Conuuittee during the discussion on
the question, raised.

F 2

Third Day.
18 April 1907.

FCTUKE

Constitution

OF THE

Conference.

84

Mr. DEAKIN : That practically meets the proposal, though I should
like to have the opportunity of speaking to the Secretary of the Coimuittee
of Defence who has not onlj' a national, hut an established Australian
reputation, before this is finally disposed of. It appears to be completely
satisfactory.

CHAIRMAX : I think the members of the Conference imderstand that
the Committee of Imperial Defence is a body which consists of one permanent
mendoer, the Prime ^linister, and the other memliers are summoned as
occasion requires. Therefore, this proposition really deals with the Colonial
question on exactly the same principle.

Sir JOSEPH WARD : When wiU that come up for consideration ?
CHAIRMAN : I do not know whether it reqiiires any more consideration.

Mr. DEAKIN : I want to speak to the Secretary upon it.

CILMRMAN : That is all I have to say as to the Committee. Military
defence is the subject of the next meeting, and naval defence is part of the
business for next week.

Sir WIIiFRID LAURIER : With regard to the resolution we have just
agreed upon, I would like to caU attention to the fact that we have not at aU
settled Avhat is to be the status of the Colonial Ministers in London. Sir
William Lyne l)rought that matter forward, and we have left it at present.

CHAIRMAN : I thought at the time we dealt with that question, I
pointed out I only mentioned the ex oj^ic'io members, but the whole resolution
means that there is to be discussion between the Governments, and the
representatives of the Governments other than the ex officio members will
attend, and I thought it was understood-- and I think you. Sir Wilfrid,
initiated it — that the particular question of the actual manner in which the
other Ministers should come in should be deferred beyond this resolution and
taken sei^arately.

Sir WILFRID LAURIER : At that time I had in my mind tliat we
should not pass this linally, but the matter is left altogether absolutely
imsettled.

Mr. DEAKIN : I proposed to bring it forward myself, only we became
absorbed in this discussion.

Sir WILFRID LAURIER : If that is so we shall have to think it over a
little more.

CHAIRMAN : I hoj^e if you do wish to alter the resolution on that
particular point it will not mean that we shaU have more than a third
reading. ,•

Sir WILFRID LAURIER : We have practically agreed to it, but the
i;Lher is a point of some practical importance, and we ought to come to some
cjcar understanding about it.

Mr. DEAKIN : Certaiidy. At the present Conference the understanding
is that the Prime Minister and one colleagiie would take part in each

85

ilisciission, wliilo on special mattors when the occasion dcmancls it, other riiira Duy.
^finisters might be asked to take part. is April 1907.

Sir WILFRID LAURIE R, : I have two of nij- colloagnes here, and I Coxstiti tk.x
should not like to come without either. <>k the

CilXKKKEXfK.

CHAIRMAN : The business on Saturday is as to militarj- defence. C^^"". Deakin.)

]\[r. DEAKIX : We must conclude this first, and perhaps wc might moot
half an hour earlier to finish it ])ofore our ap]iointMiont with Mr. Jlaldauo
at 11.

CHAIIUIAX : I will inquire if it is necessary, and will lot you l<now.
I have been making inquirios of the Chanoollor of the Exohoquor, who is
exceedingly bus.v jnst now with the Budget, and ho informs mo that he is
obliged to go to Scotland oiu> day at the boginuing of next week, and therefore
if it suits the Conforonco ho would proi'or to take a day in the following wook
i'or the discussion of the trade question. In that case he fixes Tuesday,
April .jOth, for preferential trade. The question, therefwe, is what sul)j('ets
we should take on Tuesday and Thursday next week. 1 bolieve the First
Lord of the Admiralty is willing to come on Tuesday for the discussion of
naval matters, and then the subject of emigration can bo taken on Thursday.

Adjourned to Saturday morning at 11 o'clock.

48668. F 3

8G

Fourth Day. FOURTH DAY.
2U April 1907.

Held at the Colonial Office, Downing Street,
SatijUday, 2Uth April 1907.

Present :

The l^iio-ht Honourable The EARL OF ELGIX, K.G., Secretaiy of State

for the Colonies (President).

The Plight Ilunourable Sir Wilfrid Lauimer, G.C.M.CI., Prime Minister

of Canada.
The Ilononrable Sir F. W. Borden, K.C.M.G., Minister of Militia and

Defence (Canada).
The Hononrable L. P. Brodeur, Minister of Marine and Fisheries

(Canada).,
The Hononrable Alfred Deakin, Prime Minister of the Conmionwealth

of Australia.
The Honourable Sir "William Lyne, K.C.M.G., Minister of State for

Trade and Customs (Australia).

The Honourable Sir Joseph Ward, K.C.M.G., Prime Minister of New
Zealand.

The Honourable L. S. Jameson. C.B., Prime jMinister of Cape Colony.
The Honourable Dr. Smartt, Commissioner of Public Works (Cape

Colony).
The HonouralJe F. P. Moor, Prime Minister of Natal.

The Right Honourable Sir R. Bond, K.C.M.G., Prime Minister of

Newfoundland.

General The Honourable Louis Botha, Prime Minister of the Transvaal.

Mr. Winston S. Churchill, M.P., Parliamentary Under-Secretary of
State for the Colonies.

Sir Francis Hopwood, K.C.M.G., Permanent Under-Secretary of State
for the Colonies.

Sir J. L. Mackay, G.C.M.G., K.C.LE., on behalf of the India Office.

Mr. H. W. Just, C.B., CiLG.,) 7 • , o , •
Mr. G. W. Johnson, C.M.G., J '^"'"^ Secretaries.

Mr. W. A. Robinson,

Assistant Secretary.

Also present :

The Right Honourable R. B. Haldane, K.C, J\1.P., Secretary of State
for War. .

General the Honourable Sir Neville Lyttelton, K.C.B., Chief of the
General Staff.

General Sir W. G. Nicholson, K.C.B., Quartermaster-General.

Major-Geueral Douglas Haig, C.B., Director of Military Training.

j\Iajor-General .J. S. Ewaut, C.B., Director of Military Operations.

87

CPTAIRMAN : Geutlemon, Ijcforo wo l)o<?iii business I may just remind Fourth Dut.
you tJiat our uuiubcrs arc coniplctu with the arrival of Sir liui)orl Bond. I 20 April 1907.

hope that I may extend a welcome to him from the Conference, and I may,

perhaps, mention that I have had the advantage of an interview with him at
which I explained what Iiad taken place at the meetings Ijeforo he was able
to attend, and I tliink he will be able to say that as far as he is concerned lie
is ready that matters should go on from the point which they had reached at
the last meeting.

Sir ROBERT BOND : My L(jril, and gentlemen, permit me to convey
to your Lordship an expression of my sincere thanks for your kind conUal
greeting and welcome to this Conference, and to say that it is a matter of
very great regret to me, that, owing to circumstances over which 1 had no
control, I was prevented from being here at the opening of this Conference,
and from tlnis having tlie i:)rivilcge of listening to the opening address of the
Right llouourabh; the Prime j\linister. Your iJordship has very kindly hati me
furnished this morning with a copy of the proceedings, and I have been able
to peruse with both pleasure and profit the words of wisdom and encourage-
ment contained in Sir Henry Canipbell-Bannerman's address. I am pleased
to notice that the Prime ^Minister in bringing directly under the notice of
tliis Conference the agenda of business that is to engage its attention, did not
limit its deliberations to matters therein set forth ; that he very gracefully
recognised that, owing to the different conditions appertaining in the Colonies,
it is scarce!}' possible that we can all approach the consideration of the various
subjects that are to engage our attention from precisely the same stantlpoint ;
that our dealings with many of those matters must be necessarily governed by
the ojiinions and desires of those we represent, and that our conclusions must
be subject to the approval of our respective Parlianu-nts. The Empire
stands before the world to-daj^ as probably the greatest expression of national
expansion that the world has ever seen, and tliis, my Lord, 1 tliink has been
brought about by due and proper regard for public opinioJi in the varit)Uii
States or Colonies that comprise the Empire. Therefore, 1 submit that
notliing but good can come from the r(^cognition of the principle that
Sir Henry Campbell-Bannerman set forth in his address.

May I be permitted, my Lord, to join in the expression of regret that
has proceeded from the Conference in reference to the illness of that
distinguished statesman who i)resided over the affairs of the Conference
in 1902. Probably no British statesman has ever had such a warm place
in the affection of the Colonies as Mr. Chamberlain, llis illness, therefore,
has occasioned the deepest concern throughout all the Ct)Ionies of the
Empire. In joining in the hope that has been expressed by this
Conference I am not only voicing my own heartfelt desire, l)ut I am
sure I am echoing the desire of those I have the honour to represent.

May I also be permitted, my Lord, to join with tliose wl:o paid a tribute
of respect to the memory of the late Prime Minister of New Zealand,
Mr. Seddon. We who sat with him in conference five years ago will
remember with admiration his strong personality and wide imperialism,
and I think all who watched his political career cannot have failed to
ap])reciate that by his decease a great and unique character aiul empire-
l)iiilder has passed away. As the Prime Minister remarked, my Right
Honourable friend. Sir AVilfrid Laurier, and myself are the only two mGnd)ers
of this I'onference who sat in the former one, five years ago. I anuiuite sure
that it is a satisfaction to both of us that the vicissitudes incident to jpublic
life have not come our Avay, and that we are again privileged to join in this
important Coiiferencc.

I again thank you, my Lord, and the other Members of the Conference
for your kindly welcome to-day.

F 4

Fourth Day. FUTURE COKSTITUTION OF THE CONFERENCE.

20 April 1907. CHAIRMAN : Gentlemen, we have met at an earlier hour this morning

FcTUKE ill order that we might formally adjust the Resolution which was, in

CoissTiTiTiox principle, accepted at our last meeting. I have endeavoured to get it so

OF THE far as I could into shape in certain details that the Conference desired, and

CoNFEKExcE. "i. j-^^^ ]:,eerL in your hands, and I shall be glad to hear if tliere arc any

remarks to be made.

Sir WILFRID LAURIER : I am satisfied with it so far as Canada is
concerned. Sir Robert Bond might not have had the facility, perhaps, of
perusing the discussions. I do not know whether he has or not.

Sir ROBERT BOND : No, I have not fully perused the discussion, Sir
Wilfrid. I only received the papers this morning, and consequently but
glanced through them.

Sir WIEFRID LAURIER: The question which we have been
■ discussing. Sir Roliert Bond, has l)een the creation of an Imperial Council,
and we have come to the conclusion that this Avas not advisable, and this is
Avhat we have drafted, endeavouring to meet as far as we could the different
opinions that have prevailed. I observe. Sir Robert, that in the despatch
tiiat yoii sent in answer to the Colonial OfHce despatch on this subject you
do not seem to favour the creation of such a Coimcil. This is Avhat we have
practically agreed to subject to modification, of course, nothing being settled
until it is fiaally passed : " That it will be to the advantage of the Empire
" if Conferences to be called Imperial Conferences are held every four
" years at which questions of common interest may be discussed and
" considered as between His Majesty's Government and the Governments
" of the self-governing Dominions. The Prime Minister of the United
" Kingdom will be ex-offieio I'resident, and the Prime Ministers of the
" self-governing Dominions ex-offic'io members of the Conference. The
" Secretary of State for the Colonies will be an ex-officio Member of the
" Conference, and will take the chair in the absence of the President, and
" will arrange for such Imperial Conferences after comnmnication with the
" Prime Ministers of the respective Dominions." This paragraph, so far as
it goes, meets with the approval of Canada : "' Sucli other iMinisters as the
" respective Governments may ai^poiut will also be members of the Conference
" • — it being understood that except by special permission of the Conference,
" each discussion will be conducted by not more than two represi^ntatives
" from each Government, and that each Government will have only one
" vote."

CHAIRMAN : That part was not before the last meeting.

Sir WILFRID LAURIER : So far as I am concerned I may say at once
that I am satisfied with this.

CHAIRMAN : I think Sir Robert Bond has seen it.

Sir ROBERT BOND : I have it before me, and may oljservc that Lord
Elgin showed me last evening this Resolution, when I intimated to him that
with the principle involved I concurred.

CHAIRMAN : If you are taking it paragraph by paragraph, thcBe is jiist
a small matter iMr. Deakin has mentioned to me. It is only to break up the
last sentence, and he suggests there should be a stop after the Avord
. " President " — " The Secretaiy of State for the Colonies will be an ex-ojjklo
" member of the Conference and will take the chair in the absence of the
" President." It is quite true that the last part of the sentence has not a
very direct connection with the first. I propose that we should strike out the
word " and " and Ijegin the sentence with "He."

su

Sir WILFKID LAUKIEU : Yes,

CHATR^IAN : There is one other point, T think I ouftht to call the
attention of the Conference to. We agrood, and I am not goinijj back
upon tlie asi'eenient, that instead of the word " Colonies " we should use the
word "Dominions;" but is it sufliciently defined if wo use the word
" Dominions " alone throughout ? After all, we, in this country, are part of
I lis .Majesty's self-governing l)ominions strictly speaking, and I would suggest
that we might take what is really the official term " the Dominions l)eyond the
seas" in the iirst place where it occurs — "the Governments of the self-
governing Dominions beyond the seas," and any other reference to it in the
course of the Resolution might very well be " Dominions." That would make
it absolutely clear what wc mean by the expression in the first place.

Sir WILFKID LAUIMER : Yes, I see no objection to that as far as I
am concerned.

CHAIRMAN: Then we will insert the words "beyond the seas" after
" Dominions " in the first place.

l)r. JA^IESOX : There is another small point. I should like to see the
singular instead of the plural used in the first two lines of the Iirst paragraph
— ^" A Conference to be called the Lnperial Conference is held every four
years," t'tc. I think it Avould make it more emphatic than the word
" Conferences." It is simply substituting the singular nimdjer for the
plural.

Sir JOSEPH WARD : I think it would read very much better.

Sir ROBERT BOND: I think it is a very decided improvement. I
think it is far more emphatic.

Sir WILFRID LAURIER : I think so too.

CHAIRMAN : Then subject to those alterations we agree to the first
paragraph.

Sir WILFRID LAURIER: Somebody has suggested to mo that instead
of having "His i\Iajesty's Oovernment" we should have "the Government of
the United Kingdom." I suppose we are all His :\Iajesty's Governments.

CHAIRMAN : It is a technical term for His Majesty's Government here.

Sir WILFRID LAURIER : Yes, it is very well understood, but sup])ose
we said " the Government of the United Kingdom," as we all claim to be His
Majesty's Governments.

Mr. DEAKIN : " As between His Majesty's Government of the United
" Kingdom and His Governments of the self-governing Dominions beyond
" the seas."

Sir WILFRID LAURIER: That would meet my views. The point
was brought to my notice by a friend, but " His Majesty's Government " is
such a technical expression that there can be no mistake about it.

;Mr. DEAKIN : " His Majesty's Government " in Canada means the»

Canadian Government.

Fourlh I)av.
20 April I'.Ki".

FlTlKE
CoNSTlTlTHiN"

OF THE
Co.NKEKEXCE.

90

FoarthD»y. j)^. JAMESON: AVhy not "His Majesty's Government and His

20 April 1907. Governments of the self-governing Dominions."

Future
Constitution. Mr. DEAIvIN : Yes, that is an improvement.

OF THE

Conference. ^.^^ WILFRID LAURIER : I am satisfied with that.

CHAIRMAN : And leave "His Majesty's Government."
Mr. DEAKIN : Yes, suhstitnting " His " for " the."
CHAIRMAN : Next come the words with regard to the Ministers.
Sir WILFRID LAURIER : That satisfies me.

Sir WILLIAM LYNE : I do not know ^\dlat has been done in reference
to that first ^Daragraph whicli Sir Wilfrid Lanrier read. There has been
some alteration made and I could not catch it.

CHAIRMAN : They are only verbal alterations. We have altered the
first words into " A Conference to be called the Imperial Conference is held "
instead of putting it in the plural, and we have made the words to run " as
" between His Majesty's Government and His Governments of . the self-
" governing Dominions beyond the seas," that is all. Then there is the
addition " Such other Ministers as the respective Governments may appoint
" will also he members of the Conference — it being understood that except,
" Ijy siDCcial permission of the Coni!erence each discussion will be conducted
" by not more than two i-epi'esentatives from each Government and that each-
" Government will have only one vote " — is that agreed to.

Sir WILFRID LAURIER : Clearly.

CHAIRMAN : Now the second paragraph of the Resolution.

Mr. DEAIvIN : I have a suggestion to make in this paragraph. You
were good enough to adopt throughout this Resolution the language submitted
by one or other of the diiferent states, and consequently it now reads :
" That it is desirable to estaljlish a system by which the several Governments
" represented shall be kept informed during the periods between the Con-
" ferences in regard to matters which have been or may be subjects for
" discussion, by means of a permanent secretarial staff charged under tlie
" direction of the Secretary of State for the Colonies," and so on. But the
Avord " secretarial " has ceased to have a meaning or, at all events, the
Tueaning that was attached to it when first brought forward. What is 2iow
intended is not a separate body, but a branch of the Colonial Office. On
referring to your remarks, my Lord, I notice that you stated your intention
was to separate the departments of this olficc. You wiU have a,. distinct
division which will not be exactly apart in the department, but Avill be the
one division concerned Avith the business of all the self-governing Colonies,
and will not be directly concerned Avith that of the CroAvn Colonies. I do
not think that can be clistinguished from the rest of the Colonial Office by
being called a secretariat, because practically all your office is a- secretariat.
It is for you, my Lord, to select the phrase which Avould best define your
own intention, but as this stands, it appears to me that Avhat is intended

91

is merely thai this work sliouhl l)e earried out by means of a portion of tlie Fourtli Day.
stall" inidcM- tlie direction of the Secretary of State for the Colonies, which i>o April ly07.

shall !)(> charged Avith the duty of whatever work may be allotted. The

proposal for a secretariat was a proposal for a body independent of this or Imtikk

any other (k'partnient. It was to he a kind of joint and several department " oVnil:""'
under the control of the Prime ilinister of (Jireat Britain. As such, the Coxkkkkn. k.
Avord "secnMariat" was niH'cssary, in onhu* to make it quite clear that tlicre (^Mr. iJeukin.)
was no intention of creating a hody with any authority other than to perform
the necessary secretai-ial, statistical, and other work cast upon it by the
Conference or by some of the Covermnents represented. That was specially
necessary to meet Sir Wilfrid Laurier's criticism, l)ut under the present
circumstances that proposal has entirely disappeared. This proposal is
nothing like it. The present project is that there shall be a portion of the
Colonial Ollice, a distinct division, not exactly set apart, Avhich is to deal with
us. Consequently the former title appears to me to be no longer appropriate.
My own suggestion is that wo should now indicate what is int(>nded, and it
is for you, mj' Lord, to say what is intended.

CHAIRiMAiSi : I did not mean to go into further details, for the reasons
I gave at the former meeting, but I may just say that in my own mind
I had intended to go a little more towards meeting you than you have
expressed, (^ur practice in this ollice hitherto has been to select gentlemen
from our staff who we thought, and I tliiuk quite rightly, were well
(jualilied to prepare tlie business for the Conference, and to act as its
secretaries. What we have in our minds to carry out, and hope to be
able to carry out in the future, is that we should appoint a gentleman on
our staff to be the secretary for the Conference, not for one Conference
only, but to continue the business as a member of the staff" of the olHce and
in a division of the office, as I said before, but that being his specific duty,
thereby focussing all the business in the way which I think the luend^ers of
the Conference in their various resolutions expressed the desire it shoidd be.
That is what Ave hope to do, and that is the reason we iise the expression
"secretarial staff." You quite understand, I think, that aa'c can make that
arrangement without interfering Avith the responsibility or organisation of
the office, but still in such a manner, I think, so far as it is capable of being
done Avithin the Avails of the office, as to meet the Avishes that the other
members of the Conference haA'e expressed. That is the nu-aning of the
expression. I have no ol^jection to one form or the other, because Ave can
do it either way.

Mr. DEAlvIN : Have you any objection then to substitnting " A portion
" of the staff' under the direction of the Secretary of State for the Colonies
"which shall be charged Avitli the duty"? I think it more correi-tly
expresses it.

Sir JOSEPH WARD : I think it is better to leave it as it stands.

Dr. JAMESON : Do not you think that the further explanation which
the Secretary of State has made shows that he is anxious to meet, an far as
possible, our extreme vieAvs expressed the other day.

Mr. F. R. MOOR ; Not extreme, but advanced.

Dr. JAMESON : Advanced is better. It is better to leave the Avord
iu as foreshadoAving what is coming at the next Conferenct; to meet our
views expressed the other day. 1 should like to see it remain.

02

Fourth Day. Mr. DEAKIN : It is for Lord Elgin to consider.

20 April 1907.

y J Sir AVILFRTD LAURIER : I do not care how it is expressed so long

Constitution- ^^s i* is on Ministerial responsibility. That is the only thing I attach

OP THE importance to.
Conference.

Sir JOSEPH WARD : The point raised by Mr. Dealdn is quite a clear
one, and no doubt it would probahl}- more correctly indicate what the actual
decision is, but I have a preference for indicating a permanent secretarial
staff.

Mr. DEAKIN : If you appeal to me on the ground of preference, I am
bound to agree.

"to^

Sir JOSEPH WARD : Upon that ground I assume you will vote for it
as it is.

Mr. DEAKIN : I will.

CHAIRMAN : Then it will stand as it is.

Mr. DEAKIN: Yes.

CHAIRMAN : Then we pass the second paragraph. The third para-
graph we hope we have put into shape as regards words.

Sir WILFRID LAURIER : That will be the fourth paragraph no^v ?

CHAIRMAN : Yes. The paragraph is " That upon matters of import-
" ance, requiring consultation lietween two or more (lovernments, which
" cannot convenientl.y be j^ostponed until the next Conference, or involving
" subjects of a minor character or such as call for detailed consideration,
" siibsidiary conferences should be held between representatives of the
" (xovernments concerned, specially chosen for the purpose."

Mr. DEAKIN : The only suggestion I have there is that in the last line,
instead of " the Governments concerned," which seems to point oidy to such
of the Governments as are named in the first sentence, including only the
larger self-governing States such as Canada and Aiistralia, it might be well
to substitute the Avord "any" for the word "the" — "any GoA^ernments
concerned" — in order to cover the introduction of matters which are purely
Provincial in Canada, or purely State in Australia, or a mixture of lioth.
This would plainly indicate that it was in contemplation that members of
both classes of Governments might, if necessary, take part in the sidjsidiary
conferences when the subjects with which those conferences Avere dealing
■were wdiolly or chiefly Avithin the domain of either State or Provincial
Governments. Tlie federal and local governments might both be represented
when dealing Avith ,si)ecial subjects Avhen they were Avithin the constitutional
poAvers of both sets of Ciovernments. •'

Sir JOSEPH WARD : I think that ought to be done. I am just a little
in doiJjt as to the intention of the Avord "chosen," ahvaj'S assuming, in the
ordinary practical Avorking of the respective Governments of the several
coinitrios, that Canada and Australia desire to have a conference upon an
inqiortaut matter, this Resolution ratlier supposed they would have to be
chosen ]iy probably all the members of the Conference.

93

CTfAIR^fAN : No, chosen by each (loveriiment. It only meaut it was Fourth Day.
not necessarily chosen under (he restrictions of the Conference. 20 April l'»07.

Sir WILFRID LAURIER: T am quite satisfied with the Resolution (_.^^?1',™„^.
as it is. If 1 understand !Mr. Deakiii ari.ijht, what he had in his mind was '^^ ^,,,,

that the State; Ciovernments of Australia or the Provincial (lovornments of CoNKEictxiL.
Canada might have the power to come within the scope of this Resolution.
For my part 1, with all duo respect, differ altogether from this. I think we
should i^rovide here for the Governments which are here represented. There
may be dilferences in Canada or in Australia between the Federal Govern-
ments and the State Governments. I do not think this ought to be encouraged
at all ; on the contrary, for my part, I believe in one respect our c'onstituti(jn
is better than that of Australia, in tliat the power is in the central Govern-
ment and is not in the State as Avith theirs. Even in the best and most
satisfied countries, like Canada at present, wo may have dilferences of opinion
between the Federal and State Governments. There is one at present
Ijetween us and the Government of British Columbia, and Lord Elgin has
authorised the Govermnent of Ih-itish Columbia to come here as to some
matter which has been in issue between them and us, that is to say, between
British Columbia and Canada. This will always be done whenever a
Province or State appeals to the Imperial Government here. They are always
sure to have a hearing, but I would, for my part, deprecate the introduction
of anything which is not here strictly relevant to, and conliued to, th(!
relation between the Crovernment of the United Kingdom and the Govern-
ments here represented.

Mr. DEAKIN : Am I to understand, Sir Wilfrid, that education is a
wholly Provincial question in Canada, or is it also a national question V

Sir WILFRID LAURIER : Purely a Provincial question.

Mr. DEAlvIN : Exactly. A conference may be desired in Great Britain,
as there is, I understand, a meeting relating to education shortly to be held
here to which representative men from thi; different Provinces of Canada
probably, and certainly from the dill'erent States of Australia, are coming.
Now if it were desired that a conference of that kind shouhl be held, would
it not be well that it shoidd l)e related, although in a dillereut way, to this
branch of the Colonial Ullice, which is to xmdertake the care of the matters
relating to the self-governing Colonics V I feel the force of your observation
so far as it relates to a conference, if one could imagine it, at which any
diiference between the National Government of Canada and its Provinces
were to be brought forward. lean hardly imagine such a conference, and
do not see a necessity for thinking it in advance. What was in my mind
was the possibility of conl'ereiu'cs in regard, say, to education, or to methods
of administration of criminal justice, or hygiene, which are partly State
and partly Federal, and which can come under both, or which were held
solely between our States and your Provinces, or some of them and other
local bodies. If a conference were held in regard to any of those subjects,
shoidd it or should it not be associated with this l)ranch of the Colonial
Olhce which has to deal with the affairs of the self-governing Colonies, and
therefore properly mentioned here, or should it Ijo looked upon as something
quite apart and not in relation to this part of the Colonial ( )ffice ?

Sir WILFRID LAURIER : I should conceive it as a conference quite
apart. For my part I do not see the necessity at all for this last paragraph.

n:

94

Fourth Day. J fljjul^ Jt is quite surplusage and means nothing at all. If you have a

20 April 1907. conference upon various things, either defence, or education, or anything of

y~T that kind, it will alwaj^s be called as a purely voluntary body, as is done

CoxsTiTiTioN- constantly. But if, on the subject of education, for instance, the conference

OK THE to be called were to piit in question the terms of the Act which at present

CoN-KERENCE. puts tlic subjcct of cducatiou under the Provincial governments, any amount

(S r Wilfrid of mischief might be created, and therefore, I do not think it is a good thing.

Laurier.) g^^t if it be that the Conference is called simply to advance and promote

education, or give a larger scope to it, I can quite understand that it would

be a purely voluntary conference to give advice. I would be afraid imder

the terms of this Conference you miglit bring in political qxiestions which

would create very serious embarrassment to us.

Sir JOSEPH WARD : I imderstood this paragraph applied entirely to
the governments represented Ijy the Prime Ministers who are here, and it
shoidd not go beyond that. If it goes beyond that I foresee all sorts of
conq^lication.

Mr. DEAKIN : I do not press it then at this juncture.

Sir WILFRID LAURIER : I am satisfied.

CHAIRMAN : What is the result ?

Sir WILFRID LAURIER : Let it go as it is.

Mr. DEAKIN : Yes.

Eesoliitiou I., CHAIRMAN : Then I put it that this Resolution is the Resolution of the

P'^o*^ V. Conference.

The Resolution, as amended, was carried unanimously.

Military MILITARY DEFENCE.

Defence.

CHAIRMAN : We have now the advantage of the presence of the
Secretary of State for War, who will give us his views. I think it will be
the wish of the Conference that I should ask the Secretary of State for
War to address us,

Mr. LIALDANE : My Lord Chairman and gentlemen, I think it will
be for the convenience of the Conference that I shoidd state very shortly
what the point is that seems to us to be most important for discussion,
and for arriving at some fairly clear conclusion.

To jdunge at once into things, the effect of the war in South Africa made
a profound impression on the minds of our advisers here. We realised
that we had gone into that war Avithout adequate preparation for Avar on a
great scale, and that Ave had ncA^er fully apprehended the importance of
the maxim that all preparation in time of peace must be preparation for Avar ;
it is of no use unless it is designed for that; it is the only justification for
the maintenance of armies — the preparation for Avar. In consequence,
Avhen the war Avas over, the then Government set to Avork — and the
present Government has continued the AVork — to endeavour to put the
modern military organisation into shape. In 1901 a very imjjortant Commit-
tee sat. It was presided over by a civilian Avho had given great attention to
the study of military organisation, Lord Esher, and it contained on it tAA'o

very (listiii^uishofl oxpononts of naval and niilitaiy vifws, Sir .Tolin Fishor ami K..iirili Day.
Sir (Jeorgc^ Clarko, as its other ini'inlxM-s. Tlic (.'(imniittcc reported, ami its -jo April iyi)7.

r(>port. contained a eoini)lote sohnmo for tho ro-or/^anisation of the \\ ar Ollice

and of th(> Army. That scheme was adopted l)y the hite (lovermiient and has [,'"''.' ;^'*^
b(>en carried on by the present (ioveriunout. (Jnv Itroad feature is this, that
our naval oro;anisation has been the one with which we have been con- '•^*'- "»'•'""«•)
spicnously successful in the history of this cf)untiy as distinguished from our
military organisation, and, therefore, as far as was possible^ the naval
organisation was taken as a type. But the broad feature which emerged with
regard to military |)reparations was this : Tomit Moltke was able to organise
victory I'or the Prussian and German armies in 1800, and again in ISTO,
because he and the general stall' working under him were free to apply their
minds wholly to war preparalimi. That he was able to tlo this was due to
the fact that the organisation and business administration of the army in
]H'ace were kept entirely distinct i'rom the service which consisted in the
study of war problems and ii^ the higher training of the staff and of tiu?
troops. That was the principle recommended by the Esher Connnittee,
and it culminated in the provision of a brain for the army in the shape
of a Cleneral Stall". That (leneral Stall" we have been at work on for a
long time past in endeavouring to get together. The task was not as
ililHcult as it seemed at first, because the effec-t of the Avar was to bring to the
front a nmiiber of young officers who had shown remarkable capacity and who
constituted the nucleus of a serious and thoughtful military school. They
were got together nnder the Esher re-organisation and virtually there has
been a Tleneral Stall" in existence for some time. Bnt it was not nntil last
September that it received formal and complete shape in the Army Order of
that month. The General Stall" is now a cle jure body ; it has been a dc facto
existing body for some time past. The resnlt of this re-organisation, which is
now comjtlete, is that 1 am able to attend this Conference with certain dis-
tinguished officers who are with me to-day to furnish any information re(]uisite.
Sir Neville Lyttelton, the Chief of the General Stall", is l)y my side. Sir William
Nicholson, the Quartermasti'r-General, is with him, and also Sir (ieorge
Clarke, who played a great part in the Esher re-organisation, and who is
secretary of the Imperial Defence Committee. I have also with me here
General Ewart, Director of Military Operations, and General llaig, the
Director of Military Training.

The practical point that we have to put before yon is the desirability of
a certain l)road plan of military organisation for the Empire. W(^ know
that you have all got your own difficulties and the idiosyncrasies of your
own people to deal with. No rigid model is therefore of nse. But a coinnion
purpose or a common end may be very potent in furthering military
organisation. For ourselves we have over here worked out our organisation
quite dellnitc^ly, and, indeed, the practical form of it is at present the sid)j(H-t
of plans which are before rarliament. This conception of defence is that the
Army should be divided into two parts with distinct functions. There is a
part Avith defence as its primary main function, and it has no obligation
to go over the sea. That is raised by the citizens of the particidar
dominion of the Crown concerned, simply for the purpose of home
defence. There is the other part which exists not for local defence,
but for the service of the Empire as a whole, the expeditionary force, which,
in a country like ours, must be naval as will as military,— and I go further
and say primarily naval. There is the Fleet, which, in order to make
the defence of the Empire what we all hope and believe it is, and are
convinced that it must remain if the Empire is to hold together, must
have the complete connnand of the sea, and nuist be stronger than the
fleet of any other Power, or, for that matter, of any other two Powers.
And, in conjunction with that there is an expeditionary force cousistnig of

OC)

Fourtii Dip- i'egular troops wliicli we have just re-organised at home. This expeditionary
•'0 A 111 190" iorce, worliing in conjunction witli the Navy, will he ahle to operate at a

L ' distance for the defence of the Empire as a whole. Behind that, which

Military I call the first line, our conception is a second line consisting of those
Defex( E. home defence troops of which I have spoken. The events of a few years
(Mr. Halihiue.) ago showed that the Empire could act as a whole, and that in a supreme
emei-gency these home defence forces would ponr forth for the defence of
something more than their own shores. But that rests xipon voluntary
effort and not upon any rigid pattern. Onr main purpose in bringing
this subject before yon to-day is to emphasise the desirability so far
ns possible that these home forces of the A'arious self-governing dominions of
the Crown shoidd be organised, if not to a common pattern — because rigidity
of pattern we recognise is impossible with the varying circumstances of the
various countries — yet with a common end in view and with this common
conception.

At home we may have our territorial Army, if the scheme before
Parliament just now goes through. That would be our second line. At
liome you. Sir Wilfrid, have your Canadian Militia, a creation which may
be said in its function and purpose very much to correspond with what is in
our mind in the territorial Army. Mr. Deakin has the same idea in his
mind in organisation, and I think Sir Joseph Ward has also, and I believe
the same idea is in the minds of the (South African Premiers. So that it
seems to me we have all of us got the liroad idea of this distinction lietween
the first, or expeditionary force, and the second or home defence line in
our heads. If it were well worked out, if the fact is made to correspond
to the idea, then it seems to me the Empire would be defended as no other
nation in the world is defended, because its resources would be available
from so many quarters. But in order to work on a common pattern it is
necessary that we should have a common conceiDtion, and the conmion
conception, a matter of great intricacy and great complication when you
get to details, can only adequately be supplied by the most skilled advisers,
and that is Avhere the utility of the General Staff comes in. My main
purpose in addressing the Conference is to suggest for your acceptance the
opinion that the General Staff which we have created at home and which
is in its infancy shoidd receive as far as possible an Imperial character.
I will define what I mean. It is not that we wish in the slightest degree
even to suggest that you shoidd bow your heads to any direction from home
in military matters, but the General Staff officer would have as his function
this : Trained in a great common school, recruited, it may be, from the
most varying parts of the Empire, but educated in military science
according to common principles, he would be at the disposition of the
local government or of the local Commander-in-Chief, whether he were
Canadian, British, or Australian, or New Zealander, or South iVfrican,
for giving advice and furnishing information liased upon the highest
military study of the time. The General Staff' is a class by itself in
the Army. It is so with the German Army, and it is so with the
Japanese Army, it has just become so in the Russian Army, and it is so
in th(> French Army. It consists of the most highlj- trained officers, picked
men recruited for their kno^vn capacity, specially trained, and then detailed
to be at the el])ow of the commanding officer. The commanding officer,
according to the theory of the General Staff, is unfettered ; he has the
complete power of accepting or disregarding the advice of his General Staff
offiicer, liut he has at his ell)ow somebody who is there with knowledge, with
suggestion, with advice, furnished with all the resources which arc supplied
from the central school from which the General Staff officer comes, namely,
the headquarters of the General Staff'. If I may put it a little more in
concrete, 1 will take an illustration, if I may, founded in Canada. In Canada

97

you have made some progress yourselves with ihc idea nf a Cleneral Staff,
just as we have. You have, I think, some five General Staff officers in
Cauada at the present time. Xow, as regards your General Staff olHcers,
although you have a distinguished British Cieneral Staff officer with you,
General Lake, there is no organic connection between what is your General
Staff in endiryo and our General Staff as we have just created it here. But
supposing w(> w('r(i studying at homo in the General Stall' great questions of
Imperial Defence, and, amongst others, questions of Imperial Defence in
Canada, Avhat an advantage it would he to us, and I think to you also, if we
sent you a General Staff" officer, in exchange for one of your General Staff'
officers, who should come over here and who should be working with ns at
the very problems which concern the defence of the Kmpire as a whole in
Canada. And so witli all the other affairs in the Crown's Dcmiiuions. It
seems to me that we might broaden the basis of this General Staff which we
have just created. It is a iiurely advisory organisation of which command
is not a function. The l)egiuning, of course, woidd have to Ije very modest.
If these things were organised, and if we were to bring about such an inter-
change of officers as would tend to make the work of the General vStaff in the
largest sense the Avork of a military mind which had surveyed the defence of
the Empire as a whole, it Avould, it seems to me, do much to bring about
that uniformity of patt<>rn in organisation and in wcajKins, and in other
details regarding military matters, which is to some extent essential if there
is to be effective co-operation in a great war. 1 have circulated four papers
for the information of the Premiers. It is not iirohal)le in the pressure
of other business that you have all had time to read them.

Fourth Day.
20 April 1907.

Military
Defknce.

(Mr. Haliliine.)

j\lr. DEAKIN : We onlv received tliem when Ave came here this

Mr. HALDAXE : But I can give you in a fcAv sentences the substance
of them, and it the less matters if they have not l)een extensiveh' read,
because we are not proposing that they should be adopted as representing
any hard-and-fast vieAV.

The fii'st of those papers, which are prepared 1)y our experts here,
deals Avith " the strategical conditions of the Empire from a military point
of vieAV," and it calls attention to the three great principles on Avhich I
have touched — first of all, the oliligation of each self-governing community
to provide, as far as possible, for its own local security ; secondly, the duty
of arranging for mutual assistance on some definite lines in case of supreme
conunon need ; and thirdly, the necessity for the maintenance of that sea
supremacy which can alone ensure any military co-operation at all. Then
the paper goes on to indicate what Ave are trying to do in making our
contrilmtion to this end : first, organising troops for home (k^fence to repel
raids — that is the territorial army ; secondly, a striking force, an expecH-
tionary force is the proper phrase — the striking force is that small portion of it
designed to act swiftly, and ready to assist any portion of the Empire;
thirdly, a navy capable of maintaining command of the sea. Those
])rinciples may be said to represent the result of our n^flections upon
the events of the late Avar.

The second paper points out the importance of assimilating as far as
practicable Avar organisation throughout the I'^mpire, and of adopting a
uniform system of nomenclature in regard to such organisation. The value
of any assistance Avhich the self-governing Dominions may offer in the future
to the mother country Avill be nuich increased if it can be given in the form
in AA'hich it can readily be fitted into the organisation of an entire army in
the field. On that I should like to emphasise the absolute necessity of
turning our attention to this in times of peace. It is too late when Avar

A' 48668. ('

98

Fourth Day.
20 April 1907.

Military

Defexc E.

(Mr. Huklane.

breaks out. You are at an enormous disadvantage if you commence to
organise in concert for the first time after tlie breaking out of war. The
third paper relates to the patterns and provision of equipment and stores
for Colonial forces. The chief point made is that it is essential that the
) small arms supplied to any force which may have to act side by side with
troops from the United Kingdom shall fire the same ammunition as that
supplied to the latter. A difference in ammunition is one of the greatest
curses in war time. This paper also emphasises the necessity for the pro-
vision of adequate reserves of stores in peace time. The fourth paper urges
the desirability of the seK-governing Dominions, where possible and without
interfering with their own arrangements, giving their orders for ordnance
stores, particularly arms and ammunition, through the War Office, and it
points out that expedition and economy are likely to be secured if this is
done. That is a business matter for discussion. There is a great deal to
recommend it when you come to work it out in detail.

A very important thing touched on in this connection is the training of
officers. We are just now endeavouring to organise a reserve of officers. W^e
have had a Committee sitting which has presented a preliminary scheme,
and I know that the question is also engaging the attention of the self-
governing Dominions at this time. If we could do something to make that
reserve of officers Imperial in the same sense as the General Stafi: is Imperial,
so that you coiild give us from your reserve assistance in time of a great war,
I am sure it would be a great source of strength. Besides, I need not point
out that any organisation of this kind is of the -very greatest assistance to
peace, because it profoundly impresses the mind of foreign General Staffs,
who cannot be sure what reserve we have behind us when we have troops and
officers organised over this tremendously wide area. The general point made
in this paper is that to attain these objects probably the most desirable of all
courses is the one I have indicated, that the General Staff should be Imperial
in the widest sense ; and we point oixt that we shaU. welcome Colonial officers
in its ranks very cordially, and we shall be very glad to send officers to you
to take their places in it. We do not want to ask you, unless you wish to do
it, to double the number of your own officers by sending some here while
you have to provide for other officers in their places at home. If you like
we should be very glad to send out General Staff' officers to take the places
of those you send to us and in that wa^^ to provide a circulation. Our great
object must be to make the General Staff an imperial school of military
thought, all the members of which are imbued with the same traditions,
accustomed to look at strategical problems fi-om the same point of view,
and acquainted with the principles and theories generally accepted at
headquarters.

The Imperial Reserve of Officers is a thing which I think may be better
discussed in detail. It is so complicated that I do not think we could
profitably go into it in this very short Conference ; but on all those points the
War Office is a home for you so long as you choose to Ije here ; and if any of
the gentlemen present who would like to follow^ out these tilings more in
detail will come to us, we have prepared all the information. We should be
very glad if, for instance. Sir Wilfrid Laurier and Sir Frederick Borden
will communicate with us, either personally or through General Lake, fully
upon these points of detail as they come up ; and I wish to say the same with
regard to the other Premiers.

I think I have really now put before you the general points. There are
some minor ones, which again are matters for discussion in detail. If we
get into the field together it is very desirable that we should be under one
military code, aud as far as possible we ought to arrange that whatever local
arrangements may require in time of peace, it should always be kept in view

99

that for discipline there shoultl he a certain military code in operation in time Fourth Day.

of war. Mow you would deal with that is rather a question for you. One lA) April 15W7.

knows the delicate susceptibility of peoi)k' about anything like military rules -.,'"""

iu time of peace, but probably you, a\ itli your legislatures, can solve these ijeke.nx'e.

problems quite as easily as we can. ,-^^ llaliluu ")

I think I may conclude by making a suggestion of the extent to which
we can go in this Conference in a practical direction, I mean so far as this
particular (Conference is concerned. The working out of details, as 1 have
said, may well be done with Sir Nevillt? Lyttelton and the (ieneral Staff at
the War Oilice, and General Nicholson, the Quartemiaster-Cieneral, is ready
to assist in matters of administration and questions connected with it. But
it does seem to me that it would be a great advance if we could agree upon
a resolution in this Conference focussing the broad purpose. As I have
said, we know that this thing must be founded simply upon the attaining
of a common ])urpose, the lulHlment of a connnon end. It cannot be by
the imposing of restrictions or by rigitl plans which might not siiit the
idiosyuci'asies of particular countries. 1 have drafted some words emphasising
the question of the General Staff as the point, as the key to the attaining of
the working out of the common purpose, which does seem to me to be
possible as a conimon basis without in the least interfering Avith individual
liberty. The resolution I have drafted is before you. I would like to say
that if it is agreeable to the Conference to adopt some such resolution as
this, 1 should not desire that we should stop there, but I shoidd suggest
that you should send your experts over to the War Office to confer with
our General Staff, and any other department, as to the way of making an
immediate beginning in carrying out the broad principle which the resolution
affirms.

Sir FREDERICK BORDEN : My Lord, Mr. Haldane, and gentlemen,
I am sure we have all been deeply interested iu what we have heard from
Mr. Haldane, and I may say in a general way that I am in very close
sympathy with all he has said. There seem to be two ideas involved in the
consideration of this matter. I will not say the chief, but certainly the iirst
is the question of the defence of the different Dominions beyond the seas
— I am not speaking now of these islands — particularly the defence of
those Dominions against attack from without ; secondly, as I understand
Mr. Haldane, the agreement upon some method by which preparation might
be made within those different Dominions for effective co-operation with the
central forces of the Empire in the event of any severe strain or stress
arising which woxdd involve the integrity of the Empire. The first proposal
is very easy, and I think, so far as most of the countries represented here are
concerned, is being carried on to a greater or less extent. In Canada,
without waiting to dwell in any detail upon what we have done, I think we
have there made considerable progress within the last 10 years, and certainly
very great progress since this Conference met five years ago. It should
be poTnted out at once, that so far as the Dominions lieyond the seas
are concerncul, at any rate so far as Canada is concerned, we have no
authority under our Militia Law to do anything beyond expend money and
make preparations for the defence of Canada itself. We are absobitely
limited in words to that. We cannot call our Militia out for active service
for any purpose l)ejHmd the defence of Canada. Although Canada took part
in the troubles in South Africa, it was done by a force which volunteered
specially for the purpose and made a special contract i'oi- that purpose. I do
not see" veiy well how any responsibilty could be undertaken to supply any
force for any other pm-pose without an amendment in the law. Further,

G 2

Bovdeu.)

100

Fourth Day. there is a provision Avithiu the Ian- oi' Canada that if it is desirable to

20 April 1907. contribute a force to Imperial defence aln-oad, Parliament shall be called

together, the idea being that each case shall be dealt with Avhen it arises.

n^^Jj^''^ Now I come more to the concrete part of Mr. Haldane's statement,

UEFEN( E. '11 1 • 11 T*i*i 1

CSir Fredoriol- Particularly to the most important proposal, the resolution which we have
Rnvfipn ^ ^ before us, with reference to the establishment of the General Staff. I
would like to know exactly, if I could, whether it is intended that the
General Staff which is responsible to the Home Government and to the
Army Council and the Secretary of State for War, is to be linked in with
General Staffs in the different parts of the Empire, or whether this central
(icneral Staff is to have iudei^endent authority throughout the Empire and in
the different Dominions.

]\Ir. riALDAXE : Not independent authority. It would be a training
school which would send out and lend out experts. Members of your
local General Staff might also be members of the Imperial General Staff".

Sir FREDERICK BORDEN: It seems to me that that is a most
important consideration. I would certainly favour it strongly, and as you
have said, Mr. Haldane, Canada has already established a General Staff'
in embryo, and we hope to develop it. We recognise the absolute
necessitj^ for the existence of such a body, but it really seems to me we
should have our own General Staff responsible to the Canadian Government —
and in the same way all the other Dominions — which might, as you
suggested, I think, exchange officers with your staff ; but I scarcely tliink
it would do to have officers in the different Dominions who were resjionsible
in the first place to the Secretary of State for War here.

Mr. HALDANE : The Imperial General Staff' for this purpose is a
purely advisory body.

Sir FREDERICK BORDEN : So long as that is understood I would
concur ill that view, and I am very strongly indeed in favour of the idea of
exchange of olHcers. I think we should do that, and we are doing it between
the dift'erent departments of the various services of this country and the
Dominion. I think, however, it is absolutely necessary that that point
should be thoroughly established, because I can see difficulties in the way of
an ollicer, for instance, in Canada considering himself to be in a position to
advise, whether directly or indirectly, the War (Jffice, without responsibility
to the Minister who has charge of such matters in Canada and without
responsibility to the principal military authority there. I do not Avish to
elaborate that ])oint any further, but I am glad to know that you entirely
concur in that view.

.Ml-. iIAid)AXE: Certainly, and a memoramkim wiU be drawn up by
Sir Neville LyLtelton which will be submitted to you making that perfectly
clear in detail, if we agree to carry this resolution into eff'ect.

101

Sir FREDERIf'K ROIJDEN : I will not detain the Conference by goin;; Fourtl. Day.
into detail. 1 have read the paper pi-oposed by the Army Council for 20 April 1907.

discussion, and so far as a layman is able to express an opinion, it seems to

me to be an a(lmiral)le paper and one in whic-h I thoroughly cuncur. There Ufk'/m"e
are, however, one or two points whieh 1 would like to mention, and one is in
connection Avith the very lirst paragraph, where it is laid down that the
fundamental principle of the niainten:ince of the Empire rests primaril)- on
supremacy at sea. We nnist agree in that view, and in that connection 1
would like to submit the advisibility — the necessity, perhaps — for the estab-
lishment in the different Dominions of factories, which will be a])le to
manufacture arms, for instance, und guns and amuumition, and so on, which
would render those conminnities safer in the event of the misfortune occurring
of the sea control being temporarily lost. I noticed in one of the other
papers submitted some reference to the necessity for having the diiferent
parts of the Empire— the forces of the different parts of the Empire — anned
with the same weapon, or at any rate Avith a weapon usiiig the same
ammunition. In Canada we have encouraged the establishment of a rifle
factory, which produces rifles iiring • 303 ammunition, although the rifle
differs somewhat in nn-chauism. I would like to say here that I did my best
to induce one of the factories in England to establish a branch in Canada
some years ago to manufacture the Lee-Entield rifle, but failed. 1 had to do
the next l)est thing, that is to get someone who Avas willing to establish a
factory, and that has been done, and we hope, although there has been some
difficulty, that a very good rifle will be issued, and, in fact, it is now being
issued to the troops. It seems to me, although nothing has been said about
that in this very important paper, that that is a matter worth bringing to the
attention of this Conference, and that encouragement should be given to the
diiferent Colonies to bring about the establishment not only of small arms
factories but of factorii^s Avhich would manui'acture orchiance as well.

With regard to one other matter Avhich, as ]\lr. Plaldane said, is a matter
of minor importance, that of pin-chasing through the War Office such military
stores as may be recpiired, in the very connection which 1 have just mentioned
I woidd like to say that in 1900 Canada wanted to jaurchase a consi<lerable
luunber of rifles here. I think I wanted to purchase 15,000 rifles. I
found it im]X)ssible to secure a single rifle. After a time I was offered
some 5,000 if I would Avait long enough. That is a condition of things
Avhich may arise — Ave hope it Avill not — at any moment, and that is another
argument in favour of having an independent source of supply Avithin the
Dominions themselves. It is also a reason AA-hy we should not be tied up
al)solutely to purchase either from the War Ofhce or through the AVar Oflice.
I agree that so far as possible it should be done. I agree absolutely that
we should purchase the same types of gims, and gims that Avill use the same
annnunition. So far as Canada is concerned, we made a contract some years
ago Avith Vickers, Sons, and ^Maxim for the ncAV artillery gun, and I believe
the flrst delivery of those guns Avas made to Canada, but Ave Avere very
careful to impose the condition that the guns must be in CA'ery detail first
accepted by the War ( Iffice, and that the price A\-e should pay should be the
price paid by the War Oflice. I cannot see that there is any disagreeable
i-ompetition in that. It has been suggested— perhaps not in those papers —
tluit Avc are competing really Avith the War Oflice in giving an order of that
kind. There can be no competition Avhen Ave lay down as a very first
l)rinciple that the price is to be the War Oflice price, and also that the gun
shall be precisely the samc^ gun. Those are perhaps matters of detail,
but I thought it only fair that I should make a statement as to AA-hat has
actually happened in that respect.

NoAv, in conclusion, 1 have oidy to say that I am sure there is, so far as
the Canadian people, and so far as the Canadian Militia are concerned — and

£ 4Sii(!8. G 3

102

Fourth Day.
20 April 1907.

Military
Defence.

(Sir Frederick
Borden.)

this will apply to all the military units of the Domiuion — ouly one desire,
that is, to prepare in every possible way for the fnll protection of our
OT^ai territory. We have shown, l\y relieving the War (_)ffice of the responsi-
bilitj^ for the maintenance of Halifax and Esquimalt, how far -.ve are willing
to go, and I think we showed a few years ago, in the contingents that were
sent to South Africa, what the spirit is that animates the people of Canada
when the Empire seemed for a time to be in peril. I only wish to add
that I believe thoroughly in the idea suggested here as to the adoption
of uniform organisation throughout the different parts of the Empire. There
can be no ditticulty whatever as to that. We in Canada have so organised
our militia system from top to bottom, so far as we could do it. In the main
we have adopted the princijile that it is absolutely desirable that we should
follow the lead of the War Othce in all matters of organisation, provided you
do not change too frequently here, so that we cannot keep up with you.
There can be no difficxdty in doing that, and it is certainly a desiralile thing
to do. 1 believe thoroughly in the exchange of officers. I ubsohitelj' concur
in the ideas expressed as to the education of officers. We are very glad
indeed that the War Office here is giving us certain facilities in the matter
of educating our officers which w-e are trying to take the full advantage of.
Altogether, I think that matters are working very hannoniously, and I see no
reason in the world why a great deal might not be accomplished in the way
of preparing for any supreme struggle which might take place — which we
hope will not take place, but which may take place — in the matter of keeping
in close touch Avith the organisation here in England, and in the matter of
exchange of officers, and of bringing about a better understanding between
officers and military affairs in the different Dominions and the central
organisation here in the British Islands.

Mr. DEAKIN : My Lord, and Mr. Haldane, it is true that I have not seen
one of the papers laid before us this morning, but have no doubt that has
not been due to any omission on the part of your officers. Owing to
the circumstances under which we are assembled, I have already had occasion
to mention casually that on arrival we were overwhelmed with a mass of
printed information, the value and extent of w^hich I have already acknow-
ledged, but which, under the circumstances of pressure which prevail,
are really, though in our possession, beyond our reach ; so much so, that,
occupied as one has been with the question immefliately preceding this, 1 was
not even aware of the existence of these valuable papers. The mere glance
I have been able to giye to them discovers that they are indeed most usefid
possessions of this Conference. These Avill take a high place, I believe,
among the sources of knowledge which, after this Conference, will be placed
at the disposal of the public of this country, and particularly before the
public of our own countries, where I am sure the study of these papers wiU
be of the grefitest vulue to ys all. Then we have been indebted to the
masterlj' and luminous exposition of the principles of military defence, which
we have had the privilege of hearing from the Right Honourable the
Secretary foj" War. I trust that my colleagues on the Conference will not
shudder if I venture to suggest that the sooner that statement gets in full
to the public of the Empire the better. Unless there be some reason,
not apparent to me, I do not know why it shoidd not at once appear and be
communicated to all who are interested in it. That, again, will be a store-
house to which we can refer for the elucidation of many matters. And for
my own part, I wish that it would reach every citizen of all our dominions.

It is not necessary, especially after the inquiries and criticisms of our
friend the Miuister of pefence for the Dominion of Canada, to dwell upon

103

the various pointu on whicli it can be suggested ttat the propositions Fourth D«y*
submitted to us to-day uiigiii iuipingo upou the detonuiuations of the •-'<> Aiuil iyo7.

Governments and Legishitures oi" the Duiiiinious here represented. For my

own part I feel no anxiety on that score, because the address which you Militabt
delivered, Sir, cbsplaycd at every point a most distinct appreciation ol our ,. ., , .' ,
susceptibility. You uiade it perfectly clear that what is laid before us comes ^ ^' °* '"'•'
in the way of counsel, expert advice, well-matured advice, backed up Ijy
knowledge, but simply advice, which it would Ije well for all our Parliaments
to take into consideration. That broad general principle having been
established I do not propose to dwell ujion it in detail. So far as 1 follow
it, that is not necessary. In partiiudars, we have the advantage of tlie
comments of the Minister for the Department of Defence of the Dominion
of Canada, who is necessarily much more in intimate relation with this
matter than either my colleague or myself. We are associated with
departments of peace and not of war, and the knowledge that we enjoy is
that which is general to all meml)ers of the ('abinet. Still, I have been
svifficieutly iuformeil by my colleagues tlirough their advisers to be able to
appreciate the fact that you have covered the whole ground upon this
question. Besides that you have touched upon some matters which it is
our desire to have spec'ially considered. So far as I am able to judge, the
proposition for the future use of the General Staff is one of as much import-
ance as it is of obvious magnitude, 'llie General Staff is supposed to be
the brain of the Army. Any proposition which woidd extend its activities
or permit us to share them, would be heartily welcomed in the Common-
wealth. A General Staff, such as tve possess, naturally occupies itself with
those problems which are peculiar to Australia and its very special situation.
At the same time we quite realise that any situation, however special,
requires to be dealt with in the light of certain general principles, and
particularly of the latest developments of martial methods and organisation,
and consequent!}' I. anticipate nothing but great advantage to us from any
association with the General Staff'. That will arise in a varietj' of ways
under other proposals which have been brought forward. In the list off
subjects laid befoi'e us the General Staff is properly put first, and really
the particular questions afterwards suggested, are, many of them, to be dealt
with, if not by the General Staff', at all events in the light of its studies.
Passing then to them, tve find the first matter submitted is our adoption of
similar armaments, and that is, 1 think, fully recognisable even by a la\nuan
as one of the essentials of effective imperial defence. We say yes to that
proposal, so far as it can be carried out, without the slightest hesitation.

Next, apparently a little out of its logical order, comes the proposal for
an interchange of units, which in our case appears almost impracticable.
Tlie great distance which separates us not oidy from this country but from any
other dominion in which such an exchange would be proposed, is one obvious
obstacle, but a greater obstacle is that our force of permanent men is relatively
small; it cojisists of well-trained exjierts whom we should be loth to part
with, and a unit in that sense we couhl hardly spare even if its position wa«
endeavoured to be taken by an equally competent unit abroad. We have no
possible objection to urge to this proposition except in our own case the
question of its practicability, that is as to the unit. xVs to the interchange
of othcers, I am specially asked by my colleague the Minister of Defence
of the Commonwealth to jiress for an extension of that ]>rincii)le. We at
present enjoy the privilege of exchanging with Canada and with India and
with yourselves, single officers, sending to you and you sending to us. We
find that in every tvay a tiseful practice, but we desire to carry it out on a
larger scale, that is larger for us because ours must be on a small scale as I
need not remind you. The proposal which you have made vfith reference to

G i

104

Fourth Day. ^}^Q exchange of officers represeuting- our General Staff and those of tlie

20 April 1907. General Staff' of this country, exactly lits in with another request which "we

,, intended to prefer. This Avas that othccrs of higher standing than those

Defence which have hitherto been exchanged should Ije exchanged. It has been

(Mr Deakin ) pressed upon me by my coUeagaie that, if possible, these officers should not

simply be attached to other men in this coiuitry of the same rank who are

doing the work. We Avish, if possible, that our men should be put to do the

work ; they may fail or they may do it imperfectly and that will have to be

provided against, Init we believe that without the actual pressure of active

respousiliility upon them you will not test their capacity and they will not

learn the limits of their own knowledge. In tlie matter of interchange, I

think you will find the most cordial approliation of your proposition from the

Commonwealth and its Defence Department.

There is a question to which you have not referred, a minor question,
but which arises in that connection with regard to the relative rank of
officers in the forces of the Outer Empire and the forces of the Inner Empire.
On this we hope to have the advantage of your counsel. As to the estab-
lishment of militarj- schools, in that respect as in others, we are envious
of the advance of our friends in Canada, and recognise that the course they
have taken is one dictated by sound policy and experience. Our own
difficulty is that the establishment of a true military college implies a
minimum number of regular students year by year, whom at present we
hardly see our way to obtain, becaiise of the want of adequate opportunities
for such a number afterwards within our own forces. We appreciate the
high class training which is obtainable in this country. It is more up-to-date
than we could expect to be, but at the same time our circumstances are
special. Take first of all the task of self-defence which is touched upon in
that very valuable memorandum. The defence of Aiistralia means operations
at such distances relatively to those of the United Kingdom, such enormous
distances among a population, except upon the coast, so sparse, with difficulties
of transport, transit, and concentration, all of them so absolutely altered by
scale and circumstance from those of this comitry that, for the purposes of
our own operations within the Conunonwealth, the training of your colleges
woidd require to be supplemented by jiractical training of our own. That
raises particular issues upon which it would not be proper to detain you now,
but it is perhaps as well to mention some of them. The need of adaptation
is especially manifest in a democratic country such as ours, in wdiich the
officers are chosen fi-oni all classes, in which eighty-nine one-hundredths of
them, like ninety-nine one-hundredths of our citizen forces, are composed of
men who earn their own livelihoods bj^ other callings. They devote their
spsLve hours to defence purposes, and that earnestly, as well as most generously,
becoming more effective in fact than they might appear to be, judging them
mereh- by the tests of military parades. In Australia we have been rather
sid)ject to mockery because we have followed so closely some methods of the
Imperial forces. As fast as thej'' Germanised we Germanised, until some
military experts have criticised iis for failing to adapt our drill and operations
to the country in which our men will require to act, dwelling too much upon
getting them upon parade in exact line, at the exact angle, with the proper
cap and licit. I admit that probal)ly we are open to some of these criticisms,
but are beginning to realise that there must be a greater amount of adflptation
to our particular circumstances.

The question of military education generally is serious. We see our
way to what those who advise us on these matters tell us is a sufficient
military training for the men, with little alteration in our j)re.sent system,
mainly because none of our men are pressed men, all are volimteers, who
join' because they have an enthusiasm for the work. The consequence is that

105

many of oiir onniniaiKltTs, nu-ii ol' oxptM-icncc, tell us thai ihcy liiid -.vitli our Fourth Day.
men a rapidity of progress, a readiness to siil.niit to diseipline and a prompt- 20 April Ui07.

ness in acquiring toclmical knowledge which they are not accustomed to find

elsewhere. That is because every man takes a "pride in his task ami throws UErJ^,'^r^
himself into it, because it is his chosen pursuit in addition to his ordinary ^j^ Deakin ")
labours. Hut while we feel hopeful about our men, we see that our weakness
lies in the officering of such men. We recognise what you have wisely said
that the most (essential need of the Army now-a-days is of the up-to-date,
intelligent, self-dependent military officer with a capable knowledge of his
biisiness and yet not a slave to the rules and theories of the study. Any
advice upon that head we shall be most Avilling and ready to hear, becau^;
we recognise that this is th(> direction in which we most need to improve.

The other point upon which Sir Frederick Borden with whom we
quite sympathise dwelt, is the wisdom of our making provision to supply
our own needs in times of emergt;nc-y. I am happy tcj liiul, from
my hurried glance, that the paper headed " Patterns and Provision of
Equipment and Stores for Colonial Forces," states in paragraph 0 that the
Quartermaster-General and the ]\Iaster (.ieneral of the Ortlnance recommend
that : " It is most desirable that the area of supply of the warlike stores
inider reference should be as wide as possible, and, therefore, the; Colonial
Govermnonts should 1)e urged to arrange for local manufacture and
" provision rather than to rely on the resources of the United Kingdom."

Sir FREDERICK BORDEN : I had overlooked that, sir.

Mr. DEAKIN : That recommendaticm exactly supplies what Sir Frederick
Borden was desirous of s(>curing, and also supplies what we feel in our remote
position to be still mor<^ urgent. ()ur friends. Sir Wilfrid and Sir Frederick,
in contrast with us, r(>side in the centre of modern civilisation with highly
eqiiippetl nations all round them ; by rapid conunuiiication they are kept in a few
days in touch with all. Our position at the other side of the globe, surrountled
by alien races to whom we cannot look for aid or assistance in this matter, or
indeed in any other, and far from anj^ sources of supply of arms ami material
of w-ar is A^ery different, and we feel its urgency. We have an ammunition
factory already in Melbourne, l)ut although that meets our demand for small
arms annnunitiou, we do not ol)tain a satisfactory cordjte supply. We have
now under review, and intend to propose to our Parliament, such an extension
of our local production as shall enable us to cope with future demands some
years ahead. We have an annnunition reserve, of course, l)ut in addition
propose to cope w'ith our demand by factories of our own. 1 propose at an
early date to ask your colleague, the First Lord of the Admiralty, whether
it will not be possible for us, with advantage to the Admiralty, and with
advantage to ourselves, to enlarge any ammunition factories wdaich we may
be able to esta1)lish so as to afford the Admiralty some of the munitions it will
need in time of war. Needless to say, if we are cut oil" from sources of supjply
the ships of the squadron in those seas are cut olf also. If they are employing
their ammuniticm, as it is to be hoped they would be most effectively on any
hostile ships with which they have to deal, the (luestion of re-supplying their
stores, without a visit to a very remote base, would of course be a veiy
considerable matter for them. It would be an important matter for us if
we can lease or establish a factory on such a scale that its oiitput in any
given year may be stifficiently large to make us independent of any of the
reasonable requirements of war. That is to say, our factories to be reliable

106

Fourth Day.
20 April 1907.

Military
Defence.

(Mr. Deakiii.)

must be of a certain power. We can have a factory for ourselves, but it must
be on such a scale that in time of war its complete output might prove
utterly insufficient.

If, however, Ave are able to supply your naval requirements, or some of
them, at your own rates, that is to say, the rates you would otherwise pay,
making a fair allowance for any differences, that would be of great advantage
to us. We do not want to make any business profit out of it, but we desire
to have a factory alwaj^s at work and on such a scale that when the time
of war arrived it might readily be enlarged to meet even war necessities.

As regards the arms. Sir Frederick Borden has anticipated all that it is
necessary to say. We have been driven to do business with private suppKers
simply because the War Office could not supply us. Whenever we wanted
arms the War Office wanted them most, and thej' had them first.

i\lr. HALDANE : I think that was during the war, Mr. Deakin. I may
say that just now we shall be only too glad to execute orders for any number.

Mr. DEAKIN : Exactly, you are always ready to execute orders when
neither of us is under pressure. That is what has driven us outside. We
know the value of the War Office criticism, but we also know that the War
Office looks after itself before it looks after iis, and when it is eager for
arms or ammunition we have to wait. Any arrangement which can overcome
that and put us on a basis that for any reasonable demand we should be
entitled to a certain proportion of your output of anything we do not make
for ourselves, would be a great improvement. Just as you wish to know
in advance what support you may expect fi'om each part of the Empire, each
part of the Empire is entitled to know what support in the way of arms and
material it is entitled to expect from yon in emergency.

Mr. HALDANE : I think we can do business on that basis.

Mr. DEAKIN : I hope so. I may say we do not take a narrow
view of our military obligations or their develoi^meut. The movement the
public with us are taking to most kindly, and which has most promise in
connection with our military strength, is the Cadet movement. We hope to
have at least 3(J,0(J0 cadets next year under training without counting those
who have already passed through, alid my coUeag-ue, who is sangiiine, thinks
we shall have 4U,U()0 or 5U,U0U in a short time. They get a fair training with
handy little rifles, amongst others the Westley-Richards, which is in favour.
We had tenders a little while ago in which a Belgian firm who make a
specialty of such rifles olfered to supply these Westley-Richards at about
37s. or 37s. 6d., whereas from Great Britain they wanted 39s. We took the
39s. weapon without a moment's hesitation. That was to help British
industry to tiirn out British weapons for British men. Although we have no
complaint against Belgian workmen, it is not our business to encourage their
factories when we can help factories for the manufacture of small arms here.
We do not fake a biassed view, but where we cannot supply our own'needs
we do desire to support the factories of this country.

The training of cadets, of course, is a matter which will tell more iu
the future than in the present. We are passing them through now at the
rate of some 10,000 a year. In our largest State, New South Wales, my
colleague reminds me that they have been passing them through at that
rate for a number of years. The consequence is that in a rudimentary

107

knowledge of drill, ^ettin^ them well set up, used to simple formations, and Fourth Day.

handling the ride, they do very well. Kille-shooting is rather a national i?<> April 1907.

pastime with us; it is favoured everywhere. I have had made, and shall be

glad to hand in three maps, one showing that in every quarter of Australia ijkk'fJo"e*

there are rifle-clubs in active practice— from the extreme north at Thursday ,vf n i.- \

Island to the extreme south, Hobart in Tasmania, and to the extreme

west in Perth. Wherever there is a settlement there is a rifle-club or there is

going to be a rifle-club, and although wo have not yet associated that

movement with formal drill the desire to have rifle ])ractice and 1)6 a good

shot being strong, we have great anticipations. I Avill tihow you on another

map that wherever there is a settlement, and ahuost wherever there is a

school, there is to be a cadet corps in active operation. There is some kind

of drill in every school. I will show you anothcu- map which exhibits eveiy

detachment of our forces, whetlier it is Artillery, .Mounted Infantry, Infantry,

or permanent forces, in different colours. You have oidy to look at the map

to see in an instant what and where our forces are.

The question of patterns, the question of purchase of material, and the
Military College having been touched on, the only matter remaining is a

Eermissible parallel betAveen the General Staff and the Committee of Imperial
•efence in respect of which a ^Memorandum is laid before us. 1 am happy
to know that you have complied with the request we have made, to be
somewhat more practically associated with this Committee, jiist as we desire
a practical association with the General Staff. I find that your Imperial
Defence Connnittee bears an analogy to this Conference itself, except that
we are represented politically. Both are devised to facilitate common
discussion and agreement, to advise in the case of questions of local or
general concern Avliich may be referred to us, and to bring experts into
direct touch. Both are purelj' consultative bodies having no executive
powers or administrative functions when national and colonial questions
are discussed. We have already enjoyed the benefit of the advice of this
Committee, generously given when it was asked by our Govermnent in 1905,
and we have now gained the further advantage of permission to send a
representative to it when any questions we submit are to be dealt with. I
would like to add that as this is the Conmiittee of Lnperial Defence,
covering both military and naval affairs, we shall hope to be represented
there occasionally. Although it is easy to put a question, it is not always
easy to put it without undue prolixity in indicating precisely where our
difficulties lie. We obtained a valuable report from the Connnittee of
Lnperial Defence, but it did not answer a number of queries in which we
were specially interested, and which we hoped to receive advice upon.
Now that we have permission to have a representative enabled to attend
that considtative committee, we shall be able to point out just where our
difficulties lie. Your reply would not be as the last was, most atlmirably
draftccl from a general point of view, without meeting some of our
particidar ditlicidties at that time.

In conclusion let me once more say that your broad-minded view of
Imperial possibilities in the way of military defence, and the way they can
be utilised, is not only of the highest interest to iis, but 1 can assure you
will be practically reviewed in relation to our own circumstances with the
warmest possible desire to co-operate with your oHice in the great projects
you have clearly outlined to-day.

Sir JOSEPH WARD: My Lord, the value of the meeting of the
Ministers from the self-governing countries will be enormously enhanced
as the outcome of the discussion and the information which has been

108

Jourth Day. afforded to us to-day in regard to the defence of the Empire. I wish to

20 April 1907. gr^y qj^ hehalf of the country I represent that I look upon it as of very

Military great importance to have heard the views of His Majesty's Ministers of

Defence. the United Kingdom upon this great question of the defence of the Empire.

(Sir Joseph -"■ have read some of the papers — not all of them — very closely, that have

Ward.) been furnished by your staff and I endorse the sentiment already expressed

that they will be most valuable, although some of them are of a conhdential

character, for the information of Parliament as well as for the guidance of

the administration that it is my privilege to represent here.

I would like to say I clearly imderstood from the observations of
Mr. Haldane that what is suggested by him is in the direction of suggestion
and not anything binding on the part of the Colonies. What they may do
Avill be of their voluntary act or of their voluntary co-operation and assist-
ance in the direction of assisting and bringing about a general scheme that
would be of advantage to the Empire as a whole. I am not going to take
up the time of the Conference at any great length. I want to say that
the aspect upon one point put forward by the Minister of Defence of the
Dominion of Canada, as to the powers of his country to incm- responsibilities
outside of his own Dominion, apply with equal force to New Zealand. We
are responsible for the expenditure incurred for the protection of our own
country. Our people in the past have shown their readiness and will do so
upon every occasion in the future, I have no doubt whatever, to adopt flexible
conditions to meet extraordinary circumstances shoidd they arise. Upon
some of the points referred to as to the obligations upon the Colony, my
colleagues in New Zealand, and Parliament itself, will, I am confident, ratify
and would undertake them in order to bring about a stronger and a better
system for the general defence of the Empire. I do not purpose to go into
details regarding the several suggestions. Reading them as a layman,
though holding the position of Minister of Defence of our country, the
proposals in the Memorandum signed by General Lyttelton are very valuable,
and, generally speaking, those strategical conditions from the military point
of view, our Colony would, I think, endorse. It is made very clear that it is
tlie opinion of the Gleneral Staff, not the opinion of the Government of the
United Kingdom. So far as trying to bring aliout uniformity from the
expert point of view, I think the Council of Defence which we have
established in New Zealand upon lines similar to that of the Old World,
would )je ver}' glad to co-operate with the military advisers of the British
Ciovernment, who have in this Memorandum given most valiial)le suggestions.
The possibility of assimilating War organisation throughout the Empire is a
high and worthy ideal to aim for. It is of the first consequence to Britain
itself to have a thorough organisation within its own borders as it is throughout
the Empire for the purpose of maintaining its own position an<l that of its
outlying possessions. We would be only too glad to co-operate in order to
bring about that assimilation of organisation throughout the Empire.

In reference to the desirability of having uniformity in patterns and
provision of equipment and stores for Colonial forces, generally speaking I
concur with the reservation whicli is made in No. 6, which I think Mr. Deakin
quoted from that ]\Iemorandum, wlicre it is suggested that war stores and
materials should be obtained if possible through the War Office so long as it
is recognised that we have the right, if we go for the same quality of ammu-
nition, to make it in our own country — with that reservation 1 cordially
endorse the sentiments expressed in respect to that. We already make a
large quantity of ammunition in our own Colony for our own use, and we
are likely to extend it. The suggc>stion contained in some of these Memo-
randa as to our using the same class of arms and ammunition is highly
important in view of any contingency that may arise in the futixre calling for

101)

Coiiiniou action otitside of oiii- own couutrv, when we may rpquirc in an Fourth Day.
emergency to send onr own miMi and onr own arms to another country 2:) April 1907.

for the purpose of oonnnon defence to light an enemy.

I wouhl like very much to say that xipon this question of the interchange ?{'.'.'^',*!'^
of units and oIKcers I hold a most pronounced opinion. Unlike my friend „.'''^J'^'^'
Mr. Deakiu, 1 think that New Zo-aland could arrange for interchange of units. \v,,rT')

We have tlie N'olunteer system there ; we have for j'ears had all the onlinary
organisations referred to hy Mr. Deakin in the matter of cadets and rifle
ranges, and these are being excluded for private citizens all over the country.
In connection with our Volunteer system, the only troidjle we have is to keep
the numbers down. .\U o\er our cotmtry we have the very liest class of men
offering to join our \dlunteer corps. They are encouraged by men in every
responsible position you can name in the country. Our captains of industry,
our kings of c()nunerc(>, the memi)ers of the .\dministration of the day, antl
the ofhcials connected with our important State departments and the rank
and iile of these de]iartments realise that it is upon the popular l)asis of a
Volunteer system that w(! hav(> to provi(t(> for the internal defence of our
country, and in the event of trouble arising they are our source of internal
defence, and we encourage it in every possible way. Now 1 have no doubt in
my own mintl that if there were — perhaps not in an extensive way in the first
instance — an interchange of luiits of volunteers from both parts of the world,
I do not say with the militia, because we have no militia in Xew Zealand, but
if there was an interchange of units, as betwt'eu the Old Country and ourselves,
I have no hesitation whatever in saying that we would be able to get from time
to time a body of men, not from any one ]iarticular part of the colony, but
selected from various poi-tions of it, with the instruction anil the information
upon detail so essential in times of trouble so that they may come back, and
l)y permeating the country, so to speak, be able to inspire and infuse into
others something of the enthusiasm you are trying to inspire in the Old
World, and it brings about a feeling that the interchange of individuals
amongst the rank and file tends certainly to a desire for unity and a desire for
co-operation, and that that is not to be confined to the ollicers only.

Mr. DEAKIN: What al)OuM heir livelihoo<ls?

Sir JOSKPll WAUD: I was just going to touch upon that. For my
part I should be prepared, and I am quite satisfied my colleagues would, to
see that a \'olunteer company coming to the Old Country for the purpose of
the interchange of practice and ideas, should be paid reasonaldy to enable
them to do so, and the same system miglit with advantage apply in l-lnglaud
itself. AVe need not aim at doing it on an extensive scale, but my belief is
that 'it would l)e worth trying with the idea of bringing about that
mutuality expressed in these inqwrtant papers. The desire voiced by the
Secretary of State for War to-day to try to have co-operation for the purpose
of defending th(^ Enq)ir(^ in tiuu's of trouble or stress is well Avoj'th working
for.

llv. Dl-'AKIX: That docs not put them baidc in their ohl employ-
ments ; you pay then\ while they are away, but when they come home
their places are taken l)y other men unless you make some extraordinary
provision for it.

110

Fourth Day. Sir JOSEPH WARD : That is so, but the same thing appHed during
20 April 1907. the time of the South x^frican War in all our countries ; we had many men
giving up their ordinaiy occupations and going out to fight.

MlUTABY

Defence.

Mr. DEAKIN : Many of them suffered for it afterwards, too.

Sir JOSEPH WARD: No douht that is one of the difficulties that
xmfortunalely are inseparable from the troubles of war, and I do not quite
know how you could, in the event of Volunteers occupying a position of
complete dej)endence in the country who would desire to come here for
instruction, arrange for the continuance of their appointments in their own
country until they returned. That to a large extent would have to be a
matter for them to consider.

Regarding the interchange of officers, the suggestion of Mr. Haldaue
iipon that is a most valuable one. We are doing it now to some
extent at the invitation of the War Office ; we are sending some of our
officers now from time to time here for purposes of instruction, hut
if they were to provide now, which I understood to be referred to by
Mr. Haldane, for allowing responsil:)le officers from here to go out paid by
the Imperial Authorities to take the place of the responsible officers we
have in our coimtry paid by ns, so that in the interval the void created
by the despatch of our officers to the old country would l^e filled by the men
from here, both countries paying their officers, that is, that we paid ours and
yoia paid yours, the purposes of information and instruction of officers and,
in my opinion, it would be most valuable indeed. Up to now we have really
had nothing of the kind. It seems to me that if we conld have Imperial
officers coming oiit to our coimtry and our Colonial officers coming home here,
each temporarily filling the position vacated by the other, it would, witliout
additional cost to our respective Administrations, enable the changing of
these officers to be going on for all time I should say, imtil that splendid
scheme which is in all our miuds of a common system of organisation with
a view to having, in time of trouble, uniformity in all respects and conse-
cxuently greater efficiency. A highly educated Empire staff from all stand-
points is desirable. I should most heartily support that from the standpoint
of New Zealand.

This Resoliition which 1 have read carefully, while not expressing
anything binding upon our respective countries, and which may require
to be altered in some respects, would be a good thing for us, as the
representatives of our respective countries, to affirm. It woidd show at all
events that this Conference of responsible men meeting here " without " (as
the Resolution itself expresses it) " wishing to commit to immediate action
" any of the Governments represented, recognises and affirms the need of
" developing throughout the Empire the conception of a Ceneral Staff
" recruited from the forces of the Empire as a whole." I am quite
prepared to support a resolution of that kind. It does not take awa^^ from
us the all-necessitous requirement of our own staffs being responsible to
their own (iovernments, of the control of our own staffs. It does express
a desire that we should recognise and affirm the need throughout the Empire
of having a General Staff recruited from the forces of the Empire as a
whole, and for my part I most cordially support that. Sir Frederick Borden
has well expressed upon some material points the views that his Govern-
ment entertain in the matter of protecting their position. Naturally we

Ill

all require to do tho same, and in conclusion I wish to say T am exceedingly Fourth Day.

glad of the opi)ortuQity of having lizard I'rom tiie Secretary of State for War 20 April I'JOT.

his views upon this matter, and 1 hope the publicity Mr. Deakin has

suggested can be done. I do not know whether we are to regard matters Df.kenck.

relating to defence as eoniidential. Some of the matters wo are dealing ,^. t„,„.i,
• \ -11111 'i-ii •!• 1 {^"^ Joseph

witn necessarily sliould be eoniidential, l>ut if upon such pomts as we are Ward.)

discussing lu^re we could give out (i am referring to anything I am

saying myself, of course) such jiortions or all of the speech of the

Secretary of State for War, educationally it would be valuable to the

people in our country, certainly. Th(i expression of opinion of a gentleman

occupying a position of such grave responsibility as the Secretary of State

for W^ar will be of intense interest to the public of the self-governing

(•clonics. If the principle of what is given out in a debate in the House

of Commons could be applied in this instance it would do good, but how

far the confidential can be removed from the discussion which has taken

place I am not quite prepared at the moment to say. I am animated, as

I am sure eveiy one of us is here, with the ilesire to see the system maile

as valuable as possible for the Old and the New Worlds, and without giving

away any portion of it to those who want to know what we are doing, other

than is aljsohitely uecessarj-.

I wish again to express nu' personal appreciation of the information
furnished to us and of the value of this contained in the official reports
submitted. 1 l)elieve a great deal of good will come, and the great organi-
sation which the responsible authorities here are trying to bring about will
be hastened forward. Speaking on behalf of my country, I am only too
glad to assist my colleagues representing the other countries in improving
as far as we possibly can.

Dr. JAMESON : I would ask my colleague, Dr. Smartt, who is specially
qualified to deal with this subject, to 6])eak upon it on behalf of our Govern-
meut.

Dr. SMARTT : Lord Elgin, I am not desirous of unnecessarily taking
up the time of the Confereiu-e, but wliik' not, as yet, having had an oppor-
tunity of reading the Defence papers — which only came into my hands
this morning— I should like to expi-ess to ^Ir. llaldane how much we are
indebted to him for the able and lucid manner in which he has brought this
matter forward, because it makes us realise that the Secretary of State for
War and his technical and scientific advisere are prepared to profit from the
experience of the past, and to do the best they possibly can to allow us to
meet any contingencies that may possibly arise to the detriment of the Empire
in the future.

So far as the Oape is concerned, 1 think we thoroughly endorse every-
thing that has been said by the Secretary of State for War with regard to
the General Stall and tlie interchange of officers. As the Secretary of
State knows, some short time ago a conference was held between
the various Oolonies in South Africa, under the presidency of the High
Commissioner. There the obligation.s which rest upon the individual
(;ol')nies, not al.Tie to provide for their own h)cal defence, but also to
provide for the defence of the whole of South Africa, were fully recognised.
A tentative arrangement was come to— naturally subject to the approval

112

Fourth Day. of the various Parliaments — whereby certain of our forces •ivould he inter-
20 April 1907. changeable in the event of any local emergency ; and the principle was

also recognised, and Avill naturally have to be accepted, or otherwise, by

MiLiTAUY ^^^ various South Afi-ican Governments. A point upon which I am
" ' extremely anxious to hear the opinion of my friend General Botha, is as
^ ■■• ™»' ■) iQ whether we shoiild not disband and re -enrol our permanent forces on
the understanding that they would be under obligations not alone to serve
anj^vhere in South Africa, but, in an emergency — and with the consent
of the Governments concerned — anywhere the Empire might require.
I believe the feeling of the people of Cape (Jolonj^, and I hope the feeling
of the general population in South Afi-ica, will be favourable to such a
proposition ; and I think if that principle were accepted by the other
Colonies, it would be the first nucleus of a real Imperial Army. So far
as our permanent forces are concerned (I speak more of the Cape Police
and the C.M.R.) I am perfectly certain that practically all of them would
be prepared to be re-enrolled upon that basis, that is to say that they -would
be liable to be called upon for service in any part of the world where they
might be required.

So far as our Naval defences are concerned, we have lieen onlj^ too
anxious to see if we could do anything to improve those defences, and I
trust that the result of the consultation we will have the opportunity of
having with the Admiralty before we return to the Cape will be that, on
behalf of South Africa, and certainly on behalf of the two maritime Colonies
of South Africa, some arrangement will be come to with the Admiralty
whereby we will, on the same basis as I have suggested with regard to the
Military forces, enrol, inider an Act of Parliament, a force of Royal Xaval
Volunteer Reserves who will bind themselves in time of war not only to serve
within territorial waters, but to serve in any part of the world in which the
British Admiralty may require their services ; because I feel strongly that
it is not the contributions whicli we give to the Imperial Government (which,
after all, are only a drop in the ocean) that are important, but that the great
contribution we shoiild give is personnel trained as efficiently as possible
in order to make up the waste of war should any gi-eat difficulty arise.

It is hardly necessary for me to say anj^ more, because I think tliis
Resolution will be accepted by tlie Conference. I only wish the Resolution
was wordcfl a little more strongly, and — perhaps the Secretary of State
for War may think it over — that it contained an expression of the opinion of
this Conference that a certain portion of the forces of all the Colonies or
Dominions beyond the Seas should be enrolled upon the basis that, with the
consent of their Governments, their services Avould be available wherever
required.

I may also, perhaps, Lord Elgin, as it is of such great importance,
accentuate what has been so ably said by Mr. Deakin and by Sir Joseph
Ward, that I do not think there is anything in the statement of the Secretarj^
of State for War which should necessarily be withheld from publication. So
far as the Empire is concerned. I am sure it will do a great deal of good ';
and I do not think, so far as foreign nations are concerned, that anybody can
take exception to it. If they did take any exception to it, it woidd onlv be
to assure then: that, so far as the British Empire is concerned, it is determined
to maintain and uphold its own interests in every part of the world, and
that is not a position which any foreign nation could possibly take exception
t(j. I therefore trust that the Secretary of Stale for War will consent to make
public this most valuable statement which he has been good enough to lay
before the Conference.

II-'.

Mr. F. 11. MOOR : My Lord, I have lo thank, the ( iuvcrumeiU lor having Kourih Day.
put before us so clearly and lucidly the views that are hehl here with regard -'o April 1907.
to some organised system for connnon TmiMTial defence, and the resolution
that is phiced before us is one which I can give my sincere support to. 1 Defence.
agree Avith the views that have been expresseil by the previous speakers thai,
by having a common system, such as is indieate<l here, on these broad
principles, that is one that can only lead to good.

The interchange of Staff officers, as indicated here, is one that will
undoubtedly be of great advantage to the Colonies in the direction of keeping
the Colonies duly informed and educated up to tlie latest standards of military
thought and sciiMice. 1 feel sure that, as regards South xVfrica, our tinal
military organisation with regard to that very important possession is still in
the lap of the gods, inasmuch as ',ve are not yet a federated coimtry, but we
all do realise that we have a counuon duty first in providing for an ellicient
local defence, and eventually in giving as much assistance as we possibly can
to the Enipire ; but we do feel. Sir, that to carry this out elHciently it can
only come al)out when we have obtained what we all hope will be in the near
future — a Federated Stib-Continent.

We feel. Sir, that in that part of the world we are especially bound to
fake the gravest notice of our military efficiency. We not only hold a most
imique position as regards the Empire in the event of a general war, lieing
in such a very important position with regard to all the important trade
routes, wliich is tlie imperial aspect, but we also have a very unique position
as regards our local euviroumeuts with respect to the large native jiopulation,
that it is our duty and our burden to govern and control. Having all these
heavy obligations upon us we feel that it is only by a common purpose that
we can carry out efliciently the conditions of the defence that will be
satisfactory to ourselves in the first instance, and also, I trust, to the Home
Government when our organisations are complete.

Speaking for the Colony I represent, 1 believe there, Sir, we are more or
less in advance of any of the other British Colonies in the Empire. We have
there a compulsory system as regards our Militia, and during the late
disturljauce with our natives we ditl find that this system of ours was fairly
effective. There is no doubt it will have to be amended in some directions,
but on the Avliole, Sir, it has worked well. We have also a verj- complete
cadet system there in connection with all our Public Schools. All our young
people have to go through a military training at these schools, not onh' in
drilling and more or less discipline, but by annual encamjiments and
efficiency in riile practice. This movement is very popular among the young
people, and to my mind is in the direction of the solution of that recognition
by every citizen that in the hour of peril, whether it be in the Colonies, or
whether it l)e in the United Kingdom, every man should do his duty with
regard to the defence of his countiy. We are training these young people
and 1 think the fact of their being trained at this early age imbues them with
a feeling that they do owe a duty lo their ct)untry and also to the Em|)ire.

Sir, I tliank you for the broad lines on which you have put this veiy
great question before us, and I feel that your views will have great weight
■with the people 1 represent, and 1 believe that your views will have great
effect on the Conference we are now^ attending in the direction of promoting
unitv witli regard to cmr common defence.

General BOTHA : I should just like to say a few words and to thank the
Minister for War very heartily for the valuable information he has imparted
to us. The position that we have got to take up to-day and to discuss is that

K 4S(;tiH. H

114

Fourth Day.
20 Apnl 1907.

Military
Defence.

(Geueial Botha.)

of organisation o£ defence. If the Empire is to expand still more, this is
one of the important factors in its expansion. We, in the Transvaal, are
to-day in a difBcult position. We are sitting there entirely without any
means of defence, and if, for instance, the British Government were to
remove the troops from there, our position would be hazardous. I have
discussed the matter with Dr. Jameson and Mr. Moor, and my idea is that, if
as yet we cannot bring about a general federation of South Africa we should
at any rate attempt to federate on this question of defence. If we succeed in
doing this, I think it will be a very effective way of aiding the Empire. I am
not quite satisfied as to the exact binding effect of this proposed Resolution,
and I should like to consider it further. What would be its exact effect is
not quite clear to me. That is all I have to say.

Mr. HALUANE : I do not know really that I need take up the time of
the Conference by replying, except in a few sentences. It is to me personally
deeplj' gratifying to find that to so very great an extent we have all been
thinking up)on the same lines. It seems to me that this Conference is A^ery
much of a common mind about the broad principles which underlie this
matter, but there are, of course, questions of difficulty. Dr. Smartt has
raised a very important point as to whether it would not be possible for each
of the self-governing Dominions of the Crown to raise a special contingent as
I may call it, for service in the defence of the Empire. That Avould practically
put that contingent into the first line, leaving the second line to be organised
out of all the local forces. Well, of course one sees a great many problems
that may arise at once as regards that, although it would be a most valuable
thing if it could be carried out. One sees the difficulty — to whom would
that force be responsible ? Who would have power to call it out on the
outlireak of war, and so on ? Would it be a vohmteer force or would it be a
force vdiich undertook the same kind of responsibility as the first line itself,
namely to obey the directions of the Commander-in-Chief, whoever he may be,
who Avas nominated to the supreme command of the war V Tiiose are not
insuperable difficulties by any means and I merely mention them to show that
that is probaljly a point upon Avhich this Conference cannot come to a detailed
or definite conclusion without going into matters.

Dr. SMARTT: If I may say so, Mr. Haldane, I had considered that
point and that was not my difficulty. The difficulty was that, say, in Cape
Colony, we have our Volunteer Forces and what we call our Cape Police and
our Cape Mounted Rifles. Under existing conditions, none of these forces
can be called upon to serve outside certain areas. My idea was that certain
of those forces should be disbanded (or Avhatever is the proper military term)
and re-enrolled, so that the men could, with the consent and control of the
country, be sent to any part of the world if circumstances required them,
because, under existing conditions, if the people of the Colony desired that
the services of these permanent Cape forces should be utilised, without special
enrolment they could not Ije sent away Avithout tlieir sj^ecial consent — which,
though it Avould be readily given, would naturally cause delay. It Avas
exactly the problem to which 1 think the Canadian Minister for War referred
Avitli regard to the contingents they sent to South Africa ; viz. : — that they
liad really to get the consent of the men ; there Avas no possibility of sending
tliem, even Avith the desire of the Government aud Parliiuneut, OAving to the
character of their enrolment.

Sir J< )SEITi WARD : We are entirely against discrimination of that
kind in J^eAV Zealand. We Avould not favour that at all. I- should like to
say that, Mr. Haldane.

115

Dr. S.MARTT : Do you mean nnrlev ;iiiy circumstances ? Fourth Day.

20 April 1907.

Sir J()S1"]PH WAIiD : Yes, and for this reason — I would like lo muke •

it clear from the New Zealand point of view — we want to have onr Volunteer Militaey

svstein carried out under a complete organised del'enci^ system in New efen'ce.

Zealand, without distinction of any kind for over-sea pur])oses. We are

against anything in the nature of a standing army. Wc have now in

existence our Volunteers many of whom are actively engaged in helping to

develop the country. We have a very large reserve force of private

individuals who are cpialiiied to servo anywhere, and Ave want to he

in the position, in New Zealand, of allowing it to ho a vohmtary oiYering

fxom the Government and the individual to fight over-sea when called

upon for the Empire, and we know we coidd get thousands of them, and

if we were to attempt to create a first line or com])any, whatever is

suggested, to he always ready for over-sea defence, I think you Avould create

internal difficulties amongst the ordinary, or rather regidar, forces Avho woidd

Avilliugly and spontaneously go out and fight when the time arises. 1 helieA-e,

with all due deference to my friend Dr. Smartt, that it is far bettor to let

the country as a AA'hole realise, in the event of trouble arising, that Ave can

draAv upon our A'olunteers for Avherever we are going to fight, not ear-marking

them beforehand. A good system of defence in our own country for use

externally Avhen the time arises is the better course to follow. It Avould entail

legislation in our country if anything of the kind Avere proposed, and our

jieople in time of peace do not want to ha\'e paraded a permanent

()i-gauisatiou to go outside the coimtry to fight. That is the sort of thing

that would deter them to some extent from general action AA'hen the time

arises. I do sincerely hoj^e at all events that ]Mr. llaldane will not, so far

as NeAV Zealand is concerned, expect us to go upon lines of that kind.

Sir FREDERICK BORDEN : I would like to add a word. This very
(Xucstion Avas brought up at the Conference five years ago, and tliscussed
thoroughly and disposed of, for that time at least. I, perhaps, cannot put the
matter better than I put it then. I will read Avhat I said then : " The
" suggestion Avhich Avas made that there should be a special force IcnoAvn as
" the Imperial Force for service abroad is one I cannot subscribe to, because
" 1 believe, in the first place, it Avould have a derogatory edect on the militia
" itself. I am quite content, from Avhat I know of the militia of Canada that,
" to have a special force receiving special favours, specially named, specially
" drilled ami trained, Avould have an imfavourable eifect on the militia at
" large. I Avoidtl pro])Ose as an alternative," and so on, and I concluded : —
" It seems to me that I do not think it is necessary that a set of men shall be
'' lab(-lled as being set apart for any jjarticular service, but that our militia
" should be made absolutely effective, so that when the moment arrives we
" can take part and assist tht^ Imperial Army by a voluntary enlistment."

Mr. IIALDANE : I am, at the mouient, keenly conscious of the diliiculty
Avhich Sir Joseph Ward and Sir Frederick Borden have raised, because 1
have just had to face it in framing the scheme of our OAvn second line at
home, and perhaps 1 might read to the Conference the clause in which I
came to the conclusion that I had gone to the utmost limit possil)le with
the second line. It makes me think that what Dr. Smartt proposes is
really in the nature of a special contribution uL the Colony to the first line
of Defence, a most valuable thing, Imt it is outside the strict organisation of a
second line force Avhich is what Ave are mainly discussing here.

Dr. JAMESON : On behalf of the Cape, may 1 say that, while 1 quite
quiti' agree Avith my colleague (in case there is any idea as to the Cape
Avauting to press this), this is perhaps one of these advanced ideas we have

H 1'

116

Fourth Day.
20 April 1907.

MiLITARV

Defenck.
(Dr. Jameson.)

put forward already ; perhaps it is a little too early to bring it forward, Ijut
no doubt it may grow and perhaps Dr. Smai'tt is quite right to throw it out
as a consideration to think of for the next Conference on that basis.

these

things which may

well

belong to a

Mr. HALDANE : It is one of
very inunediate future — not far off — but 1 am now going to read from the Bill
which comes up Ijefore Parliament for the fmal stage of the second reading
debate on Tuesday. " Any part of the Territorial Force " — which is the second
line force, which corresponds to the imperial second line we are discussing
— the local forces all round — " shall be liable to serve in any part of the
" United Kingdom, but no part of the Territorial Force shall be carried or
" ordered to go out of the United Kingdom." Now we have this by Avay of
proviso. " Provided that it shall be lawful for His Majesty, if he thinks fit
" to accept the offer of any body of men of the Territorial Force, signifying
" through their commanding officer, to sul)ject themselves to the lial)ility
" (a) to serv^e in any place outside the United Kingdom ; or (b) to be called
" Gilt for actual military service for the purpose of defence in such places
" in the United Kingdom as may be specified in their agreement, whether
" the Territorial Force is embodied or not," and it goes on to say if they
make the ofl'er, and it is accepted, that offer measures their liability, and
nobody is to be compelled to make such an offer, except by his own consent,
with the matter carefidly explained to him. That was the utmost we
felt we could go to in the organisation of the second line, and it is in
effect the change which was made in our Militia Act towards the end of
the Peninsular War. We were driven to rely on the militia towards the end
of the Peninsular War, and the substance of this clause was introduced as a
modilication of oiir Militia Act. However, I gather that you all, in Canada,
in Australia, and in New Zealand, are very much in the same position with
regard to that. That is very much the measure of what we want to do, and
if you could get that amount of latitude that Avould enalde you to organise your
second line so that such a voluntary offer could be provided for and accepted,
I take it that it would l^e a step on. Sir Frederick. I rather gather that you
have some legislation you might have to modify in some slight degree to meet
that, but whether it is so or not, that is a matter which, as we have said, can
stand.

If the Conference is agreeable, as I think it is, to this resolution al)oi;t
the General Staff, I think it is liighly desirable that we should pass it ; there
may be amendments upon it, of course, but I was going to suggest this,
that if we do pass it, I hope the thing will not stop there. My office wiU
be ready to take u.p the details of things and, although we say in the
beginning, " That this Conference, without wishing to commit to immediate
action any of the Governments represented," 1 hope the opportunity may
be taken to follow up all these things we have discussed to-day. Sir Neville
Lyttelton and the rest of us will put aside all other engagements ; we know
you are here and available only for about three weeks more and the most
immediate duty we could fulfil would be to meet and confer with you and
work these things out, so that 1 hope, if the substance of this resolution
is agreed to, we may be able to take some immediate action in fixing in
our minds the precise way to give effect to it and the other things we have
discussed to-day. ,.

Sir FREDERICK BORDEN: Would it be possible, Mr. llaldane, to
modify this resolution — I have not thought of the form of words, but in some
way — by which we would agree to the idea of establishing General Staffs in
each of the Domiinons beyond the Seas, in each of our countries, and then
go on as you put it so that these staffs should be interchangeable with
each other, because I think it is not only desirable that there shoiild
be exchange between the Central Staff and any one of the Colonies,

117

but excliange between the staffs of tlie different Colonies. I do not know
whetlier that is desirable, but I do not like to lose sight of the idea that the
different communities or dominions should have their own general staffs.

CHAIRMAN : Might I suggest this V There is a general expression of
opinion that it would be very desiraWe that the Secretary of State's statement
should be made public, and I understand from him that there is no objection
to that. In the statement, of course, is set forth in full what Sir Frederick
Bortlen has been asking for and perhaps that would be the easiest way of
doing it. There are one or two almost verbal amendments I think that have
been suggested to me in the resolution itself, but otherwise it might stand.
I think perhaps that the Conference might express approval of the Secretary
of State's statement and then it might be recorded in the resolution and
published.

Mr. HATDANE : I think there is nothing in what I have said to-day
that has not been said several times, not only in speeches, but in papers that
liave been published and are in the possession not only of the American
General Staff Ijut I suspect of all General Staffs. They are very well informed
of each others' proceedings and there is no secret in what we have discussed
to-day ; it is a fixing rather of the ideas that have already been given
expression to.

]\Ir. DEAKIN : It seemed to me a digest of the discussions which
have so far proceeded in your Parliament and in your Press.

CHAIRJilAN : You wiU revise it ?

Mr. HALDANE : I will revise it, and I will take care that there is
no expi'ession that can possibly be open to objection.

Sir FREDERICK BORDEN: The principle, I take it, is the esta-
blishment of an Imperial General Staff".

Mr. HALDANE : That is it.

Sir FREDERICK BORDEN : We have no Imperial Army.

Mr. HALDANE : No, j'ou have an Army which serves for the defence
of the Empire, and you have the Committee of Imperial Defence.

Sir FREDERICK BORDEN : I think we are aU agreed that this
should be done, but there may be some of our people, whom we represent,
who may be somewhat sensitive about being committed, as they might
think they were being comiriitted, to something like an obligation.

Mr. HALDANE : You observe the General Staff is a purely advisory
body, and indeed you have done it in Canada just now because you have
a very distinguished General Staff officer, General Lake, who is your own
Staff officer, as any General Staff ofhcer sent under this scheme would
be, — absolutely your own officer at your own disposition.

Sir FREDERICK BORDEN : Precisely, but we have not said much
about it.

Mr. HALDANE : No, your deeds have been better that your words.
You have had General Lake for some time and have been working it up.

E 4SGG8. H 3

Fourth Daj.
20 April 19()7.

Mu.lTARr

Dkpknce.

( Sir Frederick
Hordcii.)

118

Fourth Da), Mr. DEAKIN : I have made a suggestion in tlie last line but tkree

20 April 1907. wMcli would perhaps meet your point, Sir Frederick ; instead of reading :
" without in the least interfering in qviestions connected with command and
d'^^^^^p " administration shall be capable of advising respective Govermuents," and
so on, it should read : " without in the least interfering in questions con-
'■ nected with command and administration shall, at the request of the
" respective Governments, advise as to the training and education."

Sir WILFRID LAURIER : That is important. Will you give me the
words, Mr. Deakin ?

Ih: DEAKIN : After the word " shall " in the fourth line from the
bottom insert the words " at the request of" instead of "be capable of
advising," and it reads on "the respective Governments advise as to the
" training, education, and war organisation of the military forces of the Crown
" in every part of the Empire." That shows what I think was the clear
intention that this staff should work with the respective Governments ; it
is the brain which is to be called upon by any nerve at the extremity and
responds thereto.

Mr. HALDANE : The expert caUed in.

Mr. DEAKIN : Exactly, like the Committee of Imperial Defence ; to
make that clear I propose in the fourth line fi-om the top after the words
"recognises and affirms the need of developing" to insert "for the use of"
instead of " throughout," and then omit the words " the conception of."

Mr. HALDANE : "For the service of the Empire."

Mr. DEAKIN : That is better — " for the service of the Empire a General
Staff recruited " and so on.

Sir FREDERICK BORDEN : I would say " for the service of the
various Dominions."

Mr. HALDANE : " For the service of the various Governments of the
Empire."

Dr. JAMESON : Why not the Empire by itself ?

Mr. DEAKIN : We make that plain in the last part.

Mr. HALDANE : " For the service of the Empire."

Mr. F. R. MOOR : I think it would be better if instead of " that this
Conference without wishing to con)mit to immediate action " we said " that
"this Conference without committing any of the Governments to immediate
'" action."

Ml-. HALDANE : Yes.

Mr. F. R. MOOR : I think it would be more decided and clear.

Sir JOSEl'Ii WARD : In any case everything we do here has 1o be
ratified by our Governments and Parliaments too.

119
CtlAIRMAN : Yon cannot conunit them. Fouril. Day.

2l> April 19«)7.

Mr. HALDANE : I doubt verj'^ much Avhether these words are necessary.

Dr. SMARTT : I do not tliink we need them in at all ; you might take
out aU the words after " Conference " down to the third line.

Mr. DEAKIX : I agree, l)ut as they have been put in let it stand
as it is.

Sir WILFRID LAURIER : I think it better to let them stand as they

are.

CHAIRMAN : If we adopt the suggestion of using the statement of the
Secretary of State, ought we not to put that in some form into the Resolution,
" That the Conference welcomes aud cordially approves the exposition of
*' general principles embodied in the statement of the Secretaiy of State for
" War."

Sir JOSEPH WARD : I am quite agreeable, it is part and parcel of the
motion, really.

Mr. DEAKIN : WiU you put the whole Resolution, sir ?

CHAIRilAN : Then the Resolution would run : " The Conference
" welcomes and cordially approves the exposition of general principles
" embodied in the statement of the Secretary of State for War and
" resolves : That this Conference without wishing to commit to immediate
" action any of the Governments represented at it recognises and allirms
" the need"

Mr. DEAKIN : Is " at it " necessary ?

CHAIRMAN : No, I should think not^" recognises and allirms the need
" of developing a General Staff recruited from the forces of the Empire as a
" whole, which shall be a means of fostering the study of military science in
" the various branches, shall collect and disseminate to the various Govern-
" ments military information and intelligence, and vmdertake the preparation
" of schemes of defence on a conmion principle and without in the least
" interfering in questions connecteil with connnand and administration, shall
" at the request of the respective Governments advise them as to the training,
" education, and war organisation of the military forces of the Crown in
" every part of the Empire."

Dr. SMARTT : " Advise " alone is better.

CHAIRMAN : " Advise." That is the Resolution of the Conference.

Sir WILFRID LAURIER : I think I woidd like to defer this and have a
third reading of this Resolution also, as we had with the former one. I
see nothing to take exception to, but I would like to think it over.

CHAIRMAN : May 1 have the attention of the Conference? Sir Wilfrid
Laurier woidd like to have what we call a third reailing of this Resolution
also, that is to say, that it should not be published until the next meeting,
after it has been seen again.

II J

Military
Defence.

Fourth Day.
20 April 1907.

MlLITAKT

Defence.

120

Sir WILFRID LAURIER : I would like to look at it on Monday,
although I may say I see nothing to take exception to at present.

Dr. SMARTT : I presume, Lord Elgin, that does not prevent the state-
ment of the Secretary of State for War being published ?

CHAIRMAN : No, we can get that out. There is one Resolution which
is stiH at its third reading, Sir Wilfi'id, with regard to Imperial Defence ; I
think we have practically agreed to it, but Mr. Deakin on that occasion
wanted to see it again. This is how it ran : " That the Colonies be authorised
" to refer to the Committee of Imperial Defence through the Secretary of
" State for advice on any local questions in regard to which expert assistance
" is deemed desirable, and whenever so desired the representative of the
" Colony which may wish for advice will be surmnoned to attend as a member
" of the Committee during the discussion of the questions raised."

Sir FREDERICK BORDEN : Was that not settled long ago ?

Mr. DEAKIN : I thought so.

CHAIRMAN : I understood it was reserved in the same way as the other
point.

Mr. DEAKIN : I did not imderstand it was reserved, but merely asked
that I shoid-d be allowed to mention it as I have done this morning in
connection with the general question.

Sir FREDERICK BORDEN : It was settled by the very constitution of
the Imperial Committee itself. Mr. Balfour — whose idea perhaps it was — on
two or three occasions stated very clearly the objects, and I had the honour
myself of attending a meeting of that committee in December 1903, for the
very reason suggested in this Resolution. It hardly seems necessary to make
it a formal resolution.

CHAIRMAN : It was the explanation I gave on behalf of the Prime
Minister at the last meeting and it seemed to be acceptable to the Conference.

Dr. JAMESON : Surely there is no objection to emphasising it further
by passing it now.

Sir FREDERICK BORDEN : It is a work of supererogation, I think.

Dr. JAMESON : Does it matter ? It was not the case before that the
Committee of Defence could invite a representative of the Colony, whereas now
this goes a little further and says that practically a Colony has the right to be
invited whenever anything in which it is concerned or upon which it has
asked advice is being discussed by the Defence Committee. I think it does
go a little further. •

Sir WILFRID LAURIER : It seems to me simply burdening this
Conference with a Resolution about a matter which has always been done.
There need be no expression of opinion by the Conference upon this point.

CHAIRMAN : I am entirely in the hands of the Conference.

Military

UeI- KSCE.

121
Sir WILFRID LAURIER : I do not see what it is wanted for. Fourth Day.

20 April 1907.

Mr. HALDANE : I do not think myself, if I may say so, that it is
necessaiy. One is very familiar with the composition of the Committee of
Imperial Defence, which is a skeleton or nncleus body ; I always attend it,
but I am not a standing member of it. It has no fixed composition, but
consists merely of the people who are summoned, and, of course, if any
question arose affecting any particidar Colony, its representative would
attend. The Prime Minister is really the mainspi-ing of the Committee, and
he^summons it as he wants it.

Sir FREDERICK BORDEN : He summons whomsoever he likes ?

Mr. HALDANE : Whoever he likes and whoever is suitable.

Mr. DEAKIN : We did not feel entitled to suggest that we should
be represented at our own pleasure — we did not feel justified in officially
representing it. Accordingly this Resolution was submitted for the approval
of the British Government and the members of the Conference to the
proposition that in future any representative of a Colony which might wish
for advice shoidd be summoned upon its request to attend as a member of
the Committee during any particular discussion. That gave us not merely
an opportunity of being invited as guests but a right to be present on our
own motion when matters in which we were concerned were under discussion. '
That seems to me a distinct advance.

Sir FREDERICK BORDEN : You' think that is not included in the
memorandum ?

Mr, DEAKIN : It is included now in March 1907.

Sir JOSEPH WARD : I think that is a proper thing to do.

Dr. SMARTT: I think it would do a great deal of good. I will
give the Conference a concrete case : — Some time ago the Imperial
Oovernment appointed a Defence Commission to inquire into the defences
of the Empire. They came to Cape Colony and no doubt they inquired into
the defences of the Peninsula, but they did not go into the matter with the
Government in that confidential manner which, I think, if a Resolution of
this sort is carried and approved of by the Imperial Government, would be
the case in the future.

Sir FREDERICK BORDEN : 1 thought that was included abeady.

CHAIRMAN : Then tliis Resolution may stand. We came to a final Resolution II.,
Resolution also on the question of the constitution of the Conference and V- "•
that, of course, now will be published.

Adjourned to Tuesday next at 11 o'clock.

122

Fifth Day. FIFTH DAY.
23 April 1907.

Held at the Colonial Office, Downing Street,
Tuesday, 23rd April 1907.

Present :

The Right Honourable The EARL OF ELGIN, K.G., Secretary of State

for the Colonies (President).

The Right Honourable Sir Wilfrid Laurier, G-.C.M.G., Prime Minister

of Canada.
The Honourable Sir F. W. Borden, K.C.]\I.G., Minister of Militia and

Defence (Canada).
The Honourable L. P. Brodeur, Minister of Marine and Fisheries

(Canada).
The Honourable Alfred Deakin, Prime Minister of the Commonwealth

of Australia.
The Honourable Sir William Lyne, K.C.M.G., Minister of State of

Trade and Customs (Australia).
The Honourable Sir Joseph Ward, K.C.M.G., Prime Minister of New

Zealand.
The Honourable L. S. Jameson, C.B., Prime Minister of Cape Colony.
The Honourable Dr. Smartt, Commissioner of Pubhc Works (Cape

Colony).
The Honourable F. R. Moor, Prime Minister of Natal.
The Right Honourable Sir R. Bond, K.C.M.G., Prime Minister of

Newfoimdland.
General The Honourable Louis Botha, Prime Minister of the Transvaal.
Mr. Winston S. Churchill, M.P., Parbamentary Under-Secretary of

State for the Colonies.
Sir Francis Hopwood, K.C.M.G., Permanent Under-Secretary of State

for the Colonies.
Sir J. L. Mackay, G.C.M.G., K.C.LE., on behalf of the Lidia Office.

Mr,
Mr

. H. W Just, C.B C.M.G., | j^-^^^ Secretaries.
. G. W. Johnson, C.M.G., )

Mr. W. A. Robinson,

Assistant Secretary.

Also present :

The Right Honourable R. B. Haldane, K.C, M.P., Secretary of State

for War.
Colonel G. F. Ellison, C.B., Principal Private Secretary.

and ••

The Right Honourable The Lord Tweedmouth, First Lord of the

Admiralty.
Captain Ottley, M.V.O., R.N., Director of Naval Intelligence.
Mr. W. Graham Greene, C.B., Assistant Secretary to the Admiralty.

123
MILITARY DEFENCE. Fifth Day.

23 April 1907.

CHAIRMAJ!^ : Gentlemen, the first business is to finally approve the
Hesolution on IMilitary Defence which was before the meeting on Saturday Defencr.
last. 1 tinclerslaml that there is some suggestion from Canada.

Sir FREDEI?ICK BORDEN : In the fourth line I would ask whether
the words " to immediate action " do any particular good, and whether they
might not be left out ?

Mr. HALDANE : We thought that might be so. You mean missing out
those words and going on to " any of the Governments " ?

Sir FREDERICK BORDEN : Yes.

Mr. HALDANE : I do not think those words mean anything. They look
as if they suggested that there might be immediate action. Shall we strike
out " without wishing to commit to immediate action " ?

Sir FREDERICK BORDEN : Simply reading it as " without wishing to
commit any of the Governments."

Mr. HALDANE : Omitting the words " to immediate action."

Sir FREDERICK BORDEN : Yes.

Dr. JAMESON : Is there any harm in suggesting immediate action ?

Sir FREDERICK BORDEN : Is it any good ?

Dr. JAMESON: Y'es, I think it is a kind of fillip towards doing
eomething, and not only talking about it.

Mr. HALDANE : I do not attach importance myself to it, one way or the
other.

Sir WILFRID LAURIER: "Without wishing to commit any of the
Governments," I think it should be.

CHAIRMAN : Omit the words " to immediate action." Is that agreed to ?
Mr. F. R. MOOR : I do not think it improves it.

Sir FREDERICK BORDEN: Then as to the word "recruited," it
seems to me " recruited " is hardly a word to apply to ofiicers. " Selected "
w^ould, I think, be a better word.

Mr. HALDANE : " Selected " is I think, a more appropriate word to
apply to an officer.

Mr. DEAKIN: Do we gain anything by retaining any of these
words "without wishing to commit to immediate action any of the
Governments represented"? Would it not be advantageous to omit
those words, and possibly substitute some other words for "recognises
and afTirins,"' to indicate clearly the view of the Conference.

124

Fifth Day. Mr. HALDANE : " Is of opinion," for instance.

23 April 1907.
^ Mr. DEAKIN : Something of that sort, safeguarding the statement

'Defence. "without wishing to commit to immediate action." If we agreed to it we

woidd not Avish to commit our Governments to immediate action. We could

not. It is a matter for themselves.

Mr. HALDANE : The Conference is not an executive Conference, and I
shoidd have thought if you omitted those words and put in such words as
"is of opinion" it would make it quite clear that the Conference is
expressing only an opinion.

Mr. DEAKIN: Yes.

Sir WILFRID LAURIER : It is nothing more than an opinion there.
It is to be left to the different Legislatures to legislate upon.

Mr. DEAKIN : I suggest the omission of these words, and the Resolution
would then rim : " That this Conference welcomes and cordially approves the
" exposition of general principles embodied in the statement of the Secretary
" of State for War and is of opinion that for the service of the Empire a
" General Staif," and so on.

Mr. HALDANE : " Is of opinion that there is a need."

Mr. DEAKIN : Yes ; "Is of opinion that there is a need of developing
throughout the Empire."

Dr. JAMESON : Why substitute " is of opinion " for the more emphatic
" recognises and affirms " ?

Mr. DEAKIN : In order to emphasize the fact that we are not executive
but merely a consultative Conference, and that the governments are the
people to decide. I have no objection to " recognises and affirms," but it
is suggested that it might appear to go a little further than our fimction
warrants.

Sir JOSEPH WARD : We say we are not, of course, committing our
countries to immediate action.

Dr. JAMESON : We are only a conference and cannot do anything.
Why should not we " recognise and affirm " ? They are stronger words, and
I do not see why we should weaken it.

Mr. DEAKIN : I have no objection to " recognises and affirms," but
was endeavouring to meet Sir Frederick Borden's view.

Sir FREDERICK BORDEN : If the words " to immediate action " are
left out, I am quite satisfied with the rest, and I have no particular objection
then.

CHAIRMAN : It is suggested that the whole sub-sentence from
" without " to " represented " should come out.

125

Sir Wn.FRII) LAUKIER: I would leave it as it is taking out the Fifth D«y.
words "to immediate action" — ^" Avithout wishing to commit any of the 23 April 1907.
Governments " I think is l)etter.

Military

Mr. DEAKIX : We passed it in that form, l)iit if we are altering it I
think it is a great improvement to leave out all those words.

Sir AVILFRip LAURIER: I would takeout ihe words "to immediate
action," and su])stitute " selected " for " recruited."

Mr. IIALDAXR : Yes, that is much better.

Mr. F. R. MOOR: Yes, that has been done.

Sir AVILFRID LAURIER : On this point may I ask for information ?
It is a thing we should know more alioiit. How is this selection to be made ?
Woidd J\lr. Haldane select from the (HiVerent Colonial oflicers in Canada, for
instance ?

^Mr. UALDAXE: Our plan is this. \Ve have a list of persons eligible
for appointment to the (ieneral Staff. If you send over a name and say :
" This is a man we reconnnend to you," we should of course ask you for his
qualifications, and we shoidd ]mt him on the list, and then, arrange \vith you
from the names put (ju the list to select someboily for an appointment in
exchange for somelxnly we scut to you.

Sir FREDERICK RORDKX : I would lik.^ to have it umlerstood, and 1
think this is what is understood really, that where there is a General Staff
now in existence, as there is in Canada, nu^ndjers of that Staff should be
selected to fill appointments on the General Staff.

Mr. HALDAXE : Yes ; you woidd not send people who were not on
yOTir General Staff'.

Sir FREDERICK BORDEX : No.

]\Ir. HALDAXE : Xo. Each country woidd luive its General Staff
organisation, either very nuich developed or rudimentaiy, as it might be, but
you would send people from your Staff, whatever it was.

Sir FREDERICK BORDEX: And there would be no selection, as I
understand, except through the Government of the particular country
interested.

Mr. HALDAXE : That is right. We should take nobody whom you did
not recommend out of your General Staff. None of us would, of course,
bind oiirselves one way or the other ; it would be a matter of convenience and
arrangenuMit ; but we should take over here in the ordinary course naturally
anybody you recommended as being well qualified from your General Staff,
and at your reqxu;st we should send you somebody whom you liked.

126

Fifth Day. Sir FREDERICK BORDEN : And the responsibility for any particular
23 April 1907. officer so selected would continue to the particular Goverument under which
he ^vas serving.

MlLITAKT

Defence.

'My. HALDANE : He Avould be a member of their General Staff detailed

for this general service.

Sir FREDERICK BORDEN : Yes, I think that is so. There is oue
word here which it is thought might he improved — " fostering."

Sir WILFRID LAURIER : I merely make just this suggestion, that
instead of " which shall be the means of fostering the study of military
" science," we should say, " which shall study military science." I do not
care verj^ much which it is.

Mr. HALDANE : Yes, " which shall study military science in all its
" branches." That is qaite as good. If that is agreed to 1 have no criticism
upon it.

Ml-. DEAKIN : I have some abbreviations to suggest.

Mr. HALDANE : Then it will be " which shall study military science
" in all its branches."

Sir WILFRID LAURIER : I think that is aU, as far as I am concerned.

Mr. DEAKIN : Will Sir Frederick Borden kindly listen to this, and see
if it will not simplify it — " That this Conference," omitting the next two
words, " cordially approving the exposition of general principles embodied in
" the statement of the Secretary of State for War " — omitting the next words
and substituting " recommends to the Governments represented " — omitting
the next words " the need of developing for the service of the Empire a
" General Staff selected from the forces of the Empire." So that it would
read : " That this Conference, cordially approving " — this is all we do —
" the exposition of general principles embodied in the statement of the
" Secretary of State for War, recommends to the Governments represented
" the need of developing for the service of the Empire a General Staff selected
" from the forces." Would that meet your view, Mr. Haldane V

Mr. HALDANE : That meets my view. It is shorter, and I am in favour
of anything that is short.

]\Ii-. DEAKIN : It gets rid of a great many words ; we cordially approve
the exposition of general princi^jles, and recommend to our Governments the
need of developing a general staif.

Mr. HALDANE : "Recommend the desirability" might be better.

Mr. DEAKIN : Very good ; I was only shortening it. It is at present
rather Avinding.

Sir WILFlilD LAURIER : Sometime'^ it is well to have these long
statements, and 1 Avould let it stand as

\"

127

Mr. DEAKIN: At this stage 1 du not press it. .We really accepted it. Fifth Day.
but when one comiiieuces to criticise it is hard ti) stop. ia April 1907.

MlLITABT

Sir WIJ.FRID LAUKIKK: I would like it to stand as it is, with the Uehs.nce.

two short amendments we have made.

Sir FREDERICK BORDEX : Put in " selected " instead of " recruited,"
and leaA'e out the words " to inuuediate action," and leave out the word
"fostering."

CHAIRMAN: Then it reads: "That this Conference welcomes and

" cordially a])proves the exposition of general principles eml)odied in the

" statement of the Secretary of State for War, and without wishing to commit

" any of the Governments represented, recognises and alhrms the need of

" developing, for the service of the Empire, a General Staff, selected from the

" forces of the Empire as a Avhole, which shall study militan- science in

" all its branches," and soon.

I)r. S!\1ARTT : Surely that does not meet the case? i understood the
feeling ^\■as that some of the Governments represented hei'e might not be able
to take part in this at once. Consequently the Secretary of State for AVar
very wisely pul in " without wishing to commit to immediate action." But
really we are now going to pass a resolution under which certain of the
Governments will not l)e ctommitted to anything except passing a pui-e
opinion. They do not even conunit themselves to act upon it in the near
future, nor even in ihe distant future.

^Ir. IIALDAXI'", : liut having agreed ujiun the broad [irinciple, we
should now proceed to communicate with j^ou with a view to seeing what
you could do to carry this cmt, and as we are all of one mind we shall at least
all approach the thing from a common point of Adew. We would take the
first action in making suggestions to you for your consideration.

Dr. SMARTT : Then woidd not it be better to leave it as ,you worded it,
" without wishing to commit to immediate action, recognises and alHrms the
principle of establishing."

Mr. HALDANE : 1 do not think the words make nuich difference ; but
the point is, we have agreed on a general principle. That is the real
importance of it. We coidd not l)ind or force any Government, nor do we
want to. This is a deliberating Conference.

Dr. SMARTT : We do not force the Government, but we come to a
conclusion as to the necessity of it as quickly as possible. That is what I
want to see atiirmetl in the Resolution.

Ml-. 1 lALDANE : Do you think you add anything by putting in the
words V

Sir JOSEPH ^^'AR^) : You would not help it for\\ard in any way by
putting in " committing to inmiediate action." It would not get over the
suggestion you are making as to any Government not taking action.

128

Fifth Day. Dr. SMARTT : No, but it would really appear from tlie Resolution that,

23 April 1907. so far as possible, we were all desirous of inxaiediate action and of this matter
not being delayed.

MlLlTAKY

Defence.

Sir_ FREDERICK BORDEN : But we recognise and affirm tlie need for
developing. What more can we do beyond that ?

Sir JOSEPH WARD : So far as New Zealand is concerned, as soon
as the Secretary of State for War communicates with ns we will consider any
proposals and deal with them.

Mr. HALDANE : By getting rid of the words " to immediate action "
we have got rid of the suggestion that it is not to be immediate action.

Sir JOSEPH WARD: Quite so.

CHAIRMAN : Then the Resolution is to stand.

Resoiiition III.
p. V.

The Resolution, as amended, was carried unanimously.

Naval Defence.

NAVAL DEFENCE.

CHAIRMAN : Gentlemen, we now proceed to consider Naval Defence,
and we have on the agenda two resolutions, one from the Commonwealth
of Australia and one from New Zealand, and perhaps the most convenient
course would be to proceed as we did the other day, that is to ask those who
represent those two Colonies to first state their views. WiU Mr. Deakin Ije
ready to open it ?

Mr. DEAKIN : Before Lord Tweedmouth speaks ?

Lord TWEEDMOUTH : Whichever you like.

Mr. DEAKIN : Perhaps you would wish to indicate generally the policy
of the Admiralty. As I take it, this is not merely a disciission on Naval
Defence for New Zealand and Australia. Incidentally we liave a special
interest to consider, because we have an Act upon our Statute books, and
the qiiestion of amending that i^ct by addition or variation is a subject which
concerns us a great deal more than anybody else. But we have assembled
fii'st to take a general view of Naval Defence, and to be made acquainted
with the policy of the British Government, presenting questions of great
interest for the whole Conference. Incidentally one of these deals with the
particular agreement relating to New Zealand and Australia. I do not know
whether Sir Joseph Ward agrees.

Sir JOSEPH WARD : Yes, I agree ; T think it would be most valuable
to hear the opinions of Lord Tweedmouth.

Lord I'WEEDMOUTII : Lord Elgin, and gentlemen, I feel it a high
privilege to sit at this tal)le to discuss this matter with the Prime Ministers

129

of tlio solf-frovoniino; doiniiiions of tlio Kin^i: heyond the seas. IMy position, Fifth Dhv.
of course, is ratlicr a (iilVciTiit one frdiii llial of my c-olloafjuc and ^ood friend 2:? April 1907.

Mr. Haldane. As I nndcrslanil, he gave you a vivitl and interesting sketch .

of the new system of organisation of the Army, and explained to you how ^•*^'^'- ^^rrr-^CE.
that new scheme might he adapteil to your Colonial wants ami wishes. ^ly ^Y"^''

position is quite a ditVerent one. I c-annot offer any sketch. I rather lay weodmonih.)
before you a completed picture. Our history undoul)tedly is closely
intertwined with the history of the Naval Service from earliest days,
and though it is the fact, no doubt, that fnjm time to time we have met with
reverses and we have met with accidents, yet, on the wliole, from tlie earliest
days to tlie present moment the Xavy has been aide to defend the
country, (o ilefcnd tlie growing country, that is the Kmpire as a whole,
and 1 lid not tiiiid; tliat any charge can be brought against it ol'
ever, on any occasion, having failed. Well, gentlemen, that being the case,
what 1 have in the first place to ask is, that yon should place conildence in
the Board of Ailniiralty, and in the present Ciovernment, for the future safety
of the country. We welcome you, and we ask you to take some leading part
in making more complet(> than it is at present the naval defence of the Empire.
1 wish to recognise all that our cousins over the sea have done in conse-
quence of decisions of former Conferences. 1 know that you gave to the
CTOvernment and to the Admiralty, with a free and unstinting hand, the help
that you thought you could manage to give, (lentlemen, 1 have only one
reservation to make, and in making it I ask that, as we have proved our-
selves siiccessful in the past, you shoxdd put your trust in us now. The only.
reservation that the Admiralty desire to make is, that they claim to have
the charge of the strategical tpiestions which are necessarily iuvolvetl in
Naval Defence, to hold tlie command of the naval forces of the country,
and to arrange the distribution of ships in the best possible manner to
resist attacks and to defend the lOmpire at lai'ge, whether it be our own
islands or tlie dominions bej'ond the seas. We thoroughly recognise that
we are responsible for that defence. AVe want you to help us in that
defence. We want you to give us all the assistance you can, but we do not
come to you as beggars ; we gladly take all that you can give us, but at the
same time, if yon are not inclined to give us the help that we hope to have
from you, we acknowledge our aljsolute ol)ligation to defend the King's
dominions across the seas to the best of our ability.

Now, there is, aft«u- all, only one sea that laps around all our shores.
The sea is the link that joins us together. It was the reason of your up-
springing. It is our iirst defence. It is the origin of our great commerce.
It is the oullet and iidet of our exports and our imports, and it is to us
in these islands the channel through which we get the food and raw
material which are so necessary to our vast population There is one sea,
there is one Em])ire, and there is one Xavy, and I want to claim in the
Iirst place your help, and in the second place authority lor the .Xdiniralty
to manage this great service without restraint. How great a ])art tlie sea
takes in all our life, in all our jirosperity, is, 1 think, best seen from the
extraordinary amount of sliipj)ing that our coimtry puts out. Last year, in
1906, Great Britain's output of shipping amounted to no less than 1,930,71)3
tons. The United States had an output of 48(i,(»5() tons; Cermany,
38-1,(514 tons, and France, 08,502 tons. The output of all foreign nations
amounted to 1,319,900 tons, so that last year Great Hritain led by no less
than (ll 0,803 tons all the other nations in the world.

Mr. DKAKIX : Is that new shipping?

Lord TWEEDMOUTll: Xew shipping.

A IHC.Og. 1

Naval Dkkexce.

130
Fifth Day. Mr. DEAKIN : Commercial shipping only ?

23 April 1907.

Lord TWEEDMOUTH: No; it includes ^varships. I think in the
British Return there were abont 108,000 tons of warships. But with that
enormous interest in the sea and in the shipping that goes on the sea, it is
absolutely necessary that we should make the passage of that shipping across
the sea safe. That is what we aim at securing, and that is what we ask your
help in doing.

Mr. DEAKIN : Pardon me for interrupting, Init when you. speak about
British shipping, does that include shipping constructed in other parts of the
Empire, or only in the United Kingdom V

Lord TWEEDMOUTH : That is within the United Kingdom.

Mr. DEAKIN : The total of the construction in the various Colonies is
small ?

Lord TWEEDMOUTH : It is not very large. It amounted last year to
abont 26,000 tons. I have here a statement of the subsidies which in the
past have been given bv the various Colonies. Australia gives 200,000L ;
New Zealand, 40,0001. ; Cape Colony, 50,000?. ; Natal, 35,000L ; Newfound-
land, 3,000?,. ; in all 328,000?.

Gentlemen, what I have to say is that the Admiralty and His Majesty's
Government are perfectly ready to meet these contributors to Admiralty
funds in a liberal and conciliatory manner. We do not wish to insist that
the contributions from the Colonies should necessarily be in the form only
of money. We are quite ready to enter into any arrangements with the
Colonies that may seem most suitable to them, and which may seem to bring
advantage to the Navy, and advantage to the Colonies themselves. I have
here drawn up a short statement of what may be called the general principle
with whicli the Admiralty desire to meet the representatives of the self-
governing Dominions of the King l3eyoud the seas. His Majestj^'s Government
recognise the natural desire of the self-governing Colonies to have a more
particular share in providing the naval defence force of the Empire, and,
so long as the condition of imity of command and direction of the fleet
is maintained, they are ready to consider a modihcation of the existing
arrangements to meet the views of the various Colonies. In the opinion of the
Government, while the distribution of the fleet must be determined by
strategical requirements of which the Admiralty are the judge, it would be of
great assistance if the Colonial Governments would undertake to provide for
local service in the Imperial squadrons the smaller vessels that are useful for
defence against possible raids or iV)r co-operation with a squadron, and also to
equip and maintain docks and fitting establishments which can be used by
His Majesty's ships. It will ftirther he of much assistance if coaling facilities
are provided, and arrangements can Ije made for a supply of coal and naval
stores which otherwise would have to be sent out specially or purchased
locally.

1 understand that, in Australia particularly, and in South Al'rica,_it is
desired to start some naval service of your own. I'erhaps I might siTggest
that if the provision of the smaller craft which are necessarily incident to the
wcjrk of a great fleet of modern battleships could be made locally, it would
be a very great help to the general work of the Navy. You cannot take
the small craft such as torpedo boats and sidnnarines across the.- ocean, and
for warships to arrive in South Africa or in Australia or in New Zealand or
in Canada, and lind ready to their hand weU-trained men in good vessels

131

of this kind, would be an onornions advantage to them. It would I)e an Fifth Day.

enoniiuus advantage to lincl ready to tlieir hand men well trained, ready to 2.'i Ai>ril UH)7.

take a part in the work of the fleet. There is, I think, tlie further ailvantage

in these small flotillas, that they will I)e an admiralile means of coast ilefenee ; -"^'a^*'' Defence.
that you will l)e ahli' l»y the use of tiieni to avoid practically all danger from . .^Y*"^"' > ^

any sudden raid which might be made by a cruising squadron. What I should
like to point out is that, above all things in this work, the submarine if
probably the most important and the most elVective weapon. It is the
weapon with which you can meet a fleet attacking during the day, or indi-
vidual ships attaiddng by day. I am assured by my advisers at the Admiralty
that it is a most im])ortant weapon ; that it has already reached very con-
siderable development ; and it is one on which we may rely with great
confidence. That is a view that is very strongly taken by some of the
leading hkmi in the Frencli Navy, who think that the submarine is really
the weapon of the future. I believe myself that the provision of submarines
and all the smaller torpedo destroyers and l)oats would be of the greatest
help to the Navy, supposing it were, as T hope it may not be, drawn into a
war abroad.

We want to consult with you as to the details of this scheme. Of coui'se
if each separate colony is to i)e treated on a different footing, we are quite
ready to do that and to make separate arrangements with each separate
('olony according to its own wishes. I thoroughly recognise the great
(lilfi'rence that there is between the conditions of one country and another.
The desire of the Admiralty is to meet those wishes so far as they possilily
can be met. I think perhaps it is im]iossible suddenly to make a change.
I would suggest that a beginning should be made, and that probably the
best way to start would be to allocate to local purposes certain portions
of the subsidies already given. The particular purposes \o which that
money should he devoted should be discussed in detail between the
representatives of the various Colonies and the Ailmiralty, so that a
thoroughly good scheme might lie worked out in the end. At the same time
we do not put aside the payment of the subsidies at all. From those
Colonies who are desirous of continuing altogether on the lines on which
they have gone in th(> past, we shall be very glad to accept their contribution,
anci accept it gratefully, and do the best to apply the money in a useful
manner.

Then I should like to say a single word on the further point of the
provision of docks and coaling facilities in the Colonies. The enormous
development of the modern warship entails important consequences. These
great modern warships require large docks to contain them. 1 think we are
getting on well with the ju-ovision of docks. At this moment in our own
country and abroad we have, I think, 13 Covernment docks which will take
in our'largest ship, the "Ih-eadnought." 1 think in the course_of the next
two years we shall have four more, which will make about 17 altogether.
But it is very desirable that Ave should have in all jnirts of the world docks
which couhi take such great ships, supposing they were to meet with
an accident or were to receive ilamage in war. I do not know whether
Sir Wilfrid Laurier wouhl consider that there might be some chance of
Canada doing that in Ksquimalt and Halifax, which have now been handed
over to tiie Canadian people. We have already a dock at Simons Bay
which will take a " Dreadnought," hut all through the Enqure it would be
a great thing to tind big docks at hand in the event of any accident or
damage that Tnight happen to a ship. It is the same thing with regard to
coal. ^Coal is the life of a mod.Mii warship. It is an absolute necessity.
There are great dithculties in getting it. We are better olf, n() doubt, than
other Powers in that respect because we have coaling stations already
scattered here and tliere over the whole world, and now there are many new

1 2

132

Fifth Day.
23 April 1907.

Naval Defence.

(Lord
Tweedmouth.)

inventions and new developments in methods of coaling on the sea and at the
coaling depots. But it is a subject to which I should lil^e t(3 direct the
attention of the Prime Ministers as one of the things which are of the greatest
use to a fleet at sea.

Gentlemen, I have come to you absolutely frankly to tell you how we
hope to be able to meet you. I am anxious to hear Avhat the representatives
of the various Colonies waut to do. They have already put forward two
resolutions, and I think it would be well that I should hear what they have to
saj% and I should also like to be made aware of what the representatives of
each Colony think as to how far they could meet the suggestions that I have
ventured to make.

Sir WILFRID LAURIER : Will you iirst call upon Australia and New
Zealand, as they have proposed resolutions ?

Mr. DEAKIN : The resolutions of Australia and New Zealand, after all,
are quite subsidiary to the main principles on which his Lordship has
addressed us. Speaking for myself, may I say that I quite appreciate the
frankness Avith which your Lordship has approached the subject, and the
light yon have thrown upon it. I am not sui-j^rised at the attitude of
the Government, because I have sufficient familiarity with the references
which you and also your colleagues have made to this great subject, Init at
the same time must admit my own want of competence to deal off-hand with
the major questions which you have raised, either directly or by necessary
imijlication — they are of the first importance — without some little further
consideration.

The main views you have submitted, so far as I have followed them,
relate to the question of Colonial co-operation in the Naval Defence of the
Empire. This divides itself into two parts : first, a provision for local
defence, which again divides itself into the defence which is to be used, so to
speak, by the h.^calised bodies or other agencies, and next the localised
Imperial Sqiuvdrous, if I may distinguish them by that title. IBeyond these
local defences comes the question of the possibility of a general defence not
localised, upon an Imperial scale, whose obligations would be adapted to the
varying circumstances of the different parts of the Empire — varying as
between themselves, and varying again from those of the United Kingdom.
Any consideration I have ever been able to give to this question has led
me to the reluctant conclusion that so far we are unable to find any scheme
of the measure of responsibility either particular or general. I would be very
glad to be enlightened xipon this subject. None of the assessments and
estimates made for the purpose have appeared to me to include all the factors
to be taken into account, or to have furnished anything like an exact proportion
between them. Those are the main issues, as I follow them, which are
inseparably associated with the scheme that you have submitted very clearly
to us. Afterwards, when we have considered such general questions of
contribution and co-operation, the matter which particularly interests New
Zealand and ourselves, is as to the local form of that co-operatiou. Australia's
responsibility is now fixed on a monetary standard, and we submit that tliis
is not the most acceptable standard for Australia, nor is it likely to further
the objects that we have, or the objects that you have, iu maintaining the
present contribution. But that, as already stated, is a subsidiary question.

The larger principle of the relations which self-governing Colonies should
hold to the Imperial Naval Defence should first come imder consideration,
because that is tiie major premise of Avhich the form of any contribution is
after all only a mmor matter. I must confess myself quite unable to criticise
witli sufficient pertinency the larger principle of this question at this moment.

133

There are otliers here not under my disaltility- I'm- instance, ^Mr. Hrodeur, who Fifth Day.
represents the Xaval Department oC Canada, but so far as 1 am concerned •_'.•{ A i-ril 1907.

I wish time Tor I'urther consideration.

Let me, however, by way of addition mention one matter wliich arose out ^'-*^*'- lir.KEscE.
of the address of your colleague, the Secretary of State for War, alfectinp: the *^''- l'<-»ki"-)
possibilities of the development of local supplies of annnunition within the
(Joramonwealth. These are a necessity in most States, but of far greater
urgency in Australia than elsewhere. We desire to see established cordite
and ammunition factories Avhich should be sufficient for our own wants,
These wants in time of peace are necessarily very small, while in time of war.
with the possiliitity of interruption of communications, they would be very
large. ()ur dilliculty, therefore, is to face the cost of' eslal>lishing or
subsidising factories for the manufacture of this annnunition within our own
borders, because of that enormous difference between the regular demand ujion
the factories and their macliinery and the extraordinary demand for wliich
they ought to be equipped to some extent. Possibly in the matter of
cordite annnunition for small arms, we do not see much dilliculty. We
think we can establish a factory which would meet our wants fully in
peace, and reasonably in war, keeping reserves always in hand. Hut if we
could enlarge the scopt» so as to supply the squadron or s([u;idron.- in
our seas with, at all events, pari of the annnunition and the cordite they
recjuire, that would enable us to conduct that factory on a much larger scale.
It is not a desire to make a profit out of supplying the naval wants, but
simplj' to keep the factory going on a greater scale, and enlarge its capacitj'
so that it might be less inadequate in time of war. ( )f course we recognise the
great dithculty in the testing of this cordite, which is now very elaborately
carried out with a great lunnber of guns of different types. It is necessary to
test the cordite for a gun of a i)articular type in a gun of that type, but as it
happens, at the present time that need not i)e an insuperable objection, because
we have quite a variety of guns in Australia, many more types than we
ought to have had, since they have not conferred upon us that ilefensive
strength which we should have enjoyed if we had been limited to a few types.
Opinions have varied in the Admiralty and War Ollice, as they must vary
from time to time, and Ave have had the fall effect of the variations.
However, imder the circumstances, the report of the Committee of Imperial
Defence advises us to lay aside quite a nundjer of these guns, and thej'
are of the same types, or sufficiently near to the types of gmis, which we
would require for testing purposes. Now, until those guns are worn out —
and then the question of supplying them might be a more serious matter —
they would perhaps suffice for the application of tests. We would be able at
least to commenc(> with them. I am not pressing for an answer to-day. I
have expressed already my iiudjilit}' to cope off-hand with the great questions
you have raised, without more time for consideration. Nor would 1 ask for a
reply on this point until we have told you Avhat we can otter. In making
this proposition for the supply of annnunition we do not expect that the
Imperial Navy should accept from iis cordite or any other supplies any less
efficiently tested than they are here. We accept that.

Lord TWEED.MorTll : It would be absolutely necessary that we
should test the cordite in the most effective manner.

Mr. DEAKIN : Absolutely necessary.

Lord TWKKD.MOUTH: There is another thing to be remembered, that
as far as our knowledge at present goes of cordite, or a large class of cordite
at any rate, provided it is kept at a low temperature under 60 degrees its life
is very long — certainly (JO or 70 years— whereas when it is long affected by
a high temperature it goes bad.

A 486G8. I 3

134

Fifth Day. Mr. DEAKTN : I am aware of that. Of course that estimate of the very

23 April 1907. long life of cordite is still theoretical, because there has beeu no cordite

of that character for 60 or 70 years, though all tlie scieutilic calculations

Naval Dei-uxce. pQJj-^|; [ly^^ way. We see no difficulty in the conditions of temperature. If
we make cordite "we must fultil those conditions ; if we do not fulhl them we
cannot do business. We do not look for mere profit. To sell you an inferior
explosive for the protection of our own shores and shipping would be
short-sighted economy ; but on the assumption that we are able to satisfy
you as to tests and storage, it would, or might, make a considerable ditt'erence
to us even if we had only the supplying of certain portions .of the annual
ordinarj^ consiunption of the squadrons in the Indian, China, and Australian
seas, the present area within ^vhich our squadron operates. It would be
inexcusable to bring forward a detail of this kind, were it not to give you
the opportunity of consulting your officers iu the hope that you may in some
way or other help us to improve our means of ammunition supply, which
would then be available for your squadrons iu all grave emergencies. Other
members of the Conference more competent than myself should cope with the
great questions raised. We should have an opportunity of seeing your remarks
in print. They most decidedly are serious enough for much consideration.
Clear as is your exposition, it raises so many matters of moment to us that,
to treat them as they deseiwe, more time for reflection and more detail would
be required. I therefore do not touch on the question of coaling or the
variety of other interesting problems suggested.

Sir JOSEPH WARD : Lord Elgin, and Gentlemen, — I begin by saying
that the value to the different countries — I speak, of course, specially for the
one tliat I represent — of having an opportunity of hearing the views of Lord
Tweedmouth, as First Lord of the Admiralty, to whom we look as the head of
the Naval Branch, is very important indeed. I want to convey for New
Zealand my concurrence in the expressions that Lord Tweedmouth has given
utterance to, that we should have confidence iu the Board of Admiralty and in
the British Government in connection with the Navy. I subscribe to that
absolutely. The people in our cormtry believe — and, of course, I am speaking
on behalf of the peoi)le of our country — that the great interests, enormous as
they are, extending throughout the Empire, must of necessity receive tirst
consideration at the hands of the Board of Admiralty and of the British
Government of the day. I am very glad indeed to hear Lord Tweedmouth
say that it is his desire to make the position of the Empire more secure
than it is at present. That great object is at the bottom of the representation
that the Colonies have here in connection with Defence matters. We
want to assist as far as we can in making our general position stronger and
more secure than it is at present, thougli it is happily very strong indeed.
I want to say that I fully endorse the view expressed by Lord Tweedmouth,
that there is but one sea around our shores, and that with one sea and
one Empire, there should iu reality be but one Navy. The outcome of
deliberations such as we are engaged in now, should be to place both
ships and the disposition of the ships, and the distribution of the ships
and the whole question of strategical work, entirely imder the control of
those at the pulse of the Empire — London ; who are responsible in the time
of war for the working out of any engagements that may take place f©r the
purpose of common defence. In any lielp that New Zealand may be able to
give towards the building up of a stronger position, that main principle
should be recognised, and will be, certainly by my Colony. We regard the
custodians of the Navy, the Board of Admiralty, as those who, being at the
seat or pulse of the Empire, are the authorities in times of Avar to govern the
Navy. We also recognise that they are responsible for the defence of our
commerce on the seas, either iu our part of the world or elsewhere, which

136

Lord Tweedinouth has rcl'tMTod to. l[o\v far we can help iu a suhsifliary P'ifth Day.
or supporting manner, wliich we will readily do, is a question to be decided 23 April 1907.
upon ill conjunction with the Home Government The details will certainly "—

be improved as the result of this Conference. Naval Dekescb

I am prepared to cordially co-operate with Mr. Deakin as the represen- . i u- rrf i
tative of the Conmionwealth of Australia in helping him to attain whatever
his country conceives to be desirabh; for tlu^ purpose of earrying on the
great work of the defence of that portion of the Empire. I was very glad to
hear Lord Tweedmouth say that different countries could be treated, and he
was prepared to have them treated, in different ways. In some respects we
naay require totally ilill'eront treatment, while in the main co-operating to
effectuate a strong position generally. It is important, from the view wliich
I take of our country, to briefly indicate what the position of New Zealand
is, and its difference in some re.spects from the ("omniouwcaltli of Australia
and the great Dominion of Canada and (Jreat Britain itself, which is so
important a part of this great organisation. Our country is comparatively
young ; under 70 years of age. We have before the people in New
Zealand still the work of the interior development of a comitry which
in the years to come will he capable of carrying 20,1 )( )0,( )()() of people
without any difficulty. We have under one million of population at the
moment. We have all the ramifications of the development of great public
works, so essential as a provision for the future to enalile peojih; to settle
in the interior of our country. We have still before us the making of the
railways throughout our country. Though we have between two and three
thousand miles of railways open to-day, it is comparatively speaking but the
fringe of what the future years will require to have estaljlished in the
country in order to meet the requirements of its people. That is one aspect
of the matter which any young country such as the one I represent, with its
future all before it. has to very seriously consider. Whilst anxious t<» help
the Old World and the other portions of the Empire in making a system
of connnon defence upon both land and the seas, the all-importance of
which we recognise to the fullest possible extent, we have still to keep
before us, as a young country, the fact that in the future many millions of
money will be required for the country itself to carry o\it great undertakings
that in the Old World have been carried out, many of them, such for
instance as your railways, by private enterprise. In our country those imder-
takings of great public utility are not carried out on the basis of private
enterprise, l)ut by the State. That work must devolve in the future very
largely upon the State. It is because of the fact that we have these
great undertakings that may take years to fulfil in the future before us
that we should hesitate to impose upon ourselves the burden of the con-
struction of ships of war, or of any great liabilities connected with the
maintenance of ships of war, or any g:-eat financial responsibilities other
than we actually connnit ourselves to in a delined agreement. In the
meantime we caiinot see our way to undertake this possibly heavy financial
responsibility side 1)y side with the great development policy which is very
important to New Zealand, as its success is to the Old World from the point
of view of the aspects of trade, and from the potentiality of the settlement
of British people within our borders— important also from any dh-eetion
which one could name. It is for these reasons, in lu-ief, that New Zealand
hesitates to embark upon so great an imdertaking, in favour of which there
is a vast auuumt to be said, as establishing a local fleet for the purpose
of local delenee, with the attendant repairing and large .loekage accommo-
dation such as has been referred to by Lord Tweedmouth. W(^ hav.N with
a comparatively small population, to consider the position from a practical
standpoint, and to se(^ how far we can go in the direction of co-operaling
in a practical way with the larger scheme suggested in the observations made
by Lord Tweedmouth.

I 4

136

Fifth Day. I want to say that the statement made that the Admiralty is prepared

23 April 1907. to meet, the colonies in a liberal and conciliatory manner, and if necessary

not npon a money basis only, is a matter which is deserving of the

Naval Defence. f^Hest consideration at the hands of the country I represent. I desire
(Si'', also to make it quite clear that I do not say that in any future agreement

Joseph Waril.) ^^^ make for our country Ave should give a money contribution
only to assist in the up-keep and maintenance of our portion of the
Navy. I gathered from the observations of Lord Tweedmouth that the
British Covernment is prepared to entertain a manning proposal. Whatever
is the maximiim amount Ave may elect and agree to contribute — and I
may say at once Ave are prepared to give more than the 4O,()00L a year
that Ave are now giving — if that is converted into a proposal for the manning
of ships and the paying for the manning of those ships in oiir portion of the
Avorld, still leaving them at the full disposition of the British Admiralty
even though Ave pay for the full manning of them, I am quite prepared
to consider Avhether we should not undertake to relieve the central
authority of difficulties Avhich noAV arise in connection Avith the manning
of our ships, such as having tAvo rates of pay for the crews, and Avhether
we should not man them completely at one rate of colonial pay, outside,
of course, the Imperial officers required to control them, AAdaich I presume
would be necessary, under the direction of the Navy. I am quite prepared
to consider for our Colony Avhether we should not change our contribution
from a maximum amount into an amount to be expended on the manning of
the ships Avhich the Admiralty may think it desirable to keep in our Avaters.

With regard also to the suggestion made by Mr. Deakin of the
necessity for further consideration after Ave have seen in print the important
speech delivered by Lord TAveedmouth, I Avant to reserve final judgment
upon the great issues involved until one has had that further time to consider
it. But I think this is too important to allow it to pass in the lirst instance
Avithout saying a Avord or tAvo upon certain aspects of it Avhich struck me as
Lord Tweedmouth placed them before us. The method of putting smaller
ships out in our Avaters than those required at home and other places abroad
is one I take no exception to whatever. One recognises the principle that in
times of Avarfare the Avhole strategical work and the Avhole disposition of
the ships is to be under the control of the Admiralty, and that they,
ATith the various classes of ships in the different portions of the Empire, Avill
use their greater ones wherever required, and also that they may either
elect to keep for the purpose of local defence the smaller subsidiary vessels
such as Ave have in our country, or to call them somewhere else to assist in
times of stress. Upon this question, however, I want to say that if it Avere
possibly in any scheme AA'hich the Board of Admiralty and the British Govern-
ment lay down to have some unification, even although Ave changed our
contribution to one of paying for the actual manning of vessels, it would in
my judgment be very much better from the standpoint of Ncav Zealand to
have that uniformity, Avhether Australia carries it out upon its OAvn account
or whether Ave remain attached to the British Navy entirely. That uniformity
of system Avould, I think, add A^ery materially to the swift and practical
Avorking of the Navy in times of troidile.

Lord Tweedmouth suggested that the Colonial C(jvernments sljould
equip and niaintahi docks for use by His Majesty's ships. Upon that heading
I agree Avith llic principle suggested, but of coui'se there must be a iiniit to a
proposal of that kind as far as New Zealand goes. Already we have
co-operated with the Achniralty, and Ave have at least one of the docks in om-
country Avhich is capable of taking, I think I am right in saying, any of the
sliips that are out in our Avaters — that is the splendid Calliope dock in
Auckland. Within the next few years we shall have a very large dock
iiiiislied at the port of Wellington, Avhich will also be capable of accommodating

137

any o£ the ships likely to he retaiufd in our waters ; and we have two other Fifth Dav.
large docks in New Zealand aheady, one at Lyttelton and one at Port 23 April 1907.

Chalmers, where there is also a second autl larger one now l)eiug built. I .

foresee one possibility, and that is, if an Australian Squadron were to ^■^^'*-^ Uekence.

be kept out in our waters, and our existing docks, or the ilocks about to '''^''..

be constructed, were not of sufficient length lo cover the ships out there, we ''""'•''' *^ ""■''•)

should l)e placed in a very awkward position if the duty were cast upon us

of equipping anti niaiulaining tiiose docks eutirely, and for tiiis reason :

we have a different nu'thod of initiating and carrying out the construction

of docks in Xew Zealand to what exists in the ()"ld Country. We have what

are known as Harbour Boanis, and in one case a Dock Trust, elected by

the people from dilferent portions of the district, and upon which some

Government nominees are apixiinted for the purpose of looking after the

general interests oC tlie harbours and clocks of Xew Zealand. There are two

possibilities that may arise about this suggestion, and I make it in order

that the point may be further considered as to wliether the Admiralty should

not define what is to be the dock of the future in our waters so far as

capacity goes for the berthing of these ships. Take the case of Wellington.

If they finish a dock GOO feet long in the course of 18 months, British ships

may be sent out to our country 050 feet long. I am not giving GOO feet as

the length of the Wellington dock, as it may, and I think is to be, much

longer. I am giving an illustratif)n only. It is a good tiling to encourage

in our country the providing of suitable docks for repairing and meeting

the requirements of ships in view of any time of trouble, if we should ever

have trouble out in our waters, though I very much doubt it. I think the

settlement of the troul)les of the Empire, whenever they arise, will be far

distant from the colonies. If an opponent of the British Empire wanted

to settle the question of who is to be supreme upon the seas, or who is to

take, if they can, any portion of the British Empire, it is hardly conceivable

that they would come out to our waters to settle questions of that kinil,

though New Zealand itself is too valuable to neglect in any way local

defence. I do not want to raise questions which might be lookeil upon as

troublesome, but we do fear some of the eastern countries, whose teeming

millions, so close to Australia and Xew Zealand as they are, under an

educational process in the years to come may find the attractions of our

countrj^ sufficient to induce them to give ns some trouble. 1 think, in any

arrangements we make with the xVdmiralty for our defence upon the seas

in the common intei'ests of the Empire as a whole, if we are to make that

arrangement of a practical nature — and the people of our country are only

too anxious to help — this all-important question of equipping, maintaining,

and providing docks should be considered upon a practical liasis, and the

Admiralty itself might convej^ to us, for our information, what length of

dock for ships in our waters may in their judgment in the future be

required. I may say that, under the system of constructing harbour board

docks in Xew Zealand, we would go a long way towards meeting the

requirements of the Admiralty in the different parts of the Colony.

I wish to say one word about this question of coaling. The Xew
Zealand Government has seen its responsibilities connected with coaling in
our country for a nundier of years. I think at the moment, in round figures,
we have either provitled for or guaranteed the debentures to enable some of
our w^est coast ports in Xew Zealand to be first-class coaling places for the
purpose of the exportation of coal, and we have done so to the extent of over
lialf a million of money. 1 listened to that portion of the observations of
Lord Tweedmouth with special interest. In our country special facilities at
Westport and Greymouth could be provided of a very satisfactory kind, and
they certainly could be provided in Australia at the Port of Xewcastle ;
a harbour for the largest ships in the world could be provided at

138

Fifth Day.
23 April 1907.

Naval Defence.

(Sir
Josepli Ward.)

a plat-e called Point Elizaljeth near Greynioutli, and the finest coal in the
world could there be put aboard ships loading down to any ordinary
draught. If we can arrive, as I hope may Ije the case, at some system of
meeting the local sentiments of these self-governing countries as to how
those ships, under the control and disposition of the Board of Admiralty
always, should be equipped and manned, ^ think the coaling matter is of
sufficient importance to enable us to probably arrive at a basis which in
the course of a year or so we might be able to put into practical shape.
I want to take this opportunit}^ of saying to Lord Tweedmouth that the
difficult}' which] has presented itself by having two rates of pay on board
the ships in our waters is one that we cannot lose sight of in considering this
matter with a view to having it ])laced upon a better basis. The rates of pay
generally in the Colonies are higher than they are in the old world. In order to
meet the natural sentiment of the people there the Admiralty have, with wry
great consideration, in the past agreed to a dual system of pay on board
those ships. Under that differentiation of pay there naturally must arise a
certain amount of friction and dissatisfaction, especially on the part of a man
who is Avorking side hj side with his fellow on board any of the ships who is
receiving a much lower rate of pay than the Australian or New Zealander is.
That statement seems to me to emphasise the great importance and
desirablity of these vessels being manned entirely, so far as the crews
are concerned, from the Colony itself, and probably a rate of pay could
be fixed by Avhicli they could he borne in suificient numbers to meet the
position now filled liy a portion of the men being drawn from the old land,
and a portion from the new laud. In any case, if it cannot be arranged in
the waj' I am endeavouring to suggest, New Zealand will be quite prepared
to have what I know has been talked of and referred to in despatches, the
system of deferred pay for our men put into operation, so that they may
draw the same rate of pay as the British men on board those vessels until
the time came for paying them oif, when that deferred pay would )je paid
out to them. I need not, because it must be very familiar to Lord
Tweedmouth and those associated Avith him, refer to the troubles which
arise owing to the higher class of pay being paid to the men in these
places now.

I want to make it clear upon the details of any scheme for the
betterment of the Navy and for the more effective working of it, that I
should be only too glad with my friend Mr. Deakin and any of the other
gentlemen here to have an opportunity of conferi'ing Avith those avIio are
responsible and Avith Lord Tweedmoutli, who has made such valuable
suggestions to ns to-daA'.

I will not take up the time of the Conference further at present upon
tills matter. I have a great deal of detailed information in my possession.
I lioi)e as the outcome of the ('onference that Ave are having with the
responsible representatives of the l^oard of Adnuralty and the British
Government here, that if each Colony Avislies separate treatment, as has
been referrc^d to by l^u'd Tweedmouth, we will get it. I am sure we will
be able to arrive at it, Avliih* allowing the ]ieople of the respective countries
through their Governments to carry out such a local system as they belicA'e
to be best suited to their individual circmnstances. I look forAvanL to the
outcome of the discussions which we an^ having across this table as going
in the direction of enabling us to join with the Board of Admiralty and
the British (iov(!rnment in helping generally in making our NaA'j' stronger
and better than it is at present.

Sir WILFRID LAUKIER : Mr. Brodeur will speak for Canada.

130

Mr. JMiODElli: Lord Elgin, ami gcutlenieii, iu view of the remarks Fifth Day.
made by ]\lr. Di-akiu aud Sir Jus(;[)ij Ward, it will uot be necessary lor me -jw Ajjril 1907.

to-day to state the position whicli L'anada iiiteuds to take iu regard to this

question of Xavall )efunce. Our situation is a dillVrent one to that of thf-otlit'r •^''^■•^'- Dekencb.

Colonies, and should be troatetl as such. I think, however, it woukl be only

fair that I should state to-ilay that the posit ion of Canada has uot been

properly represented as far as Naval Defence is concerned. I see by a

document which has been laid before us that we are supposed uot to have

spent any money at all upon Naval Defeuee. That ilocumeut shows wliat has

been spent by the United Kingdom, by Newfoundland, Austraba, New

Zealand, the Cape, Natal, and when it comes It) speak of Canada, it is sunply

stated theic that the Naval expenditure is none. 1 may say at the outset tliai

iu view of the Treaty which was made in 1818 between the liuperlal

(iovernment and the (Jovernment of the United States, it was foruially

stipulated tliat the Americans should have the right to come and iisli on our

shores, and that they should have the right also to come into our harbours

when they are looking after their lishing. Outside of that, they luive a right

also, in virtue of that Treaty, to go to some parts of Canada to lish on tlie

same footing as the Canadian British sul)jects. This particular situation,

which was created iu Canada by that 'I'reaty, induced the liritish Admiralty

to look after the defence, or after the protection of Canada, against the

jioachiug of these American lishermen. That duty was performed, and that

protection was given to our own people during man^- years 'dv the British

Admiralty, but for some time, especially since 1885, absolutely nothing has

l)een done by the British authorities. All expenditure in connection with

that Fisheries Protection Service has lieen carried on, incurred, and uiade by

the Canadian Covernment. I understaml that in England the Fisheries

I'rotectiou Service is also under the control of the Admiralty, and all money

exj)ended for that service is found l)y the Admiralty. 1 do uot know whether,

in the amount which is given in that paper as being the expenditure of the

British Admiralty — 33,000,000/. — that particidar service is included or not.

I suppose it is.

I.()rd TWEEDMOUTll: The Newfoundland one ?

Mr. BRODEUR : No, I meant the Naval expenditure of the United
Kingdom, 33,O0O,000L, as the monej' expended for Naval purposes. I
suppose that includes the Fisheries Protection Service too ?

LordTWEEDMOUTlf: Yes, certainly.

Mr. BRODEUR: Of course, we woidd claim that the same thing should
be done with Canada — that the expenditure tliat we make for the Eisheries
Protection Service in our coimtry should also be given as money for, and
shoidd be considereil as, Naval exyK-nditure.

I must also say that this obligation which we are cariying out to-day is
to a certain extent not simply a local obligation but an Imperial ol)ligation,
because that obligation was incurred in virtue of treaties, those treaties
having been passed l)etween Creat Britain aud the United States without,
of course, the consent of Canada. We are very glad to-day, however, to
take upon our shoidders the expenditure iu connection with that service.
I may say that since 1885 — since the abrogation of the Washington Treaty-
we have spent for that service 3,117, 1)1)0 ilollars, and last year, 1005 (i, we
spent 250,000 dollars. I may say this year the money to be spent will be
very much larger, because Ave are going to construct a cruiser wliich will cost
■us about 500,000 dollars, or 100,0(X)Z. As I say, we have been very glad to

140

Fifth Day. take Over tMs service and to relieve the Admiralty of so much. The same
2S April 1907. thing has been done with regard to the great lakes and in connection with the

great lakes I might call the attention of the Conference to this point. It is

Naval Defence. ^^^ ^^ i^g Supposed, I think, that the Admiralty could do anything on the
(Mr. BroJeur.) great lakes. It woidd not be a very easy thing to do. This service, then should
be taken over entirely by the Canadian Government. As a matter of fact,
it was done by the British Government for some time. They haci some boats
there, but those boats went away, and they were replaced by Canadian boats.
We have to-day on the lakes a boat which is an armed-boat which is looking
specially after the protection of our fisheries against the American fishermen,
not only for the carrying oiit of the local regidations, but mostly, and I may
say almost exclusively, for preventing the Americans from coming and fishing
in our waters. We have on the great lakes (large seas, properly speaking)
American States bordering those great lakes, and they are having navies of
their own now. I think that three States bordering on the three great lakes,
Ohio, Michigan, and Illinois, are spending not less than 15,000, 000 dollars
themselves for keeping up a navy on these lakes, and are drilling their men
on the shores of the lakes. Besides, they have some ships which are not
armed — because it would be against the conclusions of the treaty — but built
in order to be prepared in case of emergency. As far as Canada is concerned,
one of the first duties we shall have to look after is our protection in connection
with the great lakes, I may say that the wars we have had since 1763, since
Canada has become part of the British Empire, came from the United States.
We had an invasion in 1775, we had an invasion in 1812, and we had the
Fenian Raids in the Sixties. All those invasions came from the United States.
So we have to look specially to protect ourselves in that direction, and I may
say we have been doing it as far as the great lakes are concerned, not to a
very large extent it is true, but to the extent of spending a sum of money
which is quite important for a country of the size of ours.

NoAV Avith regard to our Naval Militia, which comes under my Depart-
ment, we l^ave been, as I said, spending some money for the Fisheries Protection
Service, and carrying out in that way not only some local self-defence, but
also Luperial obligations, and I am sure we have been very glad to do it,
and are glad to continue to do it. We established a couple of years ago a
cruiser for Canada which is manned entirely by Canadian seamen. Those
men are now drilling every day. We have a certain number of yoimg men
on that boat drilling every day and taking exercises, and acquiring know-
ledge in connection with Naval matters.

'o^

I may say also in connection with that that we have been assuming some
parts of the work which was done previously by the Admiralty not only in
connection with the Fisheries Protection Service and Naval Militia, but also
in regard to certain other matters. We have established wireless telegraphic
stations. Several of them have been established on the Atlantic coast, and
we are now under contract to estalilish some others on the Pacific coast. We
have l^een asked by the Admiralty authorities to consult with them Avith
regard to the commimications of those different stations. We have been very
glad to do it, and since we received that communication from the Britisli
authorities we have not established any of these vrireless telegraphic stations
without consulting with the British Admiralty. Those services are costing
also a great deal of money, and are not included in the amount of Tnoney
which has been given as our part of our Naval expenditure, though 1 siq)pose
that the expenditure made in connection with wireless telegraphy in
England is also under the control of the British Admiralty, and is incbuled
ill the amount which is given here.

We have taken over also the Hydrographic Survey, and we are to-day
extending the Hydrographic Survey. We have engaged the services of a

Hi

naval officer of the British Admiralty for the purpose of making our Hydro- ^''f'"' ^"i-
graphic Survey. We are huilding a boat on the new Pacific coast for that 23 April 1907.
purpose, also, and we have two boats now engaged on that service on the ^, ^. "7^^. ,^. ^
Atlantic coast. I know that the British AdmiraUy have some two Ijoats ; * *vi^''„ ''^^-^'^^
I think one in the Atlantic Oean and the other in the Pacilic Ocean, now ^^'- """'''"'■•^
making some hydrographit-al surveys. We are ready to take over this service
at any time the British Admiralty would like us to do that work.

We have taken over, or are going to take over, the 1 lab fax and
Escpiimalt Dockyards — in fact, we are in possession already, from the
1st January, of the Halifax Dockyards. I do not know exactly how mucli
those dockyards were costing the British Acbniralty- or the one at Halifax,
but I may say we have assinned all the obligations in connection with those
dockyards, and we have provided speciality hat the amount which the British
Admiralty was to pay as an annual subscription to the graving doi'k at
Halifax would be paid by us instead of by the British Admiralty. We have,
a^s I have said, provided for the establishment of docks at Halifax and
Esquimalt, so I think it would be only fair that in the statements published
giving the monies spent for naval expenditure, the amount spent l)y the
Canadian Government in connection with those different Services 1 have
JTist mentioned should be inchided in such Naval expenditure.

I do not think for a moment it AviU be necessary for me to discuss the
question further, because I understand the discussion will be taken up on
some other dav.

Dr. JAMESON : I will ask Dr. Smartt to speak for Cape Colony.

Dr. SMARTT : Lord Elgin, and gentlemen, — I think thai, as the result
of the intervieAv which Lord Tweedmouth was kind enough to grant to
Mr. Moor and myself with regard to the naval defence of South Africa,
he is thoroughly in jiossession of the views of the Cape ; and 1 therefore
listened with all the more pleasure to the clear statement made by him
and to the express statement that the Admiralty would view, in the most
sympathetic manner, any proposition coming from any self-governing portion
of the Empire with a view to improving the naval resources.

Now I can thoroughly understand the position taken up by Canada's
representative, which is, to a certain extent, moving in the direction laid
down by Lord Tweedmouth as one of the express lines of policy desired by
the Admiralty. Canada, it is stated, is doing a great deal in the direction of
improving her harbours, which harbours would not only be of assistance to
herself, but also to the Admiralty in time of trouble. But I think a great
deal of the expenditure referred to in connection with what might be
described as the policing of the seas with the view ol' protecting their
Fisheries, is similar to that made (perhaps in a much heavier waj"-) by the
Cape Colony and Natal in connection with the forces which, o^ving to the
large native population, it is necessary to maintain and which is not the case
in other Colonies. But, Lord IClgin I do not think the people of Cape
Colony would for one niouiont desire to raise that as an argument to prevent
our meeting the legitimate obligation that rests upt)n us as a portion of th(>
Empire in assisting Great Britain in her naval defence, and 1 think Mr. !Moor
will say the same of the people of Natal. Lord Tweedmouth has told us of
the enormous work done by the Navy. 1 think that is recognised by every
portion of the Empire ; and while we are pleased to hear of the magnificent
position in which Lord Tweedmouth antl his responsible advisers (>onsider
the Navy to he, we in the outlying portions of the Empire, recognising,
as was laid down by ]\Ir. Haldane in his statement on ililitary Defence the
other day, that the first line of rlefence is the Na^'y, and that, i[ that line of
defence is broken through, the w]u)le fabric of the Empire will crumble to

142

'■ pieces, are pl-epared to recognJHe that we sliould do everything, with the

23 April 190,. assistance of the Admirahy, to tiy and make that lirst line of defence, if

Naval Defence Possible, still stronger than it is at present.

/r> c . ' Oil behaK of Cape Colouv, I at once acknowledge that the contribution

(Dr. bmartt. , . ,^ " ' . ,*' .. ,.

that we give at the present moment is not adequate to our position, and is
not adequate to the services that the Navy renders to us. We are now trying
to do something to infuse a spirit of enthusiasm into our young men to come
forward and enrol themselves in a corps of Naval Volunteers, and I trust that
the Admiralty will meet that corps by allowing it to be established as a force
not of Naval Volunteers but of Royal Naval Volunteers. I am able to state
that it is the intention of the Government to introduce a Bill into Parliament
next Session whereby every member of that Naval Volunteer force will enrol
not only for service in local waters, but for service in any part of the world that
the British Admiralty might consider such service necessary should a period
of danger unfortunately arise. We, to be able to keep up the necessary spirit
of enthusiasm in a force of this sort, must have some means of giving them
practical training ; and I gather from what I^ord Tweodmouth has said that
the Admiralty will be prepared to treat sympatheticall^y every portion
of the Empire on a basis best suited to its individual requirements, and
further will be prepared to do what would be very acceptable to the (Jape ;
that is, allow us to take over a small ship, necessary for the training of
these men, and, until other arrangements can be made, to devote to the
up-keep of that ship a certain portion of the grant that the Cape and
Natal now give towards the British Navy.

I also fully agree, and am perfectly certain that tlie peojjle at the Cape
will agree, in the necessity of assisting the Admiralty, that we outlying
portions of the Empire should provide small craft, such as submarines and
torpedo-boats, not alone for the defence of our shores, but to be joined on
to any squadron sent from Great Britain in periods of great emergency,
it being a great difficulty, or almost impossible, to send torpedo craft
many thousands of miles to sea. As the Admiralty say they would welcome
a departure of that sort, I think the people at the Cape, knowing that
they were really fundamentally assisting in building uj) the Navy, would,
when times improve, be prepared to increase their contribution ; and I
also presume that that would l)e the position of Natal. I hope that we
would be joined in that position— especially as the spirit of federation
is now so strongly evident in Soutli Africa — by the inland States, that is
the Transvaal, the Orange River Colony, and perhaps Rhodesia. I think
everybod}' recognises the burden upon the British taxpayer. I should
think at the present moment. Lord Tweedmouth, that the Admiralty is
taking out of the general taxation of Great Britain something over 201.
out of every lOOL for the up-keep of the Navy. You are paying rouglily,
I suppose, 15s. or 16s. per head of your population. Well, in comparison
with that, look at the contribution of the Cape — (5(),000Z. a year), and
the contributions of the other portions of the Empire towards the up-keep
of the Navy. It is about a sovereign, perhaps, out of every lOOL of the
general revenue. We must recognise that while it is of the first im-
portance to Great Britain to protect her enormous over-sea trade, it is
also of equal importance to South Africa, and to the other portions of
the British Empire, to protect their trade over the seas — which is of as
great importance to them as the trade of Great Britain is to her. If
the Admiralty would work out a scheme and discuss it with us, we
wouhl Ije prepared to see how far we coidd work up in that direction,
so that our contribution would be of the greatest possible assistance to
the Admiralty ; and the assistance in this direction woidd naturally appeal
much more forcibly to the people and give them a stronger individual
interest iu the fleet than simply a njonetary contribution would do.

143

With logaid to clocks : lluU is also a matter in which we oouhl Fifth Day.
assist, but I wouhl lilce to point out that as these docks wouhl not -j-^ April iyo7.

alone be used for comniercial purposes, but also for naval purposes in

time of war, they would he practically useless if they were not adequately Na\ ai. Dekexce.
dei'euded. Another matter on which we would like to have tiie advice (l^'- fsmurtt.)
and assistance of the Admiralty, is as to the character of the defences
in such an important strategical ])ortiou of the Empire as Cape Colony,
because, if we iiud that it is necet.8ary, as we thiuk it is, to improve those
defences, we would be (juite prepared to discuss what our proportion of the
contribution towards the imi)rovement of those defences should l)e. Lord
Tweedmouth lias told us that the Admiralty are increasing their dock accom-
modation, and that there ai-e already some thirteen docks that will take in
ships of war even of the size of the " Dreadnought," and that one ol' those
docks is, I believe, Simonstown. Now 1 presume that, from an Admiralty point
of view, it is not alone the question of the size of the dock to accommodate a
ship of a certain tonnage, but the question of a ship being able to get into
that dock under all conditions of weather. I woidd like to be assured by the
Admiralty on this point as to the docks at Simonstown. The advice 1 have
is that, as the Simonstown Docks have been constructed, at the present
moment in the prevailing wind at certain seasons of the year (that is
during periods of howling south-easters) it might be very difficidt for a
ship to get into the Simonstown Docks. I would like to be assured that
the necessary works to allow that to take place are under contemplation by
the Admiralty, because to have a clock which you are not able to use in
all weathers (especially in time of Avar) to my mind, detracts enormously
from the value of that dock ; and I hope that this is a point that the
Admiralty wiU fully consider before it is too late and the Simonstown Docks
are fully completed.

Before we return, we hope that, with the advice and assistance of the
Admiralty, we shall be able to devise some scheme whereby our Naval
Volunteers will be established and strengthened in num])er, in conjunction
with Natal ; and also that the Admiralty will advise us as tcj what is the best
manner in which we can move on the lines of the policy laid down by the
Achniralty. I think the i^eople of the Colony would welcome a departure
of that sort, and I believe woidd recognise that, if further contributions in
such a direction were necessary, they would be willingly met by the Colony.

Sir ROBERT BOND : Lord Elgin, and gentlemen,— For more than 400
years the Fisheries in Newfoundland have been a recruiting ground for the
British Navy. It is so to-day. It may be so to a far greater extent in future
than it is at present, for there are some 60,000 fishermen engaged iii that
Colony of a physiciue developed by their avocation, which makes them most
suitable for His Majesty's Navy.

In 1U02 I entered into an agreement with the Admiralty, on behalf of
my Colony, in the matter of the establishment of a Naval Reserve, which
should be liable for service, if found to be necessary, beyond ihe limits
of the Colony and in any part of the Empire. Up to the present time
it has been a very marked success indeed. On the roU there are
now some 590 men who have distinguished themselves in His Majesty's
Service, according to the reports of the Commodores upon that station.
Any large contribution that the Colony may give in the future must
be in the direction of the service of such men. This is necessarily so
because while the Colony that I represent is not like that of my friend,
Sir Joseph Ward, a new Colony, for on the contrary, it is Englancl's most
ancient Colony, still the conditions that apply there at the present time^ are
almost identical with those that have been pourtrayed by Sir Joseph Ward.
The Colony for the most part is an undeveloped one. The expenditure

144:

Fiftlj Day. necessary for its development must come from the resources of tlie Colony.

23Ai>nl 1907. We stand in an exceptional position amongst all other Colonies of the

,, ~ — Enipire, I think, in that we have not received any assistance from His

EPExcE. ]\fj^jgg^y'g Government — money assistance, I mean — in the direction of

R b -t B ■( promoting the indnstries or the development of the Colony. Yet at the

present time the Government owns some 700 miles of railway, nearh'' 1,500

miles of telegraph, 300 miles of cable which connect the Colony wath the

neigh l^ouriug continent, and a dock which up to a very recent date was

pronounced to be one of the finest in British North America. All these

great undertakings have come oiit of the funds of the Colony itself. In

the future, 1 take it, we shall have to look to onr own resources, and such

being the case, as I mentioned a moment ago, any large money consideration

or coniribution towards the Kavj- can hardly be exj^ected from the colony of

Newfoundland.

There is a matter that I am pleased my friend the (Canadian Minister
of ^Marine has touched upon, namely, the ex]penditure incident to the
policing of the waters consequent upon treaties entered into many years
ago by His Majesty's Government with certain foreign nations. While
the liability of expenditure to which my friend the Canadian ^Minister referred
only applies to the Americans in his case, we have a further obligation in the
Colony of Newfoundland, inasmuch as by virtue of a treaty entered into with
France many years ago, she occupies St. Pierre and Miquelon islands off our
south coast, which are a continual menace to our revenue. What I mean
is this, that a system of smuggling has been carried on from St. Pierre for
a number of years. We have estimated the loss to our revenue at something
like 150,000 to 160,000 dollars a year. We have to police —at very con-
siderable expense to our revenue — the waters of the south coast in the
neighl)ourhood of St. Pierre and Miquelon. We also have to .police our
waters right around the whole coast line of nearly 4,000 miles to protect
our fisheries and protect our revenues from encroachiuent at the hands of
the American fishermen. My friend, the Canadian Minister of Marine and
Fisheries, has contended, I think, with very much force and very much
justice to his Colony, that the expenditure incident to that protection service
ought to appear really as a contribution from his Colony towards Naval
Defence, because unless the Colony provided that protection service itself I
take it it would be regarded by His Majesty's Govermnent as a duty
incumbent upon itself to supply such protection, inasmuch as the necessity
is one that the Colony can hardly be held responsible for. The argument
applies with greater force in the case of Newfoundland. The treaties are of
old standing, naniely, that of 1818 with the Americans, and the Treaty of
Utrecht with France more than a hundred years older. They were made
without the consent of the Colonies by the Imperial Government in the
interests of the Empire. Therefore I respectfully submit that the expenditure
that the Colony is called upon to make for fishery protection service by reason
of those treaties might be properly regarded as a contribution toward naval
expenditure.

Under the agreement that was entered into in 1902, to which I have
made reference, the liability of the Colony is to the extent of 51. sterling
per liead for every man recruited in the island. His ^lajesty's Govern-
ment assiuning the whole of the balance of the expenditure in coni]£ction
therewith. The arrangement that was made having worked out entirely
satisfactorily to tlic Colony, and I believe, entirely satisfactorily to His
^Majesty's (iovernment, I assume there is no reason for any revision of the
agreement that is existing.

I liave only to add that I shall be pleased to recommend to my
Government a further increase to the amount that is at present being
contributed if it is deemed desirable by His Majesty's Government to

145

increase! the number of reservists in the C!olou.y. I will go so far as V'tUh Day.
to say that wc would assume double our presi^nt liability upon the '2^^ Ai)ril iyo7.
same basis as that set forth in the existing agreement. .

With regard to the matter of dock ])rovisi()u. The Colony built a dock ^^'^'- ^'■-'•■e^ce-
some years ago, at a cost of some G50,OUt» dcjllars, and it is regardetl as one ,. ^^!^'[. .n
of the largest docks, if not the best, in British North America. • " '^'^ "" ''

With respect to coaling facilities for His Majesty's Navy, the CVjlony at the
present time is expending a very considerable annual amount in developing the
coal measures, which not only exist on the south-west coast of Newfoundland,
but also in the interior of the island, and it is hoped that these deposits will
be such as to warrant us in going much further than we have gone up to the
present time, and at no distant date offer facilities for naval supplies. The
coal is of excellent quality.

We are also encouraging the development of the petrolemn areas of the
west coast. When I was in England in 1905 the Admiralty coinmunicateil
with me in respect to the petroleum areas of the west coast, and showed very
great interest indeed in the possibilities of that country. Mr. Pretyinan, who
was at that time Parliamentary Secretary to the Admiralty, assured me that
the matter was of special interest to his Department, and expressed a hopcj
that the Govermnent of the Colony would do what it could to aid in the
development of those deposits. That we have done, and that we are stiU
continiiiug, and I hope the efforts in this direction maj' yet result in being
of material advantage to His Majesty's Nav}',

I have nothing further to add at present.

Mr. F. R. MOOR : Lord Elgin and gentlemen, I have to thank Tx)rd
Tweedmouth for the clear way in which he has laid big problems before us
this morning, and I have also to thank him on behalf of Natal for the
sympathetic way in which he seems to have met both the Cape Colony and
the Colony I represent in the direction Ave have been indicating to him at a
conference that Dr. Smartt has already referred to.

We feel that in South Africa individual Colonies, divided as they are at
present, are not sufficientlj' strong to do all that they should be doing towards
helping the British Navy, and as far as the Cape and Natal are concerned,
having duly talked the matter over, w'e feel we might more adequately assist
if we had some kind of union together with the advice and the assistance of
the Imperial Government. Our idea is that being more or less in union with
each other, we shall have better results, and will be able to have more scope
for the movement wc arc trying to promote in these Colonies. For some
years in Natal, and I believe also in Cape Colony — in fact I know it is so —
we have had a movement there started, so far as Natal is concerned, by the
late ^Ir. Harry Escombe, who was one of the best public men we ever had in
the Colony, to promote a spirit of assistance towards the Imperial Govermnent
in regard to harbour matters and the building up of the Naval Reserve. He,
my Lord, was the father of the corps that we now have in Durlian, known as
the Naval Reserve Corps. This corps has done admirably, is very enthusiastic,
has been in the field on scn^eral occasions, and took a most prominent part in
the late outbreak that we had there- the rel)ellion. But this corps is inore
or less dying of inanition, because it feels that it is not having recognition as
regards its value or its services in a direction that it is essentially organised
for, that is, with regard to its naval training. We cannot give that naval
training or promote any further that spirit of assistance imless we have the
assistance of the Admiralty. And, as already indicated ])y Dr. Smartt, it did
occur to us that if the Admiralty could help us with a ship we might be able
to utilise the services of these men witli the ship, as l)etween dilTerent ports
on our coast, and give these men that sea training which is so essential not
only for their use, i)ut in keeping alive the movement. It would l>ring the

A 4866S. K

(Mr. F. R. Moor.)

146

Fifth Day. movement closely in evidence ; it would bring it to the notice not only of

23 April 1907. these men but to the notice of the Colony, and would raise a spirit of

V. r.rlZ,^^. ^ enthusiasm which we cannot hope for unless we do have something of that
JNaval Defence. ^ °

sort.

From the statement we have had this morning it seems that the
Admiralty is realising there may now come about a new departure with
regard to the defence of these outlying portions of the Empire, that is in the
direction of tlae utilising of smaller craft. These scientific craft are higlily
technical, I take it, but they could be used in our waters very effectively, not
only iu the event of war, Ijut in the meanwhile for the training of our local
people, and also as one of the best means for repeUing any threatened attack
by a cruiser or any ships an enemy might put round our coast, and deterring,
perhaps, tlie attack from being delivered.

That being the case, I feel that I should put myaelf here entirely
in the hands of the Admiralty and the Home Government as regards
advice. We are here to learn, to exchange ideas with you, and where
possible to give you every assistance in our power, and if our first
crude idea is not one that commends itself as the most efficient to the
Admiralty, by all means let tis take advice, and I promise that we
will do our best to forward the movement that Lord Tweedmouth has
indicated to us this morning.

I can only say this, that as regards our local defences we are
trying to do our best. My little colony has just spent some 700,000L
or 80O,OOOL of money in quelling a reljellion among the natives. That
is a danger we all of us in South Africa have to face, and I think
we do fully realise that we have to face that in the future and Ave
have to provide efficient men and means for being able to govern these
people without looking to the Home Government. Putting it against the
auguments that have been adduced by the representatives of Canada, and
also the last speaker. Sir Robert Bond, I do humbly submit that it is a sot off
"to the argmnents that have l^een adduced as regards policing their waters.
We have iu Natal made and wrenched from the reluctant hands of nature
one of the finest harbours in the southern hemisphere and it has cost us
millions of money to do it. That harbour to-day is at the disposal of the
British Navy, Avith all its furniture and all its conveniences, and all we ask of
you is to advise us how to turn those facilities, that Ave have carried out
entirely at our OAAm expense, to the greatest advantage for the common good.
I do not say it with the idea of tresj)assing on the claims of my sister colonies
in South Africa, but Ave have the finest coal that has yet been discovered in
South Africa. That coal is available in any quantity that you may desire at
our harbours, and Ave are providing these facilities for handling it and for
getting it into depots as may he desired in the interests of its use not only
connnercially but for defensive purposes.

I feel that this contrilnition Ave are noAV giving in money Avould be
perhaps more advantageously spent if it Avas more in the direction of men
and material — a direction that Avould appeal to the people, so that they woidd
have evidence that it Avas really a living organism Avhich Ave had started and
it Avould encourage them to go on Avith the good Avork. With regartl to Avhat
Dr. Smartt has said as regards increasing the combination, Avhen the time
'.lonies that Ave can afford it, and Avhen Ave have, as I hope Ave shall ha\-e, the
federation of our Colonics an accomplished fact, I do trust that avc Avill he
able to increase oiir conti'i])ution. But I do trust also that tlie Admiralty will
meet us in getting that contribution uiade more in tlie direction which 1 ha\'e
tried to indicate than l)y simjily a cold lump sum, voted on our estimate, for
Avhich wo have no actual evidence as directly concerning the. people Ave
represent.

147

I have nothing more to add, only I wish to emphasise that I do thank '''"''"''' ^*7-
Lord Tweechiionth for the kind Avay in which lie is tryiii.i: to meet our views, 23 April 1907.
and I hope that with the advice of the Achiiiralty some good will couie out of .- . "T~.. .
the movement we are attempting to advance. ^ '^^■^'' '^'^^^'^

CE.

(Mr. F. H. Moor.)

General BOTILV : Lord Elgin and (lentlemcn, tlie Transvaal is in
a unique position with regard to this (pu'stion. We are inlaud and we
have absohitcly no harbour. I was nearly going to say our friends in the
Mother Country always kept us well away from the sea.

I have gone through this Statement, and the 177,000/. that is our
expenditure in the Transvaal only indicates the sum we spend on volunteers.
But there is another force in the Transvaal on wliich we spend a hig sum
of money. This is a force that was brought into existence after the war,
and which is thei-e still. It is the South African Constabulary, anil tliat
body costs the Transvaal about a million pounds every ye.-ar, so that our
expenditure is really very much more than would a]ipear from lliis
Statement.

On the itemof expenditure on the Navy we figure as nil, but llic
question arises with me whether it would be practicable t(i give a sum of
money. 1 tliink the best way in wliich we at pretrent in tin; Trausv^il can assist
the British Empire in general is to get the Transvaal to unite with the rest
of South Africa in a practical way on the question of dcJ'euce. The position
is to-day that idthough we are spending very much money we practically
have no reliable defence in the Transvaal. And wc notice especially with
regard to the recent rebellion in Xatal that we are not sufTici(>iitly prqiared
for all contingencies. In Soutli Africa we have a situation whicli may become
a very serious one and a menace to our position, and if we do not set to work
very carefully tliere, we run the risk that one day possilily half of the white
j)opulation may l)e mown down without our being in a position to help them.
13earing this in mind, my opinion is that we should federate, at any rate witli
a view to defence, in order to remove the possibility of such a danger. 1 have
not had the opportunity of discussing the question of a naval contribution or
aiding the British Navy with my Govermnent, and still less with the Parlia-
ment of the Transvaal, but what I have in mj- mind's eye to ]-)ropose is a
system of defence for the whole of Soutli Africa, and if tlie Parliament of the
Mother Country thinks w^e can aid the Empire in that respect, we shall be
prepared to spend a large sum of money for that ol>ject. I tliiuk llial at
present we are so constituted in the Transvaal that we shall lind it dillicult to
make a contribution to tlie Navj' by way of a money payment.

CHAIRMAN: Gentlemen, the Fir.st Lord of the Adnu'ralty would like
to say a few words in reply to the observations which have been mailc, but 1
think that he agrees that effect must be given to the request of Mr. Deakin,
Avho has lieen called away by another engagement, that there should be
anotlier o])p()rtunily of resuming the discussion later ; thcrcfi)re 1 propose to
ask Lord Tweedniouth to make his rej)ly now, and I will make a suggestion
with regard to the resumption of the debate wlu'U 1 mention the other
arrangements at the conclusion of the meeting.

Lord TWKEl)]\I()rTH: Lord Elgin, and gentlemen. I think that the
general discussion and the expressions of opinion on the ]iart of the Prime
Ministers who liave spoken is very satisfactory. 1 think they form a good
basis for an eventual agreement on the lines which I have ventured to fore-
shadow. Of course it is impossible to settle details now and here. 1 liope
that some of the Prime Ministers and their friends will come and tall; over

K 2

148

Fifth iJav. that question with me as to how the wants of each particular Colony may be
23 April 1907. nict in the sort of way tliat I have roaghlj^ suggested.

There are just two or three points that I think I ought to allude to. The
first is the question of manning, which is a very important one. The present

Twceiliuoutli.)

2sAvAL Defence.

■cdinoutli.') view of the Admiralty undoubtedly is, after very carefid consideration of the
wliole subject, that the conditions of modern war probably would lead rather
to the loss of ships than of men ; that the results of the Japanese War and
other experience have shown that the loss is rather one of ships than of the
men who are on board those ships ; that there is alwaj'^s a considerable number
of men saved even if a ship is lost, and that the loss of men in a naval
battle is small in proportion to the loss of men on land. That must always
be rememlDered. So that ^vhat ive may naturally expect is that as a Avar goes
on and we are subject to the casualties of war we shall find that we have a
number of men at our disposal, whose ships perhaps have either been
damaged or lost, to use on board other ships.

Another point that I should like to remind you of is the long time under
modern conditions that it takes to train a man properly to do his work
efliciently on one of these great modern battleships. I think I am not
exaggerating in the least when I say that for the higher ratings on board ship
certainly six years are taken to train a man to do his work projjerly. The
higher ratings now in the Navy are really trained and skilful mechanics, and
they only are alilc to take the duties of those ratings and to undertake the
machinery, gunnerj-, torpedo, and other work of that sort. Untrained men
are useless for that work, and therefore we are bound to have men who have
gone through a long and careful training.

Then it is the same thing, to a stiU greater extent perhaps, as regards
the officers. I do not consider that an officer really can start on his career
now on less than eight years' training. Of course, we take them veiy young
— at 13 now — and by the time they are 21 or 22 they become lieutenants,
but even then I do not for a moment suggest that they are fully capaljle
of discharging all the important work that has to be done by officers. This,
however, I can say with the greatest confidence, that you may have the
most magnificent ships, guns, armour, and everything else, but if the human
element is not very properly trained, j'our guns, your armour, and your ships
are al)solutely useless. The whole history of our Navy shows that the self-
sacrifice and endurance of British sailors has been beyond compare, and I
believe at this moment they have reached a higher state of efficiency than
has ever been known before in the history of our countrj'. I make that
remark, because I think it is only fair to warn the Conference that the
admission of an unlimited number of men to the Naval Service is in practice
impossil)le. I mean we should have nothing for them to do. We should
not 1)0 alile to employ them.

Then there is a point which has been alluded to more than once by
speakers, and that is the question of the distribution of ships. At this
nionient no doubt we are under certain obligations with regard to Australia
as to the ships that are to be on that particular station. If, in future, as 1
hope will be the case, there will be greater concentration of the ships, I want
it to l)e very distinctly understood that I do not believe tliat our dominions
beyond the seas would sulfer in any way from such an arrangement, 'lihey
Avould not even sulfer in the show made by British ships in Colonial waters,
because tliough it may be perfectly time tliat vessels may not Ite so frequently
on the station, yet, as 1 bebeve, future developments will lead to the Colonies
not having the secondarj' or not quite the best of the ships, but they would
see the big l)attleships and cruisers from time to time. This would really
give a much greater show and give the Colonies a nnich better idea of what
the British Navy is than the ships that they have now stationed permanently

149

in their waters. That has been unflonbtedly the case in the Northern Fifth Day.

Hemisphere since the concentration of the Fleet in fkinie waters. The visits 2;{ Aiiril 1907.

made by squadrons to foreign powers and hjreign cities have been much

more impressive, much more freqiient, and much more useful than they ^'-^^ai- Uekence.

woxdd be if oulv comparativelv few ships were sent at a time to ])articuh»r (Loixl

foreip;n ports. " TwetHlmouth.)

Sir Joseph Ward referred to the question of pay. That is a very
important one. Jt is quite true that we have had trouble from the fact
of the Colonial men serving at a higher rate of pay than our own British
sailors. I tliink it was inevitable, and of course we must try to make as
good an arrangement as possible for mitigating the evils of the system.
At the present moment in Australia the pay is not paid directly to the men
on board ship, but is paid to them through the Post Olhce on land, the idea
being that they would leavt> their money in the Post Olhce and would not
spend it with their British comrades wliilst they were on board sl)ip. As a
matter of fact 1 think that idea has proved false. 1 have the figures here,
which are very curious. In Australia, out of 32,300/. paid to the Savings
Bank since the beginning of the agreement — that is up to the 30th June
190G — only 2,800L has remained in the Savings Bank, showiug that the men
have drawn out the money at once, and have expended it whilst they were
on service in British ships. Therefore, they were living and are living at a
higher rate than their British comrades on board the shijis, and they spend
their money on various things, clothes, or food, or one thing and another.
They do live on a different scale and in a different manner to the British
sailors who are serving alongsi<le tliem, which leads, no doidjt, to diflicidty.
I think that is an unfortunate thing, and what I shoidd suggest woxdd be
that in those cases we should adopt a system of deferred pay, so that the
Colonial sailor shoidd not be paid his extra pa,y till he has fuliilled his time
of service. When his time of service expired, then he would receive the
whole payment due to him for the whole service, and would have a con-
siderable sum with which to go away from the ship, anil he could use it
on land for some really xisefiil purpose rather than fritter it away in having
a good time on board ship.

Sir WTT.LIAM LYNE : Is it not possible that that money was drawn
out of the Savings Bank to supj)ort wiv( s or jjarenls on shore ?

Lord TWEEDMOUTH : tJf course that may be so.

Sir WILLIA^l LYNE: 1 think that most likely accounts for a portion

of it.

Lord TWEEDMOUTH : I am afraid a good deal of it is spent by the
men on board. I quite admit Sir \\'illiam Lyne's point is a good one, and
no doubt an arrangement ought to l)e made to enal)le them to transfer
money to those belonging to them, and the people they have to support
while they are on board ship.

I ought to say that we here make no sort of reliection on Canada, and
we do not for a moment accept the criticism to which Mr. Brodeur referred.
We hold that Canada is pei-hn'tly free to come to any resolution. We hop(>
to have their help, Imt still they are cpiite right to look after their own
interests, in the full security that so far as the British Government can be
of use to thorn in their deftMicc; in time of need, they may depend in any
circumstances on our giving tliat aid with the greatest joy and without any
sort of drawback whatever.

A 48668. K 3

150

Fifth Day. Di'- Smartt made a great point that the Naval Volunteers should receive

23 April 1907. the title of " Royal." That depends, I think, chiefly on the local legislature

passing a JBill registering the Naval Volunteers as a regidar force. I think

Naval Defence, as soon as that Bill has passed through the Cape Legislature there v\dll be no

(Lord difficulty in their coming under the title of " Royal."

Tweedmouth.) With regard to the point raised as to the dock at Simon's Bay, I will

discuss it with the Hydrographer at the Admiralty and see what truth there

may he in that allegation that the dock at Simon's Bay is not accessible in

certain winds. I fancy there is some question of a breakwater to be added.

Dr. SMARTT : What I gather from seamen who know that coast is that
in a howling south-easter, which very often blows for two or three days,
the sweep of the wind playing on the entrance to the dock might make it
imsafe for a battleship or cruiser to enter. I imderstand that that could
be remedied by an expenditure of a not very large amount of money.

Lord TWEEDMOUTH
breakwater contemplated.

I believe there has been some adijitional

Dr. SMARTT : I believe so.

Lord TWEEDMOUTH : I do not know the details of it, but I must get
it from the Hydrographer.

Dr. JAMESON : Practically the extra expenditure necessary would be
50,000L or 60,0001

Dr. SMARTT : Say 60,000?. or 70,000/. to make it complete.

Lord TWEEDMOUTH: Then Sir Robert Bond referred to the New-
foundland Naval Reserve men. Your Chairman and I saw a squadron of them,
in this very quadrangle last summer, and we were struck by the smartness of
the men, and we had a most excellent report of the service they do. W^e are
very pleased to have the help of these men who are trained to the sea and
who must be, and are, most efficient fellows, and of course Ave shall be glad to
consider Sir Robert Bond's suggestion that there might be a possibility of
some addition to these reservists.

The same remark that I made to Dr. Smartt applies to what Mr. Moor
said about the Natal Naval Corps. They have not been registered as naval
volunteers. It would be necessary to have a Bill passed in the local
legislature before that is done. At this moment I think from the reports I
have received that the Natal Naval Corps is practically used as a sort of
garrison artillery ; that they do not at all train at sea ; that they have some
considerable guns under their charge — four 6-inch breech-loading guns, one
12-pounder C[uick-firing gun, two '45 Maxim guns, and two quick-firing
Hotchkiss guns. In the last defence scheme, this body is to take charge of
the guns in case of war or any attack as I understand. That I believe is the
last arrangement under the Defence Committee.

I quite recognise that General Botha is in rather a different position Jit)m
the other Prime Ministers, and, of course, the case of the Transvaal is ciuite
different, in having no coast at all. Still, we shall welcome any help that
General Botha may be able to give after consultation with his Government
and his Parliament to the general Naval Defence of South Africa. I am sure
anything of that sort would greatly help what, I hope, may very soon come
alwut — the federation of all the different Colonies now existing in South
Africa.

Fiflh Day,
2:5 April 1907.

151

All I can say is, that I shall he only too glad to confer with any nienibers

of the Conference who may wish to go into greater detail with regard to the

arrangements that can he juade umler tlie suggestions that I have made

to-day, and then I tliink if we had another talk at the Conference after that, Naval Deke\ce.

we might, perhaps, come to some defined resolution on the sidiject. (Lord

Tweed inoiitL.)

CHAIRMAN : I think my best plan is to move the adjournment of this
debate.

It was arranged at the last meeting that Emigration should be taken on
Thursday at 11. We might, perhaps, also put on the agenda Naturalisation
as another sul)ject, in the hope that we might reach it. The Home Secretary,
Avho will deal with that subject, would 1)e abl(> to attend.

Adjourned to 'riiiirsday next at 1 1 o'clock.

K 4

152

Sixth Day. SIXTH DAY.
25 April 1907.

Held at the Colonial Office, Downing Street,
Thursday, 25th April 1907.

Present :

The Right Honourable The EARL OF ELGIN, K.G., Secretary of State

for the Colonies (President).

The Right Honourable Sir Wilfrid Laurier, G.C.M.G., Prime Minister
of Canada,

The Honourable Sir F. W. Borden, K.C.M.G., Minister of Militia and
Defence (Canada).

The Honourable L. P. Brodeur, Minister of Marine and Fisheries

(Canada).

The Honourable Alfred Deakin, Prime Minister of the Commonwealth
of Australia.

The Honourable Sir Joseph Ward, K.C.M.G., Prime Minister of New
Zealand.

The Honourable L. S. Jameson, C.B., Prime Minister of Cape Colony.

The Honourable Dr. Smartt, Commissioner of Public Works (Cape
Colony).

The Right Honourable Sir R. Bond, K.C.M.G., Prime Minister of
Newfoundland.

The Honourable F. R. Moor, Prime Minister of Natal.

General The Honourable Louis Botha, Prime Minister of the Transvaal.

Mr. Winston S. Churchili,, M.P., Parliamentary Under-Secretary of
State for the Colonies.

Sir Francis Hopwood, K.C.B., K.C.M.G., Permanent Under-Secretary
of State for the Colonies.

Sir J. L. Mackay, G.C.M.G., K.C.I.E., on behalf of the India Office.

Mr. H. W. Just, C.B., C.M.G., \ j ■ , n , •
Mr. G. W. Johnson, C.M.G., j ^^^"^ Secretaries.

Mr. W. A. Robinson,

Assistant Secretary.

Also present : ;*

The Riglit Honourable IlERnERT Gladstone, M.P., Home Secretary.

The Right Honoural)le .John Burns, M.P., President of the Local
Govornnient Board.

Sir M. D. Chalmers, K.C.B., Permanent Under-Secretary of State, Home
Office.

153

Mr. C. P. Lucas, C.B., Assistant Under-Secretary of State for the Sixth Day.

Colonies. 25 April 1907.
Mr. H. Bertram Cox, CV>., Assistant Under-Secretary of State for the

Colonies.
Mr. J. Pedder, Home Ofhce.
Mr. H. Lambert, oI the ( 'olonial Ollice and Emigrants' Informatioix Office.

EMIGRATION.

CHAIRMAN : Gentlemen, we are to proceed to-day with the considera- Emiguatiox.
tion of the subject of emigration, which is a subject which, I think, has
already received considerable attention l)oth in the Colonies and in this
country. K I undcrstanti rightly, the Canadian CJovernment have their own
system for dealing with this question. The Australian and New Zealand
Governments have also, 1 think, had it under consideration. As regartls
ourselves in this country, we have had an inquiry by a very competent
Conuuittee, on which Colonial opinion, 1 think 1 may say, was represented,
because the Chairman was Lord Tennyson, and the Report of that Committee
and the evidence has been foi'warded to the Governments of the Colonies for
their consideration. 1 therefore think that we may, perhaps, come more
directly to a specific point on this question than, perhaps, on some other
subjects which have Ijeen l)efore us, for in the despatch fi'om this Ollice
forwarding these papers to which I have referred, the third paragraph drew
the attention of the other Governments to the question of whether
or not they were willing to accept state-aided emigration. 1 explained
that for my colleagues and myself we would wish to be assured on
this point before considering the matter fron\ the point of view of the ^Mother
Country. I would suggest, therefore, that in the discussion which is now
to open, that the particular point might be borne in mind specially. My
Right Honourable friend, the President of the Local Government Roanl, al'ter
hearing the views to he expressed by the other meml)ei-s of the Cunicrciice,
would be prepared to state his opinion upon that and other ])oints connecteil
with this subject. I, therefore, invite th(> other mendx-rs of the Conf«!rcnci!
to proceed to discuss the question from that standpoint.

Sir WILFRID LAURIER : I suppose, my Lord, it would be natural wo
should first hear the views of the Colony of Australia which has brought this
matter to the attention of the Conference.

CHAIRMAN : Yes. I omitted to say that one resolution submitted is by
the Commonwealth.

Mr. DEAKIN : My Lord and gentlemen, in touching upon this question
my first duty is to remove an apparent misaiiprehensicm. The question of
immigration to us is the question of emigration from you. The question of
emigration is as distinctly a British question as that of immigration is ()urs.
To what extent the Government and Parliament of Great Britain desin^ to
foster emigration is for them to discuss and decide. I shall therefore h)ok at
immigi-ation from our point of view, and not from the point of view of the
Mother Country, because upon that the representatives of the people of that
country are necessarily themselves the judges. Any remarks, therefore, which
I may make in regard to our desire for immigration are subject, of course,
to that necessary preliminary qualification. One aspect we necessarily must
leave in your hands, as it pertains to you and to you aloue.

154

Sixth Day. We commence, with the fact that ■ there is an emigration from this

25 April 1907. country. Whether that be stimulated by the Government or retarded, or

conditioned, there is the emigration actually proceeding. The first matter,

Emigration-. qj. ^]^g gj-g^ aspect, to whicli Ave draw attention is that while emigration
(Mr. Deakiii.) continues, we venture to submit that there is an obligation upon the British
Government to direct those who are leaving its shores to some part of the
Empire, and, if not activelj^ to at all events passively discourage the migration
of people of British stock to other countries under other flags. Of course,
the emigrant chooses for himself. He may, for his own reasons, prefer either
to join friends who have already left, or in order to follow some particidar
caUing desire to pass outside our territories. That the emigrant will decide.
But, subject to that free choice, what we submit is that so far as the Govern-
ment of this country acts at all its action should be to direct its sons and
daughters to its own Dominions where there is ample room and more than
ample room for all who may leave this country to settle abroad. The position
appears to us to be so clear as scarcely to need argument. It is a fact that in
the Dominions beyond the seas the inhabitants are greater consumers of the
goods of this country than any other people. The man who settles in Canada,
or Australia, or South Africa, purchases more from the Mother Country than
if he went to the United States, to South America, or to any other country
under another flag. That counts for something. What counts for more is that
none of the great Dependencies are yet anything like effectively popiilated.
n^'here is boundless room for settlement in most of them ; and that settlement
not onl^^ enhances the prosperity of that part of the Empire, and not only
increases its trade with the Mother Country, but is a guarantee for the
permanence of the control of those great territories by our own people and
by our own race. I use the word " race " here generally and in no invidious
sense. We quite recognise that in Canada and in South Africa we have two
races with whom we are most intimately associated. We look forward in
those countries to a gradual merging into a conimon stock. They are so closely
akin to each other that there is no olDstacle to a complete blending of the two.
Ultimately, there will be a Canadian people, and a South African people,
who, while associated with the Empire as closely as possible, will not have
within themselves the consciousness of any tlivision. In the same way we
recognise that it is, perhaps, hardly possible for us in Australia to draw
from the Mother Country the whole of the people for whom we are at once
able to provide. We should be very happy if the peoples who come from
outside the Mother Country to dwell and blend with iis were people of
French or Dutch extraction. We have in Australia, though in minor numbers,
both French and Dutch settlers already who are among the most valued
citizens we possess. Consequently we look forward to blending in Australia,
to some extent at all events, though perhaps to a small extent, with races
friendly, closely allied, and similar in character. Now take the point of view
of the Empire, and look forward to a very remote contingency. Suppose
that Canada in course of time becomes densely peopled, supposing its people
overflow — I take that, of course, as an illustration merely- -it woidd be the
paramount interest of all the other self-governing peoples that those Cana-
dians who desire to leave their country should settle in some other portion
of the Empire for commercial reasons, for racial reasons, and for every
reason. Consequently, we venture to submit that in whatever way the
Government of this country may think right and j)roper to intervene
in the matter of emigration, in this one direction we are, jjerhaps, entitled
to press thcnu for some action ; that is to say, that all they do shall
encourage settlers to pass to any part of the Empire they please, so
long as it is a part of the Empire, and shall, at all events negativelj^
discourage and certainly not assist them to go to countries whicb
are not under the Flag. At present I midcrstand whatever infonvat

155

is given is given indiscriminately, ami tliat those who are anxious to go ^'*'*i '^"y-
to North or South America beyond our territories, and I)eyond the Flag, ?5 April 1907.
arc praeticallv as much assisted and encouraged as if they \\ere going „

• *• H. M 111 It t T Wl V

to Colonies within the Empire. I cannot myself vouch for that statement, . " " '
but am so informed by some of those who have been associated with their ^
going. Under these circumstances, we put forward our lirst plea, which is
that for all our sakes the stream of emigration from the Mother Country ought
to be directed as much as possiljle towards some portion of the King's
Dominions, and it ought not to be assisted in anj- way towards the Dominions
of any other Power. That is the purpose of the first portion of our resolu-
tion : " That it is desirable to encourage British emigrants to proceed to
" British Colonies rather than to foreign countries."' I do not know whether
it would meet your wishes, and the wishes of the rest of the Conference,
if I stop here, so that this question in which w-e are all interested, and on
which we can all speak, may be settled before passing to the second part,
which relates to further action by the Imperial Government.

Sir WILFRID LAURIER : There will be no contrary opinion, I think,
to that proposal. I think we can all accept it as grantetl at once : " That it
" is desirable to encourage British emigrants to proceed to British Colonies
" rather than to foreign countries." Everybody would agree to that.

Mr. DEAKIN : I should hope so. May we take that as passed ?

Sir WILFRID LAURIER: What will it lead to? I look upon this
simply as a preliminary.

Mr. DEAKIN : If that is settled I ^vill then proceed Avith the second
part.

Sir JOSEPH WARD : I \vant to say something on it somewhere.

Mr. DEAKIN : Would it be on the first part ?

Sir JOSEPH WARD : Either on the first part or the second part?

Sir WILFRID LAURIER : I do nt)t think there is anything to say
against this part.

Sir JOSEPH WARD : Only there are some general points on which I,
as representing New Zealand, should like to say a word or two. Like Sir
W'ilfrid Lauricr I most cordially assent to the first part, but it is just a
(jucstion wdiother we should not discuss the whole matter on the first
proposal.

Dr. JAMESON : The second portion is the practical ])art. Would it
not be well to have some practical suggestion from Australia before going
into the discussion, to save going all over it again?

Sir JOSEPH WARD : I support the first part general! v.

CHAIRMAN : I do not thiidv there is any dissent on the lirst part?

lea- Sir JOSEPH WARD : No.

156

Sixth Day.
25 April 1907.

Emigkatiox.

Mr. DEAKIN : I tope not. The second part is " That the Imperial
" Government be requested to co-operate yrith any Colonies desiring immi-
" grants in assisting suitable persons to emigrate." Here we take a step
further. The Lnperial Government is asked to co-operate with every Colony
desiring immigrants. If there are any portions of the Empire which do not
desire immigrants, to them we have nothing to say. Biit most of us are
eager to obtain them, and far jnore eager to obtain them from the ]\Iother
Country than from elsewhere. They blend with us in the working of our
social and political institutions, they enter into our life in all its phases
without any sense of separateness or strangeness, and hence, we are most
eager to obtain them.

The extent to which the Imperial Government will co-operate has been
left unsj)ecified for the reasons previously given. That is a matter on which
we can prefer a request for co-operation, but cannot expect to do more than
suggest generally what, from our point of view, we wish them to imdertake.
Whetlier they wiU do what we ask, or only part of it, is for them to decide.
The co-operation we seek is, first of all, in regard to the practical channels
by which emigration is sought to be effected in this countrJ^ These should
be adequate to their task. The only body that I understand is connected
with it officially, is the Emigi'ation Board imder this Department. I haA^e
been inquiring from the Agents-General of the several States of Australia
their opinions as to the efficiency of this particular agency, and regret to
say that their unanimous opinion is of an unfavourable character. They
think, at present, that no effective assistance is being given to them by this
Board. They go so far as to doubt whether it is possible for it to be given
by a Board constituted in this manner. Thej'' object even to the publications
which it has submitted, and have felt this so strongly that they have imder-
taken publications of their own, at their own expense, which thej^ consider
far more likelj^ to attract emigrants than those of the Emigi^tion Board.
Speaking, as thej^ do, as men of high standing who have the supervision
on this side of whatever is being done by the States of the Connnonwealth
in respect to immigration, I regret to learn that their verdict is so unfavour-
able. They suggest that some Board, responsilile directly to Parliament, or
responsible directly to a Minister, should be charged with this duty ; that
thej^, or some of their representatives, should be associated with it in the
most direct fashion, and that they should be consulted before statements
are put forward which sometimes they have foimd themselves obliged to
challenge.

B}^ way of illustration, since I have been here I have been si;pplied with
correspondence which has taken place with reference to one of the most
recent of the circulars issued by the Emigrants' Information Office. It is
dated 12th of April of this year. Of course, persouallv, I am dependent upon
the material that is put into my hands when speaking of the operations here.
The official statement published is that " The Queensland Government has a
" system of free passages to hona fide farm labourers and their families who
" are approved by the Agent-General in London, and guarantees them employ-
" ment in the State at full wages ; but up to the present the indents for such
" i)assages have been limited to men willing to work on the sugar farms in the
" north. The climate there is hot and moist in the rainy season, from January
" to ]\Iarcli, and hot and drj' at other times, and is very different from tliat to
" which farm labourers are accustomed in this country. It is very questionable,
" therefore, whether they would l)e able to Avork on arrival imder the fropical
" conditions that prevail in Nortli Queensland. The work of harvesting and
" crushing cane is still more trying, and is paid for at a higher rate. The
" free passage emigrant need not engage in it unless he wishes, and, indeed,
" the v.-ork is not suitable for persons from this country who have not resided
" for some time in the tropics. Assisted passages are also offered at 5/. per

157

statute adult." That is a ritateiuont, one of those many statements from Sixth l<av.
wliifh we suller, n\ hich is sullieiently corroct in a general way not to be 25 Ai)ril 1907.

challengeable as williil misrepresentation, but which, in its actual effect ami ,

purport, is a misrepresentation. First of all. the work of crushing cane has K>"<-«atios.
never yet been done by auylxxly but white lal)Our ever since sugar was grown ^^''- 1^«"'''"-)
in Queensland, and the warning therefore given here that the work of
crusliing cane " is still more trying and is paid for a at higher ratt\" is, lirst
of all, not correct, because it is not more trying, ami secondly, it takes place
in the mills, and is therefore, less trying. Jt has never been carried on from
the commencement by anything but white labour ; it is well pai<l, and well-
sought for. Therefore, so far as the crushing of cane is concerned, that is an
absolute misrepresentation. Take the other statement : " the work of harvest-
ing is still more trying and is paid for at a higher rate." The work of
harvesting is trying. You could not takeanuiss of labourers from this country
and put them down into a cane han'est field, and expect the whole body
of them to be al)le to engag(> in tliat work, well as it is remunerated,
Avith satisfacti(jn to themselves. Tlu're are a certain proportion of our
people^ who cannot face the rdose atmosphere and moist heat of the
cane fields. That proportion, of course, cannot be classified beforehand ;
it is a matter for individual experience. But this wholesale statement
is made in face of the fact that the (.'ommonwealth of Australia has
deliberately adopted the policy of requiring that the whole of this work
shall be done by white labour, and in face uf the fact that we have been
dealing during the last two years with the largest hai-vest of sugar cane we
have ever had, and arc dealing with it by a far largtu- proportion of white labour
than ever was employed in it bi>fore, 1 think, I may say, to the satisfaction of
the men Avho obtain the Avork and to the satisfaction, to a very large extent,
of the employers themselves. Where there is dissatisfaction the testimony is
that it arises from the want of self-control of those; engaged in a reuuuu'rative
employment, who are accustomed, as unfortunately people are in mauy
parts of the world, to spend too great a proportion of their wages upon
stimulants and to disqualify themselves by that means from ellieiently
continuing their work. There can be no doubt that the excessive use of
stimulants is more injurious in a hot climate than it is in a cold climate.
What the labourer in the cane Held suffers from most, or at all events what
is most complained about, is due to these excesses. But here we are
deliberately, as a part of a national policy, providing for the carrying on of
the whole of this industry by white labour. (.)f course, as Australia liecomes
older an increasingly large proportion of our labour will be Australian born.
Yet, speaking broadly and accepting the opinion of competent critics, they
are miable to detect in our first or even in our second generation any
apprecial)le departure from the old stock. Wo. have men freshly landed in the
hotter regions of our country- and I am speaking now of the north of Australia
— who go at once to such work. 1 have sjioken to many men who have
gone from England, Ireland, or Scotland direct to North tjueeuslaiul, or some
of the northern portions of Australia, and who have engaged at once in the
most trying occupations in the most trying belt. A short distance from the
sea coast one reaches the plateau. On that plateau we get cold fresh nights,
and there white men enjoy what is saiti by them to be one of the liest
c-liniates in the; world. In the belt where the sugar grows, conditions are
dilTerent, it is on the sea coast, and the heat is moist and oppressive. It
is not everyone who can live there with cond'ort and satisfaction, though it
is only a small proportion of those who settle there who ever think of leaving
it. The great proportion remain, thrive and flourish by labour, nuich of
which is as trying as this labour, and they are now dohig this labour with
excellent pecuniary results. No one would gather from reading this ollicial
statement that these are the facts of the case ; that a ilelilierate attempt has

158

Sixth Day. been made, which so far has been most successful, to substitute white labour
25 April 1907. for black labour in this industry. That is actually proceeding. Each year

for the last three or four years a great stride has been made. During the

Emgration. j.-^gj twelve months we have returned to their homes some 3,000 Kanakas,
(Mr. Deakm.) pacific Islanders, who have been engaged in this industry. Their place
will have to lie taken in the next season hj white men. A certain proportion
of the Kanakas are allowed to remain with us — those who have really made
homes, or become, in their sense of the word, partially civilised and settled
down. Their labour will be still available if they choose to give it. But
undoubtedly the greater part of this Avork will have to lie done by white
men, and is cheerfully lieing done by white men. My last news from
Australia is that the ajijilicants for employment on those fields are numerous
enough to cause it to be doubted whether we shall be dependent on immigra-
tion to permit of the whole crop being dealt with thoroughly this year.
Personally 1 think that is too sanguine an estimate. I am not a North
Queenslander, and therefore not qualified to speak liy personal knowledge,
but looking at the number of Kanakas leaving, and the great demand there
is at present for labour in all parts of Australia at high rates of wages, it
seems to me very doubtful whether we should be able to cope with the special
demands of this crop, the biggest crop we have ever had. and a similar crop
which will Ije reaped in the coming season. Therefore I think we .shall need
immigration. What I have been referring to I have said in a letter calling
attention to this circular. I might proceed to the other portions of this state-
ment, but really this general statement will show first of all a serious lihmder
in regard to the crushing, and next that it is a statement which is entirely
one-sided — although, of course, quite honest — and is certain to be misleading.

Dr. JAMESON : Whom is that published by ?

Mr. DEAKIN : By this very Board of Emigration of which the Agents
General have been complaining — the Emigration Information Office. In
my letter of the 20th of April, I pointed out — " No doubt it would lie a
" perfectly proper thing to instruct emigrants both on the nature of the
" work for which they are proposed to be engaged, and also to call their
" attention to the climatic conditions under which it is to be accomplished.
" All facts of this kind ought to l^e supplied and none suppressed ; but it is not
" apparent why the members of the Board with their imperfect knowledge
'' of the character of this employment, and apparently also of the extent to
" which it is being successfidly carried on by white labour, shouhl alisolutely
" Avarn emigrants against the undertaking. Evidently the influence that such
" an official declaration on the part of the Colonial Office is likely to have upon
" other European Governments has been overlooked by those whose desire ]uust
" be to encourage British settlers to seek new homes within the Empire. The
" circular of the Emigrants' Information Office dated 12th April is free
" from this objection, though the expression of opinion it contains is in
" Mr. Deakin's opinion decidedly too sweeping." I will qiiote presently a
further statement of the Emigration Board made in a letter to an applicant
for British innnigrants for Australia, to wliich my reply refers. The passages
that I have read from the circular should have been accompanied by a few
other sentences, stating that the greater part of this work is now being jJone
by white labour ; a great part of that Avhite labour is British boru ; the Avhole
of that work will have to bo done in future, liy steady degrees, more and
more by wliitc labour ; the wages paid are high ; for men who lead temperate
lives and will take the ordinary precautions necessary in a different climate
this work is thoroughly healthy. I am assured by those Avho have
personal (experience that some of the llnt^st specimens of our manhood they
have ever seen are to be found engaged in harvesting in the cane fields.

159

I take this as a typical illustration. Tt is a fact that men are earning in Sixth Day.

those cane fields wages which would be very hard to get anywhere else. 25 April 1907.

Some first-class experts during the last harvest season were making as high

as i'roni IL a day, and in a few exceptional extraordinary instances ' '

upwards of 30s. a day, during the time of harvesting. The point is that this ^ ^' '"''"'•■'

harvest, like all other harvests all the world over, is for a limited season ;

its beginning depends partly on the j)art of the coast on wliicli you are.

Quite a considerable portion of our rural labour in Australia is nomadic.

Our iimiiense flocks of sheep are shorn by shearers who come from their own

farms or from employment in the city, during tlie season. They take their

hoi'ses, and c'onuuenciug at the north of Australia, when the shearing season

Ijegins earliest, shear their way southwards, right down through (^)ucensland

and New South Wales to Victoria, travelling probably 2,000 to .j,000 miles.

In the same way, tliough to a lesser extent, in the cane-cutting on the

(Queensland coast, which lasts about four months altogether, it is possible to

commence at the north, and work south. The cane-cutters, like the shearers,

are(>ither the owners of farms, or are estaldishiug farms tliemselves, and wish

to obtain money for improvements auil other purposes. They come for that

season of the year. The work proceeds during the hot season, but the

evidence goes to show that these men, apart from the over-indulgence in

alcohol of which I have spoken, and over-indulgence in meat-eating which is

practically miiversal in Australia, maintain their health perfectly in the cane

fields. They can work, not only with the black men, but, as is always the

case in our experience, they can beat the black men or Chinamen out of the

liidd, in cane-cutting or any other employment, in any climate we have in

xVustralia. AVhon I speak of the very high wages I am not sj^eaking of the

whole body of cane-cutters. Where they earn those high Avages they are

not being paid Ijy the day, ])ut, Ijy piecework They take contracts at average

rates, and the high wages are obtaineil by exceptional capacity and expert

training, siich as I have spoken of. They can get that training in a season

or two. One season is considered sufficient to train a man, ami two seasons

ought to enaljle him to make the Ijest of his time. These high wages are

earned only on contract work, they are not earned on ilay work.

I ilid not intend to enter into all these considerations, or I would have
summarised my remarks antl ablireviated them. I have been drawn on to
them by the fact that 1 had not realised that before I could make these
conditions untlerstood in criticising that circular, 1 had to give some sort of
sketch of what is being done in t^Uieensland.

Surely, the proper thing for an Emigration Office under these circum-
stances would be to say : " You are going out to Queensland, a State which
" offers already large opportunities for land settlement, which, according to
" its programme, is about to give IGO acres free to any settler who will go
" there, and to make other land available at attractive rates ; a State where
" there'are boundless mineral and agricultural resources of all kinds. This
" is one class of work in connection with one class of ])roduct only of the
" many in Queensland, and if you should find that thi.s employment is misuit-

able for vou, you can have an^ph' work on dairy farms, on grain farms.

on

'• sheep stations, on cattle stations, as soon as you acquire the requisite local
" knowledije." As far as work in the dairy is concerned local knowleilge is
soon addecl There is al)undance of employment on the land in Queensland.
1 am speaking of that State only because that is the sugar State, whose
conditions have been questioned, ))ut the same remark applies to the northern
rivers of New South Wales where sugar is also grown. Although sugar is not
now grown in the remaining states of Australia, with some qualification the
same general renuirks apply to them. Agriculture is by no means the only
rural industry ; the timber industry has great potentialities in the felling.
This clears the' land, which when cleared is marvellously rich. Th(> climate

160

Sixth Day. is iiot described with strict correctness in that circular as tropical. It is
25 April 1907. rather sub-tropical. Perhaps you may say that this is a distinction -without a

difference, but in an official document it is as well to be accurate. The north

Emigeatiox. coast climate of Queensland is suli-tropical rather than tropical. Those,
(Mr. Deiikiu.) however, are minor matters. But the fact is, anyone reading that circular
would l)e discouraged, or would be likely to be discouraged, and certainly
those who persist go out under serious misapprehension. They ought to be
warned of the climate, which is extremely trjnng to men not accustomed
to a hot sini and close atmosphere. The cane work is perfectly healthy ;
but as the dense cane shrub shuts out the breeze in its midst, that makes
cane cutting moist and uncomfortable work. Still, as I have said, some of
the linest specimens of manhood that we possess are to be seen there. Some
of these men 1 have spoken to personally, and they make nothing of their
labour. I do not wish to push that too far. We have not sufficient knowledge
yet to fix the i^erceutage of average labourers who would choose this Avork.
But 1 have spoken to men engaged in the actual task of cutting, and they
have assured me — and they have no reason to mislead --that they find it not
more laborious than many classes of work which they do elsewhere.

Coming back to the circular, and apologising for my long digression, I
say that is not the way in which a Government office ought to co-operate
with a Colony desiring immigrants. So far as we are concerned we desire
the truth to be stated — the whole truth and nothing but the truth — but it
is to be stated in such a manner as not to convey misapprehensions. It is
to be stated in some way that will not discourage all the Agents-General
concerned, as the EmigTation Board has done. There will always be a certain
proportion of people who come from Great Britain wlio will lie to some extent
at all events dissatisfied with their colonising experience. Until they leave
their OAvn country they do not know how much they are attached to its special
conditions, to their old relationships, ties, and memories, and they are very
apt to take an miduly dissatisfied view of their new country, simply because
it is not a replica of the ohl country, with the customs and undertakings with
which they are familiar. An allowance always has to be allowed for that
margin, which is to be found in any country to \vhicli there has been any
immigration. On the other hand, speaking broadly, not only for Australia,
but for the whole of the dominions, we say that immigrants -will find
conditions inore closely approximating to those in Great Britain there than
they will under any other flag. They will find Governments, business relations,
and social conditions much nearer to those they have left than they can hope
to find anywhere else. Consequently, we suggest that the Imperial Govern-
ment should adapt some more effective form of instructing those who are
about to emigrate and in a far more adequate way than this circular, if it
be a fair sample, has done. The statements made should 1)e complete and
balanced, instead of being incomplete and unbalanced. The emigrants from
Great Britain should, as far as possible be equipped with official statements
which can be furnished from every State giving all the details of life and
living, prices, and every other particular, so that there may be no misap-
prehension whatever as to the state of afi'airs into which the new comer will
be laxmched. Up to now we have not properly imitated the splendid example
of Canada. We have neither coped with immigration on the same scale, nor
provided for the reception of immigrants in the manner in which they have
set an example; but that is being remedied. Innnigrants to Australia no
longer find themselves left to look after themselves. They are met on
landing, sui^plied with information, and, as far as possible, assisted in every
way to make their homes. Eveiw State of Australia gives exceptional
advantages for land settlement. They make advances upon improvements
as these are made by the settlers, the Crown, of course, retaining still its
right to the land, subject to the fulfilment of its conditions, which are verv

161

light nnd easy, l>y the iiiiiuigraiit. The Crown still being the gioun<l Sixth Day.
landlord, so to speak, for the time, is able to advance to settlers money 25 April 1907.

which enables them to build their houses, anil fenee and improve their ,

property, and to assist them in clearing the land. They now get a welcome, i^n'i^HATioN.
and every encouragement. We think therelore that the least to be expected (^Ir. Dcakiu.)
is that a fair view of these facts should l)e put before all intending emigrants
so that, when each makes his clioice, he may know wliat Australia has to offer.
If he keeps within the Empire we have nothing more to say. if he should
leave it we regard him as a loss. We look upon emigi-atiou to foreign
countries as draining the life blood of the Knipire. \\"e cannot consent to see
people pass away from it who ought to remain upholding its Hag.

iSirJOSKPlI WARD: Lord Elgin and gentlemen, f would like to say
a few words upon this matter. New Z(>alan<i is in rather a different position
from Australia. 1 think what Mr. Dcakin has said with regard to Australia
in its general application ai^plies to New Zealand, but there is one important
distinction, and that is that happily we have not a " coloured labour " question.
It does not troTd)h' us as a reality in New Zeahuid ; in Australia it does.
And from Avhat T know of my own knowledge and have seen and heard from
people in Australia, my opinion on the black laliour question is similar to that
of Mr. Deakin, that wliite labour could do all the work in Australia thai
black labour is now doing. Though there have been many statements made
to the contrary by people, that is the general feeling of the people of
Australia, and ]S[ew Zealand most heartily endorses it, and 1 siip])ort
Mr. Deakin in that respect most thoroughly.

In New Zealand we are in a tlifferent position. We have been cariying
out a system of innuigration for a nundjer of years, Ijut have been doing it
upon a scale and upon a system that I should not like to see departed from.
The principle suggested or the proposal indicated in the memorandiun from
the Secretary of State for the Colonies about State-aided emigrants from (ireat.
Britain, is one which we would require to approach very carefidly indeed,
for the reason that I believe the troul)les in the matter of an excess of
people that you have to meet in England implies that the majority of those
who seek to be helped out of your country, or a great nuuiy of them, would be
the class that luider ordinaiy conditions you do not care to retain. What
I mean to say by that is that the class of people, if they were of a superior
class, that you woxdd want to help out in large lunnbers to oiu* countiy, are
the very people you ought to want to keep for yourselves. If you are going \
to have a system of State-aided emigrants to the self-governing Colonies, \
unless w'e had the right of exanu'nation and selection before they left here —
which right, if you Avere giving State-aid or a large portion of that aid, I
presume you would want to retain in yoiu' own hanils the inference is
we might get people imported into our countiy, or a portion of them, whom
we would not care to have coming in in either small t)r large nundiei-s.
I am not for a moment presmning to nuike any reflection upon probably
the most estimable class of people who nuiy want to go to " fresh fields
and pastures new " to try their fortunes there. Ibit experiiuice some years
ago in New Zealand — and we can only look at this matter in the light
of what we suffered many years ago — was in the nature of what I have?
endeavoured to describe, nanudy, that we got a very large section of people
who were most vmdesiral)le ; and our Colony woulil certainly not be prepared
to go into anything like a wholesale scheme of innuigration upon lines of
that kind.

The position that New Zeahmd takes up is that we are glad to receive
immigrants if they are of a suitable class and have some capital ; otherwise
we are not. Innuigration of that character is assisted ncnv Ijy the Colony

A 4H6IW. L

Ward.)

uy2

Sixth Day. througli the High ( Commissioner in the case of British emigrants, and
25 April 1907. we are very particular in the matter and the High Commissioner of the
— — Colony here is most careful and thorough, he does not make a super-

Emiuratio.n. ticial examination, but a thorough examination into every instance of people
^"'^w'^^j'n''^ desiring to come to our countr3\ If they are accepted, then we pay a
sufficient portion of the passage money to reduce the passage to New Zealand
to 1 0?. We are in the position of being the most distant of the self-governing
Colonies from England, and the passage to our country is probably a good
deal higher than it is to the more fortunate Colonies that are close to the Old
Land. We make a reservation that each person we assist miLst have some
money, and we guard ourselves by doing that in order to ensure that, in the
ordinary sense, he would be able to look roimd for himself after he has
arrived in our Colony with a vipAv to obtaining suitable employment, or
embarking in anything he desires. We fixed the amount at one time at 50L,
but have since reduced it to 20L We do not make it a hard and fast rule
that that is the only class of immigi-ation we assist. We have a system of
nominated immigration by which the people of ovu* country make their own
.selection, and then upon their arrival in our Colony the immigrants are
taken in hand by their own friends and in that respect the State
r)epartments are relieved of any direct assistance to them in the way
of helping them to find employment. We also in such a case give a contri-
bution to the passage money to reduce it to 10?. That we do with all lines
of steamers trading to our Colony. I may say that in two years from the Old
Country itself under a system of selected immigration. (i,632 people came to
New Zealand, and In-ought with them the siun of 275,046/. So, while anxious
to see the people in our country increase legitimately, we are working rather
from a different standpoint to that which I take it the Old World or Canada and
Australia are doing. We are working in the direction of getting some of
your people who have a limited amount of means into our Colony with a
certain amount of capital to ensure that they become good colonists, and
be a valuable asset to our country generally. To enable those G,(i32 people
to come out to New Zealand we paid 22,382L to the steamship companies to
help them.

Quite outside of those whom the High Connnissioner selects and sends to
our country, and of the nominated system to which I have referred, we have a
class who come to Zealand of their own accord, who are quite welcome to come
to our country without means at all, or with means, as the case may be. From
that source we get the larger proportion of those who come to New Zealand and
settle there. Within a period of years we have had over 50,00(> people coming
in that way. An examination into the statistics of our Colom^ shows that
over a period of years Ave have retained them permanently, and we have
lost only 1,000 against 00,000 coming in (hiring that period of years.
In our coiuitry, which is expanding, and which requires to have out-
side suitaljle laljour ii-om time to time drawn to it, we are Avorking upon
the principle of gradual expansion and gradual increase suitable to the
requirements of our people, and Ave are prepared to assist upon the lines I
have indicated in order to bring that about. I think 1 am right in saying
that indiscriminate emigration under the auspices of any organisation in the
( )ld Country Avould not be approved in New Zealand. Here I would remark
that there is an opening for farmers Avith a little capital, and also for domestic
servants, but I hesitate to advise unskilled labourers Avho have neither means
nor vocations, to come out to our country in large numbers, for the reason
that Ave do not AA-aut to haA-e the Avrong impression conveyed which Mr. Deakin
has referred to. Whatever the position in our country we desire the truth to
be stated for the guidance of those Avho desire to come to our countiy. We
flo not Avant a large lunnber of unskilled labourers (-oming t(j New Zealand,
because Avith the possibility of the dislocation of the labour market, there

in'A

nu^ht be a tendency to crcute Irum tinic to time a section ol' tlio>c ulio niiijht
not bo able to get regnlar employment. We are in the pusititxi in our Colony
of fortunately not having imemployed. We have not known the meaning of
" nnemployed " in the or<linary sense for many years, and we want to avoid
anything of the kind. We prefer to have a conuniinity well spread over
our country, fully employed, but to be rather on the side of requiring a
few more to come those re( quired for the use of our farmers and l)usiness
men and for settling the country -than to have an excess with its tendency to
create the troubles that many many years ago we had. What I want to
remark is that New Zealand is quite prt^pared to have placed before it the
suggestions of what is best in the general interest for making provision to
meet the desire suggested by Air. Deakin, of British sul^jects going to oui-
British Colonies. We are quite prepared to consider as favourably as we can,
any proposal for a suitable scheme to Ijringabout what 1 think we all desire, but
it would be quite a wrong impression for me to convey, as the representative of
New Zealand, that we can subscribe to any great scheme for the wholesale
immigration of people, which the country itsell' uiight not be prepared to
absorb within reasonable time upon their arrival.

I therefore wish to say that any proposal that is made for a large scheme
of immigration, would require to be very carefully considered by the New
Zealand Government and Parliament before I could subscribe to it.

Upon one point referred to by Air. Deakin, I would remark that while
those who are anxious to send people away from the Old Land, may desire the
co-operation of the Colonial Governnients, and while we might be anxious to
have British people placed in British Colonies, there is the very importam
factor that exists, that great shipping organisations travelling from here to
America, for instance, can by reduction of fares, and in many ways defeat an
object of that kind. For my own part, while I should be only too glad to
co-operate in, and to see, an ideal scheme, as suggested by Air. i)eakin, of
British subjects living under the British flag, I am afraid we should have
some difficulty in piittiug it into practical operation so long as these other
great countries outside Canada (which has been doing an inmieuse amount of
good in that respect") are prepared, owing to their closeness to the Old Workl.
to give advantages which we cannot give in the matter of passage nione>-.
I do not know whether Mr. Burns has any fixed notions of a general scheme
which we coidd co-operate in, but I have thought it desirable to put on record
the views tliat I hold on behalf of New Zealand. We want to help people
to come to our country on legitimate lines. We do not want to have them
coming out in excessive numbers, though the country has absorbed all who
have come up to now without any difficulty, and, while we want to assist
generally, we want to prevent a rush of peo]>le under mistaken impressions
of there being limitless em])loymeut available in our country.

Si I til Day.
25 April 1907.

Emiguatioii.

( Sir Juiicph
Ward.)

Dr. JAMESON : Lord l^lgin, and gentlemen, after what Mr. Deakin and
Sir Joseph Ward have said, I do not think there is much to be said on the
general subject. Of course, 1 believe the whole Conference is absolutely at
one upon the first portion of the resolution. With regard to Cape Colony
and I think my colleagues will say South iVJ'rica— we, unfortunately, are
rather in the reverse position at present owing to our late troubles.

Mr. DEAKIN: Only momentarily.

Dr. JAMESON : Mr. Deakin has been speaking ol emigration from this
country and immigration into our countries. The fact of the matter is we
have been engaged in promoting emigration from our country antf

L 2

164

Sixth TMy. immigTation into the old country. Still, we are very miicli interested iu the
25 April 1907. subject, though not immediately or actively interested at the present moment,
but I have no doubt, as Mr. Deakin says, it is onlj- momentary, and when my
Emigration. f,-iend General BDtha has firmly established or re-established prosperity in
(Dr. Jameson.) ^j^p source of the mass of our wealth in the north of our country, we will
then actively go into the ci[uestion of emigration, because there is plenty of
room to fill up in both directions — both from the labour point of view, when
that wealth has accumulated again from the North, and also from the land
settlement point of view. At the present moment as a fact, we are only on
the very verge of close settlement, but later, I have not the least doubt that
close settlement will take place in South Africa, as it is taking place so
largely in Canada and I believe even now in Australia. We believe in our
country ; we believe that the wealth which is under the land ought to have a
chance to come up and be made applicable to the increasing of the
agricultural prospects of our country so that the country may hold a very
large population.

With regard to labour coming into the country we cannot congratulate
ourselves like Sir Joseph Ward that we have no coloured labour. I was very
much, interested in what Mr. Deakin said with regard to the perfect certainty
that the coloured labour, in Avhat appeared to be, from his description,
circumstances as trying as anything we have in South Africa, was absolutely
beaten out by the white. I must say that in our experiments iu the country
I come from we have not found that. We have found that practically a
certain class of labour has always to be done l)y the coloured man. If we
coidd believe that we, like Northern Queensland are going to replace the
black l;)y the white labour, thea we should have an enormous field for
immigration into our country, but from Mr. Deakin's own figures, giving the
wages at 1?. or 30s. a day, it looks to me, unless it is a very very prosperous
industry, that if you have to pay so much, it is not very attractiA^e to white
labour, and it is quite possilsle the industry will not last, if it is on a large
scale, at 11. or oOs. a day. We should get white men to do labour in our
country where the black does it at present, but it has actuallj^ been tried and
failed. If we get a navvy out there, we pay the navvy under the circum-
stances in which the labour takes place — not under ground, but on the
surface in mining work — 10s. a day in the summer time ; but he does exactly
half the amount of work that the black man at three pounds a month does.

Mr. DEAKIN : My figures, as I said, were for contract labour, not
day wages.

Dr. JAMES(JN : We could easily adopt day labour or contract labour.
It does not matter which system we adopt, we find that the white men cannot
compete with the black under certain conditions. However, we hope in the
future to have plenty of room for many more white laboui'ers in the country,
and especially we hope to have still more room for the agriculturists on close
settlements when Ave get our ii-rigation and other problems settled.

With regard to the practical point, the onlj' thing brought forward by
Mr. Deakin was that the Imperial (Government at the present moment hag
rather prevented than helped emigration. I quite agree with Mr. Deakin in
what he has said aljout the report of the Emigration Council or Board. I
suppose really what we all have to do in that direction is to follow the example
of Canada, and practically manage the emigration for ourselves, both on this
side and on the other side. We are all pretty good at advertising, but I think
Canada is pre-emineatly good in advertising their country on this side. If
there is an Emigration Board, I tliiuk that it should be on the lines suggested

165

by -Mr l)eiikiii, giving tlu' iieccssjiiy warning, and at tlu- same time pointing sixili Uny.

out the, necessary advantages. 25 April 1907.

As I said, this is not an active (jncstion for ns at present. We hope later

on Ave may henelit l)y whatever conchisions the Conference conies to in the HjiKiUATiox.

way of helping towards emigration from the Motherland into the Colonies as (.'>'• .linn'-on.)
against the rest of the wt)rld.

Mr. F. R. MOOR : Lord Elgin, ami gentlemen, I agree on general lines
witli what has been stated liy my colleague from tlie Cape Colony. Owing to
tlie large inHux of men during the war, and owing to the great (U'st ruction of
property and wealth during the progress of the war, at the end of that crisis
we found South Africa with a large floating po])»dation which we could not
immediately absorl) owing to the condition of tilings in which we were, and
we have really been suffering from a large number of men being unai)le to get
immediate cmi^loyment.. I do believe the day will come, and I hope to see the
ihiy, when we sliall be able to alisorb a large number of whites from these
islands. We are now trying to reorganise the whole position of affairs over
there, and more or less to get our house in order, after what I have been
ilescribing as the losses contingent on the war. I also am very much
impressed Avith Avhat has been said by Mr. Deakin here which goes to show
that the white man can hold his o\Ani under certain conditions against the
black. I hold veiy strong views in that respect, and do believe that the
white man under the incentive of contract labour will be able to do a great
deal more than ever has been attempted yet by white labour in South Africa.
\Ve in South Africa have, perhaps, sull'ered, from a ijlelhora of blai-k or
coloured unskilled labour, which in my humble opinion has been misapplied
in regard to numbers, and in regard to which there has been a vast waste of
labour owing to tlie unorganised metliods we have adopted for employing
this labour. I do not coniine myself to any particular industiy over there,
but men are applied in far greater numbers, as regards results, than any
other country that employs entirely white, more or less skilled, labour.
That is so at eveiy turn in the Colony that 1 represent. 1 will not
commit myself to numbers, but you find three or four black fellows being
useil where, with skilletl intelligent white labour, one man eouhl do it. That
was impressed upon my mind most strongly in my visit to Australia, and
there being able to see how they were managing there with laboiw-saving
appliances, and returning to my Colony, I realised how we were wasting
labour with our crude forms of nnorganised labour, owing, to a veiy large
extent, to the vast amount of unskilled labour that was at our doors. Insteatl
of using brains and capital to save labour, we were piling on unskilled labour
to do the work regardless of cost, and perhaps in many instances the result of
production with that unskilled labour was really more costly than the products
of the countries w'orking with labour skilled and properly organised. We
find in many of our industries w'e are being beaten byproducts from Australia
(which w^e can produce quite as well and in quite as large quantities),
owing to ovu' methods and wasteful means of carrying on those imhistries.
I do hope that the day will not be long delayed before the re-organisation
of our economic conditions we shall be able to absorl) a larger amount of
white labour. We are doing a little now in that direction in the wav of
assisted passages. The Govermnent has contracts with steamers which nave
brought down the passage money, and our Government contributes half of
that amount in the event of any employer applying to the Government for
any particular selected emigrant on this side of the water. Owing, however,
to the present surplus of labour, this provision is temj^orarily suspended.

I have nothing further to add. We feel that we have to reorganise our
methods and our conditions to bring ourselves up to the position of advance-
ment of the other Colonies of the Empire. I believe, sincerely, we shall
A 4,si;i;s. L :i

166

Sixth Day. succeed, and, if we do, we have almost as large a field there for the settlement
25 April 1907. of men of our colour and race as the other Dependencies with the Empire. I

will not say it is so, perhaps, as regards Canada, because there they seem to

Emigration. have such a vast area of arable land that we cannot compare ourselves to it ;
(Mr. F. K. Moor.) jj^t given area for area, I do believe we shall be able to altsorb proportionately
our share of emigration from this land.

General BOTHiV : Lord Elgin, and gentlemen, in the Transvaal our
y)osition is ahnost more difficult than in any other of the South African
Colonies. The unfortunate circumstances in the past have dislocated many
matters there, but the Grovernment sinct the conclusion of peace is doing its
best to encourage immigration into the Transvaal. During the War many
people covae to the Transvaal who are not suitable for immigration purposes,
and who do not wish to remain there. We have unfortunately a place like
•lohannesburg where people want to get rich very soon, and that is where the
dirticulty lies with us in the Transvaal. I have a great faith in South Africa
and in the Transvaal as a country for a large population, especially as regards
agriculture. But it will take some time before we can put this thing on a
proper basis. 1 hope that we shall be able to very strongly support the
immigration of white people into the Transvaal, because if there is one thing
that we require in South Africa it is a large white population. x\t present
we want people who have some means. We have to-day thousands of people
in the country who have really no work to do and the Government have to employ
them on road making and similar matters to make them earn their daily bread,
'llien imfortunately there is the lamentable difference of opinion between whites
and whites on the labour question. Now my Government are of opinion that we
should as far as practicable encourage the immigration of white workmen into
the coiuitry. The l^iggest immigration that we have had into the Transvaal has
been that of Chinese, and I think we have between 50,000 and 60,000 China-
men still in the country. I hope that on this question too we shall be able to
arrive at a clear understanding, and that in future instead of importing yellow
labour we shall have immigration of Avhite people into the country, because
we feel that if we have a considerable white inmiigration into the country the
money which they earn will be spent afterwards in building up the
agriculture of the country. We have got any amount of scope and space, antl
we think Ave can bear a population of millions of people. The thing that we
lack is money to carry out this project. It is a dry country. We must set
large irrigation schemes on foot and before we have made some such
arrangements it will be impossible for us to do anything further. 1 may say
that my Government have under their earnest consideration to-day the
question of encouraging more white people into the country and on to the
farins and t)n to the land.

Mr. DEAKIN : Might I point out this : sj^eaking in an impromptu
fashion to-day, I did not read one document which I ought to have read with
reference to emigration, though I alluded to it. A Mr. Hughes, who
represents the employers in Queensland who desire to obtain white laliour
for sugar cutting, wrote to the Emigration Board and I referred to their
reply with(Mit quoting it. He forwarded the conditions to them. The
conditions are for the obtaining of labourers, and provide that preference
must lie given to British people under all circumstances. Only failing th^n
can application be made to the Continent. I am happy to hear indirectly
that we hope to obtain a sufficiency from this coimtry without applying at
all to the ( 'Ontinent so far as the Queensland Government is concerned.
However, what they are offered is not contract rates, though they may take
these if they like afterwards, but regular terms, which range from 22.s> Qd. to
2os. a week with rations and accommodation, and for harvesting, 25s. a Ave'

167

Avith rations, or an alternative for contract enttin<; by .nntnal agropinont. *^'''''' ^>^J-

01 conrse the prices earned by contract cutting must not be measured by l'^J April U»07.

the price for clay hibour. They are the earnings of exceptionally skilled anti "

capable men, just as some of our shearers always earn twice or thrice as ', " '

much as the ordinary shearers because they have a special aptitmle. The '*^''^' ''"'""•^

reply of the Committee was even more direct and unqualilied than their

published circular, l^ecause in answer, Mr. Henry Laml)ert, signing as

Chainnaii, on the ir)th .March last says : "My Comnntte(> do not consider that

" emigrants from this country are at all suited for work on sugar planta-

" tions " — the whole sugar industry is swept out- "and they woidd certainly

" feel it their duty to warn them against undertaking such work in the

" tropics." I think explicitness is a great virtue ; it is one of the gi-eatest

official virtues, and there is no doubt al)out the jKM'fect explicitness of that

statement. The Emigration Ollice feel it their duty, owing to their own want

of knowledge, actually to warn British einigi-ants against undertaking the work

which is now being undertaken successfully by several thousand white men

this season. Tlie industry is very pros[)erous ; the contract rates I referred

to are exceptionally high. If the whole iudustrj' were conducted on that

basis. Dr. Jameson's criticism would be quite justified. The average man is

on daily wages. I mentioned those high rates because they tend to withdraw

men from the daily wage system to the contract system, in Avhich, as a rule.

they get better results than on the ilaily system. Otherwise they would not

tmdertake it. Only exceptionally qualified men get the woudeiiul results

mentioned, which are of gi'eat value, although they are rare, because they

operate as a stimulus to attract men to the industiy, and as a stimulus to the

men employed in the industry to put forth their best efforts. When others

see a man able to make IL a day for w^eeks in succession, and return home

with the result, that helps to draw people in Australia to this industrj-.

Undoubtedly in every part of it this work will be accomplished by white

labour only. We have enough direct experience now to be quite satisiied that

it can be done. There is no doubt about that. Those exceptional terms

attract people to it. The average men do not earn so much, but the work is

being done efficiently by white labour to-day — more than half of it. If my

memory serves me, T think nearly three parts of the work will be done by

white labour this seast)ii. Under these circmnstances, for a Government

.Agency to absolutely warn men against unikn-taking work which men are

already doing, and (loing most profitably, certainly pt)ints to a very strange

contiition of affair>.

;Mr. BURNS : Lord Elgin and gentlemen, the Conference has dei-ided
unanimously to adopt the first paragraph, that "it is desirable to encourage
" Bi-itish emigrants to proceed to British Colon i<>s rather than to foreign
" countries." Against that first paragrapli the Government have no oljjection
to make, because it practically c-onnotes a lineof action that has been taken not
only l)y the Government but by all the subordinate authorities throughout the
United Kingdom during the last 15 or 2U years with regard to the direction
of, advice to, antl guidance of intending settlers in new countries from the
Mother Coimtry.

We are discussing the second paragraph now, which says :" That the
" Imperial Government be requested to co-operate with any Colonies desiring
" inunigrants in assisting suitaljle persons to emigrate." That, of course,
brings us face to face with i)ractical methods and proliable financial
schemes, and on that it is advisable that the view of the Government should
be in the main expressed. P>efore it is expressed it is advisable that the
point raised by Mr. Deakin should be met, and I trust mutually saUsfaclordy
jpleared away.^ The Government think that as so many Colonies are all
mpeting for emigrants from the same source it is very very difficult to give

L t

168

Sixth Day. financial assistance to one without more or less damnifying the others. Up
25 April 1907. tiU now the Govermnent at home have considered it best, both to intending
^ settlers and emigrants, above aU to be fair to all the Colonies, and that the

MIGRATION. agencies on this side should be directed to give the intending emigrant all the
( r. ul•ll^.) essential facts in forming his mind and in advising him as to where best he
can take his labour, and adapt his industrial aptitude to any particular
Colonial demand that for the moment is seeking his labour. Mr. Deakiu will
pardon me if I say that he has rather misunderstood, and I do not think
sufficiently appreciated, the extent to which the Board of Emigration have done
this particidar form of Avork. If ]\Ir. Deakin will look — as he often j^robaljly
has looked, but I Avould ask him to look again — at many of the really excellent
specimens of literature that are issued by the Board of Emigration on this
side, he will find we ahnost vie Anth Canada both in the versatility and the
excellence of our adA'ice to emigi-ants and settlers. I can assure Mr. Deakin
and the Conference that every step is taken by the Board of Emigration to
give all the people in this countrj- Avho intend to settle elscAA^here, facts such
as cannot be challenged, because the Board realise that much of the
diminution that in recent years has taken place in the number of emigrants
from the Mother Country to some of the Australian Colonies, is due in the past
either to ]Drivate, public, or semi-public agencies misrepresenting the Australian
fields of labour, and to this information being allowed to go uncontradicted
or imcorrected. The result is that suspicion of certain Colonial fields of
laboixr has groAvn up Avhich can only be removed 1)y the Board of Emigration
itself being almost painfully precise in acquainting people Avith Avhat the
real conditions are. I do not think that in the j)articular Queensland case
anything more than that has been done. Mr. Deakin was rather severe
upon the Board of Emigration for what I believe is after all only an
exceptional incident, and one that I trust may never occiir again. I would
like to point out to Mr. Deakin, that the circulars and handljooks issued
by the Emigration Office, AA-hich are nimierous and circidate through many
ramifications, are never issued before the proofs of those publications
are previously sent to the Agents-General themselves ; and in many cases
the Agents-General are asked, and they are A-ery Avilling in the majority
of cases to respond, to reA'ise the actual proofs and correct the draft literature
and information Avhich is submitted to them. I can only say Avith regard
to the Queensland incident, that there the Home Government, through its
Emigration Department, did Avhat I think was nothing but bare justice to
people Avho Avere likely to be attracted to this particular form of lalx)ur. If
Mr. Deakin Avill alloAV me, I Avould like to read the first notice in March. It
saj's : " Free passages by the Orient Royal Mail Line steamers are uoav offered
" to bo)ia fide farm labourers, and their families, to whom employment is
" guaranteed on arriA'al at fidl Avages current in the State. The Queensland
" Govermnent, in addition to the passage, undertake to take care of such
" persons until they are safe on the farms Avhere work has been arranged
" for them. Notification has already been given by the GoA^ernment to intend-
" ing employers that farm labourers AviU not be indented imless the Avages
" offered are considered satisfactorj^ by the Executive Government of the State ;
" information as to this sum can noAv be obtained at the Agent-General's
" Office, London. It Avill probably save many applicants time and trouble to
" be informed that as the Government are indenting this labour lor employers
" in the agricultural industry, there is an implied promise that the labour Avill
" be up to the standard of an ordinary agricultural labourer, and that for
" the concession of a free passage and constant employment on arrival,
" applicants must come strictly Avithin these conditions and must be Avhat
" is generally knoAA-n as farm lal)ourers, i.e., healthy men Avho liiive been
" accustomed to work at some form of farming operations." I respectfully
submit that that is a clear, bald, and truthful presentation of the conditions

KiO

under which the lahoiir was to l)e employed there. On April the 12t.h, sixth Duj.

shortly afterwards, the Board of Eiui^iation sent out a revise, wiiich was as 2.'> Ajuil M<)T,

follows : " The Queensland Government has a system of free ])assao;es to — -

" huiia fide farm lalujurers and their families who are ap|)r()ved liy tlie A^ent- KMi.iuvnos.

" (ieneral in London, and guarantees them employment in the Slate at full 'Mr. ISunis.)

wages ; but up to the present the indents for such passages have been
" limited to men willing to work on the sugar farms in the north. The
" climate there is hot and moist." I gather that ^Mr. Deakin expressed the
same view.

Mr. DEAKIX: Y

es.

.Mr. 13URNS : " The climate there is hot and moist in the rainy season,
" from January to March, and hot and dry at other times, and" is very
" different from that to which farm labourers are accustomeil in this
" country. It is very questionable, therefore, whether they would Ijc
" able to work on arrival under the tropical conditions that prevail
'' in North Queensland. The work of harvesting anil crushing cane is
" still more trying, and is paid for at a higher rate. The free passage
" emigrant need not engage in it unless he wishes ; and indeed the
'• work is not suitable for persons from this country Avho have not resided
" for some time in the tropics." I venture to say that both the (original
tlocument and the revision sent out by the Board of Emigration are in accord
with the statement made by "Sh. Deakin himself here. The Board of
Emigration thought it desirable that the peo]de going to this particular
tropical sugar belt should not be in any way under any misapprelieusion as
to the kind of labour that they would have to do, because our experience here
is that one grundjliug, sore-headeil, dissatisfied emigrant in a field of labour,
when he has been attracted there tlirough too glowing a description of
what would happen to him when he arrived there, does more harm to the
general flow and direction of emigration to that and other fields of labour
tlian anything you can possiby conceive. The Board of Emigration. I think,
with fairness and impartiality, decided that it is far better to tell the
emigrants even the unpleasant truth, if it be the truth, as to the conditions
of labour under which he can be employed, than to buoy them up with rosy
descriptions that cannot be realised, of which, Avhen connnunit-ited back
as it always is by letter tlirough the discontented one's complaints, the
effect is to damage that particular district for 10, 15, or 20 years. The case
quoted by Mr. Deakin is an evidence in my judgment of the great care
and truthfulness and courage that the Boanl of Emigration has shown in
this particular case. I may say that the Cxoverument of Queensland have
expressed their appreciation so much of circidars and reports of the Board
of Emigration, that only recently this year they have ordered ^o.dOd
copies of the Board of Emigration's Handbook on the Colony. I can t)idy
say that in my judgment the Board of Emigration were well within
their rights. It would have been a permanent injustice to the Qut>enslaiiii
labour field unless they had made their revise. I am convinced that this
incident will still further induce the Board of Emigration to place themselves
more closely in touch with the Agents-General before issuing any iidormatiou.
or making any correction, or rectifying any mis-statement, anil they will do
their best to instruct the settler and the emigrant to find work imder con-
ditions that will be beneficial to him and we trust not detrimental to the
Colony to which he goes.

Having dealt with that inciilent, may I say a word or two— because it is
pertinent — on the general question as to practical means. Mr. Deakin said
that there Avas an obligation to direct actively to the Colonies the surplus

170

Sixth Day. people of tliB Mother Countiy, and I think he suggested passively to divert

25 Ajtril 1907. people who intended to go elsewhere to places Avithin the British Empire.

I can only say that the emigrant decides this in the main practically for

MK.KATK.N. ijiniself, and to the extent that we would over-persuade him in making up

( 1-. Biiiii^.j j^-g ^^[j^(\ ggy^ j-y gQ ^Q (Janada as against Australia or New Zealand, to that

extent we would give his jnind a bias in a direction that we ought not.

Mr. DEAKIN : Xo one suggested that.

Mr. BURXS : Xo, the business, we think, of the Home Goverijment is that
as all the Colonies are competing for emigrants and settlers practically of the
same type, what we have to do is to take the claims as set forth by the Agents-
General themselves who want those claims for labour submitted to the Old
Country. It is the business of the Agents-General and the Home Government
to co-operate with each other as to where, how, and in what best way that
information can be placed before intending settlers and emigrants, and I can
assure the Conference that efficient though the steps of the Board have been
in the past, we hope considerably to improve upon our present methods and
agencies by means of which the connnon desire of this Conference can be
secured.

Xow, may I say a word about the type of emigrant. I know that
Mr. Deakin, and also Dr. Jameson, Mr. Moor, General Botha, and Sir Joseph
Ward, and I know it fi"om practical observation in Canada on the subject, —
want tbe same type of settler and emigrant. They want the farmer, they want
the good skilled labourer, they want the skilled handy-man, they want the
domestic servant, and, in many cases, they want the platelayer, and the heavy
lifter, and the man whose physicpie is adapted to the opening pioneer work of
constructing public and private works on a big scale in new countries. You
also want skilled artizans, mainly of the building trades. Xow, in this
particular matter, the Colonies, to a great extent, can be helped by
the Old Country, because at this moment we have, 1 am sorry to say,
through reasons that I need not go into, a very large number of
men in the building trade who are slack of employment. We also have,
proportionately to the Colonies, more surplus unskilled labourers than any of
the Colonies possess, and it does seem to me that if those men in the building-
trades, who are a type of men that many of the Colonies pre-eminentlj-
want in opening up new countries, were more closely informed as to
the colonial requirements of labour, we shoidd see a very consider-
able number of the men of the building and similar trades seeking-
work in Colonies where their work would perhaps be for the moment
better, and perhaps ultimately more regular than it is now. But the
supply of labour must flow without preference or pressure on the choice
of the individual emigrant to wherever he chooses to go. It is interesting
that this Conference should know that in the last two or three years when
emigration from the Old Country has gone up enormously by all the agencies,
whether it be distress committees, or boards of giiardians, or private or public
bodies, or trade unions, or any other association, and there are nearly
1,000 agencies in this country taking directly or indirectly an active part in
sending people out of the country, mainly to the Colonies ; 95 or 97 percent,
of the total people that have left through private, public, or semi-public,
agencies the Mother Country for external Dominions have gone to Canada
or to the other Colonies. But the enormous volmne of emigration that has
gone to the United States, relatively is not as great as it was, and is rapidly
diminishing. For instance, only a few years ago, and this Sir Wilfiid
Laurier will be pleased to hear, in 1888 Canada had 11 per cent, of the
emigrants that left the Mother Countiy, and America had 72 per cent. ; to-day
Canada has 31 per cent, and America i7 per cent, of the total. So that the-

object this Conferenct' has at heart, namely, the training and (hrt'cting the Sixtli Duv.

surphis popuhition from the United Kingdom to British Colonies is being 25 April 1907.

attained without too mueh organisation and without too much olivious

regulation. Kmicuation.

The other point is tlii^ : 1 trust that this Conference will realise what ^ ^' ''"'"
my experience suggests, and what I think the facts inform us upon, which is
that over-zealous attempts to get people to emigrate very frequently do more
harm than good. They very often attract the wrong type of people to the
right place, and the result is that disappointment ensues, aufl th<' iiennaiient
steady How of regidar emigration is damaged thereby, i trust that the
Conference will agree with us that emigration by settlement of comnuinities
of men is not a desirable thing. The northern farmer in another connection
said : " The poor in a loomp is ])ad," l)ut the poor in a lump taken from one
country and from special districts and of a particular class to another is
worse. 1 do not care whether you emigrate bodies of rich men from England
to Canada or Australia, even if you can get them all to live togetliei- in
theii- new home, which is dou])tfnl, that in itself is not so beneficial as it
would be if they were spread over a large area. In any case, to take
large communities of men from one district of Kngland and to dump
them down in any Colonj' is, in my judgment, a mistake. What we have to
do is to guide and direct the individual, let him go where his aptitude inclines
him to go, but anj' attempt, if Dr. Jameson will pardon me for saying it, of
close settlement, of laud settlement, of settlement by communities of men such
as philanthropic associations have attempted in some parts of Canada and
America, is, in mj' judgment, a mistake, as experience will prove. Outside
the Doukhobors, in Canada, 1 have leai-nt of no case of a commnuity of
emigi-aiits that was at all worth the money spent upon it, or which in anyway
justdieij the enlluisiasm or the ho^jes raised on its behaK.

I 'r. .lAMESON : Close settlement does not mean large settlements going
out. it coidd be very well carried out bj' individual emigrants.

i\Ir. Bl'RNS : Yes, 1 know, but that is a very risky experiment. 1 mean
there should not be 1,00U men from one part of England taken to some
particidar part in any of the Colonies. It is best to mix them up. They have
different tastes, they have different habits, and the tendency of these settle-
ments, however large, or, however small, is for them to become a first-rate
collection of social and i)olitical cranks, ending in failure and disappointment,
and waste of the money spent upon them.

Dr. JAMESOX : Excuse me, there is some misapprehension as to what 1
mean by close settlement. The fact of the matter is, in South Africa our laud
is in large areas, and it is the large fanns of 2.000 or .">,0()0 acres, and so on,
which exist until we get irrigation, as mentioned by ( iencral Botha, so that
we can, like in Canada and in Australia, J. believe, get a family to live on
160, or 20, or 10 acres even. That is my idea of close settlement.

.Mr. BURNS : I uiulerstand the point is, that iu a tropical or semi-
tropical climate agriculture can only be carried on by irrigation an(l more or
less artificial means, aiul you have more or less to pack yonr people iu certain
areas, because there the irrigation scheme is. That 1 do not object to, but to
ask that a certain block of population should be taken, or a certain class of
population should be taken from the old country for that jiarticular work, in
my judgment will ultinuitely prove to be a mistake. It leads to industrial,
social, mental and moral, disadvantages that we need not enlarge upon at this
particular moment.

172

.Sixtli Day. This brings me to the point as to what the form of the co-operation can

25 April 1907. be. The settled j)olicy of Parliament, it is well I should inform the Conference,

has been not to vote State money for emigration. Although local l:)odies,

E.MIGKATIOX. ijoards of g-uardians, distress committees, and others, have power and exercise
(Jlr. Burns.) j^.^ ^g j j^^^yp indicated, to vote public and voluntary money to emigration and
settlement, Parliament has always been against a State sul>sidy for emigration
to any or to all of the Colonies. I may give an instance of the kind of thing
that is done. Under the Unemployed Workmen's Act the distress committees
in the year 1906 sent out 3,875 persons at a cost of 71. per head, part State, part
local, part private mone3\ In 1907 that will be considerably more. The boards
of guardians in the last ten years have sent out 3,588 children, and if I may say
so, these, in my judgment, are perhaps the best form of emigrants and settlers,
looking ahead, that the Colonies could possibly have. Dr. Barnardo's agency has
sent out 18,000, and nothing pleased me more when I was last in Canada than to
hear that of these 18,000 children that had lieeu sent out, 95 per cent. Avere not
only doing well, but were doing first-rate in many cases and more than
satisfied those with Avhom they were settled. It is interesting for us at this
moment to know that even onl}- last year there were 19,000 people in Canada
who wrote to the Canadian Board of Emigration for children, boys and girls,
from the Mother Country. On that some of the gentlemen of this Conference
might say: "But what about their condition?" On that I think this
Conference ought to be assured of this fact that the people who have charge
of them here, whether they be guardians or private or public agencies, do
evei"ything within their power not only to see that the children are physically
fit, but that they are trained and equipped for their new life, and I know no
fomi of diversion of population that would be productive of so much good to
the Colonies and to the Mother Country as an increase in the number of
children going to the new settlements beyond the seas.

I can only say in conclusion that Canada, which has recently given no
assistance towards the cost of passages, has perhaps shoAvn the Mother Country
and some of the other Colonies the way of handling this particular question.
Nothing could be better than the way in Avhich the Canadian Emigration Autho-
rities, by information, by circular and by literature, have done their Avork, and in
so far as the Old Country can live up to Canada in this particular regard,
the Board of Emigration will be disposed to do so. The Colonies represented
here to-day can rest assured that if they care in any form to make any
representation to the Home Government as to AAdiat should he done, the
Board of Emigration, the Local Government Board, and the Board of Trade,,
Avill be only too ready to respond to any suggestion or information they
may give. The re-organisation of the Emigration Board itself is under the
consideration of the Government. The reconnnendation l)y the Settlements
Committee that a .State grant for five years should be passed by the Imperial
Parliament, is under the consideration of His Majesty's Govermiient at the
present time, and my last Avord is that if the Colonies think that any of the
work done by any of the home agencies is of such a character that it may
lie improved upon, the Government Avill be only too pleased to respond to
such advice, suggestion, or information, ahvays relying upon this cardinal
fact that the Old Country cannot be expected to shoAv a preference in
the matter of emigration to any of the Colonies, and Avill do her best to treat
all of them fairly and to bring before intending settlers and emigrants the
real facts of Avhat the Colonies offer them. For the moment lieycmd that the.
Home Government is not disposed to go.

Sir WILFRID LAURIER : When this resolution of the Connnonwealth of
Australia Avas first brought to our attention I read here : " That it is
" desirable t(j encourage British emigrants to proceed to British Colonies
" rather than foreign countries. That the Imperial Government be requested

173

to co-operate with auy ( 'oloixies dersiriiif;- iiumi^-ants iu assisting suitable 8ixth Day.

persons to emigrate." As I have stated already the first paragraph, as to 25 April 1907.

which Canada has no dissenting voice, does not require any discussion.

But we thought with regard to the second paragraph, that perhaps it was Emi.;kation.
intended Ijy the Government ol Australia that the Imperial Ciovernment '^^.'' Wilfrid
should be invited to co-operate fiuamially iu a scheme lor bringing '-"""er.)

emigrants to the new Countries beyond the seas. We approach this suljject
from the point of view of Canada, with the statement that we have no
grievance at all. At the present moment we are quite satisfied with our
position in that regard. In fact, we hav<> undertaken ourselves to manage
our own immigration, and so far, we have no reason to complain of the
residt of our efforts ; but of course it goes without saying, that if the Imperial
Government were prejiared to help and assist us financially we would l)e only
too gla<l to co-operate with them. Listening to .Mr. Deakin very carefidly I
did not xmderstand that he had even any such project in his mind. If I
propei;ly appreciated the tenour of his remarks, he rather thought that the
Imperial Government mider e.xistiug circmnstances were not doing all they
might do, or were doing it iu a way which was not satisfactory to the (.Govern-
ment of Australia. For my own ])art T would be glad to hear again from
Mr. Deakin what i)ractical suggestion he has to make to implement what is
contained in this paragraph.

Mr. DEAKIN: Sir WiliViil, our diihculty was when we considered the
schemes that we ourselves woidd like to see adopted, how far we ought to
approach the Imperial Government with any definite suggestion, inasmuch as
they might consider that this implied at all events that we were better judges
of their business than they were. Now we can only claim that at our end of
the immigration movement we are entitled to speak from our own experience
as to what we want. But as to the particular means by which immigration
coidd he fostered here, we have a good deal of hesitation. Our first idea was
a reform of existing methods. I have no personal quarrel with the Emigration
Board. I have spoken upon information supplied me, and am not singling
out the Emigration Board or the Department with which it is associated from
auy other Department. But our experience in Australia is — and it may
possiblj" be not confined to the Connnonwealth — that it is not possible to
■constitute a public department of officials for any purpose, however excellent,
•of any men, however capable, who will not sooner or later, and pr()I)ably soon,
lose touch with the changing conditions of the practical work with which
they were originally created to deal. For ourselves it is only by constant
Parliamentary vigilance, by perpetual Parliamentary criticism, by influence
hr(jught to bear through the responsible ^linisfers, that we are able to keep
•our own departments in some degree up to the requirements of our own
country. I should suspect that the experience everywhere is the same. It is
not the fault of the individual so much as it is the fact you cannot have a
department without a system, and when once you stereotype the system you
begin to check the individual energy, initiative power and free criticism of
the men engaged iu it. While you cannot live without yoiu' bureaucracy, and
while the democracy needs it specially, with us the constant attention of the
representatives of the people is required to he devoted to our own departments.
We have to confess that they do not satisfy us. Constnpiently, if 1 may be
pardoned for the digression, I am not trying to select the Emigration Board
for conmients which 1 have had occasion to make upon other departments.
There Avill always be differences between ourselves and our departments.
While departments are necessary agencies of governments, they are in my
•opinion in ininntaljlc opposition, so to speak, to the re-adaptations and fresh
adaptations called for l)y the circumstances of each case. I do not say that
any one statement in that objectionable circular was untrue, but I do say that

174

Sixth Day. fQ send it out w'itliout adding the facts that the whole of the crushing always-
25 April l9i>T. has been done by white labour, that the greater part of the harvt^sting is now
being done by white labour, and the whole of it will be, is misleading.
The greater part of the work of an ordinary sugar cane farm is now being-
( r. ea in.) ,\q^q j^y gniall farmers upon their own land who make an arrangement
for the disposal of their cane, yet this circular might suggest that white
labour is being excluded and cannot be expected to cope with this industry.
The circular is bad because of what has been omitted. In that letter 1 have
read there is an extraordinary intimation that people need to l)e warned off
from what white people are already doing with profit to themselves and to the
country. That appears to me to be an inexciisable act. I do not put it
stronger than that. Mr. Burns, if I may say so, made the best possible
defence that could be made, and in so doing has discharged the duty of a
jMinister, of speaking for those who cannot speak for themselves much better
than they could. All I can say is, I am confident if Mr. Burns had been
dealing with this question, it Avould have been dealt with in a different
fashion. Any Minister issuing a circular would have framed it in a different
fashion. I do not wish to dwell upon that, but I must say there is a good deal
to be expected not only at this moment, because we come here to criticise,
but from that perpetual reformation of departments which we find necessary
in Australia, — I am confining my criticism to my own country, because that
cannot possibly give offence — imparting to them fresh life and fresh direction
so as to keep them in touch with changing circumstances. I have reason to-
suspect that the need is just the same elsewhere.

With a great deal Sir Joseph Ward said, and I also wish to associate
myself in his criticism, I concur. Certainly, when we ask for the co-operation
of the Imperial Government, we ask for effective co-operation in directing
and not in discouraging emigration. Then Sir Wilfiid Laurier implies that
w^e ought to specify the means to be employed. We think a more effective
organisation here is wanted under the direct control of the Britisli (Govern-
ment, or some of its Ministers, with that closer touch with the various
representatives of all the Dominions which Mr. Burns has been good enough
to foreshadow for us. We anticipate a great deal can be accomplished by
this means, and we confidently expect it will be accomplished. 1 am sure, as
far as Mr. Burns is concerned, it will be done, becaiise he is an active and
practical working man in this and other respects. But we go further ; we
do not wish to press unduly upon the Imperial Government, but we look
upon improved means of communication generally, by joint action between
the Mother Country and the several Dominions, as a very important means,
not only of assisting emigration, Init also trade. We are perfectly aware that
subsidies are now given to shipping which competes with British shipping,
both for passengers, cargo, and even emigrants. We have a line running to
Australia to-day under the British flag, which is really in the main portion
of its capital and interest, I i;nderstand, a foreign line of steamers. We
think encouragement should be given to vessels not only flying the British
flag, but actually British, so as to enable freights to be cheapened, and
passenger rates to be lowered. It is only upon the last economy upon
steamers ruiming to all the dominions, or that should be encouraged to run
to all the dominions requiring colonisation. We venture to think a good
deal can be done by co-operation between the different Governments in that
direction, and indeed by improvement of all the means of communication,
Avhich outside this chamber. Sir Joseph Ward and Sir Wilfrid Laurier have
been recently discussing. We say improved agencies between the Mother
Country and ourselves, improved means of communication, closer touch with
our fellow colonists, improved shipping services, cheap and rapid, are among
the means by which a popidation might be attz'acted to Britisli countries
instead of to foreign countries. We appreciate Mr. Burns' criticism of

175

■communities when their settlements are separated by language and by sixth Day.
strongly-marked customs from the rest of our p('Oi)lc, but communities from 25 April 1907.

the white races grouped together under one Hag, whether British or French

•Canadian or Africantler, as the case may be, so long as they are our own KMioKAnoif.
people, although we have no urgent desire for communities, we are yet so '^''- Deiikm.)
very nmch in need of ]iopulation that if it could only be obtained Ijy that
means, we should be sorry to disapprove it. We would be quit(! willing to
see some communal settlements, not in the strict sense, but joint efforts for
settling individuals who choose to group themselves together on particular
areas cf land. While we do not favour it, we shoidd not fear it, and Avould
rather face it, speaking for Australia, than not acquire population at all. It is
•only where the conununity is, so to speak, kept within a ring fence by reason
of language, blood, habits, and practices, that we see grave reason to apprehend
danger. Any other reasons arsiing from the settlement of communities woidd
appear to be of a slighter chai'acter which might lie ignored. We wish the
British Government would also favour subsidiary educational means, such as
have been recently proposed, seeing that the schools and through the schools
the children in this country were brought into closer touch with the
realities of life in the outer portions of the Empire. Mr. Burns spoke —and
I think so far as any of us know we all echo his commendation of the trans-
port of children by Dr. Barnado and others to ('anada, and elsewhere. That
appears to have been a brilliant success. Is not the suggestion closely
connected that in all the schools of the United Kingdom there should be
sutiicient teaching with regard to the Dependencies of the Empire, so that as
the children grow up, if they wish to make a choice of a new home, they will
have the knowledge necessary to make that choice. We are imdertaking the
necessary oliligatiou in all our schools of teaching not only British history,
but British geography, in order that they may understand the course of events
in the Mother Country, the centre of our race. In the schools, among tlie
children, by operating through your Boards of Guardians and other bodies to
whom Mr. Burns referred, by operating through a rejuvenated Emigration
Board here, associating it with the Central Emigration Board in this city, by
assisting the means of conununication and particularly shipping — these are
.among the methods which are open to the British Government to choose.
Any or all of those we would welcome, so far as Australia is concerned. We
are prepared to co-operate in any and every way in order to encourage
•emigration.

Mr. BURNS: May 1 say a few words on thr last point Mr. Deakin has
raised ? I have had placed in my hand this morning some postcards received
by the Board of Emigration from school children, in response; to a circular the
Board of Emigration issues. Here are 50 oi- tK) postcards from children,
received this morning, and it is only typical of what they receive : " Kindly
send to aljove address tlie circulars on Canada mid Anslralia."

Mr. DEAKIN : I hope you will not send the irircular of April \2i\\.

Mr. BURNS : If we send the one of April 12th, 1 think we will have to
put a footnote in, that we omitted, in order not to damage (Queensland, any
reference to the fact that Kanakas have previously been employed in this

particular industry.

Mr. DEAKIN : We do not mind that a bit. Put it in by all means.
We are determined to have a white; Australia, and im^an to keep it white.
We have voted 12,000?. of Conunonwealth moni-y in onlerto deport those
men comfortably to their homes and famihes. We believe it is good for the

176

Sixth Day.
25 April 1907.

Emigration.
(Mr. Deakiu.)

Islands to have tliem back, aud good for tlieir people that they should return
and live among them. For ourselves, we will have a white Australia, cost iis
what it may. We are anxious to let everyone know it.

CHAIRMAN : There is one resolution before the Conference proposed by
the Commonwealth. We agi-ee to the first part. I think, as far as my
colleague and I are concerned, we are quite prepared to accept the
second.

Mr. F. R. MOOR : If I may he allowed to interrupt, I think it would,
perhaps, be better if that second part was more elaborated iii the direction
that Mr. Deakin pointed out, so that the public should realise what the
resolution really means. Towards the end of Mr. Deakin's exposition of
what they did mean, he pointed out the A-alue of co-operation as regards
shipping and reduction of freights. I think if one or two indications were
just enumerated in that resolution it would he of great use.

Sir JOSEPH WARD : Surely that is a matter to come up later on in
connection with trade. I would not mix them.

CHAIRIMAN : I think it would be a little difficult to take it up no\v.

Mr. F. R. MOOR : I am in the hands of the Conference, but it seems a
pity that the public should not know what is meant, even if it is only one or
two headings of what we intend by the co-operation.

Sir JOSEPH WARD : For myseK I would support the resolution as a
whole. I see no objection whatever to it upon the imderstanding that so far
as the second paragraph is concerned — having reference to New Zealand
alone, for which I am speaking — that the co-operation would be upon
application from a Colony.

Mr. DEAKIN : Necessarily. There nmst be two people to co-operate.
If New Zealand does not co-operate, plainly it does not desire it.

Sir JOSEPH WARD : There is one Colony here suggesting co-operation^
and the other side is the Mother Country.

Mr. DEAKIN : " That any Colonies desiring."

Sir JOSEPH WARD: "Be requested to co-operate with any Colonies
" desiring to co-operate." The understanding is, we have first to express
our wish to co-operate.

Dr. JAMESON : What it means, after Mr. Burus's speech, is, that this,
co-operation is limited to good wishes,

Mr. BURNS : And methods affecting the distribution of information.

Dr. JAMESON : And the Board of Emigration reorganisation is under
consideration at the present moment.

CHAIRMAN : That is in the report of the Committee.

Dr. JAMESON : ^^'ith regard to the subsidising of ships, I imderstand
Mr. Burns to say that Parliament has set its face against anything of
the kind.

177

Mr. BURNS : Yes ; it lias bceu the settled policy ol rarliameut for Sixth Day.
some years. 25 April 1907.

Tf T^■r' t T'T-VT -VT • ■ , 1 1 ■ !• • PI- EsilU 11 ATIO.V.

Mr. DiLAiviiN : Aot in comiectiou with the subsuhsing of ships.

Mr. BURXS : But, in comiectiou with emigration, not to grant votes of
Imperial money lor emigration.

Mr. F. R. MOOR : But as regards South Africa, owing to the practice
of the Colony as regards our contracts, we have been able to obtain contracts
highly advantageous in respect of emigration. I have no doubt Canada and
Australia, if not already doing it, could use co-operative influences there
which, although not directly State-aided, would, by means of State work, be
Ijrought al)out. I think it is a pity to simply put down an arbitrary condition
and say, we are going to have nothing to say to it.

Mr. DEAKIN : What i think Mr. Moor means, and very properly, is
what we call a postal subsidy. That assists emigration and trade because
it encourages the rapid despatch of boats. So, while it is not put forward
in (xreat Britain for the assistance of either trade or emigration, a postal
contract, as a matter of fact, does helj) l)oth. Wliy should not that be
systematised more ?

Sir WILFRID LAURIER : Mr. Moor has brought it up, but it is a
much more involved question and embraces much more than emigration. I
think Avith Mr. Moor that it is a matter which ought to be taken up Ijy itself
before the Conference separates. I would not limit it simply to emigration.
There are uiany other considerations to be taken into account, and I am quite
with Mr. Moor on this j^oint, that this is one of the things we shoulil discuss
before we separate.

CHAIRMAN : As far as emigration is concerned, what is i^ut in the Resolution IV.,
second part of this resolution, is a request to co-operate generally, and that p- vi.
we are willing to accejjt. i\Iay 1 put it that this resolution from the Common-
wealth is accepted by the Conference ?

Sir WILFRID LAURIER : The only objection I liavc to it is that it is
too vague.

Mr. F. R. MOOR : That is my feeling.

Mr. DEAKIN : I have given the reasons for the vagueness.

CHAIRMAN : Is it accepted ?

Sir WILFRID LAURIER : I have no objection.

Mr. F. R. MOOR : I must say I am disappointed as regards its present
wording. It is very indefinite. If we could specify how this coukl be done
I think it would be" of more practical importance to us in the future.

Sir JOSEPH WARD : I do not know what your method of working is.
I take it we would still go on through our High Commissioner with tlie object
of inducing people to come out to our country. For instance, with the great
powerful and attractive Dominion of Canada, which is so close to England
and has such splendid advantages, with tlicir great organisation that they

A' ISfiGS. il

178

Sixth Day. are going on with we should all have to carry out onr own work on our

25 April 1907. own account if we desire to get the class of people we require in our country.

I do not see how you could set up the machinery in the resolution unless

jmighatio.v. y^^^ elaborate it minutely, so as to help your country or my country to get

J 1 w what we want. We are going to have the co-operation of the British

Government impartiallj^ as suggested by Mr. Burns. At the same time

we must go on with our own work.

Dr. SMx\RTT: Perhaps Mr. Burns would, with the help of his Department,
draw lip a ]\Iemoraudum for the Conference, showing how best the tenour of
this resolution could be carried out, and also what steps the Emigration
Department would take to discourage enugrauts going from this country —
going to anywhere except British Colonies.

Mr. BURNS : I thiiak it may be taken generally that consciously the
British Government has never discouraged emigration to any British Colony.

Dr. SMARTT : But without recommending them to go to any British
Colony, your Department ought to take up strongly the position of discouraging
them from going to foreign countries, and to encourage them to go to the
Colony of their choice, when so many require their services.

Mr. BURNS : The Conference has, by the adoption of the first paragi'aph :
" That it is desirable to encourage British emigrants to proceed to British
Colonies rather than to foreign countries," met your point.

Dr. SMARTT : No, my point is to Ivnow what steps your Departnient
proposes to take to carry out the tenour of this resolution.

CHAIRMAN : We Avill take the best steps we can. We could not
define them at the moment.

Mr. BURNS : If those steps can be improved we shall be pleased to hear
from the Colonies.

Sir W.ILFRID LAURIER : The Conference is obliged to Mr. Burns tor
his address to us on this subject.

Mr. DEAKIN : I am very happy to support Sir Wilfrid Laurier in
recognising the kindness and frankness of the Minister's address this

NATURALIZATION.

NATi-iiAi.izATiux. CHAIRMAN : With regard to the subject of naturalization to which we

now pass I may remind you that we sent out in December last certain papers
dealing with the subject, and the Home Secretary is here to-day to make a
further statement to you and to make a suggestion as to the best manner in
which the Conference might, perhaps, deal with this subject in its present
form.

Mr. HERBERT GLADSTONE : Lord Elgin, and gentlemen, we are, I
take it, in general agreement that it is most desirable to attain uniformity in
this matter by Imperial legislation as far as possible. We recognise that this

179

is a qnestion of the sn'^atest importance to the Cc'Dnies. Experience and Sixth Day.
scientific observation hav(^ taught us much on th(> subject, but here in this 25 April 1907.

country we have a flense estabHshed population, and the difficulties which

will occur in connection Avith naturali/ation are not likely to lie of a critical ^ ^tibalization
nature. To the Colonies with their vast indilhul territories, we recognise that (Mr-Hpr'^rt
questions oi ininiigratujn and naturalization arlmittedly must beoi the greatest
moment. In what I have to say 1 propose to fleal with the main considera-
tions and to avoid for the present the subsidiaiy points, and all the more so
because when you disturb the seemingly quiet surface j'ou very soon find that
there are a series of rocks and shoals in law and other directions in connection
with this question. The draft llill circulated as a basis for this discussion I
need not say we have no desire to rush in any sense at all. It has been
prepared for this discussion, and I have no doubt the discussion will be full
in every way. Our wish in seeking iniiforniity is to cover by the Act which
we have in prospect as corajjletely as possible all the ground which is common
to us all, both in the United Kingdom and in the Colonies ; and the Bill
itself re-enacts, consolidates, and, to a certain extent, amends the existing law.
Ill its construction we proceeded from the circumference to the centre rather
than from the centre to the circinnference. First and foremost, I woukl like
to draw the attention of the Conference to the fact that the Bill proposes
to remove two principal anomalies which have for a long time caused irrita-
tion and inconvenience, Iwth in the Colonies and in the Mother Country.
First of all, as the law now stands, a certificate of naturalization can only be
granted in the United Kingdom — excepting the case of a person in the service
of the Crown — to a person Avho has resided, and intends to reside, in the
United Kingdom, li' he intends to go to the Colonies, however closely asso-
ciated he may he with British interests and British life generally, he cannot
be naturalised. Therefore it comes to this, that a wish on the part of this
person to go to the Colonies in itself becomes a disqualification. Conversely,
if a man in the Colonies is identified with Colonial interests, even if he is
naturalised in that Colonj^ he cannot qualify if he comes to the Mother Country
until he has resided here for five years. So that his Colonial connection is
again a disqualification for a period of five years during which he cannot
become a British subject. Our view is that these anomalies are totally
opposed to the principle of unity and solidarity within the Empire with
regard to this matter. We propose to deal with this in clause 7 of the Bill,
which provides that : " An alien who within such limited time before making
" the application hereinafter mentioned as has been under any Act hereby
" repealed or may be allcnved by the Secretary of State, either by general
" order or on any special occasion, has resided in His Majesty's Dominions
" for not less than five years or has been in the service of the Crown for not
" less than five years, and he intends, when naturalised, either to reside in
" His Majesty's Hominions, or to serve under the Crown, may apply to the
" Secretary of State for a certificate of naturalization." It is in its general
terms taken from the Act of 1S7(), but substituting "His ]\Iajesty's Dominions "
for " the United Kingdom." In that way we propose to entirely remove this
particular anomaly. The second leading anomaly to which I have alluded
lies in the fact that a certificate of naturalization granted in a Colony takes
effect only in that Colony. We propose to remove that by clause 2(i of the
BiU, the effect of whicli in brief is this, that where conditions of naturalization
in a Colony are substantially the same as those required in the United King-
dom, an Order of His iMajesty in C'ouncil may enable that certificate granted
in that Colony to have effect throughout the Empire. That provision produces
two main results ; a certificate granted in the Colonies in that prescribed way
becomes valid in the United Kingdom, and in the second i)lace it becomes
valid in other Colonies. By the first result the second great anomaly to which
I have referred is removed.

M 2

180

Sixth Day. Mr. DEAKIX : " Colonies " covers more than " self-goveruiiio- Colouies."

25 April : )07.

Naturalization-. jj^. HERBERT GLADSTONE : That is quite true. I am talking in

general terms now. That point certainly requires elucidation and discussion ;
and other similar points, for instance, as an illustration the meaning of the
word " Governor " in the Bill. Points of that sort will require further
discussion. I am only dealing now with the general drift of our proposals.
I think then that so far as the removal of these anomalies is concerned,
we do provide a certain basis of principle for an Imperial Naturalization
Law. The second result of clause 26, to which I have alluded, namely
that a certificate given in the Colonies is valid in other Colonies, has
been the subject of considerable criticism in the Memorandum which
we have received fi-om the Cape drawn up by the Attorney-General of
the Cape Govermnent. His point is that the Imperial law is too lax to
be accepted as a test of adequate conditions of naturalization in the
Colony ; and he develops the criticism in two directions. He points out
that, the discretion of the Secretary of State being absolute, there was
nothing in the law to prevent in the Mother Country a certificate of
naturalization being given to undesirables who might even be criminals, and
in the second place to persons of non-European descent. . In passing, I might
perhaps observe one remark in the jMemorandum. The Cape Attorney-General
noted that at the time the Memorandum was written there was no Act dealing
with the immigration of aliens in this country. Since then, as is well known,
an Act has been passed, and certainlj^ with regard to imdesirables that Act
has had a considerable operative force, and it does arm the Government with
large powers to deal with aliens who are found guilty of crime in this
coxmtry ; and under that Act we have got rid of a large number of
extremely dangerous and unsatisfactory persons. So we are so much, at
any rate, to the good in that matter. Perhaps I may here deal with the point
that the law of this country is lax, or rather that the i)ractice under the law,
the administration of it, is lax, because that is what it comes to. I may just
briefly describe to the Conference what our action is in regard to this matter
in mj^ Department. Every applicant for a certificate has to give four referees
as to his character, and he has to give a fifth as to his residence. In every
single case the most minute inquiries are made as to his character, his
position, his antecedents, and his intentions. Of course, the inquiries are
made in various directions, and whenever there is any necessity we make
the inquiries through the j^olice, who are the most convenient agents at our
disposal in the matter. We also lay down certain tests which we require
the applicants to pass ; for example, we have the general test that the
njan must be able to read and write. We hold that he has not a
real claim to the advantages of citizenship unless he is al)le to read and
write English. Although there may be a solitary occasion or two in
vhich some exception is made to that, that is the general rule on which
Ave act. Then there is also a fee to be paid, if the alien is generally
satisfactory, of 5?., before he can get his certificate. If there is any suspicion
of criminality on the part of the man, that suspicion has to be dissipated as a
condition precedent to his obtaining his certificate ; and, as far as we know,
no criminal has been naturalised in this country. Of coiirse, we maintain,
whatever may be said about the provisions of the law, that in effect our
administration of it is by no means lax, and would fulfil with regard to
undesiraljleness and crime the requirements which are suggested on the part
of the Cape Government. But it would be quite possible to consider whether
certain classes of criminal undesirables might not be named in the Bill as
being disqualified for naturalization. That is a matter which we should
be very glad to consider, and, in fact, to put it lirietly, we might see how far

181

wo could express in law what, in fact, has been onr practice in its Sixth Uuy.
administration in this countrv-. Willi regard to the second point of the 25 April 1907.

Cape Attorney-General, namely, liis reference to persons of non-European

descent, in this country we have admitted extremely few j)ersons of non- -^ -*" ''-^ -"--^
luiropean descent. It is a point, so far as we are concerned here, which is v, .."^'^r'
not at ail serious; and I woidd like to remind the Conference that >»atal,
which has l)y law excluded non-Europeans from naturalization, has accepted
the United Kingdom's certificates as valid. A point has heen raised in the
Cape xVttornev-Gpiieral's Memorandum with regard to the conditions jire-
vailiug ill Crown Colonies in regard to this matter, and he says it is a vital
consideration that liong Kong, a Crown Colony, has no naturalization law,
and tliat the Straits Settlements require no stated period of resilience, so there
is nothing to prevent a Chinaman landing there and at once getting his
lettei'S of naturalization, and if the recommendation of the Committee is
adopted, that it shall suflicc to declare intention to reside within the
Dominion, that Chiuamau can at once proceed to South Africa, and can only
he shut out by Act of Parliament. ()f course, that is a point that requires
very serious consideration, but I would suggest with regard to it that the
Order in Council mider these circumstances would not be made, because the
conditions locally would not be so satisfactorj' as the conditions which prevail
in this country, which would l)e the test. The test really would be the
conditions which prevail in lliis country, and not the conditions which might
prevail in Hong Kong or the Straits Settlements or any other Crown Colony.
I would suggest to the Conference on this point, which is, as I quite under-
stand of great importance in connection with tliis Draft Bill, that before an
Order in Council is issued there would be ample opportunity to consult the
Colonial Governments concerned; and through tlie machinery, which T am
glad to say it is proposed to set up by the establishment of a Seci-etariat,
we should be able to ascertain the views of the Colonial Governments
concerned, as to Avhether the conditions of the certificate were sufficiently
satisfactory.

I do not like to go into further details at this stage. We shall be
glad to consider any suggestion. A number of detailed suggestions were
made in the Cape Attorney-General's Memorandum, most of which have
lieen dealt with and embocHed in the draft Bill ; so that it is proposed
to assimilate those suggestions which are now the law in most Cnlonies
with our own law. We recognise the force and justice of the claim of the
Colonial Governments to deal with special (Ullicultics which alfei't them
in varying ways, and with which the Home Country is not directly concerned,
or with which it is not desirable or possible for iis to deal ourselves. I would
venture to suggest that outstanding points, points for the most part of detail,
but still of very important detail, should be left to be dealt with by a
committee. Our chief desire is to make the Imperial Law as comprehensive
and acceptable to the Empire as possilile, and avc seek, in short, willing
agreement on a basis Avhich will not interfere with the local necessities and
the legitimate desires of all the individual Colonial Governnients which are
concerned in this question. I therefore would venture, Lord Elgin, to suggest
that this Bill might be referred to a Committee, so that its details may bo
thoroughly considered by representative men, and I would propose to move
a resolution Avhicli runs thus : " That, with a view to attain imiformity, so
" far as practicable, an inquiiy should be held to consider further the
" ([uestion of naturalization, and in particular to consider how far and
" under what conditions naturalization in one part of His Majesty's Dominions
" should be effective in other parts of those Dominions, a subsitliary
" Conference to be held if necessary under the terms of the resolution
" adopted by this Conference on the 20th April last."

■1800S. M 3

182

Sixth Day. Sir WILFRID LAURIER : That is, perhaps, as far as this Confereace

25 April 1907. would propose to go. It is a very complicated question, and I think it
advisable to have a discussion upon it.

Naturalization.

CHAIRMAN : You wish to discuss it further ?

Sir WILFRID LAURIER: I think so. It is most important and most
complicated.

Sir JOSEPH WARD : It certainly ought to he discussed.

Mr. HERBERT GLADSTONE : It is very complicated.

CHAIRMAN : We submitted this resolution strictly in the terms of the
decision of the Conference the other day with regard to our future organisa-
tion, so that it might be carried out on those lines, namely, that we should
be responsil^le for seeing that an inquiry was made at a subsidiary Conference
held as soon as the inquiry might be ready. We put it before you just now
in case on those terms the Conference did not wish to discuss it further at
this meeting, it being a very technical matter, but of course if the Conference
does desire it, we must try and arrange another day.

Dr. JAMESON : Could it be adjourned to one day next week, when we
might have a copy of what Mr. Gladstone has told us ?

CHAIRMAN : We cannot discuss it next week.

Sir JOSEPH WARD : I think we ought to have a general discussion
upon it.

Dr. JAMESON : Yes, that general discussion might be at a later period,
and then we shall have before us a copy of Mr. Gladstone's address.

Sir JOSEPH WARD : If this matter went to a Conuuittee before we had
an opportunity of discussing it, there are some points of material importance
certainly, to New Zealand, which I should have no opportunity of dealing
with. I wish to deal with them, though I can do so briefly, because it is a
very complicated and difficult matter and the proposals outlined by Mr.
Gladstone in some respects are of a very far reaching character so far as my
country is concerned.

Mr. HERBERT GLADSTONE : May I say that I did not formally move
the resolution with a view to avoid a general discussion before we got to it,
but I thought that as the hour was now late it might be desirable to put my
general suggestion before the Conference so that you should be in possession
at any rate of our views in the matter, and then the Conference could take
what course it thought desirable.

CHAIRMAN : Then the Conference adjourns on this matter, and the
actual day to be fixed for that discussion to be left open.

Adjourned to to-morrow at 3.30.

183

Minutes of Proceedings at a Discussion between the -5 April 1907.
Chancellor of the Exchequer and Others representing
His Majesty's Treasury and certain Members of the
Conference.

Held at the Treasury, Whitehall, Thursday, 25th Ai-ril 1907.

Present :

The Honourable Alfred Deakin, Prime Minister of the ConinionweaJth
of Australia.

The Honourable Sir Joseph Ward, K.C.M.G., Prime Minister of New

Zealand.

The Honourable L. S. -iAiiESOx, C.B., Prime ilinister of Cape Colony.

The Honourable Dr. Smartt, Conunissioner of Public Works (Cape
Colony).

General the Honourable Louis Botha, Prime Minister of the Transvaal.

The Right Honourable H. H. Asquitii, K.C, M.P., Chancellor of the
Exchequer.

The Right Honourable W. E. Macartney (Deputy blaster of the Mint).

Mr. Walter Runciman, Financial Secretary to the Treasury.

Sir E. W. Hamilton, (J.C.B., K.C.V.O., Permanent Financial Secretary
to the Treasury and Auditor of the Civil List.

Sir George Murray, K.C.B., Permanent Administrative Secretary to
the Treasury.

Sir Hexry Primrose, K.C.B., C.S.I., Chairman of the Board of Inland
Revenue.

Mr. W. Blain, C.B., and other Officials of the Treasury.

Mr. G. W. JoH.\.sox, C.iM.G.

Joint Secretory.

DOUBLE INCOME TAX."

CHANCELLOR OF THE EXCHEQUER : I thought that, perhaps, Doii.lf. Income
the most convenient point to begin with, tiubjcct to your opinion, was the Tax.

double payment of income tax. It touches you most, Dr. Jameson, and
you also, Mr. Deakin.

Dr. JAMESON : Very much iiuleed, and it will affect General Botha
very much more than it does us, or will presently.

CHANCELLOR OF THE I'.XCHEQUER: It does not ju^.t now.
Dr. Jameson ; perhaps you had better open that tojjic if it is convenient
to you.

• See p. 543.
M 4

184

to April 1907. Dr. JAMESON : Mr. Asquith, we liave stated and re-stated this case

frequently and I tLiuk it is fairlj^ rightly stated in our resolution : " That it

oiuLE Income ,i ^^ inequitable that income tax be levied in the United Kingdom on profits
" made in the British Colonies and possessions, upon which income tax has
" been paid in such Colonies or possessions, and it is eq^^ally inequitable that
" income tax be paid in any British Colony or possession on profits made in
" the United Kingdom upon which income tax has been paid in the United
" Kingdom, and that representations be made in the Federal Govermiient to
" urge the repeal of enactments imposing double income tax on British
" subjects by the laws of the separate States and Great Britain."'

I think you will remember, Mr. Asquith, that about eight months ago
when I was at home the De Beers Company came and put the case l^efore
you, and I had the pleasure of seeing you afterwards and Ave got at that time
what, I am afraid, we rather expected to get — an absolute non ijiossumus.
We recognise that judgment has been given against iis in the test case of
De Beers )jy all the various courts going up to the highest, so that, of course,
as the law stands, we recognise that we are liable. ^Vhat we ask is — and it
is a very large " ask," no doubt — that there should be legislation introduced in
the Imperial Parliament altering the law. That is the only way in which our
peoi)le can get relief at all. At present the position turns on the difference
as to where ijrofits are earned and where they are spent practically, and we
know that we can only get relief fi-om this double income tax upon income
which is earned in the Colony, or in General Botha's case, where he has not
got an income tax at present but probably may have later on, if in any case
the money is actually earned in the Transvaal, when there are various
shareholders outside tlie Transvaal, not only here, but abroad — I mean, not
only in the United Kingdom, but in Europe generally — and General Botha
takes the view which we take in Cape Colony, that if there is to be any
taxation on those earnings, it ought to go to the State in which the earnings
are created.

I do not think I need elaborate the case. It is simply as to whether the
Exchequer can see its way to introduce such legislation as would exempt us,
in Companies where the whole production takes place within our Colony,
from the taxation of shareholders living there. There are two Avays of doing
the thing, as to shareholders living in the Colony itself, and as to people
living in England. The usual inethod of collection at the j)resent moment is
that the Company deducts the total income tax, whether in the Colony or in
England, from the total amount of profits earned, and, therefore, the Colonial
shareholder is hit twice in our case, and we think he ought not to be ; and
the same in General Botha's case. Representations have been made from the
foreign shareboklers in the particular case of the De Beers Company where
the test case took place agamst it. Of course, the Colonial shareholder also
feels it, and he has jnade violent protests against it.

There is the point, possibly, that abroad or in the Uiiited Kingdom
where money is spent and the man living, he may have to pay his income
tax, but surely for the Colonies themselves, for the individual Colonial
shareholder, it seems to be inequitable that he should be taxed for money
earned when those earnings are sj^ent within the Colony itself. Perhaps he
never visits anywhere except in the Colony, and yet he has to pay this tax
to the English Government besides the ordinary taxation he has to pay in
liis own country.

There is a small point also which Avas brought forward at that time,
that supposing the companies did not practically collect the income tax
for the Imperial Government here and that they had to coUect it from
the individual shareholder themselves, Avhich, of course, Avould be in the
poAver of the company, then proljably the Treasury here Avould lose a good
deal of money. That is merely u small side issue, and roughly the jjosition

DoriiLF, Income
Tax.

185

is that I wish to press upon you, if yon sec your way to it, that legishitioii 25 April 1907.
should be brought in so as to remove this inequitable tax, as we consider it to
be, on the Colonial sharehoklers.

CHANCELLOR OF THL EXCHEQUER (to General Botha) : Have you ^^'- '^"™«*"'"-)
anything to say upon this topic ?

General BOTHA : No, except that I quite agree with that.

CHANCELLOR OF THE EXCHEQUER: You associate yourself with
what has been said ?

General BOTHA: Yes.

CHANCELLOR OF THE EXCHEQUER .
Mr. Deakin ?

it does not interest you,

Mr. DEAKIN : Certainly, it interests us because there is a double tax.
It interests us quite as much as it does any other part of the Empire, but
Ave have not pressed it furtlier because Ave understood (I hope I may bo
undeceived) that your mind was absolutely made up aljout it, and that there
Avas no chance of our being exempted. That is our position.

CHANCELLOR OF THE EXCHEQUER
knows, he and I have talked about this Ijofore.

Of course, as Dr. Jameson

Dr. JAMESON: Sir Joseph
something to say about it.

Ward is here now, and he may have

Sir JOSEPH WARD: I do not know Avhat you have l)een discussing,
but Ave have had an important question of Avhat Ave think is diuil taxation
up very frequently in our country, as to whether there was a possibility of
reciprocity where your people come out Avho are paying income tax legitimately
here, and may reside for a time in our country till the arrival of the period
for collecting income tax ; they invariably complain Avhen asked to pay
income tax in our Colony, and Ave have that reversed of course ; people from
NeAV Zealand come to the Old Country, and the question is Avhether it is
possible to arrive at the position of saying that Ave shall not charge an
Englishman resident in our country Avho pays income tax if you say the same
to a NcAv Zealand Resident avIio comes to England. If Ave could arrive at a
mutual understanding upon that point it Avould be very satisfactory to us.
I admit it is a very difficult thing to do.

CHANCELLOR OF THE EXCHEQUER: It is a difficult thing to do.
but that is rather a different point from the one Dr. Jameson lias raised. I
Avill take a typical case, the case of the De Heers Company, Avhich has been held
liable to income tax here, and I may point out that the tax is a tax, not upon
the shareholders, but upon the profits of the Company ; of course, indirectly
no doubt in the long run it is a tax Avhich falls on the individual shareholders,
but the tax is collected here upon the profits made l)y the Company, and the
ground upon Avhich the Company has been held liable is no neAv ground, it is
quite as old as our income tax legislation. It is that the Company has been
found in point of fact to be resident here, that is to say, that although the
mines Avhich it owns, and the operations for Avorking those mines are carried
on in South Africa, Avhat the Courts have held to be the head, the controlling
power, the directing poAver, the brains, and the nerve centre of the Company ia

186

^5 April 1907.

Double Income
Tax.

(Ghancellor of
the Exchequer.)

here in London, or at least within the jurisdiction of the United Kingdom, and
it is always a question in each case, a pure question of fact, Avhether that
criterion is or is not satisfied.

There are a great many companies carrying on operations, for instance,
in the Transvaal, a great many gold-mining companies of Avhieh that cannot
be said, where the directing poAver, the real head and centre and directing
power is not here, but is in the Transvaal, the spot where the physical
operations of mining are carried on, and wherever that is the case the
Imperial income tax is only exigible from any part of the profits which is
remitted to this countrj^ and actually received here. It is only when in point
of fact the Courts come to the determination with regard to a particular
company, that the head and centre of the operations are here, that the
Company is regarded as in point of law resident or domiciled here, that
the whole of its profits comes within the reach of the income tax
law. It is open to any company to alter its arrangements in that respect if it
is to its interest to do so, but so long as the company conceives it to be in its
interests to carry on the main directing power of its operations within the area
of the United Kingdom, a matter which is entirely within its discretion to
determine one way or the other, it has always been the law — it is no new law
— in this country that the whole profits made as the result of that company's
operations are subject to income tax here and the profits of the company as a
whole are liable to be so charged.

I cannot hold out any hope that the Imperial Parliament will effect any
change in that principle of law. To do so would be to deprive ourselves here
of an amount which I should be very sorry offhand to calculate, and also it
would be to fly entirely in the face of the principle of our income tax law,
which is that wherever a person, a natural person or an artificial person,
chooses for purposes of his or their own, to domicile themselves in this
country, to take the advantage of o^^r laws for the purposes of carrying on
their trade, they are proper subjects of taxation, and we cannot discuss
the question amongst whom in what part of the world the ultimate profits are
divided.

We have many such cases, not only in connection with the Colonies ; we
have many more cases in connection with foreign countries. In South
America, as Dr. Jameson knows, we have a great many South American
railways, and although the wdiole operation of the railway as a railway is
carried on in South America, the caj^ital has been, as a rule, very largely
subscribed here, aud the board of directors meets here, and the operations of
the company are carried on here. We tax those companies, although they
are South American companies in the same sense iu which De Beers is a
Cape Colony Company.

Sir JOSEPH WARD : I3o you tax in that case the individual in London
-,n the profits of the Company ?

CHANCELLOR OF THE EXCHEQUER: No, we tax the Company
upon its profits. We take the profits of the Company and tax them.

Sir JOSEPH WARD : Then does the individual upon his annual income
again pay on a proportion of these profits ?

CHANCELLOR OF THE EXCHEQUER : No ; if the individual has a
claim for aliatement or anything of that kind that is another matter. We
tax the profits of the Company, and then the Company hands on the burden
of the liability, no doubt, to the individual shareholder by deducting from

187

thfi (lividcnd which wouhl otherwise be payable to him his proportion of 25 April 1907. ;

the income tax. The thing we have to deal with, the taxable entity, so far ^

as we are concerned is not the in<lividual sharehoMer ; we have no concern '^"'^^"I^e^ Income

with him ; it is the Corporation, the artificial person who is making the (Chancollor of

profits, and who, l)cing a person now under our law resident here, is subject to tl>e Exohiquer.)

our income tax law. It does not matter whetlier lie owns a mine in Siberia

or a railway in Soutli America or a mine in Xev/ Zealand or South Africa,

the law is applied ([uite impartially to all and it is always a question of

fact in each particular case whether the constitution and the mode of

management of the Company is such as to make it elVectively and actually

resident for the purpose here. If it chooses to transfer its head, its centre,

its brain and nerve power, to some otiier part of the work! so that it is no

longer in point of fact resident here, then, of course, our ciaim for income

tax ceases, but in tliat respect the case of the Company is exactly like

that of the natural person ; either the one or the other have to be resident

here and to carry on the main directing power of their operations here to

render themselves liable to Imperial income tax.

I do not think that consistently witli the general principles which
pervade and luideiiie the whole of our income tax law it would be possible
for us to make a distinction in that respect, so that 1 am afraid on that point
I cannot hold out any hope that the Imperial Parliament is likely to alter the
policy which has now been persistently and consistently pursued for more than
60 years.

Dr. JAMESON : That has just raised a point, Mr. Asquith, that made us
hope there might be a possil)ility of something being done. We are certainly
not here to look after the interests of Soutli America or these various places
you have referred to. There is that awhxl word " Preference " which comes
into this like many other things and we are realising, as we are all here now,
that the fact that there is a jiartnership in the various portions of the Empire
is becoming more emphasised, and I cannot see a better example of partnership
than if we diiferentiated between the foreigner and the various Colonies on a
subject of this kind.

CHANCELLOR OF THE EXCHEQUER: .May I interrupt you one
moment ? I suppose a very considerable number of the shareholders in the
De Beers Company are on the Continent of Europe, are they not ?

Dr. JAMESON : Yes, the shareholders, but then you told us you are
not dealing with the shareholders, but with the Company, the corporate
body.

CHANCELLOR OF THE EXCHEQUER : The shareholders are tlie
people who would iiltimately l)enefit, when you come to the question of
preference. It is quite true that the operations of the Company are carried
on in South Africa, but who are the people receiving the dividends ?

Dr. JAMESON : I do not care much who receives the dividends or how
much they receive, but I do care that a big Company in a British Colony
should be as successful as possible, and I feel that the success of any other
Companies following in its wake wtuild be more assured if this great l)enetit
was given to them as a portion of the Empire, leaving out, as you said
yourself, the shareholder, and we do not care what the shareholder gets.
From one point of view we naturally care what the shareholder gets, but
leaving him out altogether and taking the coriiorate body with its operations
within the Colony, ii' it got a certain amount of benefits probably it would

Double Income

188

25 April 1907. benefit very mncli the people who are working in that Colony. There is not
the least doulit oi' that. Yon made it out to he something like 200,000J. for
Tax^*^"'^*" o]ie year which is taken, and of that 2(J0,U00/. a great deal wonld go towards

(Dr Jameson ) ^^® working and good government of the Cape Colony. It will not all go to
the shareholders. We will do things on a better scale if we are not taxed
to that extent.

CHANCELTiOR OF THE EXCHEQUER : It would be an increase of
the dividend.

Dr. JAMESOX : Take even the sentiment point of view represented by
a very small amount of cash, it woiild he all helpful. Then you said just
now that of course the brain force is here, and that is quite true with regard
to the De Beers Company. I believe it has been decided by the law courts,
and it must be so, but yon said that if they did not like that they could move
elsewhere. It has been discussed at the De Beers Board whether it would not
be worth while for the sake of saving some 200,000?. a year that they should
move their oihces out of London altogether. It could be done, I believe ; it
would be rather difficult to move them out to Africa altogether, but I believe
that could be done ; in fact there is a very strong agitation on the part of
a portion of the De Beers Company to move the whole thing out to Kimberley,
and I wish they would, and then the only people who Avould pay income tax
would he the British shareholder who happened to be resident in England,
and the tax would have to be collected individually. That is Avhere the
agreement I brought in just now would come in because you would prac-
tically get nothing, and it would be not only the De Beers Company, but a
large portion of the companies in South Africa are here with their brain power
and have to pay. They have not been tried yet — but are going to be tried.

Sir HENRY PRIMROSE : There are a good many of them here, but
there are also a good many not here.

Dr. JAMESON : Really, the larger ones are a great deal controlled from
London.

Sir HENRY PRIMROSE : Y^es.

CHANCELLOR OF THE EXCHEQUER: Many of them are, no doubt.
I did not mean to imply that the whole were.

Dr. JAMESON : It would be rather too bad to frighten any of them away.
Perhaps the Treasury might lose more by frightening them away than by
making this concession to companies existing within the Empire in the
various British Colonies.

Of course, the position is quite as you say, Mr. Asquith, only we Avant it
altered. Here is the Memorandum from the Treasury of 189G, and they put
it here perfectly simply, and that is why I began by saying that we know
without legislation we could not alter the present position of things. " The tax
" in England is a tax upon income received in the United Kingdom, not
" earned, in that respect it appears, according to the statement of the
" Memorial, to differ from the income tax, established in the Colonies, Avhich
" extends oirly to incomes earned in the country where the tax is in force."
Now, to us Colonists, it appears that that is a most equitable arrangement that
it should be a tax iipon incomes earned in the country where the tax is in
forcie, and that is what we hope may be an indication to have discussed, at all
eveats, if iiot got any further.

189

CHANCKLLOR OF THE EXCHEQUKli : It would strike at the veiy 2o April 1907.

root of our income tax law, and that is the tliihculty, you see ; logically it

would go tremendous lengths. Docble Income

Mr. DEAKIN : Are you not introducing a difference between earned
income and not-earned ?

CHANCELLOR OF Till-: EXCHEOUER : As regards small incomes.
The De Beers Company under no possible stretch of the imagination could
come into that category.

Mr. DEAKIN : Lulividual shareholders might.

CHANCELLOR OF THE EXCHEQUER: They can get the benefit of
the l;-,w.

j\[r. DEAKIN : I wanted to get that, because of your recent Budget
distinction l)ctween earning and not earning.

CHANGFLLOR OF THE IvXCHEQUEri : That was not the point of
my remark ; the point of my remark was totally different — that in England
under I'higlish law income taxis payable by everybody resident here on profits
wherever earned. The question whether a companj- is resident here is a
question of fact, as you know as a lawyer, to be determined in each particular
case, and if it is once held that either a natural or an artificial person is
resident here, then you sweep the whole of his earnings into the net and
within the ambit of the law. That has always been the position of our
income tax law. Of course there is another way of giving a relief to
the De Beers Company, but I daresay it would not conmiend itself to you,
Dr. Jameson.

Dr. JxVMESON: What is that?

CHANCELLOR OF THE EXCHEQUFR: That the Cape Colony should
not tax it.

Dr. JAMESON : I think the De Beers Company should, perhaps, Ih'
taxed more than it is for the lienefit of the Cape Colony. I am going to put
some more on them this year when I go back, and thei-efore I am very
anxious that whatever is to be plucked out of them I shall get for Cape
Colony and not pass it over here.

CHANCELLOR OF THE EXCPIEQUER : I quite nnderstand. and
thoroughly sympathise with you, if I may say so. I am afrai<l you must leave
that now ior the moment. I need not say I will careliilly bear in mind all
you have said.

;Mr. Deakin, which of your resolutions do you prefer to take first ?

Mr. DEAKIN : I think the profit on silver.

CHANCELLOR OF THE EXCHEQUER: Vou liave o.u- niemoraudum?

Mr. DEAKIN : T have.

Dr. JAMESON : Before you leave that other point, -Mr. Asquith. this is
mofe or less a private Conference, and some of us would like if you would

090

25 April 1907. canse your answer to he sent in as a Memorandnm to the General Conference

so that it may be brought up.

Double Income

'^^^- ^ CHANCELLOR OF THE EXCHEQUER : I quite understand ; you

(Dr. Jameson.) j^^turaUy would like to raise it formally ?

Dr. JAMESON : Yes.

CHANCELLOR OF THE EXCHEQUER: I will see that is done.
You are now to deal with profits on silver coinage, Mr. Deakin.

PROFITS ON SH^A^ER COINAGE.

Profits on Mr. DEAKIN : The Memorandiim I have just had the opportunity of

SiLVEE CoiNAfiE. reading I may have looked at before, biit really have had no chance of fully
considering. It contains a good deal which appears to me to be arguable,
and that might be an interesting pursuit, but I do not know that it would
proht us. Let me at once call attention to one or two omissions from the
Memorandum. In the first place, nowhere here is any estimate or calculation
furnished. First there is an interesting discussion as to what is "profit"
and what is not, and what indefinite liabilities have to be provided for ;
that is mere argument. Now, as a matter of fact, it ought to be possible —
I assume it is known— to state what is the apparent profit up to the present
time on the silver coined in, for instance, the Colonies generally. Nowhere
do Ave see that, and without that the argument remains academic. When
reference is made to severa] statements here which can only have Ijeen
made on the faith of some such calculation more or less close having been
already carried out, one finds that it is not given. We are told that under
certain circumstances the present profit may disappear. I assume these
statements to be made with knowledge of what the profit is, and what chances
there are of losses occurring ; we are left in the dark. The supposition with
us is that there is, and always has been, a consideralile profit, and tliat there
are profits still. If that could be settled by actual figaires it would a good
deal diminish our difiiculties in dealing with the matter.

-'&

CHANCELLOR OF THE EXCHEQUER: Are the figures you wish
for the total profits, or the annual profits, for a series of years, or the profit
made in respect of that part of the coinage which goes to Australia and is
used in Australia, or both ?

Mr. DEAKIN : I should like Ijoth, because one conies into tlie other.
The latter would show whether we are really misled by those among us
who calculate that there is a very considerable profit which we have some
title to claim.

CHANCELLOR OF THE EXCHEQUER : Of course as you agree we
have to take into account as a set-off the loss which is incurred in rej)lacing
gold.

Mr. DEAKIN : Yes, that is reasonal)le. I would look at the figures
with the further a(hiiission that it is witliin the 1)0unds of possibility tliat
there may be, though we hope there will not be, fluctuations iu silver whicli
may affect the profit. We have that generally iu our mind, but really I feel
quite unable to grapple with the practical side of this question until we
have some idea of wliat the actual earnings are.

CHANCELLOR OF THE EXCHEQUER : 1 shall be glad, if it is
possible, to let you have these.

191

Mr. DEAKIN : It would bo a great nflvjmtage, and may T also ask for 25 April 1907.

some other information ? There is an arrangement between the Dominion

of Canada and vonrselves in regard to the silver coinage, which has obtained ''''"rn,K»rp
for a number of years. T asked my own ollicers but they coukl not tell mo
what that was, neither the nature of it uor what its effect is.

CHANCELLOR OF THE EXCHEQUER : Canada has a subsidiary
silver coinage, has it not, of its own ?

Mr. BLAHS' : It is coined by the Mint here.

Mr. DEAKIN : And it is also, now proposing to have a mint of its own.

Mr. BLAIN : Yes.

Mr. DEAKIN : 1 assume if it is proposing to make a mint of its own it
is because they must think the business of minting more profitable than the
returns which liave hitherto been derived from this arrangement with you. I
merely assmue that from this statement.

Mr. BLAIN : I think Canada wanted a mint of its own for much the
same reasons as Australia.

;Mr. DEAKIN : We have got a mint of our own in that sense.

Mr. BLAIN : It is a branch of the Royal Mint, like the three branch
mints in Australia, that is proposed to be founded at Ottawa.

Mr. DEAKIN : It is proposed to have an institution there and to coin
locally.

Mr. BLAIN : That is all that is proposed in Canada.

Mr. DEAKIN : They will not derive any greater or less profit than they
do now ?

Mr. BLAIN: No.

CHANCELLOR OF THE EXCHEQUER: It is really to put them
on an equality of status with you, and to have a little mint of their own.

Mr. DEAKIN : I presume there is no objection to our knowing what
the nature of the an-angement that exists with Canada is.

Mr. BLAIN : The sidisidiaiy silver coins for Canada are coined for the
profit of Canada, as far as there is profit arising from the i)urchase of the
silver, and they simply ]xiy an allowance to the Mint here that is sufficient
to cover the cost of striking the coins. Mr. Macartney would say what the
allowance is.

CHANCELLOR OF THE EXCHEQUER : You charge them three
per cent., Mr. Macartney ?

Mr. MACARTNEY : Yes.

192

25 April 1907. Mr. DEAKIN : Are you in a position to say what profit they have been

Profits ox
Silver Coinage.

gaining from that ?
Profits ox

Mr. MACARTNEY : No, I should not like to say off-hand, but there is
profit, of course.

Mr. DEAKIN : I would be glad to know what it was.

CHiVNCELLOR OF THE EXCHEQUER: You understand it is a
subsidiary coinage.

Mr. DEAKIN : Quite. That makes it easier to calculate than ours, but
it affords a clue if you take into account the amount of the coinage, the
population, and so on.

CHANCELLOR OF THE EXCHEQUER : We will try and furnish
that to you.

Mr. DEAKIN : If we had those facts before us we woidd be alile to
argue in a more concrete fashion.

CHANCELLOR OF THE EXCHEQUER: Have you considered the
last paragraph ?

Mr. DEAKIN : Yes, we have recenth' called attention to the fact that
our half-sovereigns are getting sliabljy. We recognise that as a charge
against the coinage of silver. The profit upon it is ample to provide that.

CHANCELLOR OF THE EXCHEQUER : Hitherto, the old gold coins
have had to be tendered to the Bank of England, and Ave have suggested
what we thought might be acceptable to you, to allow them to be tendered in
Australia.

Mr. DEx\KIN : That would be an advantage.

CHANCELLOR OF THE EXCHEQUER: I think there would be a
very distinct advantage in that.

Mr. DEAKIN : Yes. If we could get the information I have asked
for, perhaps we might look at this again.

CHANCELLOR OF THE EXCHEQUER : Very well. What would
j'oii like to take next ?

DECIMAL SYSTEM.

DEctJTAL Sy-^tem. Mr. DEAKIN : There is decimal currency, still believed to be disposed

of by an interesting document of 1859.

CHANCELLOR OF THE EXCHEQUER: Just before you arrived
here, we had a Debate this Session in the House of Commons, not on deciiual
currency, Ijut on decimal weights and measures.

Mr. DEAKIN: Tlio metric system.

193

r'rTANCET.LOR OF THE EXC'JIE(,)UE1? : It is nioiv or less rclato.l ^'^ April UW.

to it.

Mr. DEAKIN: Tliey are looped together by this report of IS")!!. The
elTect of that discussion in the House was^ ?

CHANCELLOR OF THE EXCIlEQrER : To shoxv on the whole a
very adverse feeling to any change. The state of the law here at present is,
as regards weights and measures, that it is optional ; anybody, if they please,
can carry on their transactions on the decimal nomenclature, or whatever you
choose to call it, as regards weights and measures.

Sir JOSEPH WARD: Li England itself?

CHANCELLOR OF THE EXCHEQUER : Yes ; it is optional, but it
is not compulsoiy, and some changes have been advocated hy a consiflerable
body of opinion, principally amongst the Chambers of Commerce. The
advocates of the change have been advising that the change should be made,
allowing an interval for the transformation from one system to the other, and
the thing came to a head a few years ago in the House of Conunons, when a
Bill was brought in, and the thing was very thoroughly debated. I forget
the exact figures.

^[r. RUNCIMAN : The Bill was lost by a large majority weeks ago.

CblANCELLOR OF THE EXCHEQUER: A ven-consi.lerable majority
in this new House of Conunons, which is pretty fresh from the country, and
I thought that was prol)ably a fair indication.

Mr. DEAKIN : " Fresh " in the sense you apply the word to horses.

CHANCELLOR OF THE EXCHEQUER : Li both senses, perhaps.

Dr. JAMESON : The option is very little used.

CHANCELLOR OF THE EXCHEQUER : Very little.

Mr. RUNCIMAN : It is used in the engineering trades to some extent.

CHANCELLOR OF THE EXCHEQUER: I think we hud a very
interesting debate about it which, perhaps, you may find worth reading — the
report in " The Times " a few weeks ago. The strong opposition came from
the cotton trade ; I think they were the strongest of all.

Mr. RUNCTMAN : Yes, and the whole of the textile trades.

CHANCELLOR OF THE EXCHEQUER: The textile trades as a
whole, but the cotton trade in particular ; they said it would involve a
complete revision of the whole of their machinery as well as the old-
established price-list which has been slowly compiled during od years.

Mr. RUNCIMAN: And the reconstruction of their looms V

ClIAXCELLOU OF THE EXCHEQUER: Yes, and, in lact, of the
whole apparatus of ])roduction, uliicli would lie so expensive and involve

Decimal

Sv<Tru,

194

25 April 1907. during the process of transformation so much, loss from capital Ij'ing idle and

Decimal ^^^ ^^®^ capital which would have to he put into it, that they regarded it as a

Systkm. thing which would be for the time heing almost disastrous to the cotton

(Chancellor of the industry. The operatives and masters were absolutely at one about it ; there

Exchequer.) was a most remarkable demonstration from the whole of that industry, and I

think the woollen trade was hardlj"- less emphatic.

Mr. RUNCIMAN : The cotton trade is even more important, as the
English " count " is the standard for the world.

CHANCELLOR OF THE EXCHEQUER : That is quite true ; it would
affect India, and I suppose America, and you have always to consider the
United States in this matter. There is no tendency whatever, as far as one
can see, in the United States towards the decimal system, no really definite
tendency.

Mr. DEAKESr : It is not like the coinage.

CHANCELLOR OF THE EXCHEQUER : T am speaking of the
weights and measures. It is very difficult to separate the two ; they are
related very much to one another.

Mr. DEAKIN : As will be seen from our resolution, our Parliament
contains a certain number of members who are deeph' interested in this, more
or less from theoretical considerations ; but the resolutions both about the
metric system and a decimal coinage relate to their use within the Empire.
It never has been contemplated in relation to either that we should set up a
standard of our own, and that is why we have to bring them forward
conditionally. The resolution as to decimal currency asks that it should be
applicable to the whole Empire. Of course, a statement as strong as you
are able to make at the present time, after your Parliamentary discussion,
does not encourage any debate on the merits.

CHANCELLOR OF THE EXCHEQUER: I, personally, was always
rather what j'ou woidd call an academic advocate of it. Some of the great
thinkers are not, and Herbert Spencer, for instance, was verj^ much opposed
to it.

Mr. RUNCIMAN : He was a duo-decimalist.

Mr. DEAKIN : Our resolutions on this point direct us to press for their
use within the Empire in each case ; in each case they desire an Imperial
scheme. Mr. Asquith himself is theoretically inclined to it.

CHANCELLOR OF THE EXCHEQUER: Twas, but lam not sure that
I am now ; I am a little weakened in my views.

Mr. DEAKIN : In any case it is sufficient, take whichever view you
please, if you tell us that there is no present prospect of eitlier of the systems
being adopted. Is there any chance of this suggestion that the manufacturers
and traders shoidd themselves institute an inquiry being carried out ? Your
colleague appeared to think it possible.

CHANCELLOR OF THE EXCHEQUER : I am afi-aid as regards three
or four of the leading industries in this country you would find it impossible,
thev would have nothing of the kind.

196

Sir JOSEPH WARD : We have legislation atlirming it. in our country 2.", April lf»07.

subject to Britain adopting it.

CHANCELLOR OF THE EXCHEQUER : xMukiug it cumpulsoiy.

Sir JOSEPH WARD : Providing it is adopted iu Britain, otliervvise it
would be no use to us.

Dr. JAMESON : It is the same with us ; it comes up regularly with us
and it is " when the Luperial Ciovernment passes a measure."

' II!'

Sir JOSEPH WARD : We have actually passed legislation giving the
Governor in Council power with regard to the matter.

CHANCELLOR OF THE EXCHEQUER : It is ol)vi()usly a thing in
which one part of the Empire cannot move without the rest ; It must be inter-
dependent and it is not worth doing unless ou an Imperial scale.

Sir JOSEPH WARD : I concur that unless it is Imperial iu its operation
ihci'e is no use troubling further about that.

CHANCELLOR OF THE EXCHEQUER : 1 am afraid there is no
present prospect of that at any rate.

Mr. DEAKIN : In face of the attitude of the Mother Country both the
metric system and the decimal currency are temporarily outside practical
politics ?

CHANCELLOR OF THE EXCHEQUER : I am afraid so.

Dt< IMAL

Bonds.

STAMP CHARGES ON COLONIAL BONDS. g^^,,,. charges

Colon
Bonds.

Mr. DEAKIN : You arc still going to levy stamp charges on Colonial ®^' Colonial

CHANCELLOR OF THE EXCHEQUER: I think we give you a good

deal there.

Mr. DEAKIN : If you have no intention of altering that either, whv

should we argue ?

CHANCELLOR OF THE EXCHEQUER: I think for the reasons
stated here, and we make a very good case, we have given you under the
Colonial Stock Act — as I had occasion to point out to you the other day,
and I do not want to exaggerate it at aU— what you ought to agree is very
substantial.

Mr. DEAKIN : That is a preference.

CHANCELLOR OF THE EXCHEQUER : It is a preference of a most
substantial kind, as compared with all foreign securities. I had a calculation
made the other day for the purposes of the Budget, and I was informed—and
I think it is an under-estimation rather than otherwise — that about 300 millions
of Colonial Stock had benefited by being admitted to the category of, and
treated as, trust securities.

Mr. DEAKIN : I notice, however, in this table, comparing the prices
in February 1900 and February 1907, the argument implies, and I

N 2

196

25 Apr;l 1907. suppose it has a certain meariure of correctness, that Consols may be takon

as a standard in respect of these securities, without regard to the continually

Stami- Char(;es changing circmnstances affecting them specially.
ON Colonial

Bonds. CHANCELLOR OF THE EXCHEQUER: All comparisons of that

(Mr. Deakiii). kind must be taken with a good many deductions, of course ; they are not

put forAvard as mathematically accurate, of course. There are lots of things

that happen in the interval, for instance, the war ; and great difficulties were

caused there.

Mr. DEAKIN : Yes. Besides the great prosperity of New South Wales
and New Zealand affects the prices of their bonds quoted here.

CHANCELLOR OF THE EXCHEQUER : All these must he regarded
as illustrations. They are not put forward as demonstrations, Imt I thinlc
the facts stated in that memorandum show that we are really treating the
Colonial securities with a preference of a verj" substantial kind as compared
with every other security, including some of our own — including a large
number of our own — considering the amount of securities that have been
issued by our own municipalities.

Mr. DEAKIN : We always make a broad distinction between our
municipal securities and State securities.

CHANCELLOR OF THE EXCHEQUER : Particularly if compared
. with foreign and leaving out mimicipal securities, we have given a very
substantial preference to the Colonies which I think ought to be regarded
as final for the time being at any rate.

1 think that concludes our Agenda, does it not, for the moment ? It
conies to this, Mr. Deakin, as far as you are concerned, that you would like
on the question of the silver coinage to have those fiu-ther particidars lor
which you asked and then to have a further discussion on the suljject.

u„nn.,: Pav- DOUBLE PAYMENT OF INCOME TAX.

"''^' Tax.^'"'"' Sir -JOSEPH WARD: Referring further to the question of double

])ayment of iucome tax, Mr. Asquith, I would like a little further information.
We have had a great many representations aboi;t it in New Zealand from
time to time. Take a shareholder in a company that is registered in England
and earns its money in New Zealand, assimiing he gets 1,OOOZ. as a dividend
from that company do you charge the income tax to the company on the
whole of its profits here, including of course the 1,OUO?., and then to the
individual shareholder on his 1,000/. too?

CHANCELLOR OF THE EXCHEQUER: Is he resident in New
Zealand ?

Sir JOSEPH WARD : U resident here.

CHANCELLOR OF THE EXCHEQUER: If resident Iicrc, if llir.
iucome tax is charged to the company then we are satisfied as far as we arc
concerned, and the company proceeds to deduct from his dividend his propor-
tionate share of the tax which they have paid to the Government here.

Sir JOSI'^PH WARD : And the shareholder is not charged again ?

CHANCELLOR OF THE EXCHEQUER : No.

197

IJr. .TAMESON : lie will bring iorward a staleineul, I pfesuiue, that he 20 Ai.ril 1907.

paid on that occasion.

Dorm.E Pav-
MEXT OK Inohsik

CHANCELI.Oi'v OF THE EXCHEQUER: Yes. If he is a person Tax.

entitled to an abatement ; that is to say, if his whole income is less than TOOL
a year, which is our upward limit for abatement, then he is entitled to an
abatement of sometliing between 701. and IGOL according to the amount of
his income, and he would be entitled pro tanto to have that refunded if the
company had taken the full rate from him.

Sir JOSEPH WARD : I ask the question because we have had
representations made rather the other way. Taking the case of a limited
liability company registered in London and with their shareholders here,
earning its money in our coiuitry upon which they charge him income tax on
their earnings there — whom do you charge — the company ?

CHANCELLOR OF THE EXCHEQUER : We charge the company.

Sir JOSEPH WARD : The shareholders are not resident in our country
at all in the case I am taking ; thej* are here. Amongst the representations
made is one that in our countiy the Company has first to pay income tax
to the New Zealand Government which is charged to the shareholders as a
whole, and then the iudivirUial shareholder pays again in England. That is
what we have been told.

CHANCELLOR OF THE EXCHEQUER : Tliey could not possibly.

Dr. JAMESON : In the case of those paying income tax on money
earned in the Colony, say that they registered a companj^ in London,
therefore the profits wovild be received in London and paid out in London,
and so they would pay a second time in London according to the present
conditions because, as put here in the case of this company Sir Joseph
Ward is talking about now, the income tax is a tax upon income received
in the United Kingdom. If the company is registered here the income
will be received in the United Kingdom and your man will pay. Yours is
the same as ours in the Cape wliich taxes only the income earned in the
country where the tax is in force, biit it will pay both there and in England.

CHANCELLOR OF THE EXCHEQUER: That may be, but I thought
the question was wlicther we collected the tax twice over, once from the
company and ouce from the shareholder.

Sir JOSI-yPH WARD: Yes.

CHANCELLOR OF TUE EXCUEQUVAl : And my answer was
addressetl to that question. We never get the tax twice over.

Sir HENRY PRIMROSE : No.

CHANCELLOR OF THE EXCMEQUEIJ : If you choose to tax him

you got it. There is nothing in international or muiiieipal law to lU'eveuL you
paying income tax twice, in two diil'erenl countries, if the laws of those
countries each allow it.

198
25 April 19or. Sir JOSEPH WARD : On the same earnings ?

Double Pay- CHANCELLOR OF THE EXCHEQUER: Yes, nothine whatever if

MEXT OF InCOJIK . . . . . . ^, ■ , V , • "^ T-i i l i

Tax. they insist upon it. it is not against the comity or nations. Does that

conclude everything ? Thank you very much.

199

SEVENTH DAY. Seventh Day.
26 April 1907.

Held at the Colonial Office, Downing Street,
Friday, 26th April 1907.

Present :

The Right Houourable The EARL OF ELGIN, K.G., Secretary of State

J'or the Colonies (President).

The Right Honourable Sir Wilfrid Laukier, G.C.M.Q-., Priuw; Minister
of Canada.

The Honourable Sir F. W. Bouden, K.C.M.G., Minister of Militia and
Defence (Canada).

The Honourable L. P. Brodeuu, Minister of Marine and Fisheries

(Canada).

The Honourable Alfred Dkakin, Prime Minister of the ( 'onmionwealth
of Australia.

The Honourable Sir W. Lyne, K.C.M.G., Minister of Trade and
Customs (Australia).

The Honourable Sii- Joseph Ward, K.C.M.G., Prime Minister of New
Zealand.

The Honourable L. S. Jameson, C.B., Prime Mhiister of Cape Colony.

The Houourable Dr. Smartt, Commissioner of Public Works (Cape
Colony).

The Right Honourable Sir R. Bond, K.C.M.G., Prime Minister of
Newfoundland.

The Honourable F. R. Moor, Prime Minister of Natal.

General the Honourable Lottis Botha, Prime Minister of the Transvaal.

Mr. Winston S. Churchill, M.P., Parliamentary T>nder Secretary of

State for the Colonies.

Sir Francis Hopwood, K.C.B., K.C.M.G., Pennanent Under Secretary
of State for the Colonies.

Sir J. L. J^Iacivay, G.G.M.G., K.C.LE., on behalf of the India Ollice.

. H. W. Just, C.B., C.M.G., \ r ■ , c ,
. G. W. Johnson, C.M.G., j ^"^^* ^^^^^^"^•'

at' /-I ITT T. ..;.',„.. ri -M r^ ' Y Joint aecretartes.

Mr. W. A. Robinson,

Assistant Secretary.

Also present:

The Right Honourable The Lord Chancellor.

The Right Honourable The Earl of Crewe, Lord President of the
Council.

N 1

200

Seventh Day. Mr. H. Bertuam Cox, T'.B., Legal Assistant Under Secretary of Stat(

26 April 1907. for the Colonies.

Mr. E. S. Hope, O.B., Registrar of tlie Privy Council.

Uv. A. W. FiTZROY, C.V.O., Clerk to the Privy Conncil.

Imperial Court IMPERIAL COURT OF APPEAL.

OF Appeal.

CHAIRMAN : Gentlemen, we proceed to-day to the question of Judicial
Appeals. We liave before us two resolutions, one proposed by the Common-
wealth of Australia and another by the Cape Colony. I think Mr. Deakin is
ready to speak to the Australian resolution.

Mr. DEAIvIN : My Lord, my Lord Chancellor, and gentlemen, the
resolution of the Commonwealth of Australia is simplj^, " That it is desirable
to establish an Imperial Court of Appeal," by which it is intended to convey
a single Court of Appeal for the whole Empire, instead of as at i:)resent
retaining dual Courts, the one dealing with cases from India and the self-
governing Colonies, and the other dealing with cases arising within the
United Kingdom. It is unnecessary to go further back than the time of the
passage of the Commonwealth Constitution through the British Parliament,
when the question of appeal arose in relation to the discussions as to the
proposals in regard to appeals made in the Commonwealth Constitution, at
the verj^ outset of the discussion between the then British Government
and the representatives from Aiistralia who were charged with attendance
here during the passage of that BiU. In the very first document that
we received from the Government of the United Kingdom occurs a
memorable passage. It is headed, " Memorandum of the Objections of
" Her Majestv^'s Government to some provisions of the Draft Commonwealth
" Bill." I quote the statement made by the Government on page 152 of
the volume of " Debates in the Imperial Parliament with Appendices,"
published in 1901 from the British Hansard : " Proposals are under considera-
" tion for securing a permanent and effective representation of the great
" Colonies on the Judicial Conmiittee, and for amalgamating the Judicial
" Committee with the House of Lords so as to constitute a Court of Aj^peal
" for the whole British Empire." Again, on page 156, in a telegram from
the then Secretary of State for the Colonies, Mr. Chamberlain, to the
Governors of the Australian States, there is this, sub-paragraph 7 : " Her
" Majesty's Government feel that the actual restriction of the i^ower claimed
" to make fiirther restriction equivalent to the practical abolition of appeal
" would be specially inopportune at the moment when thej^ are considering
" the terms of a Bill for enhancing the dignitj'^ and promoting the efficiencj'^
" of the Judicial Committee by practically amalgamating it with the House
" of Lords and providing for permanent representation of the great Colonies
" in a new Court which it is proposed to create." In consequence of those
statements and their discussion then a Colonial Conference was called in 1901
■ — what would be now termed a subsidiary Conference — for the purpose of
considering this special question. Perhaps before referring to that I might call
attention, for the sake of those who are sufficiently interested to pursue the
course of this question, to the debates which followed in the Hoiise of
Commons when the Commonwealth Bill was under discussion. There are
a series of statements made by the Secretary of State for the Colonies,
l\lr. Chamberlain, who repeated the projiosal for the amalgamation of tiie
Ju(b'cial Committee of tlie Privy ^Council with the appellate jurisdiction of

tlio House oi Li)i-(ls as one of the groimds on wliicli lie resisted certain Scvfurh Duy.
amciHliiients of tliat Hill. Apart Ii-oni Mr. Cliamberlain a nunil)er of other 26 April 1907.

Members spoke, including Mr. Haldane, who pointed out that this proposal ,

of the Government was one wliich he and others had long supiiorted. Mr. I"'''^«Y'' *:."^'*'^

. . , ( -) 1 • 1 • 11 • 1 1 { 1 1- 1 '"'" Al'i'EAL.

Asquitli, at page -iz, also gave m his adhesion as one who looked lorwarii (Mr. Deukin.)
" to the constitution of a real Imperial Court of Supreme Appeal, a Couri,
" not to be forced on the Colonies against their will, but a Court of such a
" character and having such attributes as would appeal to every part of
" the Empire." Mr. liryce, another distinguished authority, at page 53,
echoed the hope that the Imperial Parliament would proceed with the
creation of this Court. The member for Dumfries Burgiis asked the
Committee to consider for a moment the real importance of the Appeal to
the Privy Council which he thought very desira1)le to retain if we could, but
admitted that it ought never to be imposed on the Colonies unless they
wished it. At the conclusion of his remarks he said that " the proposal
" then before the House would do no harm he believed to the " — Australian —
" Constitution, and certainly it contains no element of injustice or
" unfairness, but if they do not think so, and continue to express what
" exists to a considerable extent in Australia, a decided preference to the
" form of Bill to which they all agreed in the first instance, I would express
" the hope that the Government even now, after having done their best
" according to their own view of their duty, will revert to the Australian
" view." We were therefore encouraged to hope a good deal from the
Conference which followed in 19t)l, at which Canada, Australia, New
Zealand, South Africa, the Crown Colonies, and India were represented by
nominees. But the result of their discussions — the discussions themselves,
I think, have not been published — was that a majority consisting of five of
the members signed an unqualified reconuuendation tluit appeals should
continue to lie from the Colonies and from India to His ^Majesty in Council.
They went on to make certain suggestions that the appointments to the
Judicial Conuuittee should be made from the Dominion of Canada, the
Commonwealth, New Zealand, Soutli Africa, and so on ; the appointments
should be for life or for a term of years not less than 15 years, and arrange-
ments should be made for securing a larger attendance of Lords of Ai)peal
at sittings of the Judicial Connnittee. The recommendations of the five
ended there. Though these suggestions for the improvement of the Court
were endorsed by two other mem])ers, Mr. Justice Emerson and Sir James
Preudergast, I am not aware how far any steps have been taken to give
effect to any of the recommendations at which that Conference almost
unanimously arrived. I am quite in the dark as to any arraiigemeuts since
made for securing a larger attendance of Lords of Appeal at sittings of the
• ludicial Committee. Cases have occurred — one case qxiite recently, of a
very grave and serious character, to which 1 shall jiresenlly call some
attention — in which the presence of a larger comn)ittee would have been
extremely desirable. After the five signatories, Mr. Justice Emerson specially
added that he signed subject to the j>roposal that had been made for the
establishment of an Imperial Court of Appeal for the Empire. Jn the same
way Sir James Prendergast on ])ehalf of New Zealand signed subject to
the establishment of a new final Court of Appeal for the whole British
Dominions. Mr. Justice I lodges of \'ictoria, the representative of the Conunon-
wealth, added on our behalf not only a dissenting opinion but a further
request repeated at our d(>sire for the establislnuent of one Court of Final
Appeal. Three members of the Conference declared for an Imperial Ccjurt
of Final Appeal.

That, 1 tliiiU<, represents, as far as it is necessary to deal with it at
this time, the immediate history of this proposal.

202

Seventh Day.
26 April 1907.

Imperial Couut
OF Appeal.

(Mr. Deakin.)

Since those events the Government, and, I think, the great majority
of the Parliament and people of Australia, have not altered their attitude
upon this question. They are no more contented with the present condition
of appeal cases than they were in 1900 or 1901. Nor are their sentiments
likely to alter after the judgment given lately in an Australian case in which
two matters of vital importance came before the consideration of the Judicial
Committee. The first question related to the right of hearing an appeal at
all under such circumstances ; the second related to the principle of inter-
pretation to be adopted in respect to the constitution of the Commonwealth.
The two taken together raised the most fundamental public issues for Australia
that could well be summarised in any single case. It was heard by two Lords
of Appeal, one of them the late Lord Chancellor, and two Colonial judges —
a Court of four. If my memory serves me rightly, within two or three weeks
of the hearing of that case a Court of exactly twice the same str. :gth — four
Lords of Appeal and four other judges — assembled to rehear a case which,
so far as its financial subject-matter was concerned, affected the sum of 6001.
in the State of New South Wales. Of course, it is impossible to suggest,
even in the vaguest way, any scale of proportion by which the relative
importance of cases can be judged. Great principles may possibly arise in
connection with the smallest suras and slightest personal transactions. But
in the one particular case, as I have said, the scope of the Commonwealth
Constitution from a judicial aspect was in a measiire at stake. We cannot
think, and cannot for a moment admit, that under such circumstances the
arrangement by which that attendance of judges was obtained was satisfactory.
We are aware of the special manner in which this Court is constituted.
Attention has been called to that for many years. During the Australian
Convention, which resolved Tipon jjroposals restricting the Appeals to the
Jiidicial Committee of the Privy Council, that Avas one of the grounds upon
which a very decided view was talsen. Although alterations have been made
from time to time and decided improvements of late, it is evident that, even
regarded in its jpresent condition, the system adopted is by no means
satisfactory to us, nor, I think, is it satisfactory to niauy other than Australian
litigants.

The aim that we have was well expressed in course of the debate on the
Commonwealth Bill, if my memory serves me, by the Right Honourable
R. B. Haldane, when he said that he understood the Colonial view to be that
what in the shape of a Court of Appeal was good enough for the people of
Great Britain was qiiite good enough for ihe Colonies, and what was not
good enoiigh for the people of Great Britain was not good enough for
Colonial litigants. That was a very pithy way of putting the case as it
presents itself to us. We venture to entertain the opinion that notwith-
standing the theory of its relation to the Crown, but from a purely legal
poiut of view, the House of Lords is the tribunal to be preferred. It
certainly stands higher in the estimation, at all events, of Australian lawyers
than the Judicial Committee of the Privy Council, speaking of it, of course,
as a Board and not under special circmnstances. If the two are to be
compared, having some regard, of course, to the differences in their procedure,
the House of Lords is preferred in Australia. The fact that in the case of the
Judicial Committee you get but one judgment has its advantages in the way
of simplification, and does not promote doubts which might otherwise arise,
bixt it leaves us absolutely unaware whether that jiidgment was arrived
at by a majority of one or by the unanimous consent of the whole of the
distinguished lawyers who form that Court. It has to be taken or left. The
practice of the House of Lords, which at the sacrifice of some apparent
simplicity does afford a great many lights upon every question submitted,
often from a number of quite individual standpoints, leads our litigants, as

2U3

far as I know their opiuiou, to prefer that method oJ" disposing of tlieir cases. iscvcnth Day.

It is uot so much on grounds of this character that we put forward this plea 26 April 1907.

for a single Court of Appeal, but rather on the ground that what we all desire,

and should desire, is the establishment of the very best Court of Final Appeal ",', k ' aVI-eal""

that can possibly be constituted. We believe tiiat even tlie wealth of le<ial ... ,, ,. \

knowledge and experience in this country, supplemented as it might be fi'om

the Outer Emj)ire from time to time, can scarcely be divided into two Courts

without one being less effective, or, what is ahnost the same, obtaining less

confidence than the other. Of course the fact that those members of the House

of Lords who are Law Lords participate in the Judgments of the Privy Council

has added the great weight which they Ijriug. In the Judgments of the

Privy Council, wliich are understood to have been much appreciated in the

Dominion of Canada, it was generally, I Ijelieve, considered that the most

prominent part in shaping them was taken by Lord Watson, a very eminent

and distinguished Judge, whose services were at least equally available in

the House of Lords.

Consequently, with the aim of obtaining if possible the veiy best Court
which the Empire can fiu'nish, and making it the strongest Court of Appeal
without rival or fellow, we are attracted not merely by the symmetry of the
proposal but by the fact that it would afford an assurance which Ave consider
we do not at present enjoy, that in regard to appeals from Australia, for
which alone I claim to speak, we would receive the Ijenefit of the very best
and strongest Court available. Comparing the Judicial Committee of tlie
Privy Council, as we see it, with the House of Lords, our opinion is that
of the two the latter is the more desirable Court.

The present proposal has become compHcated of course by the fact that
the representative Conference which assembled in 1901, although it consisted
of delegates only, did, by a majority, decide in favour of the retention of
the appeal to the Privy Council. I hasten to say that nothing is further from
our intention in making this proposal than while both Courts remain to
require those communities who prefer to appeal to the Judicial Committee
of the Privy Council to be diverted to any other tribunal on our account,
or for the reasons which commend themselves to us. I have, therefore, by
way of supplement, to say that our desires would be satisfied if His Majesty's
Government could provide, by Order in Council, or if not by Act, that it
should be possible for any of the King's Dominions which intimated its
desire in a formal manner to transfer its appeals, while the present sj'stem
of two Courts is maintained, from the Judicial Committee of the PriA';}'
Council to the House of Lords. Under that plan those who for one reason or
another are satisfied to lie within the jurisdiction of the former, would remain
as at present, their appeals following the existing course ; while on the
other hand the Commonwealth of Australia, and any other dominion which
on the whole, talcing all things into consideration, prefers to have the law
interpreted in the last resort by the House of Lords, would have the benefit
of coming under its jurisdiction. That, I take it, would in no sense disturb
either system. It would make some further demands upon the Lortls of
Appeal ; it would increase the amount of business before them, though, I
think, having regard to the lists with which they already deal, that it would
not be by any means a serious increase, that is to say, sufficiently serious to
render it a matter of moment. It would be a source of satisfaction to us in
Australia. It would not interfere with the equally free choice of any other
part of the Empire.

Although I feel some difficulty in alluding to the Judgment of tlie
Judicial Committee of the Privy Council, to which I have already referred,

204

Seventh Day. upou tlie appeal wltli relation to iucome tax sought to be levied hy tlie

26 April 1907. States of Australia upon officers of the Federal Government, yet I cannot

^ complete what I have to saj^ in this connection without calling attention to

Imi'erial Lci:;! ^^ situation that mav possibly arise in connection with that case which is not

O F A. P 1* E A L . ....

/ ... ", an unexpected situation, since it was clearly foreseen by the leading states-
^ '■ ^" ' men who took part in the debates upon the Commonwealth Bill at the
time it Avas passing through your Parliament. As you, my Lord, are well
aware — and probably our colleagues have some recollection of it — the
proposal ultimately placed in our constitution limited appeal to the Privj'
Council, and conferred iipon the High Court of Australia what we believed
to be and intended to be final jurisdiction in matters relating to the
interpretation of our own constitution. But, owiiig partly to differences of
opinion between ourselves as delegates, the majority of the British
Parliament, led by the Government of the day, introduced amendments in
that constitution which left us in a position of some uncertainty. I do not
wish to detain the Conference more than to refer very briefly to the fact that
Mr. Haldane, at page 07 of this report of the Debates, was, I think, one of the
very first to call attention to a remarkai)le situation that might possibly
arise in the future. I think it maj' very reasonably be expected to
arise either in connection with this case to which I have referred, or to any
decision Avhich follows the principles it lays down. Mr. Haldane pointed out
that " the clause provides that if you have litigation in a State upon a
" constitutional question, you may appeal either to the Privy Council or to
" the High Court. If you appeal to the High Court, the decision is to be
" final unless the High Court gives you leave to appeal to the Privy
" Council. It is, in other words, a court of final jurisdiction upon this
" matter." Then he coutimies, "As the clause makes the High Court
" of Australia a court of final jurisdiclion, there may well be conflicting
" decisions between the High Cotn-t and the Privy Council. I do not think
" that is an academic matter." The Attorney-General of the day, Sir Robert
Finlay, achnitting the apparent conflict, maintained that under such circxun-
stances the High Court would necessarily as of courtesy, and from a sense
of subordination, accept the ruling of the Judicial Committee ; but
members on his own side were doubtful, and those on the other side of
the House, and an authority as eminent in such matters — that is, matters
relating to a federal constitution — as Mr. Bryce, the present Ambassador to
the United States, repeated the warning that the constitution as amended
left these two tribunals in danger of conflict. He said-— when replying
to the Attorney-General — " He sviggested that imder the Amendment the
" Committee is now discussing the High Court of the Commonwealth of
" Australia will not be a court of co-ordinate jurisdiction with the Privy
" Council, and that it will be bound to follow the decisions of the Privy
" Council. I cannot feel by any means so clear as my right hon. and learned
" friend on that point, because we are here making a special provision for a
" special case." He said again : " Stirely it will not only be within the
" power of, but also the dtity and the right of the High Court to give full
" ett'ect to that provision of the Australian constitution, and to say, ' We are
" ' in this particidar matter made a final court of appeal. In all other
" ' matters we are undoubtedly a subordinate court, unless in a particular
" ' matter we are made a court of co-ordinate jurisdiction.' They
" would say : ' The only appeal is to lie from us, where we are satisfied
" ' there is some special reason ; we are bound to carry out the intention
" ' of the people of Australia and of the Imperial Parliament in not going
" ' beyond the express provision ; they have given no appeal unless special
" ' reasons, in our opinion, exist.' I think, therefore, that it will be open
*' to the High Court in future to hold that in this matter they are a court,

2(Jo

" uot of subordinate jurisdiction, hni of co-ordinate jurisdiction. 1 cannot ^>i'^i'"tli lifty.

" assent to the argument that, liecause they are subject to appeal in other 26 April 1907.

" cases, they are suldcct to api)eal in this case also." And lower down he ,.,,,. ~,,

says : i tnmk it necessary to enter a protest against the view the Attorney- ^,^■ ai-i-kal.

" General has taken on this point." I will not venture to delay the Couiorence z^^,. i)i.,,kj,|_)

l)y reference to the varying opinions expressed by ditl'erent ineinl)ers.

There was conflict of opinion then that pointed to the conflict in the future.

Perhaps I may be pardoned if I refer to the debates in the House of Lords, in

which the late Lord Davey viewed this very question. He dealt with it in

a very clear and emphatic fashion. At page 101 he is reported to have said :

"Clause 74" — that is the clause in question- — "as it stands is a perfect

" solecism in jurisprudence, and for this reason, that it creates two final

" co-ordinate courts of appeal, neither of which is bound by the decision of

" the other." Omitting some sentences, he goes on : " The Judicial Committee,

" of course, is not bound by the tlecision of the High Court, nor, as

" I understand, is the High Court bound to follow the decisions of the

" Judicial Committee in matters of this kind. They may, therefore, each

" maintain their own opinion. I know that the answer that may be made

" to me is that the Australian judges are men of such high principle and

" good sense that they will find some way of either agreeing with the

" .Judicial Committee or of allowing the matter to be finally decided.

" Tiiey may ; but it lies in their discretion, and unless they do so you will

" have two co-ordinate Supreme Courts of Appeal from the same courts

" on the same class of subjects deciding in entirely different ways. That,

" I venture to think, is a solecism in jurisprudence." Finally, the late

Lord Chief Justice of England (Lord Russell) at page 109 is reported to have

said : " The third and last point to which I will call attention is this. While

" there is no appeal according to this clause from the High Court exce]it

" by leave of that court, in the cases mentioned, there is an appeal from

" the decision of the State Court to the Queen in Council, and thereupon

" arises the conflict to which reference has been made— which court is to

" prevail ? I do not seek to dogmatise upon this matter, as to which there

" are obviously, from what my noble and learned friend has said, ilifferent

" opinions ; but I fail to see anything in this Bill asserting directly

" or indirectly, that where the decision of the Privy Council conflicts with

" the decision of the High Court, the decision of the Privy Council is to

" prevail. I see nothing to that effect expressed certainly, and nothing 1

" think to be implied. When I remind your Lordships that the clause

" expressly says that the High Court shall be the final judge in the matter

" unless it chooses to give leave, surely that does lay a solid and reasonable

" foundation for the contention that it is thereby, as regards matters so

" dealt with in the clause, created the final court, and therefore co-ordinate

" with the other final court, namely, the Privy Council. It seems to me

" that that is a difficulty which will very likely arise." Lower down he

says : " It seems to me that the conflict is inevitable."

I am, therefore, bound to consider the possibility that when the recent
Judgment of tlie Judicial Committee of the Privy Counc-il comes before
the High Court of Australia, as I understand it will within the next two
or three nionvhs, that out of this grave decision in the Income Tax case that
very conflict of opinion may arise. Such a contingency, even if only referred
to by way of illustration, suggests the advantage to be derived by the
acceptance, so far as Australia is concerned, of the proposal embodied in this
Resolution. The anomaly to which Lord Davey called attention remains and
is likely to remain a cause of serious inconvenience, perhaps of very serious
loss and cost to the Conunonwealth of Australia. That is, when in this

206

Seventh Day. case, Or some other case, some discrepancy becomes flagrant between tbe
26 April 1907. judgments of the two courts, which are in certain respects co-ordinate, and
, , , _ both of which are in terms final Courts of Appeal. Therefore, while not

OF Appeal. desiring to press for more consideration than we are entitled to on this head,
(Mr. Deakin.) "'■ submit, first, my general resolution with the qualification that it is not in
any way desired to be imposed upon any of the other Dominions who may
prefer to remain subject to the existing jin-isdiction. Supposing the Imperial
Court of Appeal is rejected, if His Majesty's Government, for one reason
or another, does not think fit to proceed with the distinct proposal made in
1900, and then apparently very generally approved, and .if our request
cannot be complied with because of differences among ourselves, or for
other reasons, perhaps His Majesty's Government would give their attention
to the suggestion of an optional appeal — not in each individual case, but
for all cases from Australia. Then, if necessary, after legislation by the
Commonwealth Parliament, all appeals from us might go to the House of
Lords, instead of, as at present, to the Judicial Committee. I make that
suggestion in order to clarify our position, and to remove all appearances
of pressure on other dominions, but not to detract fi'om our opinion that
the best possible manner of meeting the situation is the acceptance, as
early as may reasonably be possible, on conditions to be laid down by His
Majesty's Government, of the proposal for one court for the Empire.

Finally let me refer to the protest of Mr. Justice Hodges, the very
able representative of Australia in 1901. His concluding words relating
to this proposition are, " Such a court " — that is one Imperial Court of
Appeal for the whole Empire, sitting perhaps in two Divisions, and with
certain ai-rangements which it is not necessary to dweU upon, " would
" bring the best legal thought in the United Kingdom in touch with the
" best legal thought in the Empire outside the United Kingdom. It would
" . be a wonderfully strong court, and command the admiration and respect,
" not only of the whole British race, but of every race in the British
" dominions. It would be a powerfid factor in the development of a closer
" union between all parts of the Empire. In the British dominions it would
" obliterate in the administration of justice all distinctions between places
" and persons. Just as there is one flag to protect the subject from external
" assault, so there would be one court as the final arbiter of internal
" disputes." That is our view. We think it is a great ideal, and one which
ought to be served. We have not thought it necessary to appear to criticise
the Judicial Committee of the Privy Coimcil in its methods or manner. In
" The Life of the late Mr. Henry Reeve " there is a great deal of light
throvra iipon the manner in which the Board was then constituted — that
is the Judicial Committee — and apparently it is still open to the same
vicissitudes. With that great ideal before us, we respectfully submit the
resolution which I have the honour to move.

Sir WILFRID LAURIER : I would not like to speak at this moment.
I see that Cape Colony has also proposed an elaborate resolution on this
question, and I would like to hear what their representative has to say.

Dr. JAMESON : The resolution of the Cape Colony is more on detail
matters than the very large siibject brought forward by Mi-. Deakin, and I
would only say with regard to that general subject, we have entire sympathy
with Mr. Deakin in desiring a final Imperial Court of Appeal. Of course, as
to what that Imperial Court of Appeal should be, and what form it should

207

take, T must say, I think, from the South African point of view, we would Seventh Day.
differ from Mr. Deakin. We wonld rather it existed as coiistitiited at present -R April 1907.
— the Judicial Committee of tiie Privy Council- than the House of Lords, , ^ . . ,,„„„,

1 ,. 1 • TTT • >i 1 « ^ • 1 1 iMPEHIAl. COURT

and for a very obvious reason. We, in bouth Africa, are more or less under ^^. aiteai..
Roman Dutch law which, I imderstand, differs considerably from the t^nglish , j^j^. jm^gjon.)
law, and there is provision for this in an appeal to the Privy Council, and
we have a very able representative ou that court at present, who is an
acknowledged authority on Roman Dutch law, and naturally, from our
point of view, we woidd rather the final Court of Appeal should take that
form than the House of Lords where, of course, no such representative
could sit.

Mr. DEAKIN : The proposal of Mr. Justice Hodges especially provided
for the case of Roman Dutch law and local law.

Dr. JAMESON : That would remove my objection. I would not care
which it was, but one final court appeals to us very much.

With regard to the Cape Colony Resolutions, after studying the papers
with which we have been furnished ou the subject, I find a good many of our
suggestions have been met ; in fact 1 may say that practically the onus is
thrown upon the Colonies, and not ujjon the procedure of the Judicial
Committee of the Privy Council, for any delay or extra expense that may
occur. Still T think, perhaps, it would not do any harm that these four
sub-resolutions should be passed as an indication that we are desirous of
minimising delay and curtailing expense as far as possible. But since these
Resolutions from Cape Colony were sent in, my colleagiies from South iVfrica,
— General Botha and Mr. Moor — and myself, have met together and have
formulated some further proposals wliich we should like to bring before the
Conference, which General Botha wiU propose presently. They mainly
relate to our own local affairs. At the same time they also relate, if I am
rightly informed, to the condition of the Appellate Courts in other Stales
too. We, in South Africa, are very anxious to get established a final
Court of Appeal in South Africa for all the various States. Of course,
supposing Federation comes about, that would come naturally. We believe
Federation is coming immediately, but stiU we feel that it would
be advisable that we should prepare at once, and get established if
we can, as part of that Federation and even before that Feileration,
a liual Court of Appeal in South Africa. Our present position is we have
a Supreme Court in each of the Colonies. We have other District Courts.
There is an appeal from a District Court to the Supreme Court. Similar
cases occur in the various Colonies, and we are faced with absolutely
dissimilar decisions in the vari(;us Colonies, which naturally leads to a good
deal of discontent. So we are anxious that we should have a final Court of
Appeal for the whole of South Africa, but that will entail considerable expense,
both to set it going and maintain it afterwards, and we feel that we would
not, unless the various States are in agreement on this subject, be justilietl in
undertaking that expenditure unless we were permitted, which I understand
is the word to use, by His ^lajesty's Government to ])ass legislation in our
own various Colonies, taking away the right of appeal from the Supreme
Courts in each of the Colonies to the Judicial Committee of the Privy Council.
1 think that possibly might suit some other States also, and we should aU be
anxious to do it. So that our Supreme Court of Appeal would be a final
Court of Appeal except that it might be put into the Statute by which it is
created that ou certain subjects--possibly on relations between the various States
and so on- there might be permitted an Appeal to the Privy Council by per-
mission of that Supreme Court. Those cases would be very few. So really it

208

Seventh Day. woald be a final Court ol: Appeal sci far as we are concerned, except in special
21) April 1907. cases which would be laid down \t the same time, I would add that the

prerogative of the King — the right of every citizen of the British Enipire to

Imi-ehiai.Couut appeal to the King — must be carefully safeguarded, but that would
practically not be used, because I understand, supposing the right of appeal
(1 I-. iiTiie.soii.) ^^,_^_ refused in a particular case by the Appeal Court to the Privy Council,
and an individual still wished to go to the Privy Council, as his right is, of
course, the practical point is that if he won his case or lost it, he woidd still
have to pay all the costs, which would be a considerable deterrent to anyone
taking that extreme action.

1 think I will leave General Botha to lu'ing forward these further
resolutions.

Sir JOSEPH WARD : Who do you suggest would" constitute the
:5uperior court — the final (Jourt of Apj)eal in South Africa ?

Dr. JAMESON : Judges selected in South Africa by all the Stales in
South Africa.

Sir JOSEPH WARD: Judges who hud previously tried portions of the
cases ?

Dr. JAMESON : No, we would like, idtimately, when the business was
large enough, to have separate judges for it, but as a tentative measure they
might be selected from the various States, and if there was not enough work for
the judges to do in the Appeal Court they might be the superior judges in the
various States. That is a detail to be managed out there, but the idea would
be that the judges of the final Appeal Court would have their time occupied
as judges of that Court.

Mr. DEAKIN : With the jurisdiction you propose T do not think there
would be much doubt about that.

Sir JOSEPH WARD : No, I think not.

General BOTHA : My Lords and gentlemen, I have little to add to what
Dr. Jameson has said. We have a Memorandum. If the Chairman thinks it
necessary, I should like to hand in this Memoranckun so that the other Premiers
may peruse it. There is a resolution attached to this Memorandum which
we should like to support. Dr. Jameson has rightly remarked that there is a
great desire in South Africa to establish a Court of Appeal, and, although
we have there four Colonies, we think that we can commence Federation l)y
establishing this Appeal Court for South Africa ; specially also because this
will in a great measure reduce the amount of costs, and it will be specially
advantageous to the poorer classes who cannot aiford to carry appeals to the
Privy Council, to go to a Court of Appeal in South Africa. I will, therefore,
ask lea\ e to hand in this Memoranchun, and I shoidd like to add tcj that
Memorandmn the resolution which we, the Premiers of Soiith Africa, have
arrangi^d to support.

CIIAIPMAN : I think it would be belter if von would read boti).

209

The Memorandum and Resolution were read as follows : — Seventh Day.

26 April 1907.

MEMORANDUM.

Impehial Codrt
Question of Jddicial Appeals. »'•■ Ai-i-eal.

There is no objection to the Resolution of Cape Colony on the question
of Judicial Appeals, but it does not go far enough.

There is a general feeling throughout South Africa in favour of the
establishment of a South African Court of Appeal to which appeals would lie
from the decisions of the Supreme Court of each of the South African Colonies,
even before a federation of these Colonies becomes an accomplished fact.

It has been urged, however, that the expense of establishing and
maintaining such a court would not be justified as long as there is a right of
appeal from the Supreme Court of each Colony to His Majesty in His Privy
Council.

If a Court of Appeal is established it is considered most desirable that
this right of appeal to the Privy Council should Ije taken away, so as to
prevent a litigant dissatisfied with the decision of the Supreme Court of a
Colony passing by the Court of Appeal and prosecuting his appeal from such
decision, before the Judicial Committee of the Privy Council.

It is also desirable that when such CVmrt of Appeal is established, its
decisions should be linal, excepting in certain matters in which that Court may
grant leave to appeal to the Judicial Committee of the Privy Council. These
matters would, of course, be prescribed in the statute establishing such a
court. The right of any litigant to apply to the Judicial Committee of the
Privy Council for leave to appeal to it from a decision of the Soiith African
Court of Appeal should not in any way be curtailed. The following
resolution is suggested : —

(1) That when a Goxnt of Appeal has been established for any group

of Colonies geographically connected, wdiether federated or not,
to which appeals lie from the decisions of the Supreme Courts
of such Colonies, it shall be competent for the Legislature
of each such Colony to abolish any existing right of appeal from
its Supreme Court to the Judicial Committee of the Privy
Council.

(2) That the decisions of such Court of Appeal shall be final but leave

to appeal from such decisions may be granted by the ssaid Court
in certain cases prescribed by the Statute under which it is
established.

(3) That the right of any person to apply to the Judicial Committee

of the Privy Council for leave to appeal to it from the decision
of such Appeal Court shall not be ciu-tailed.

CHAIRMAN : Do you wish to add anything, Mr. Moor ?

Mr. F. R. MOOR: No, my Lord, 1 have nothing to say. We have
considered it together.

Sir WILFRID LAURIER : Jly Lord and Gentlemen, I have listened
with great care and attention to the view presented by Mr. Deakin in support
of the resolution which the Conunonwealth of Australia have laid before
the Conference. But if I understood him aright his argument was rather
an indictment of the Constitution which was finally passed by the British
Parliament for the Commonwealth of Australia in this : that that provided
for two appeals from the decision of its own courts. As he has presented

i 4866'*. O

no

Seventh Day. the matter to us, the diiahty of appeal must necessarily lead to some

26 April 1907. confusiou, and so far as it goes it seems to me his argument cannot

he successfully met, and nobody now would he interested in opposing

OF Appeal ^^- "^^^ British Parliament no doubt can remedy the evil since they are

f Sir w Laiiricr ) ^^^^ paramount power, but perhaps they would have some hesitation in

interfering and making Avhat would practically be an amendment of the

constitution of a federal country.

Mr. DEAKIN : That we have not asked for.

Sir WILFRID LAURIER : No, and I believe the British Parliament
would hesitate also to do it iintil they had heard from the dift'erent states
which composed the Federation.

Mr. DEAKIN : Even in that case we should not ask for any intervention.

Sir WILFRID LAURIER : As I construe it the resolution which you
have presented, " that it is desirable to establish an Imperial Court of
Appeal," would be practically an amendment of the Constitution of
Aiistralia.

Mr. DEAKIN : No.

Sir WILFRID LAURIER : Yes, since there are two appeals granted, if
you destroy one I take it to be an amendment of the Constitution.

AVith regard to the question of a Court of Appeal in South Africa, so far
as it concerns the Conference I do not know that serioiis objection can be
taken to that. If the three Colonies or dependencies in South Africa
are agi-eeable to have a Court of Appeal for themselves, nobody else can take
exception to it. It seems to me to lead in the direction of immediate
federation. If they have a Court of Appeal for themselves, this leads to the
ultimate and proximate creation of a federation for all purposes. This woidd
certainly be in the best interest of themselves and the Empire.

So far as Canada has any concern we have an appeal to the Judicial
Committee of the Privy Council, and it has, as a general rule, given very great
satisfaction. I do not know that all its decisions have been accepted. There
are few courts which have not their decisions criticised within twenty-foiu'
hours, but as a rule the decisions of the Privy Council so far as concerns
Canada have been eminently satisfactory. At the same time everybody must
recognise that the constitution of the Court is not, perhaps, quite in accordance
Avith the modern age and tendencies. The point made out by Mr. Deakin,
that the constitution of the Court may be one day four and the next day eight
is certainly a point well taken, and is liable to create dissatisfaction, and,
perhaps more than dissatisfaction, serious complications. It seems to me that
the Judicial Committee of the Privy Council should be remodelled if it is to
be maintained. I may say that in my country the views of the j)eople are not
all in accord as to the retention of that appeal. Some jurists have maintained
that any country oiight to be able to interpret its own laAvs, that is to say, the
Parliament Avhich creates the laws should be the Parliament to create the
tribiuial to interpret those laws. There is a great deal of force uudotibtedly
in that view. On the other hand thei'e are some jurists of equal eminence
who believe that taking us as avo are at the present time a part of the British
Empire, in Avhich so many questions of Imperial interests must necessarily
arise even in the loAvest courts, it Avould be a good feature to retain the present
appeal to the Judicial Committee of the PriA'y Council. The present Minister
of Justice, as able a man as Ave have ever had in Canada, is of this opinion

211

to-rlaj', though some of his prodecessors, an.J, I believe, his predecessor in 1901, Seventh Day.
hehra different view. But there is a serious question, a serious conllict of 26 April 1907.

opinion when you come to the question of the jurisdiction of this Court. ~"

Under the Canadian Constitution the adnuuistration ot justice docs not of Appeal.
belong to the central government but to the Provincial govcrnmouts. So ,gj^ ^ Laurier.)
that we have only one court in our country of a federal character, that
is the Supreme Court, which is a Court of Appeal for the Provinces. But the
provinces themselves have retainetl their jiuisdiction and kept the liberty of
going to the Privy Council, so that practically whilst the Dominion of Canada is
represented at this Conference, the provinces of the dominion, in so far as
they have retained for themselves tlie administration of justice, are not
here represented, and it would be a delicate matter to pass finally
without consTiltino; them a question of so much importance. The question
of jurisdiction will always be, so far as this Court is concerned, the one
great difficulty. I am sure that the Imperial Government have no
desire to impose their views as to what should be the jurisdiction. This
should be left to the provinces themse1v(>s to determine. The Judicial Com-
mittee of the Privy Council have always decided — and it is a matter of
common every day occurrence — that the King has retained his prerogative
of allowing anyone who chooses to take an appeal before the Judicial
Committee of the Privy Council. That appeal, which is an appeal of favour,
has perhaps passed the day of its utility, and if I have any opinion to proffer
upon this question it would be that all matters of jurisdiction should be
relegated altogether to the parties interested — the provinces or the Parlia-
ments— to determine whether and why there should be an appeal or not.

On the whole, we have two resolutions presented to us, one bylMr. Deakin
for the Commonwealth of Australia, and one by Cape Colony. I prefer for
my part the resolution of Cape Colony. A further draft has 1)een submitted
to us wliich is based upon the resolution of the Cape Colony, and I would be
disposed to accept it with the suggestion that one or two words should be
eliminated. In the first paragraph the resolution runs as follows : " This
" Conference, recognising the importance to all parts of the Empire^of the
" maintenance of the Appellate jurisdiction of His Majesty the King in
" Council desires to place upon record its opinion." I would eliminate the
word maintenance. I do not oljject to the words " appellate jurisdiction,"
because I rather favour it, but in view of the conflict of opinion which exists
in my country 1 would prefer those words out ; they would not alter the
sense very materially, but it would not be such an absolute pronouncement
upon the matter.

Mr. DEAKIN : Might 1 simply explain to Sir Wilfrid Laurier that I
have no intention, either directly or by implication, of suggesting any legis-
lation to the Lnperial Parliament which could affect the present existing
Commonwealth constitution. Nothing was further from my thoughts. From
a desire for brevity I omitted to explain, as perhaps I ought to have done,
that this co-ordinate jurisdiction of our High Court is only on a particular
class of cases wliich may come before it. We have powers under the
Commonwealth constitution to restrict appeals to the Vr'wj Coimcil fi-om
the Supreme Courts of the States, which we have not exercised, and next,
subject to the consent of His Majesty, to still further restrict appeals to him.
Neither of those powers has yet been exercised, and the consequence is, I
think I should be safe in saying, that nineteen-twentiefhs of our cases are
still open to appeal to the Judicial Committee of the Privy Council. Con-
sequently, quite apart from the other issue I have raised, we have a gi-eat
interest, having such a large area of appeals to the Privy Council, in asking
that the Imperial Court of Appeal, which we assume woukl be a body of still
higher standing and repute, should deal with these appeals, quite apart

O 2

212

Seventh Day. from tlie particular class of constitutional questions referred to. It is to
26 April 1907. our interest to have a single Lnperial court instead of the Privy Council.

If we cannot obtain it, and must make a choice between the two existing

OF Appeal. courts, we prefer the House of Lords. In any case we advocate an Imperial

CM D k"n ") Court of Appeal, because we still believe that appeals from Australia are

not likely to be much reduced for some time to come. If we wanted

any amendment of the constitution Ave should provide for that ourselves

according to the constitution and in no other way.

Sir WILFRID LA.URIER : I thought your argument was that you had
two Courts of Appeal in Australia at the present time.

Mr. DEAKIN : On one class of case.

Sir WILFRID LAURIER : The object you had in view was to suppress
one of them and provide only for one, if I understood your argument aright.

Mr. DEAKIN : In constitutional cases an appeal is still allowed by
consent of our High Court, which may refer them on to the Privy Council.
]f we had an Lnperial Court of ApjDeal instead of the Privy Council it is
quite certain that those references would be more encouraged than they
are at present. Then, again, public opinion coidd be better satisfied than it
is now in Australia. For both those reasons and others we think the
establishment of an Imperial Court of AjDpeal is very desirable.

Sir JOSEPH WARD : My Lords and Gentlemen, New Zealand is in a
slightly different position upon the point referred to by Mr. Deakin. We
have no federal High Court. Our position is a very clear and defined one.
Our Supreme Court, which sits as a Court of Appeal twice a year at the seat
of Government, so far as Ave are concerned is quite satisfactory. But Ncav
Zealand is in favour of an ultimate Court of Appeal in the United Kingdom,
AA^hether it be the PriA^y Council as at present constituted or an Imperial
Court of Appeal, as suggested by the CommonAvealth resolution. That is
why I asked Dr. Jameson what he proposed to set up to take the place of it,
and I understood him to say an idtimate Court of Appeal.

Dr. JAMESON : An ultimate Court of Appeal for South Africa only.

Sir JOSEPH WARD : I agree in that. You stiU believe in appealing ?

Dr. JAMESON : Absolutely.

Sir JOSEPH WARD: There is only one point 1 Avant to refer in
connection Avith this, and I do so on information furnished to me fi'oni
legal authorities in my OAvn country, as I am speaking entirely as a layman.
I take the opportunity of mentioning it in the hope that possibly the Home
Government might in future be able to see their way to meet an opinion which
has been expressed by legal gentlemen in my OAvn country. I am infomiod
one great defect in the Privy Council, as at present constituted, is that though
in the case, say of New Zealand, they are deciding according to New Zealand
law, yet they have before them only such portion of that laAV as is presented
by counsel. Now in recent times particularly Ave have been sendingj counsel

213

over from New Zealand specially to call attention to the New Zealand side Seveuth Day.

of the law. I am informed that when the argnment*1s over, their Lordships ^^ ■'^P'"'' 1907.

may applj* some rule of English law which has l)eeu rcn'oked in Xew Zealand imi-ekial Court

or omit to ajDplj' some rule of New Zealand law which does not exist in ^y Appeal.

England, ami which they at the moment have not specially brought (gir Joseph

imder their knowledge. I am told that has actually occurred, and the W'urd.j

results, Avlien it has occurred, has been to the people who are the litigants

in our country very unsatisfactory. What has been suggested from a New

Zealand standpoint to prevent that is that in the case of every appeal from

a colony, a ju(lge of the Supreme Court of that Colony should sit with their

Lordships, but without taking part in the arguments or decision, his

function Ijcing to supply full information as to the Colonial law and the

points of difference between it and the English law. I may say that in

most cases the number of judges in the colonies is such that one can be

always on leave, and if he spent his leave in England, or in touch with

England, he would be available. My country is strongly favouralde

to the admission of Supreme Court judges to the Privy Council. But

distant as we are and where we are with vast interests involved at times,

we Avant to be quite sure that the state of New Zealand law is fully before

their Lordships who are dealing with the cases. That is the most practical

suggestion from our point of view, whether it is feasil>lc or not is for those

responsible here to see — but I put it forward with all respect and urge it from

the standpoint of the practical working of the administration of a country

which, from time to time, must have numbers of cases referred to the Privy

Council for judgment. If that could be done, so far as New Zealand is

concerned I think I am right in saying that the whole system of administration

would give very general satisfaction in our countiy.

I may also suggest, that as there have been suggestions made by the
various Colonies, perhaps the simpler course would be for the Home
Authorities to prepare a Draft Order in Council consolidating the existing
state of things with such alterations and simplilications as they deem reason-
able, and forward the draft to the respective Governments to confer thereon,
inter se, and make a conuuon report as to alterations desired or recommended,
in this way there would result an Order in Council containing the general
rules common to all appeals, and special ndes dealing with appeals from
specified Colonies in cases where special rules are necessary.

I may say the main suggestions for the purpose of avoiding delay and
reducing expense put forward by the Cape Colony commend themselves to
me, and I should be only too glad to give them my supjtort. I do not know
the circumstances Sir \\'ilfrid Laurier refers to in Canada. The disabilities
under Mr. Deakin's resolution, as applicable to Canada, do not apply to
New Zealand. As long as it is understood we have the Court of Appeal in
the I.'nited Kingdom — the Privy Council as at present constituted, or the one
suggested by Mr. Deakin — I am perfectly satisfietl on behalf of New
Zealand.

Sir ROBERT BOND: Lord Elgin and Gentlemen, in the Colony
that I have the honour to represent we have the right of appeal to the
Privy Council, and so far as I am aware that is entirely satisfactoiy. In
1904, I think, a despatch was sent out from your Department asking for an
expression of opinion in reference to an amendment of the rules which govern
Privy Council practice. At that time I submitted the contents of the despatch
to the Judges of the Supreme Court, from whom I received an intimation
to the effect that generally the delay and expense in prosecuting these appeals
are the principal causes of complaint, and those which, in their opinion,
mostly require remedy. In the first place, with regard to delay, they pointed
out that while it was perfectly correct that the Privy Council has no control

i 48(i68. O 3

214

Seventh Day. over the proceedings until the record is lodged, tliey submitted that the three

26 April 1907. mouths now limited between the time of the filing o£ the Petition for leave

to appeal, and the perfecting of the bond obtaining leave is too long, and

Impekial Court ^]^^ suggested two months from the date of the Colonial Judgment should

rs' R h I M n * ^"^® fixed. As regards the expense, their Lordships were of opinion

o er . OIK .; ^^^^^ ^^^ costs of appeal are much too higb, especially the fees paid in the
Privy Council Office.

These were the only two matters that they thought called for their
conunent, and I oidy feel justified in putting forward their views on the
matter.

The LORD CHANCELLOR : My Lords and Gentlemen, I wiU endeavour
to speak to the different points that have been raised in this very interesting
and instructive discussion. I think the first thing that must occur to all of
us is the diversity of interests that have to be considered and the diversity
of conditions that obtain in the different parts of His Majesty's dominions.
My view is, and I think we shall all agi-ee in it, that in those circmnstances
all that can be done is to recognise and act unreservedly, upon the j)rinciple
of autonomy, that each integral unit of His Majesty's dominions should
govern itself in the matter of appeals ; that one should not necessarily be the
same as any other, but each should govern itself. 1 can saj' this, that as far
as His Majesty's Government is concei-ned, we most cordially fall in with that
and will do aU we fairly can for the purpose of furthering the views of all
concerned.

May I say a word with reference to what Mr. Leakin said as to the
anomalous position — what Lord Davey called a solecism in law — created by
the fact that in a limited class of cases in Australia there may be two courts,
each of them bj^ the constitution final in a particular case that they tletermine,
which need not necessarily come to the same conclusion. Of course that is
a solecism in law. I am not sure exactly how it arose, but I have some
recollection in the House of Conmions of the debate and it seems 1 took part
in it, as Mr. Deakin was good enough to quote me, and I seem to have said
that it would have been, perhaps, better to leave the constitution of
Australia as the Australians had sent it over the water, a sentiment
in which I probably keep true to my past views and my present views.
But that was not the view adopted. However, this I say, that when
Mr. Chamberlain suggested — and, of course, it was accepted by Australia
or it never would have been in the Act — that the Australians should accept
this view, I am sure he did it in the very best interest, as he believed, of the
friendly and close connection between the two countries. 1 am sure his object
was a good one. If anything has gone wrong in regard to that, which 1
should be very sorry to think, the Australian Parliament has the power under
their constitution to alter it themselves if they think fit. I can only say in
regard to it, that upon the ground of sentiment I like to sit as an Australian
Judge on the Privy Coimcil, and I hope 1 may not be deprived of the
privilege.

In regard to the other points referred to by Mr. Deakin as to the Privy
Council, it is quite true that in Mr. Reeve's book, and also in the Greville
Memoirs, if I remember rightly, there are references to the ways in which
the Courts were made up, which were not satisfactory. The English courts
were not altogether satisfactory at that time either. 1 think we have all
made progress generally. We attend to these things a little more closely and
rjetter than we did.

Let me say what is the constitution of the Privy Council and the House
of Lords respectively. They consist of the same persons, who sit in different
places, with this difference that all the persons who can sit in the House

215

of Lords judicially are entitled to sit in the Pri\y Council and do sit there ; Seventh Day-

but iu the Privy Council, having regard to the I'act of past opinions expressed 26 April 1907.

by Colonial Ministers, and to a general feeling that we want, so to speak, to ij,,.erial Court

enlarge the scope as much as we can, there are other additional members „^. appeal.

who are not mend:)ers of the House of Lords. There are two ineuibers of the /-^'i^g L^^d

Privy Council who may be specially appointed, and receive a salaiy. There Cbaucellor.)

are two also who may be appointed without receiving any salary, and without

any specilic qualification. There are two such persons, distinguished men

both of them. In addition to that there is the Act under which five gentlemen

may ])c appointed, and five have been appointed, including Sir Henri

Tascherean, Sir Henry De Villiers, Chief Justice Way, and two other

distinguished men. I will say a word about that Statute in a moment.

Besides that, all those who have held high judicial office, the conditions

of which are prescribed, in any part of His Majesty's dominions, if mend)ers

of the Privy Council, may sit on the Judicial Committee. Therefore it is what

may be called in its composition a somewhat cosmopolitan court. My friend

the Ijord President of the (Council delegates to me this part of his duty,

namely the smnmoning of the Privy Councillors for the purpose of hearing

these appeals ; and 1 can only say — and you will credit it — that not only

myself but all my predecessors (audi am certain it will be the same of my

successors, whoever they are) have been most anxious to provide as strong a

court, and as good a court as can be made for the hearing of Colonial

appeals, not only appeals from the self-governing states of the British

Dominions, but of the Crown Colonies. I hope we are anxious, and always

shall l)e to have as good a court to hear a Fiji appeal, as to hear an appeal

fi-om the Dominion of Canada. We are in this dilliculty, that we have to man

two courts, and I am afraid it is not easy to alter that. We can do it without

overwork, and it woidd be very undesirable that we should have overwork. I

think we have full work, and overwork would ])e very undesirable considering

the character of the tribunals of the House of Lords and the Privy Council,

and the gravity of the cases which often come to them. What we do is

we divide quite impartially, and I can assure ilr. Deakin that in the House of

Lords the English appeals are not favoured at the expense of the Australian

appeals — ^not Ivnowingly or consciously favoured. We try to make the best

Courts Ave can. Let me refer to the case which Mr. Deakin referred to. I

was not sitting on that case myself, but there were fom- judges — Lord Halsbury,

whom we all recognise in this country to l)e one of the greatest judges

we have ever had, a very great judge. Lord Macnaghten, Sir Arthur Wilson,

and Sir Alfred Wills. It would be unbecoming in me to pass panegjn-ics upon

my colleagues and friends, but I should feel myself very uncomfortal)le if I

differed from them on a point of law.

Then there was the case of the eight judges. That was, I think, the
only time we have sat with eight for many years, but we did sit as eight
because we first sat as four, and I was one of them. The case raised a
point which was considered one of very great dilficulty, and there was a
difference or a sense of extreme difficulty in the case although the sum was
not large.

'o^

Mr. DEAKIN : It was a New South Wales case affecting, I think, the
State land laws.

The LORD CHANCELLOR: Yes, and we got it re-heard by eight
judges, because it was found to be so dillicult a case. W^e said, "No, we
" will not settle it ourselves but get four more judges." We got Lord
Halsbury and the whole of the four Law Lords and myself. It was a
re-hearing with eight, and then we came to our conclusion which was I
hope a right conclusion.

O 4

116

Seventh Day.
26 April 1907.

Imperial Court
OF Appeal.

(The Lord
Chancellor.)

1 Avill say a word aljout tlie arrangement for Colonial judges sitting, in a
moment, and simplj^ say this to Mr. Deakin that I lilie, and I am sure we all
like, free and open criticism, and that we are all the better for it, I have not the
least doubt. Really, if he will believe it, taking appeals to the House of Lords
instead of the Privy Council Avould be a great disarrangement of our system,
and would really mean coming before the same people in another place, and
you would not have the advantage, which I should like to have (without an
Act of Parliament altering the whole thing) of the presence of an Australian
judge : you Avould not have the advantage of some of the very distinguished
men like Sir Arthur Wilson, who are ornaments to any courts You would
limit the number of judges from whom the selection could be made
to hear your cases. But I hope this will satisfy Mr. Deakin. I can assure
him not merely that we have taken every pains that we can, but that
we Avill do our level best to give his cases, as all the other cases,
strong and adequate courts just as good as Ave shall be able to giA^e
our oAvn people. Remember this as regards nimiber ; I knoAv in some
countries — in France where they have a great genius for j urisprudence, and
they may be right — in some of the Coiu'ts of Appeal they have a great number
of judges. In England the custom has been all through our history to limit
the number. We think that five is quite large enough — understand in saying
" Ave " I speak for everybody — and is by many of us regarded as quite as
many as you ought to have in a court. Seven have sat sometimes, but, as a
rule, Ave think that is too great a number, but if it is a very special case we
Avould have seA^en or eight, just as in the case I referred to just now. The
genius of our jurisprudence is to pick your best men ; to see you haA-e first-
rate men, and not to haA-e too many. Perhaps that is AvTong ; but that has
ahvays been the custom, and you Avill find that the greatest decisions in the
history of England, AA'hich have made history, so to speak, have been decisions
given by quite a limited nimiber of judges — but they have been of the very
best. We will try to do our best in that respect.

Let me now come to Avhat Mr. Deakin said with regard to the limitations
of appeal. Li 1900, Mr. Chamberlain Avent the length of stating in
Parliament that he had contemplated the creation of one court, the House
of Lords being fused with the Privy Council into one great court. I think
it Avas found there was A^ery great dilficulty in carrying out that project. If
you think of it intrinsically there is a great difficulty in it. Let me take it
by stages. When we speak of an Lnperial Court of Appeal we do not ahvays
make it quite clear what we have in our minds. In the first place, there is
a suggestion, such as is made by Sir Josepb Ward, namely, that one or more of
the judges from Ncav Zealand, or from any other part of the British Dominions,
should come and sit in the Court of Appeal on the hearing of a New Zealand case
or in a case from their OA\m country. I xmreservedly agi-ee to Sir Joseph
Ward's proposal. I have had experience myself. I remember an Australian
case relating to sheep, about great tracts of land and the mortgaging of it,
and so forth, and Avhen I AA-as arguing this case before the PriA-y Council
I was stopped by Chief Justice Way who happened to be present, AA'ho put
in a piece of local knowledge Avhicli I am afraid exploded my contention
aboxit sheep farming and sheep management — knoAvledge which Ave did not
possess. That is only an illustration. It is also true that there may be
jDoints of law, even though the laAv in Xcav Zealand be the same as our own
law, in Avliich avc should be much the better for having assistance, and very
ghxd to have assistance. I do not think any matters of importance in regard
to laAV are left out by Counsel, and Ave find it out for ourseb^es too. I
unreservedly agree, and heartily think it Avould be a good thing, if each of
the different parts of the British Dominions, each for the hearing of their
OAvn cases, could send to us one of their distinguished judges, and I need not
add it would he a great pleasure and honour to receiA-e him amongst us.

Imi'ekial Court

OK Appeal.

(Tlie Lord

217

Then j-oii come to the next stage, wliether there ought not to be a court Seventh Day
on which not merely representatives of the particuhir part of the worhl 26 April 190:
from which the appeal came were sitting, Init whether you ouglit to have the
Privy Council of itself, consisting normally and ordinarily for all purposes of
the representatives of all, or a good many, of the dilferent parts of the
British Empire. You must rememher that that concerns not only the self- Chiinceflor!)
governing Colonies, but the Crown Colonies from which a good many appeals
come, and India from which a great many of the appeals come. Of course it
is a difficulty, though it is not an insurmountable ditliculty, but itwoidd make
a very large court. No one would say that every place should be represented
at all times, but it would mean a very considerable numl)er of jxidges sitting.
Still, if Australia, for example, or any other part of the British Empire,
desire that their cases shoidd he heard, not merely by the judges of the
United Kingdom with the assistance of their own, but also by judges from
other parts of the British Dominions, the Cape, Canada, India, and the Crown
Colonies, and those countries are willing to send us the judges, we can have
no objection. It seems to me to be a part of the autonomy of Australia or
Canada, for example, that if they wish it done, they are the persons to decide
whether it shoidd be done. It is part of what, in the familiar language of
this Constitution, is called the order and good government of the Colony.

Then comes the still further stage, the third stage, and that is the fusion
of the House of Lords into the Privy Council. It is a mere question of
jurisdiction, liecause the persons are the same substantially, with the addition
of larger nundjcrs in the Privy Cmuicil. That is a proposal the effect of which
woidd be to alter the tribunal to which P^nglish, Scotch and Irish appeals
have always gone — English appeals from time innnemorial, and Scotch
appeals since the Union in 1707, and Irish appeals since ISUO. lu
the same way as the cpiestion of constituting a different tribunal for Australia
could not l)e done without delilieration in Australia, so this could not be done
here without being fully considered in the United Kingdom which it
affects.

This last stage directly affects the United Kingdom — whether they
will alter the tribunal to which they have been accustomed. I must saj' it
has hardly been discussed in the United Kingdom. We have been very busy
about many other things as you may suppose. It has never been really
discussed. It was brought forward by Mr. Chamberlain in April, 1900, and
I think a few speeches and observations were made about it, but it has never
been l)rought up since. I do not think it has been ventilated in the Press
beyond the idea, or what I would rather call, if I may, the aspiration that
there should be community of judicial authority over the whole British
Empire. The aspiration I think is felt, but it has never been thought out,
discussed, or threshed out. Therefore, I cannot help thinking myself that,
it would be a pity to make an affirmation in such general tei-ms as are
contained in the Australian proposal ])ecause I think it is premature as far
as the practical consideration of it in the, United Kingdom is concerned.
But I also feel thus : It is apparent that there is a sense in Australia that they
are not altogether at ease in regard to Privy Council Appeals. I am sure
the Privy Council is in regard to Australian cases an Australian Coiut, and
what we ought to do is to try and satisfy the people in Australia not only
that justice is done, biit that every effort is made to do it, and as cheaply
as possible.

Before I turn to the other matter which I am afiaid I must trouble you
with, may I say a word in regard to what was said about delay? No
complaint has been made, I think, liut what really has happened is this :
Since I have become Lord Chancclloi' — and I only take that as the time
because I know about it — beginning in 1906, 16 months ago, we put down

218

Serenth Day.
26 April 1907.

Imperial Court
OF Appeal.

(The Lord
Chancellor. )

appeals as soon as they are ready, and whenever there ia a sufficient
nimiber of them we sit and try them, perhaps five successive lists in the
course of a year. We had a list which we heard in February and March
1906. All that were ready were put down, and we heard and disposed of
them all before we separated. We put down a second list in March and
April. We finished every one of the cases. All those had become due since
the beginning of March. In May we had another list, and we finished all the
cases ; and we also had a supplemeatarj^ list of those cases which had become
ready while we were sitting in the month of May. They were set down for
hearing after the list of the May sittings had been closed, and .one of them I
think was heard. In Jime and July we proceeded with aU the cases that
were then ready, and heard them all except one Indian Appeal which stood
over by order for a particidar reason, and another Indian Appeal which stood
over at the request of both sides. There were two Maritime Appeals which
stood over by order with the consent of the parties, owing to special
circumstances; We also heard one additional appeal which had been entered
after we began sitting. In October to December we resumed oiir list, and
finished all the cases except one appeal from British Guiana which stood over
at the request of the parties. In addition to that, we heard three supple-
mentary appeals which had been entered after we began sitting. In January
and February of this year we sat and heard all the appeals, and we also in
March heard four additional appeals which had been entered while we were
sitting. The Privy Comicil is now sitting, and I expect that in the course of
ten days or so we shall finish oft" every case that was ready when we began to
sit, which was eight, or nine, or ten days ago. I do not think you will find
any record of the way in which business is done which will beat us in regard
to that. As regards the point of delay, I must say I think there is a good
deal to be said for leaving it, as has been suggested in some of these different
counnunications, to the Colonial Courts themselves to regulate all the
procedures, and the time, and so forth until the case is brought and
presented to the Privy Council. After that we shall be able to deal with it
and dispose of it with the rapidity to which I have referred.

May I turn to the next resolutions, to which Dr. Jameson alluded, and
which I think he said are to a considerable extent satisfied by what has been
said. Perhaps I may go through them : " This Conference, recognising the
" importance to all parts of the Empire of the maintenance of the Appellate
" Jurisdiction of His Majesty the King in Council, desires to place i;pon
" record its opinion : — ' (1) That in the interests of His Majesty's subjects
" ' beyond the seas it is expedient that the practice and procedui-e of the
" ' Right Honourable the Lords of the Judicial Committee of the Privy
" ' Council be definitely laid down in the form of a code of rides and
" ' regulations.' " The first point is that the practice and procedure should
be definitely laid down in the form of a code of rules and regidations. That
1 think is a very good idea, and we think it is quite right, and we will
consolidate and amend so as to conform as nearly as can be to modem
circumstances and requirements, and with a view to facilitating and expediting
the hearing of appeals. 1 am sure Dr. Jameson wiU remember that our
difficulty is of a practical kind. AVhen we consolidate and amend, if we are
to send to every part of His Majesty's Dominions, that is an enormous
thing to do. Answers come back perhaps not all agreeing, and then ensues
correspondence. It is a herculean task, and takes a great time. But we will
try to do it, treating it really as consolidation, and taking upon ourselves the
responsibility. Peally, after all, practice and procedure, while imi")ortant,
does not raise vital matters of principle, and if you will leave it to us Ave will
send round to the different Colonies.

Dr. JAMESON : You might put in the words " as far as possible."

219

The LORD CHANCELLOR : It is a matter of business detail, we will Seventh Day.
try to meet you with regard to it, and I think we shall satisfy you. 26 April 1907.

The second Resolution is : " L'hat iu the codification of the rules, regard ^

" should be had to the necessity for the removal of anachronisms and ^'"^p"ArrErL'*^

anomalies, the possibility of the curtailment of expense, and the desirability

of the esta])lishment of courses of proceedure which woidd minimise
" delays." The second is of course involved in the first. The third is : " That

with a view to the extension of uniform rights of appeal to all Colonial
" subjects of His Majesty, the various Orders iu Council, Instructions to

Governors, Charters of Justice, Ordinances, and Proclamations upon the
" subject of the Appellate Jurisdiction uf the Sovereign should be taken into

consideration for the purpose of determining the desirability of equalising
" the conditions Avhich gave right of appeal to His Majesty." In every
Order in Council there are some provisions which are common to every
set of circumstances ; liut the priut'ipal variations are dependent upon the
diversity of the different countries that have to be dealt with. For instance,
the principal variations relate to the sum of money which is to warrant an
appeal. Xow that varies between '.MM. and 2,O0UZ. It is a matter upon
which each country may have different views ; but whatever a country thinks
there will be no difficulty whatever in giving effect to it. I doubt myself
whether, in a matter of that kind, it is desirable even to press for uniformity.
Perhaps uniformity in things of that kind might not be advisable.

Dr. JAMESON : The idea was that all the Premiers being together
they might effect some general agreement.

The LORD CHANCELLOR : It is a luxury to us to have unifonnity.
We shoidd be the last people to object ; ])ut, if the Prime Ministers, being
here, should come to any arrangenumt al)out that so nuich the better. The
same in regard to the limit of time for appealing as of right, and the lodgment
of security for costs. If Dr. Jameson were to say : " So far as may be
agreed upon by different parts of His Majesty's dominions " we shoidd
not make any difficulty.

Dr. JAMESON : I quite imdcrstood that. The Premiers being here, the
subject might be raised, and our idea was that the Imperial (Jovernment
might imdertake to correspond with the various States with a view to getting
luiiformity.

The LORD CHANCELLOR : I must not take upon myself Lord Elgin's
functions, and no (loul)t he will help in anything of that kind. I am only
speaking from the actual point of view of the Privy Council.

As regards the last Resolution it says : " That much uncertainty, expense
" and delay would be avoided if some portion of His Majesty's prerogative to
" grant special leave to ajtpeal in cases where there exists no right of appeal
" were, under definite rules and restrictions, delegated to the discretion of
" the local courts." I think that is quite right. It is .so in India. It is
regulated by codes of civil procedure, and it can be regulated by your own
Parliament. You niay pass in the Cape, if you like, an Act of Parliament ;
or it may be done and has been done by Orders in Council. If you should
prefer it should be done by Orders in Council it woukl be perfectly easy to
do it.

Sir WILFRID LAURIER: "That much uncertainty, expense, and
" delay would be avoided if somu portion of His Majesty's prerogative to

220

Seventh Day.
26 April 1907.

Ijipekial Cockt
OF Appeal.

(Sir W. Laurier.)

" grant special leave to appeal in cases where there exists no right of appeal
" were, under definite rnles and restrictions, delegated to the discretion of
" the local courts." I would rather see that done by the central authority
than hy the judicial authority.

The LORD CHANCELLOR: I tliink Avhat it means is that leave to
appeal in a particular case — not the general rule laying down when there should
Le leave to appeal — shoid-d be put in the power of the local courts to give,
instead of litigants being obliged to come and apply to the Privy Council for
leave.

Sir WILFRID LALRIER: That could be done without legislative
authority. I know in my Province, when I was a young member, an interesting
discussion took place on this point.

The LORD CHANCELLOR: You would have to do it by Act of
Parliament. It is in the case of the Crown Colonies that we do it by Order
in Council.

Sir WILFRID LAURIER : Yes, and a great many members favour the
absolute abolition of the prerogative of the Crown to hear any complaints
from any subject all over the world. It was conceded that Canada under our
iVct could take away that prerogative, but the opinion prevailed at that time
that the right should not be interfered with. Whilst in some cases we have
restricted the number of appeals, no man can take away the right of appeal
to the Privy Council. If a case involves over 2,000 dollars, he can come
as of right to the Privy Council ; but, as a matter of fact, he can come to
the Crown and ask for leave to appeal. I would prefer to leave this.

Dr. JAMESON : This is made to a great extent unnecessary by the
further Resolution Avhich we have brought in in concert to-day, where we
say what we want is to have power to legislate, and then, when we form a
special court of appeal, that there shall be only certain things which shall
be capable of being the sidjject of appeal to the Privy Council, and power to
grant that leave shall be left in the hands of the final court.

Sir WILFRID LAURIER
of Parliament.

I would rather say it should be in the hands

Dr. JAMESON : It Avoidd he Parliament really, because Parliament
would legislate as to that point.

Sir WILFRID LAURIER : It would satisfj- me if you -svere to say :
" That much uncertainty, exj)ense and delay woidd be avoided if some
" portion of His Majesty's prerogative to grant special leave to appeal in
" cases where there exists no right of appeal were, under definite rules and

" restrictions " leaving the rest out.

Dr. JAMESON : I am quite willing to do that. Our fourth Resolution
practically puts it in tlie hands of the local courts.

The LORD CHANCELLOR : I misapprehended the point Sir Wilfrid
was takiug. It is obvious the Privy Council cannot make laws to govern

Imperial Coort
OF Appeal.

221

the self-governing Colonies in any way. I was speaking of it, as I have Seventh Day.
been speaking of it thmughout, not, niero^ly in relation to the self-governing 26 April 1907
Colonies, but to the whole British Empire, because the Privy Council has
jurisdiction everywhere.

(The Lord

Mr. DEAKIX : Except in the United Kingdom. Chancellor.)

The LORD CHANCELLOR: Yes, it has jurisdiction there too, in
respect of patents. What I meant was you could do it in the Legislatures
yourselves as you please, and it is for the Legislatures to pass your own
laws, and for the local courts to carry out the laws the Legislatures pass.
It is possible to do it by ordinance in the Colony, or Order in Council here
in the case of Crown Colonies.

May I turn now to the other supplementary points Dr. Jameson has
given us. I think his general object is the establishment of a final Court
of Appeal in Soiith Africa, with certain restrictions upon the right of appeal
from South Africa to the Privy Council, which is obviously a matter for the
South African Colonies to determine for themselves. If they pass their own
Act they can set up their own Court of Appeal in South Africa, unless they
like to invoke the machinery of the Imperial Parliament by asking the
Imperial Parliament to do it. I do not know whether they would or not.

Dr. JAMESON : I miderstand the Lnperial Parliament might use its
machinery supposing we pass such legislation at the present moment as
would deprive our own State even of the right of appeal to the Privy
Council.

Sir WILFRID LAURIER: As I understand, you want to have a Court
of Appeal for the three Colonies — the Transvaal, the Cape, and Natal. In a
case which would affect you in Natal yoTi want to have a Court of Appeal
for these three parts ?

Mr. DEAKIN : And the Orange River Colony.

Dr. JAMESON : We want it for all, but, to justify us in doing that, we
must take away their right of appeal from the present Supreme Court direct
to the Privy Conncil.

Sir WILFRID LAURIER : You must have legislation of the Imperial
Parliament for that.

Dr. JAMESON : Yes, that is what I am asking. We want their approval,
at all events.

The LORD CHANCELLOR : It really comes to tliis : You would set up
your own court for all the self-governing Colonies in South Africa — and
probably the Orange River Colony will have a c-onstitution in the course of a
few Aveeks— a South African court in South Africa. That would be your
work. If you wanted the auxiliary liel]) of the Imperial Parliament for
other purposes, it may be constitutional and the most convenient way of doing
it. I, for my part, greatly hope that, however the functions of the Privy
Council maylie restricted, the conn(>ction will not be severed between the
Privy Council and the courts either in South Africa or elsewhere. Hut every
self-governing portion of His Majesty's Dominions has its own right to regulate
its own affairs, and do as it thinks fit in regard to that.

222

Seventh Day.
26 April 1907.

Imperial Court
OF Appeal.

Dr. JAMESON : The point I wanted lu know about is this question of our
dejDriving ourselves of the right of appeal to the Privy Council. Do I under-
stand we could only do that by Imperial legislation or an Lnperial Order in
Council ?

The LORD CHANCELLOR : You could not do it by Imperial Order in
Covincil because it would be interfering with your own affairs. By the
Imperial Parliament it could be done if the Colony asked that it should be
done — and it would be done. It is rather a novel point. My present
irapression — and I am sure you will not tie me to it if I am Wrong — is that
the Parliament of a self-governing Colony with the Royal Assent could
regulate that as well as anything else.

Mr. DEAKIN : Is not there power by Order in Council to restrict the
conditions of appeal ?

The LORD CHANCELLOR : When the constitution is set up the King
has no power whatever to interfere with, or derogate from it.

Mr. DEAKIN : Surely he rules in his own court ?

The LORD CHANCELLOR : Yes, the King might be advised to say
by Order in Council that he would not undertake such and such an appeal.
After all, we are now getting upon constitutional methods of carrying it out.
The machinery is not so important, after all, as the object. May I suggest to
Dr. Jameson that if he reads these three resolutions closely, he Avill find they
are not quite consistent, because if in No. 3 you keep the right of any person
to apply to the Judicial Committee of the Privy Council for leave to appeal
to it from the decision of such Appeal Court, and you say that is not to be
curtailed, it is inconsistent with abolishing the appeal in particular cases.

Dr. JAMESON : No, this is abolishing the appeal from the present
Supreme Courts of the various States of South Africa direct to the Privy
Coxmcil, because this would be constantly going on, and our new Court of
Appeal might have nothing to do. We want to abolish that, and, as far as
South Africa is concerned, we want this new Appeal Court to be the final
Appeal Court, except in stated cases to be mentioned in the Statute creating
the court. Then we say we know the prerogative of every British subject is
the right of final appeal to the King, and we want that safeguarded, so that,
outside of that, any subject could come to the Privy Council, but he has then
to ask for leave to appear before the Privy Coxmcil. What we want out
there is that any case nmst go to the Appeal Court in South Africa before it
can go to the Privy Council.

The LORD CHANCELI,OR : I think I see your point. Then there
are General Botha's resolutions, the substance of them having been explained
hv Dr. Jameson. I think Sir Wilfrid Laurier merely suggested an amendment
to one of the Cape resolutions : " This Conference recognising the imj)ortance
" to all parts of the Empire of the maintenance of the Appellate jurisdiction."

Dr. JAMESON : I am willing to take the words out. If they had never
been in I should not mind, but taking out something looks like weakening
the idea.

223

CHAIRMAN : Then we take oiti v.hose words. Seventh Day.

26 April 1907.

The LORD CHANCELLOR : That (>nds aU I have to say, except that

there was a reference to the fee of the Pri^y Coxincil Office. The fees ^^'o^ApprAu^''

ordinarily chargeable to a sucfessfiil appellant and respondent are about ]5l.

anti 131. respectively, and to an unsuccessful appellant and respcsident il. and

SI. respectively. It has not been suggested before that the fees are too high.

We have not received any suggestion of that kind. We will look into it.

The suggestion came from NcAvfoundlaud.

Sir ROBERT BOND : I was putting forward the views that were
expressed by the Justices of the Supreme Court of Newfoundland.

The LORD CHANCELLOR : I think that is all I need say, except this :
that the Privy Council is very conscious of its responsibilities, I can assure
you, and is proud of being able to sit as His Majesty's Court for the different
parts of His Majesty's Dominions.

Mr. DEAKIN : Do I understand you to take exception to the resolution
of which the Commonwealth has given notice, that it is desirable to establish
an Imperial Court of Appeal ?

The LORD CHANCELLOR: I think it is asking us in the United
Kingdom to adopt a resolution which lias not been in the least considered in
this country, and I think myself it is premature. I do not want to speak
hostilely to it.

Dr. JAMESON : You used the word "aspiration." Would not we pass
it in that form, that it is a fair aspiration ?

The LORD CHANCELLOR: I think our people would be rather
s\irprised and startled, remendjering that this is a new subject to us altogether,
if we were to commit ourselves to the idea of an Imperial Court of Appeal,
which means one court for the whole of the British Dominions, and a
reconstruction of the House of Lords and the Privy Council.

Sir WILFRID LAURIER : The adoption of your resolution. Dr. Jameson,
commits those who are here present, and the Oflicers of the Crown, to an
inquiry into the present constitution of the Privy Council. It is a very ancient
tribunal. This resolution has some very good words in it — that there are
anachronisms and anomalies. There are many things wliich I think can be
eliminated. If the Privy Coimcil is reconstructed that is practically the
court. It does not matter by what name it goes. At present, this i-esolution
being adopted we must have a report, as I understand, from the Officers of
the Crown with a view to carrying out the suggestion. Then we can see
if we should go further. At present I am quite satisfied in adopting this
resolution.

Dr. JA]\I1']S0N : And after this investigation, the result of it taking
place on the part of His Majesty's Government will be such a suitable court
that it will be suitable for the United Kingdom also. Therefore, I cannot
see why we should not pass the Conmionwealth resolution as our aspiration
of the one which will be created out of the Privy Council.

224

Seventh Day. ii^._ DEAKIN : 1 do not know whetlier I should enlist Sir Wilfrid

26 April i907. Laurier's support to an amendment of this first resolution by which it would

J ^ ^, read " That the Conference recommends to the consideration of His Majesty's

OP Appeal. " Government the establishment of an Imperial Court of Appeal."

Sir WILFRID LAURIER : Do you mean we should pass the resolution ?
It seems to me not particularly compatilDle.

Mr. DEAKIN : The first resolution would then be reduced to an
aspiration.

Sir WILFRID LAURIER : I have no objection to an Imperial Court
of Appeal. I do not care what name you call it ; whether it is the House
of Lords, or the Judicial Committee, or any other body, it matters not very
much. For my part I prefer Dr. Jameson's resolution.

The LORD CHANCELLOR : Do you include General Botha's addition ?

Sir WILFRID LAURIER : I have no objection to that. It is not a
matter which concerns this Conference, but concerns the three Colonies
there represented.

Dr. JAMESON : If you and other members in the Conference agree,
it will help us a good deal in getting this machinery, which the Lord
Chancellor has foreshadowed as necessary, carried out.

Sir n' ILFRID LAURIER : With all my heart. You are far away, and
you want to have a Court of Appeal for South Africa which should be final
in most cases, and from which alone there can be an appeal to the Privy
Council.

Dr. JAMESON : That is exactly it.

Sir WILFRID LAURIER : I quite agree with that.

Sir JOSEPH ^VARD : I favour that very cordially too.

The LORD CHANCELLOR : I think everyone agrees in regard to the
resolution of Cape Colony, and General Botha's additional resolution. If the
resolution as to the Lnperial Court of Appeal were accepted, of course it
would be the committal of the United Kingdom to a variation which, as I
have said, they certainly have not considered, and which I think we ought
not to agree to.

Mr. DEAKIN : Have you any objection to our asking you to consider it
if we alter it in that way, " that the Conference reconnnends to the cousidera-
" tiou of His ^lajesty's Government the establishment of an Imperial Court
" of Appeal."

CHAIRMAN : His Majesty's Government arc represented in the
Colonies.

225

The LORD CHANCELLOR : Is nut that one of the thiug^; which relate Seventh Day.
to the order aud good governmout ol' the Uuited Kingdom ? 26 April 1907.

i\[r. LEAKIN : I am bound to a(hnit that is one of the reasons why we ^"o^Ari-L^vL""^
put this resolution forward in terms that are intentionally vague ; if it were
otlierwise it would have seemed as if we were impcjsing something upon
the United Kizigdom, though it affects us both. I am satisfied to have put
forward the proposal. 1 do not desire to place His Majesty's Govermuent in
a dilliculty. I recognise the force of the stat(Muent of the Lord Chancellor
that as yet the matter has not l:)een matured in this country,

CHAIRMAN : Would it not meet your case if we treat it in this way :
that we record this resohition as having been submitted by you and (Hsoissed ;
then proceed to say that the resolution propose/1 by the Cape (!olony has also
been discussed, and that the ('onference thought effect should be given to its
rc^conimoiidatioiis ; then make the samc^ sort of deliverance with regard to
General Botha's additional resolution. That would put your resolution on
record, but not bind us who feel a ditlirulty in the matter to any further
action.

Mr. DE.\KIN : In this Conference it is undesirable to attempt to liind
any of its memljers to that to which they take exception. ]\Iight I point
out that while I do not question the statement directly, or by implication, of
the Lord Chancellor, as to the impartial treatment of the courts, yet, in the
very constitution of the Privy Council, if my memory serves me, the enact-
ment says that the Lords of Appeal in Ordinary shall, "subject to the
discharge of their duties in the House of Lords," attend the sittings of the
Judicial Committee. That distinctly places upon the Lords of Appeal a
mandate for their consideration of their duties in the House of Lords before
their duties in the Privy Council. Again, you pointed out the very great care
with which the court of which you were a member dealt with the New
Soutli Wales case, to which reference has been made, when you said that
although four members of the Judicial Committee assembletl to hear it, you
had a re-hearing with eight members because it was an important matter.
Extremely satisfactorj^ as this: was in that case, it only emphasises the
distinction between it and a case which, from the pul)lic point of view,
was of iimnensely greater importance, alfecting so many vital constitutional
issues. Yet that case was finally decided by a court only half as large, after
an argument which, I fear, was imperf(>ct, in a Judgment dealing with
matters which, so far as the records show, do not appear to have been argued
at all. Unhappily, the members of the Board on that occasion did not seem
to perceive that the issues were specially important or tliat they demanded a
stronger Committee. I only mention tiiat by way of illustration of the risk
suitors run by not being able to secin-e the same very wise and considerate
treatment which the court gave in the New South Wales case.

Finally, while it is pericctlj- true that we have to take upon our own
shoulders the responsilulity of having accepted in our constitution those
terms out of which this judicial anouialy has arisen, it stands on record that
we did so only to sav(^ the whole constitution. It was one of those choices
which all practical politicians have to make. We made it with our eyes
open, but none the less reluctantly, regretfully, and now rememlier it
repentantly.

CHAIRMAN : My suggestion is this : that the finding of the Resolution v.,
Conference might run in this form: — That tlic i'ollowing resolution of the !'■'*"'•
Commonwealth of Australia, "That it is desirable to (^stal)lis]i an imperial

E 48668. P

226

Seventh Day. Court of Appeal," was submitted and fully discussed. The resolution
26 April 1907. submitted by the Grovernment of Cape Colony as amended was accepted as

follows : —
MPEEi^L^^^^oiTRT -'This Conference, recognising the importance to all parts of the Empire

,_,, . . of the appellate jurisdiction of His Maiesty the King in Council, desires to

(Chairman.) , ^^ ■> ^ . . . j ^ o '

place upon record its opmion : —

" (1) That in the interests of His Majesty's subjects beyond the seas it is
expedient that the practice and procedure of the Eight Honour-
able the Lords of the Judicial Committee of the Privy Council
be definitely laid down in the form of a code of rules and
regulations.

■■ (2) That in the codification of the rules, regard should be had to the
necessity for the removal of anachronisms and anomalies, the
possibility of the curtailment of expense, and the desirability of
the establishment of courses of procedure which would minimise
delays.

" (3) That, with a view to the extension of uniform rights of appeal to all
colonial subjects of His Majestj?^, the various Orders in Council,
Instructions to Governors, Charters of Justice, Ordinances and
Proclamations upon the subject of the Appellate Jurisdiction of
the Sovereign should be taken into consideration for the purpose
of determining the desirability of equalising the conditions which
gave right of appeal to His Majesty.

"(4) That much uncertainty, expense, and delay would be avoided if
some portion of His Majesty's prerogative to grant special leave
to appeal, in cases where there exists no right of appeal, were
exercised under definite rules and restrictions."

The following resolutions presented to the Conference by General
Botha, and supported by the representatives of Cape Colony and Natal, were
accepted : —

" (1) That when a Court of Appeal has been established for any group
of Colonies geographically connected, whether federated or not,
to which appeals lie fi'om the decisions of the Supreme Courts
of such Colonies, it shall be competent for the Legislature of
each such Colony to abolish' any existing right of appeal
from its Supreme Court to the Judicial Committee of the Priyj^
Council.
" (2) That the decisions of such Court of Appeal shall be final, but leave
to appeal from such decisions inay be granted by the said
court in certain cases prescribed liy the Statute under which
it is established.

" (3) That the right of any person to apply to the Judicial Committee
of the Privy Council for leave to aj^peal to it ft-om the decision
of siich Appeal Court shall not be curtailed."

The Conference adjourned till Tuesday, April 30th, at 11 a.m.

227

EIGHTH DAY. Eighth D.>y.

30 April 1907.

Held at the Colonial Office, Downing Street,
Tuesday, 30th April 1907.

Present :

The Right Honourable The EARL OF ELGIN, K.G., Secretary of State

for the Colonies (President).

The Right Honourable Sir Wilfrid Laurier, G.C.M.G., Prime Minister
of Canada.

The Honourable Sir ¥. W. Borden, K.C.M.G., !\rinister of Militia and
Defence (Canada).

The Honourable L. P. Brodelr, Minister of Marine and Fisheries

(Canada).

The Honourable Alfred DE^vxl^, Prinu' Minister of the Connnonwealth
of Australia.

The Honourable Sir W. Lynh, K.C.:M.G., Minister of Trade and
Customs (iVustralia).

The Honourable Sir JosErii Ward, K.C.M.G., Prime Minister of New
Zealand.

The Honourable L. S. Jameson, C.B., Prime j\linister of Cape Colony.

The Honourable Dr. Smartt, Commissioner of Pul)lic Works (Capo
Colony).

The Right Honourable Sir K. Bond, K.C.M.G., Prime Minister of
Newfoimdland.

The Honourable F. R. Moor, Prime Minister of Natal.

General The Honourable Louis Botua, Prime Minister of the Transvaal.

Mr. Winston S. Churchill, M.P., Parliamentary Under Secretary of
State for the Colonies.

Sir Francis Hopwood, K.C.B., K.C.M.G., Permanent Under Secretary

of State for the Colonies.

Sir J. L. Mackay, G.C.M.G., K.C.I.E., on I.elialf of the India Oilice.

Mr. H. W. Just, C.B., C.M.G., \ r ■ , ^ , •
Mr. G. W. Johnson, C.M.G., j '^^"^^ Secretartes.

]\lr. W. A. Robinson,

Assistant Secretary.

Also present :

The Right Honourable 11. H. Asquith, M.P., (.-hancellor of the Exchequer.
The Right Honourable D. Lloyd George, JI.P., President of the Board

of Trade.
Mr. W. RuNciMAN, M.P., Financial Secretary to the Treasury.
Mr. H. K. Kearley, M.P., Parliamentary Secretary to tlu^ Board of Trade.

r 2

228

Eighth Day ^^^' ^- ^^- HAMILTON, G.C.B., K.C.V.O., Permanent Financial Secretary

30 AprU 1907. t° the Treasury.

Mr. H. Llewellyn Smith, C.B., Permanent Secretary to tlie Board of

Trade.
Mr. A. Wilson Fox, C.B., Comptroller-General of tlie Commercial,
Labour, and Statistical Department of tlie Board of Trade.

Mr. G. J. Stanley of the Board of Trade.

CHAIRMAN : Gentlemen, we proceed to-day to a very important series
of Pesolutions concerning points on which we know there is difference of
opinion, but which, I have no dotibt, we shall discuss, as we have hitherto,
with an attempt to understand each other. I suppose wo shall proceed as
we have hitherto done, that is, ask those Colonies who have submitted
Resolutions to explain to us in the first place the reasons which they ■wish to
adduce. There is only one observation which I should like to make on the
matter. My two colleagues beside me have come to deal wuth two sides of
this question. The Chancellor of the Exchequer will deal with the fiscal
side, and the President of the Board of Trade with the side relating to
treaties and other matters. I assume from a study of the Resolutions that in
some of them both sides are dealt with, and I venture to suggest, as a matter
of convenience, that we should treat them separately, and that we should, in
the first place, take up the discussion of the fiscal side, on which the
Chancellor of the Exchequer will reply. I do not know whether there has
been any arrangement between those who have submitted Resolutions as to
the order in which they will speak to them, but I naturally turn, as I have
hitherto done, to Australia in the first instance, and ask if they are prepared
to open the discussion.

Mr. DEAKTN : If that is the preferal)le course to pursue, in your
opinion, I certainly will do so ; but perhaps Sir Wilfrid Laurier would prefer
to make a statement of some kind.

Prefekential PREFERENTIAL TRADE.

Trade.

Sir WILFRID LAURIER: Lord Elgin, and gentlemen, so far as
Canada is concerned, the statement which I have to make will be very brief.
Our views upon this matter have l^eeu kno-\\u for some time, and at the last
Conference they were the subject of ample discussion which resulted in the
Resolution w^hich was adopted on that occasion, and which is to be found on
page 3(3 of the Blue Book. The Resolution was in these terms, first : " That
" this Conference recognises that the principle of preferential trade between
" the United Kingdom and His Majesty's Dominions beyond the Seas would
" stinudate and facilitate mutual commercial intercourse, and would, by
" promoting the development of the resources and industries of the several
" parts, strengthen the Empire. (2) Tliat this Conference recognises that, in
" the present circumstances of the Colonies, it is not practicable to adopt a
" general system of free trade as between the Mother Country and
" the British Dominions beyond the Seas. (3) That with a view,
" however, to j)romoting the increase of trade within the Empire, it is
" desirable that those Colonies wliich liave not already adopted such
" a policy should, as far as their circumstances permit, give substantial
" preferential treatment to the products and manufactures of the United
" Kingdom. (4) That the Prime Ministers of the Colonies respectively

229

" in-i^e on His Majesty's Government the expediencj' of granting in the Eighth Day.
" United Kingdom preferential treatment to the pro(hicts and mainifactures 30 April 1907.

" of the Colonies either by exemption from or rednetion of duties now or

" hereafter imposed. (5) That the Prime Ministers present at the Con- Pi"-^e"extial
" ference nndertake to submit to their n^speetive Ciovernments at the .'^"'\'^'^'.

" earliest opportunity, the principle of the Resolution and to request them (S'r \\ilfri.l

to take such measures as may be necessary to give eflect to it. The
Canadian Government adhere to this Resolution, and have none other to
propose than that, and I intend at the proper time to move it again. As I
understand the Resolutions of Australia, they agree in substance with this
Resolution. The first three parts, I think, are verbatim the same. As to the
others, there is not much diiference between the fourth and fifth parts of
the Resolution adopted in 1902 and the Resolution proposed by Mr. Deakin.
But perhaps Mr. Deakin himself will show what dilference there is, and what
he has in mind in sul)stituting the new ilraft for what the previous Conference
concluded.

Mr. DEAKIN : ily Lord, ^Ir. Asquith, and gentlemen, our variation lies
first of all in the omission from the fourth Resolution of the words " either
by exemption from or reduction of duties," words which do not appear to
be material to the substance of that proposal, and its application to the
self-govern iug dominions between themselves. The fifth paragraph does not
mark a departure. The fifth says it is desirable that the United Kingdom
gi-ant preferential treatment to the products and manufactures of the
Colonies. That is complementary to tlic proposal included previously in
tbe third Resolution, which was that the Colonics were to give substantial
preferential treatment to the products and manufactures of the United
Kingdom. By adding the fifth Resolution it is intended to propose that
we should recommend the adoption of reciprocal preference as in the fourth
Resolution of 1902 — a preference from the United Kingdom in return for any
preference granted to the United Kingdom, or, at all events, in association
with that.

In moving these Resolutions may I, in a very brief fashion, in the first
place allude to the rather significant circumstance that from the earliest
occasion of the sunnnoning of representatives of the self-governing Dominions
to a Conference of all parts of the Empire, this very question at once pre-
sented itself as a natural and j^roper, if not necessarj', subject for consideration
as between the several Parliaments concerned. It has never been omitted
since from any of these Imperial assemblies. When the first Conference
assembled in 18S7, with that prescience for which the late Ijord Salisbuiy was
distinguished, he put in the forefront of his brief adilress to the assembled
representatives the situation as it then appeared, in these wcnxls, which appear
on page 5 of the Reports of the Proceedings of 1887*" : "I fear that wo must
for the present put in the distant and shadowy portion of our task, and not in
" the practical part of it, any hope of establishing a Customs Union among the
" various ])arts of the Empire. I do not think that in the nature of things it is
" impossil)le ; I do not think that the mere fact that we are separated by the
" sea renders it impossible. In fact, the case of Ireland, which has a Customs
" Union with England, shows that it is not impossible. But the resolutions
" which were come to in respect to our fiscal policy -lU years ago set
" any such porssibility entirely aside, and it cannot be now resumed until
" on one side or the other very different notions with regard to fiscal
" policy prevail from those which prevail at the present moment."
The Colonies at that time were as thej' are now, more or less definitelj'
Protectionist in principle. The United Kingdom was then, as it is nov»,
practically Free Trade in every detail. The prospect, therefore, of any form
of " Customs Union " — words used, of course, by the Prime Ministei-, in a

' [C. 5091].
18668. P ,3

230

Eighth Day. very general sense — had to be postponed, as lie indicated, nntil tliere should

30 April 1907. be some change of opinion. But looking through the reports of this first

_ Conference, one finds even at that date most of the salient features of the

" Trade^'*^ discussion as it has since been developed, were already present to the minds

''M- 1) ■ k' ") °'" those "who assembled here. The question of foreign bounties and how

^ ' ' ' they should be met — whether by retaliation or otherwise — was dealt with.

Sir Samuel Griffith, then Premier of Queensland, submitted an express

proposition for the granting of preferential trade, which will be found on

page 4G2 of the same book. He said : " The question that 1 should like to

submit for consideration to-day is whether that conclusion ought not to be
" carried further, whether it should not be recognised as part of the duty of

the governing bodies of the Empire to see that their own subjects have a

preference over foreign subjects in matters of trade." Lower down on the
same page he said : "I am not going to venture into the deep waters of
" Free Trade and Protection ; but I maintain that buying in the cheapest

market is not the greatest consideration in the world — that after all
" that or any other system of fiscal policy can only be adopted as a

means to an end, the end being the prosperity of the country
" to which we belong." Omitting a sentence: "If that can be best
" done by buying in the cheapest market, and insisting that that

shall be done, by all means be it so. But if buying in some other
" than the cheapest market would conduce more to the prosperity of the
" Empire, then, as in all other matters, individual liberty nmst yield to
" the general good of the whole commimity. All government, I suppose,
■' consists in a surrender of individual liberty in some particulars for the

benefit of the whole community. I am not sanguine enough to suppose
" that anything is likely to be done just now ; nor do I suggest any inter-
" ference in the least degree Avith the tariffs of any countries, or that it should
" be insisted that any country should impose a customs charge for any goods

if it does not choose to do so. But I submit for consideration this proposi-
" tion ; That if any member of the Empire thinks fit for any reason to impose
" Customs charges upon goods imported from abroad, it shoidd be recognised
" that goods coming from British possessions should be subject to a lighter
" duty than those coming fi'om foreign possessions ; or to put it in, I think,
" a preferable way, that the duty on goods imported from abroad being fixed
" according to the convenience of the country, according to the wishes of its
" legislature, as to which there should be perfect freedom, with which I would
" not in the least interfere, a higher duty should be imposed upon the same
" kind of goods coming from foreign countries." I have read rather more than
I intended, but a portion of the speech shows that even at that date the idea
embodied in jDroposals for preferential trade was quite clearly recognised by
this most capal)le Australian statesman.

Then it is notable, too, that in the course of the debate a Victorian
statesman, perhaps known by name to most present, the Hon. James Service,
who was during the whole of his career an ardent Free Trader, and to whom
this proposition appeared then to be suggested almost for the first time,
after remarking that he was a Free Trader, said at page 471 : " If
this question were to be raised now as a Free Trade and Protection
" question, I would not take anj'- part in the discussion, because I am not
" prepared to open up that whole question. I am not, however, one of
" those Free Traders who believe in Free Trade as a fetish to be worn as a
" mere phrase round our necks, and who regard it as always indicative
" of precisely the same condition of tilings that it was indicative of in the
" Cobdeu period, or hold that circumstances might never arise of an
" Imperial character which might demand a revision of our jpolicy upon
" that sulijcct." Generally, I tliink, I may say that was the attitude of the
majority of the speakers on that occasion. At all events I find myself

231

reported as having said of preferential trade, " this is one of the best Eiphth Day.
" and one of the few means of drawing closer the bonds of unity, 3o April iy07.

" and increasing, as Sir Samuel GrilRth phrased it very properly,

"the solidarity of the Empire." I went on to add: "But it is 'tka[;"e!"*^

" not for the Colonies to urge the adoption of this proposal as one .,, ^ ,". ,

" which would be a benefit to them. It is really an Imperial matter, and

" until the head and heart of the Empire here " — meaning London,

Britain — " become animated by the same feeling, and become convinced

" that this is a good means to adopt, our voices must be futile, the expression

" of our views may be considered premature." I simply placed it on

record that, so far as we were concerned, we favoured " an Imperial tariff

" which Avoiald not only demonstrate the imity of the Empire, but assist

" to make it a potent reality." So even in 1887 we were face to face with

the question which still confronts us to-day.

The next Conference, which met in 1894, in Canada, at Ottawa," and
which was referred to by one of the Canadian Ministers present as a " Trade
Conference," took this question into very special consideration. Two
resolutions were carried, either then or in 1897, the first recommending the
denunciation at the earliest convenient time of any treaties Avhich now
hamper the commercial relations between Great Britain and her Colonies.
That resolution was carried unanimously. The next was that in the hope of
improving the trade relations lietween the Mother Countiy and the Colonies,
the Premiers present should undertake to confer with their colleagues with
a view to seeing whether such a result could be properly secured by a
preference given by the Colonies for the protection of the United .Kingdom.

Perhaps, as I have not the papers at hand, I may l)e pardoned for
alluding here to a fellow proposal of a distinctive character which was made
on the first occasion in 1887 by an exceedingly able representative from
the Cape, Mr. Hofmeyr. He proposed, not nmtual tariff concessions as
between the Mother Country and the Self-governing Dominions, but — I think,
for the first time, so far as I am aware — an addition of some small percentage
(T think he suggested 2 per cent.) to every tariff' of the Empire, either in the
Mother Country or elsewhere, so as not to affect in the slightest degree the
complete freedom of each portion of the Empire in framing its own tariff",
Protectionist or Free Trade. He sought to make that levy upon foreign
goods on entering the Empire, the sum derived to be devoted to Imperial
purposes, partly to defence. Naval Defence in particular, and partly to assisting
trade and commercial development. I do not wish to detain this Conference,
and therefore hurriedly abbreviate from memory Mr. Hofmeyr's proposal,
which lie supported in a most striking and able speech. He attended, though
in ill-health, the Canadian Conference of 1 SO 1, when he again alluded to the
proposals which he had previously suljmitted, but I do not appear to have a
reference to the page. We are very much indebted to Lord Elgin for the
mass of material which he has placed at our disposal. 1 only wish it had
been within my power to reail, mark, learn, and inwardly digest it before
we resumed these discussions. But the pressure upon us is such that even
in making a note of this reference to Mr. Hofmeyr, I have evidently
mis-stated the page. Now I have the papers. In 1894 the resolution was
passed for reciprocity betwe(>n the different Colonies and the Mother (\Miiiti-y,
and also between each otlier ; and another resolution in which they asked
for a denunciation of treaties. There were treaties at that time proposed
between New Zealand and Canada, and New Zealand and South Australia,
to which, however, no effect was given ; but the making of such tn^aties
was deliberately encouraged. Then it was that Mr. Hofmeyr, referring to
his former proposal, expressed his delibei-atc judgment to this effect —
without waiting to find the reference in order to quote the exact
words tliat it was higldy necessary for the stability of the Emjiire and

• See [C. 7553].
P 4

232

Eighth Day. almost for its existence that a customs alliance of some kind should be
30 April 1307. established ; that if it were not established the Self-governing Dominions

might be expected to turn to other Powers and possibly to enter into

Prefekential treaties with them which he thought would have an injurious effect. That
Trade. seems mucli neai'er to-day. He considered by anticipation the question of

(Mr. Deakm.) i]jq effect upon food j)roducts of his proposal, and, as I remember, thought
that any increased cost of a reasonable duty upon food products other than
those from within the Empire which were brought into the United Kingdom,
would be slight and of short duration. He entertained a strong hope and
expectation that his proposal would be adopted. I do not wish to dwell
further upon this side issue, except to say that if Mr. Hofmeyr's speeches in
1887 and in 1894 at Ottawa be taken together, they form a very notable
contribution to the discussion of this question from another point of view,
though an allied point of view, to that which is touched upon in the Resolu-
tion that the Commonwealth has submitted. They seem so important that I
venture to interject them here, becaixse of the intimacy of their relation,
although they are not directly material to the proposals we have before
us. It was in 1897 at which the Resolutions, which I read as of 1894,
were passed, showing that at the third Conference Preference was still
a live question. Then in 1902 we have the resolutions which Sir Wilfrid
Laurier has read to lis this morning, and which, I am glad to hear, he
proposes to re-athrm.-'- At every Conference, therefore, this issue has been
raised in some form or another, with increasing force on each occasion and
with increasing definiteness. It would not, therefore, be quite consistent
with the course that has been followed by previous Conferences if this issue
were not dealt with, and I hope even more thoroughly, at this Conference.
For that, too, we have a special warrant. I find in a document, which
appears to be in a sense official, issued by the Lnperial Federation
(Defence) Committee, reporting very fully a deputation to the Prime
Minister of 1904, that Mr. Balfour, speaking as Prime Minister, in reply to
their request that the question of Naval Defence and Imperial Defence
generally should be pressed upon the coming Conference which was due
in 1906 — which is this Conference, postponed for a year — Avent on to
say: "As everybody is aware, the circumstance which forced iipon me
" at least the absolute necessity of calling such a Conference was the
" position in which we have been gradually brought by a controversy which
" has nothing immediately or directly to do with, though it is indirectly no
" doubt connected with, the subject which has brought you all here to-day " —
that is the subject of Defeuce. " I am not going to say a word upon that
controversy " — that was the Tariff Reform controversy. " There are gentle-
" men in this room, probably, holding very many different views upon the
" subject, and it would be quite out of place and quite improper for me to
" drag in the merits of that controversj'^ even in the most indirect manner.
" But I quite admit that though the question of closer commercial union with
" the Colonies, or though a discussion of the possibility of finding an
" arrangement for closer commercial union with the Colonies, may -be the
" occasion for the summoning of the Conference, it is impossible, and it
" would be improper, that any such Conference should be confined to that,
" or should be restricted from discussmg anything connected with the closer
" luiion of one part of the Empire with the other. It would, indeed, violate
" the very fundamental condition which I believe to be essential to the value
" of such a Conference — the condition, I mean, that it should meet with
" perfect fi-eedom, unhampered and unfettered." I quote that for the
purpose of sho^ving that the late Govermnent, which had in view the present
Conference, held that the discussion of the possibility' of finding an arrange-
ment for closer connnercial union with the Colonies was the occasion, or the
jDrime occasion, for the smnmoning of this very Conference.

• [Cd. 1299] p. 36.

233

In order to avoid enloring upon the iield of British politics, so far as it Eip;litli Day.
embraces proposals for Tariff Reform, I ch^sire to exclude its local relations 30 April 1907.

from my remarks as much as possible. We have, however, had addressed to

US in Australia, an appeal on this question, so unusual and (!manatinf:f from a 'xu^^'p^'^^

large number of representative Mendjers of the liritish Parliament, that one .^^ ' .'. .

feels under some obligation to refer to it. This was an appeal from Members '^' '" '"

of the Imperial Parliament to the electors of the Commonwealth of Australia.

It set out that in a few nionths they would Ije choosing representatives in a

Parliament of the Commonwealth, and that Fiscal Preference was one of the

questions to be submitted to them, 'iluuking this gravely affected them,

they addressed an appeal to our electors, taking the view that " there is

no offer within your power to make " — that is, within the Conunon wealth's

power — " that could compensate us for a tax upon our food." Again, they

speak of the possibility of working men being "endjittered by a sense of

the wrong done to them by a tax upon food." In conclusion, though it is

a short address, they protest in order that goodwill should be maintained

between us, thjxt " you should not encourage those among you who are

proposing to put a tax upon our food."

Mr. ASQUITH : What is the date of that ?

Mr. DEAKIN: June the 22nd, 190G. This appeal was made to the
electors of the Commonwealth of Australia, and those electors have given
their answer very decidedly. It was very much more in favour of Preference
than ever before — in favour of some degree or kind of Preference, though
doubtless dillering as to its extent. The result showed certainly a majority
of 3 to 1, and probably a larger majority. By way of comment upon their
plea, may I saj^ that we venture to hold their terminology rather inexact.
What is called a " tax " on food would be more appropriately referred to as a
duty ; and in our experience a duty is not a tax, of necessity ; it need not
raise prices. We have illustrations within our own country in which we
have imposed duties of a deliuilely protectionist character, which have not
had the effect of raising prices in our community. Of course, no statement
whatever can be made as to the effect of " duties " which would apply to all
of them, or even to many of them. They may be of any height or of any
character, apply to any part or totality of a product. There are duties some
of which would be no tax at all, some of which woidd impose a partial tax,
and some which might be wholly taxes. If I do not err, all the duties in
this country, with possibly an exception for cocoa and chocolate, which
have a slight protectionist flavour- with that single exception, so far as I
know — the duties in this country are imposed as taxes, so to speak ; that is,
with the sole purpose of raising revenue. We, on the contrary, impose duties
from mixed motives ; some purely to raise revenue ; others not only with the
object of raising revenue, but of giving a stimulus to local production ; others
to foster that production without any regard to the amount of revenue that
may accrue — these, of course, are levied in differing proportions. To take
the tariff' of the Commonwealth, or any other tariff, and analyse its duties,
would require a very elaborate scheme of classilication to discriminate
between the different effects which are either intended or achieved.

With that preliminary caution may I say that this reference to a tax on
food appears to us to be appropriate enough, considering its source, because
the phrase wa? evidently vised having regard to the British tariff. There
it is alleged that some 18,000,0O0L is levied directly, and I have seen
another estimate which said 5O,000,O00Z. indirectly, though I do not quite
xmderstand how that could be, upon food and food products,

Mr. ASQUITH: Mainly drink.

234
Eighth Day. Mr. BEAKIN : Does food include drink ?

30 April 1907.

p Mr. ASQUITH : It is a very simple matter. Our tariff consists, so far

Trade. ^^ these things are concerned, of a tax upon various forms of alcohol, tobacco,

sugar, and tea, with one or two small duties like those upon cocoa and dried
fruits, which hardly count, and practically that exhausts our tariff.

Mr. DEAKIN : I thought that physicians had settled the question
whether alcohol is a food or not.

Mr. ASQUITH : They are still disputing it.

Mr. DEAKIN : One further question which apjjears to be raised — and I
am entering into no academic discussion, — is, when a duty is a tax, who pays
that tax? I only refer to this because the subject appears to be dealt with
by a gentleman who, I understand, occupietl, and possibly still occupies, the
highest position in the orthodox sect of Free Traders. I think he was, if he
is not still, the Secretary of the Cobden Club — Mr. Harold Cox, M.P. In your
debates, which I had the opportunity of reading Avhile journeying here,
Mr. Cox's testimony on that subject is remarkably clear. He pointed out that
Canada had a substantial preferential tariff ; the duties paid on British goods
were 2,000,000L a year. That was 33 per cent, less than the duty which
would have lieen charged on the same goods if they had been foreign goods ;
if the goods had been foreign, the duties would have amounted to 3,00(),000L,
but, if he credited Canada with the 1,()00,000L she did not levy on our
goods, he must also credit her with the 2,000,000?. she did levy. We had,
therefore, in his opinion, practically to bear a burden of 2,000,0001. in order
to obtain a remission of 1,000,000?., which, he added, was hardly good
business. Mr. Cox is an authority, and when he says that the importing
British merchant had to bear the burden of the 2,000,000?. of duties, he
clearly asserts that the importer pays the whole of the tax — the whole of the
duty which he prefers to call a " tax."

Mr. ASQUITH : I do not so understand it, but I am not concerned in
defending Mr. Cox.

Mr. DEAKIN : It is very hard to put any other meaning upon it. He
said we had practically to bear a burden of 2,000,000?. — " we " being the
merchants of Great Britain — those who exported from Great Britain for the
purpose of importing into Canada. If they bear the burden of 2,000,000?. he
does not suggest, I suppose, that the Canadian people bear another 2,000,000?.
over again. That does seem to me quite a hopeful light thrown upon the
burden of duties borne by the foreigner.

The reference that was made at the conclusion of the Parliamentary
appeal to the preservation of goodwill, is one to Avhich there was and always
will he an instantaneous response. There can be no j)Ossible peril to goodwill
in this matter. There may be a strong difference of opinion as to the best
means of giving effect to that goodAvill, but certainly the sentiment would
not be diminished by the particular character of that opinion. We argue
something in this way : All trade, speaking broadly, exists for mutual jDrofit,
and is based upon mutual profit. Just as every individual who engages in it
desires to have the largest trade possible, so does every nation; Nations,
like individuals, live by their labour, their production, and their exchange.
This is so true that not only are there wars in fact which are called
" commercial wars," but trade is always sought for by aggressive means

235

and sometimes fought for with the sword in order that it may be acquired Eifrhth Day.

or retained. What wc suggest is a trade in preferences, in trade advantages 30 April 1907.

which should be conceded to each other, on the usual principle of trade,

that it shall be to the l)(>nefit of both parties concerned. So far as I am ^pJi'^^.r"'^^

aware no one has yet fathered, or is likely to father, any such proposition „ n • W i )

as that this matter of business is to be dealt with to the advantage of one of ^ ' '' '
the paities only. There is not any business of that character, or which is
assumed to be of that character. It must yield mutual advantage, and of
the value of that advantage each party must be the judge.

Mr. ASQUITH : I entirely assent to that proposition, if I may say so.
It admirably states the case.

Mr. DEAKIN : That is why the goodwill cannot he disturbed. It must
always be admitted that each of the i>arties to the bargain must be the best
judge of its own gain. We may have a strong and clear opinion as to how
the other bargainer should proceed, in his own interest, but after all that is
his affair. W(! may regret that we cannot do the l)usiuess. but necessarily we
must in eveiy case bow to his decision. So in the present instance it appears
to us to be possible for each to impose duties on a certain scale — putting
aside the advantage which may Ijc gained from those duties —granting each
other preferences under them without loss or risk of loss.

The question, as it seems to me, which foreign nations will then put to
themselves is not whether duties have been imposeil for this particular
purpose by Gi'eat Britain or by Great Britain and all her Dominions together.
What the foreign exporter seeks is the best market ; the market where he
gets the best price, the biggest market. The position of the United Kingdom
appears to us to be so unique, that it not only is to-day the l)est market for
all the world, but may easily continue to be still the best market for all the
world outside its own Dominions, even if preferences were conceded to
those Dominiojis when their goods were entering its ports. That, again,
is a business question. If the foreign producer can still sell in your market
at a profit, even thougli it be a smaller profit than now, so long as it is
a profit he will be induced to continue his trade. If, as is probably the case,
even with any duty which you would impose, Great Britain still remained
absolutely the best market in the world to him, the fact that it was not
as good as it had been would not operate. Markets vary everywhere, owing
to circumstances too many even to indicate. Merchants are accustomed to
sell, sometimes in good, and sometimes in indifferent, markets, and it does
appear to us from our point of view that we are not suggesting anything
unreasonable in the proposals we make even in respect of food stuffs and
raw materials, both of which we quite admit should be most carefully
scrutinised before they could be dealt with. The special circumstances of
this country seem to us to offer a margin in which both of those could be
dealt with, and effectively dealt with to our great gain, yet without altering the
place which the United Kingdom occupies to-day as probably the best market
for them in the world.

It is not for us to i:)ropose a new or criticise your present fiscal policy,
but we may remark that consideration for your own British industries might
lead to duties being levied, the object of which would l)e either to revive those
industries wliicli had suffered or were suffering, or to expand those already
existing. That involves another set of principles altogether, and I slioidd be
distinctly departing from the rule laid down for myself if I entered upon any
iliscussion of the merits or demerits of local protection. It ought to be clearly
understood that my reason for mentioning it is this : that when the outer
Dominions suggest a preference they not only believe that you should have
that opportunity of profit, but also that in considering any proposal for

236

Eighth Day. preference to tliem, the first obligation upon every British Parliament is to

30 April 1907. consider its own citizens, its own indnstries, and its own advantage first.
So far as you might think it right to exclude us and everyone else from your

Preferential ^-^^j^ markets in order to maintain, or I'etain, or extend any kind of production
or interest of your own, it would be impossible for us to raise one word of

(Mr. ea -in.) complaint. That is entirely a matter for the discretion of the people and the
Parliament of Clreat Britain. May I be forgiven for even mentioning this
truism, because it occasionally is inferred that the attitude we adopt is
of another character — that we are looking for same sort of eleemosynary
aid which is to be given in consideration of our youth and inexperience.
We may be youthful, but in this matter we are fairly experienced. In
our own tariffs we distinctly study our o^vn interests, and hold that the
same duty rests as seriously upon the Government and representatives
of the people of this country as it does upon us. We approach this question
of preference with that preliminary admission, it ought not to be necessary to
mention it, that of coi;rse our proposal is made, admitting that, first of all, you
should consider your owai industries, your own production, and youj own
people, and impose whatever duties you think fit in regard to ihevaJJ Only
after that should you undertake to go further and enter upon the question of
preference, when you see it to be to your advantage so to do. I use the word
"advantage" in that last connection, as going, perhaps, beyond pounds,
shillings, and pence, either in the matter of revenue received or preference
conceded. If the result of granting a j)reference is, for instance, to largely
build up the Dominions beyond the Seas, it should be remembered that
they were, are, and are likely to remain the best customers of this country.
Consequently you have a direct trade interest in multiplying their population
and increasing their consuming powder by means of preferences.

The question of preference comes in only after yoii have considered
your own interests, your own social system, your own financial system,
your own industrial system, and whatever else yovi think fit to take into
account. On this matter we have no dogmas ; our own method is to study
each industry and its needs, or each kind of production, by itself in a business
light, and to see how far it is likely to pay the country to foster it or to
ignore it. Just in ^he degree that we deem it to be a good Ijusiness pro-
position, we undertake without fear the experiment of fiscally assisting it.
If it appears to us an imattractive business proposition, we let it alone. We
are bound by no shibboleths ; we simply, to the best of our aljility, deal
with our duties as a merchant deals with his own business in his own interest.
Preference for Preference Ave hope and believe woxdd be profitable to both.
We have the strongest reasons, we think, for believing it ; at all events, we
are satisfied that it could be made profitable to us.

There is one illustration of the method we ourselves attempt to apply,
which appears to us to be practical. It is in a Blue Book published in 1904,
headed "East India Tariff's; Views of the Government of India on the
cpiestion of Preferential Tariff's." To that is annexed a general report as to
which I have nothing to say, as it relates to India. I find Enclcisurc No. 1 is
a minute of Sir Edward Law, K.C.M.G., C.S.I., Financial Member of the
Council of the Viceroy and Governor-General of India, dated 31&t August
1903. What is valuable is the manner in which the relation of India to
each country is treated. It is handled precisely as we endeavour to handle
each proposal for a new customs duty — either its increase or its decrease —
but liere it is treated in relation to the possil)ilities of retaliation. Each
country that trades with India is taken separately ; the quantum of the trade
is given ; the suliject matter of that trade defined ; its value to the customer
country is considered ; and the trade from India to that coimtry is also passed
in review. That memorandum exhibits exactly the method in v/hich in the
Conunonwoallh we endeavour to approach any such proposals. Sir Edward

237

Law complains of the deficiency of his materials, and speaks tentatively just Eighth Day.
as one Avould do undrr the circumstances, Init Avhat is pertinent in this 30 April 1907.

particular connection is his study of export and import trade and its character

and possibilities on both sides. That represents a business-like way of I'i'ekei'en'tiai,
disposing of questions of this kind, exhaustive having regard to the materials "'^^'^■.

at hand, so that I have taken the opportunity of quoting it as a l)etter ^ '""■'

illustration than any statement of the way in which we try to handle such
matters.

Before closing this argument, may I say that a good deal appears to
us to depend upon what jo\i make the unit of your consideration. I have
already achnitted that the British t;iri(T should be dealt with, taking the
United Kingdom as the unit first, and that the other units should come
afterwards. At the same time, those other units together with the United
Kingdom make up what we speak of as the British Empire. The view
that has very strongly pressed us in relation to all these questions of the
tariff and a great variety of other questions, especially such as we have
been considering at this Conference, is the future of the larger unit, the
Empire as a whole. After the United Kingdom has studied its individual
interests ; after Canada, and the Commonwealth, and South Africa, have
studied their individual interests within themselves, and in their dealings
with each other, necessarily the greater question presents itself as to the mutual
possibilities which those units possess to-day. Their fortunes are bound up
together, tlieir trade and commerce are mostly with each other. You come
then to the next stage of the question which is quite separate from the first,
because you have a great political motive for inquiring how far it is possible
for these units to assist each other by interchange. That interc-hauge
must be mutually profitable in itself, and even if it were onlj^ slightly
profitable might become of immense importance as a factor in the interests
of the group of units of the Empire considered as a whole. Whatever the
possibilities of trade may be between us, and they appear to our minds to be
considerable, we are never blind to the fact that closer relations of this
kind might play a most important part in waj's too nimierous to mention
not only in bringing us together, but in keeping us together and making us
stronger by union for national business bargains. Certainly we should then
become better eqitipped for making those bargains Avhich nations from time
to time enter into in order to preserve the peace of the world. We proceed
on the supposition, which is nmch more than a supposition to us, that it is
possible in this way to strengthen the Empire as a whole, and this becomes
one of the strongest motives we have for looking hopefully to movements
of this kind, even while we recognise that they have to begin as business
operations, and cannot succeed if they are conducted, or sought to bo
conducted, in breach of business principles.

So far as I can speak for the people of Australia, tliis motive — speaking
of them as a whole — counts for as much as an}' promise of direct material
advantage to themselves, if you can speak of direct material advanlagi; to
us, apart from that of the whole Empire. Personally, I do not think j-ou
can. United as we are, the Ijcncfit of one must Iw a benefit to all, and, of
course, the benefit of two is better than the benefit of one, and so on. But,
for the moment, speaking as if the interests could be severed, I believe a
motive qtiitc as strong and probably stronger- than that of tlic money gain
or advantage of this trade, influences the bulk of the people of Australia,
through tlie idea of having more intimate relations with their own
countrymen antl being more united with them in peace as well as in war.
They look to the operation of traile and to its great agencies, particularly
the shipping of the Empire, to uphold the proud position which it occupies
to-day. Lord Tweedmouth, -when he was with us, mentioned some very
striking figures on that point. Not the least by any means of the

238

A -I iq^7 advantages of the increase of trade within the Empire is an increase in-

^^'' ■ the strength of the mercantile marine with its general relation to naval

Peeferential supremacy, and also in itself a great means of employment and source

Trade. of national strength. Anything that multiplies the shipping of the Empire,

(Mr. Deakin.) any devices that increase its cable commimi cations and postal facilities are

all extremely valuable means of unity to be sought in themselves quite

apart from preferential trade, but where preferential trade helps them, it

is another argaunent for preferential trade to whatever extent it encourages

them. Ships and cables, and raj)id regular frequent communication in all

forms appeal very strongly to the people of Australia, perhaps' because they

are, with New Zealand, the most remote outposts. We look forward with

hope to increasing every means of inter-Imperial alliances in association with

trade, and also indej)endently of it by other and more direct means.

In the Australian attitude on this question, and I believe the attitude to be
the same in all the other Dominions, these really are very considerable motives.
Our people and the thoughtful all the world over recognise the immense
advantage of the support they gain fi'oni each other as parts of this Empire.
They cherish that union and desire to possess even stronger ties than exist
at present. They realise that the modern world is fall of critical occasions,
especially for a great world power with enterprising rivals, and are very
anxious that any means of making the Empire more distinctly seK-dependent
both in peace and war, should also be sought and used with a view to
jjossible emergencies. So, from quite a variety of what you might consider
at first sight outside considerations, they are powerfully drawn towards the
proposal which is roughly embodied in the resolutions now sidjmitted
to the Conference. Peace, education, progress, our independence, and the
maintenance of our social conditions, are all bound up with the capacity of
the empire to hold its own even against hostilities. Years ago I had occasion
to point out to those with whom I am associated in the Commonwealth,
that we owed our opportunities and possibilities to the shelter of the
position which we enjoyed under the flag, and to remind them that what we
prize in the way of liberties, institutions, opportiinities, racial relations,
and power depended upon the maintenance of this Empire and its strong
arm. Many of them share that view. That is the deepest self-interest we
have in union — an interest which we share in common with you. The
possibilities of the severance of this Empire, of its defeat and destruction, are
too painful to contemplate, and, thank Heaven ! in no prospect that we can see.
But the mere suggestioii of them and their possibilities makes us turn with
even more intense anxiety towards every opportunity, small or large, which
we can find for preparing ourselves against a day of trial and for securing
what we hold dearer x^erhaps than life. To us it appears that henceforth the
individual will become more and more dependent upon the social and national
structure in which he finds a place. It makes all the difference whether yoii
are grains of sand or the same grains compacted into solid rock. Anything
that encourages the development of Imperial organisation, which, Avithout
limiting the self-governing powers of the several parts, or unduly trespassing
on the individual liberty of the citizen, shall compact them together in
co-operative relations for the discharge of social duties, political obligations,
and industrial efforts — every possible increase of that co-operation — marks
a higher stage in civilisation, giving greater opportunities to the individual
and greater strength to the nation to which he belongs. That is a political
gospel. The nation and the individual act and ro-act upon each other, and
in the liritisli I'^mpire we think we see the greatest future at present open
to any people for that inter-action affording the fullest free play to individual
energy and (enterprise, and at the same time by willing consent uniting its
peoples togi'ther for their i^reat connnon ends of one national destiny.

239

Coming down from gpnoral consirlorations to the proposals omborlied in Eifrlnli Hay.
this Kesohition, while the motives l)y which we are attracted are ot: that 30 April 1907.
general nature, they are supported by reasons of a much more precise 7

character. I see to-day in one of your leading newspapers, an article Trade.

by Mr. John Holt Schooling, a well-known writer, whose diagrams elucidate ^j^ Di-akin.)
so manj" problems. He furnish(>s several tables, one relating to India, which
are devised on a new plan of taking .yearly averages during each decade.
The general result of his examination of the Indian figures is that tlicy
show a continuous fall of imports from the United Kingdom as compared
with imports froni all countries. Then we come to the Australian Counuon-
wealth, and commencing with the year 1880, when the imports from the
United Kingdom were 72 ' 7 per cent, of the imports from all the countries
into the Connnonwealth, he shows their steady decline down to lOOf), when th(^
percentage of proportion had fallen to CI ''} p(!r cent. This he tcMMus a large
and continuoiis fall. Of course, this table does not include our inter-State
trade.

Mr. ASQUITH : What do you say the figures are now ?

Mr. DEAKIN: For 190.'') he gives the imports from the United Kingdom
as 61 • 3 per cent, of the total imports from all countries. He does not take
190C.

Mr. ASQUITH : I think all the figures are not out yet.

Mr. DEAKIN: I have, I think, the 1000 figures with me. He summarises
It ill this fashion : " What has been the course of trade during 1880-1905?
" Australia's purchases from all countries have risen, and Australia's purchases
" from the United Kingdom have fallen. Tlu> latter were 24 • 3 million pounds
" yearly during the first decadf>, and 22 ' 4 million pounds yearly during the
" last decade. These two opposite courses of trade produce in combination
" the result disclosed in the last column of Table II. A large and c-outinuous
" fall has occurred in the United Kingdom's share of Australian markets.
" For example, during the first decade our share was 72 " 7/. per 100/. of
" Australia's purchases. But during the last decade our share had fallen to
" 61 • 3Z. per 100/. And the fall was continuous. Not only are we making
" less advance in foreign markets than is made liy our trade rivals, but also
" we are losing our place as a seller in the market of Ih-itish Colonies. One
" of the causes of this loss of position by us in foreign markets and in the
" markets of British Colonies is the fact that we give to each of our rivals a
" great trade advantage. We give to our rivals a fi-ee market of 43,000,000
" persons in the United Kingdom, to add to their own free market in their
" own country. For example, the United States possess an open market of
" 82,000,000 persons in the United States, plus an open market of 43,000,00(1
" persons in the United Kingdom— total, 125,000,000. But the United
" Kingdom possesses an open market of 43,000,000 in the United Kingdom,
" which, moreover, is considerably interfered with l)y the foreign goods we
" buy." His third table deals with Canada, and shows in the same way a
large and continuous fall. The ft)urth table deals with the Straits Settle-
ments, with a similar result, and the last table deals with the Cape of Good
Hope, also showing a large fall.

240
Eighth Day. Mr. ASQUITH : VVJiat do you mean by a large Ml r

30 April 1907.

Preferential

Trade, Mr. DEAKIN : In percentage.

Mr. ASQUITH : A large fall in the aggregate, or a large fall in propor-
tion to the whole ?

Mr. DEAKIN : In proportion to the whole. For instance, the percentage
in Cape Colony dropped from 80 "3 in 1880, in 65 "4 last year. It is in
its proportions that he is measuring it.

Then, looking a little more closely at the coiirse of British and Australian
trade, I find that the greater part of the goods that Australia purchases
abroad are still obtained in Great Britain, and to that country a large propor-
tion of Australian produce is exported. But thoiigh British superiority as
the chief market for Australian trade is maintained, the extent of that
superiority has distinctly diminished. Take the official figures of the
development of British trade from 1860 onwards : they represent the average
annual importations into Australia from Great Britain in each decennial
period of goods of British or Irish origin. The figures are, for the period
1860-69, omitting odd figures, 12,400,000?. ; 1870-70, 14,400,000?. ; 1880-89,
21,700,000/. ; 1890-99, 18,400,000/. ; and 1900-05, a quinquennial period,
20,800,000?.

Mr. ASQUITH : Those are British imports into Australia.

Mr. DEAKIN : The average annual imports into Australia from Great
Britain, during that decennial period, show that increase, which has then to
be measured with the general increase of our trade. It has been urged
that an important influence affecting British trade is the loss of the direct
carriage of goods produced in the continent of Europe, which formerly
were sent to Australia by way of England. Mr. Schooling did not deal
with this, but took the imports in gross, that is to say, he took all
those as English which came from England, and the balance as
foreign. It is impossible (hiring the earlier years above referred to,
to distinguish directly from the trade statistics, either of Australia or of
the United Kingdom, the amount of foreign goods imported into Australia
by way of England. But though the total of all goods not of British
origin is not known, yet a competent Australian authority has been able to
make for me a close dissection of the returns, with the results shown in the
following table. From this, it will be seen that there has been little change in
the volume of foreign exports to Australia coming by way of England during
the last 20 years. Look at the average annual imports into Australia from
foreign countries, distinguishing the value of goods coming direct or by way
of England ; in 1860-69 the direct importations were 3,200,000?. ; imported
by way of England, 700,000?.- total, 4,000,000?. ; in 1870-79, direct impor-
tations w(,'re 2,800,000?. ; imported by Avay of England, 1,140,000?. — total,
4,0(J0,000?. ; in 1880-89, direct importations, 4,900,000?. ; imported by way
of England, 2,00(),()()0?.- total, 6,900,000?. ; in 1890-99, direct importations,
5,900,n()0?. ; imported by way of England, ] ,500,000?.— total, 7,500,000?.;
and in 1904-05, direct importations, 11,300,000?.; imported by way of

241

Englaud, 2,1()0,0()0/.- total 13,7t)(J,OUO?. Having put tliesu luu general Eighth Day.
sets of ligures before you, let us now uotc the respective positions 30 Apiil l!);)7.

which Britain antl foreign countries hold in the Australian marivct. The

changes that have taken place daring the last 40 years disclose this: I'kkkkhentia!.
the average annual import into Australia in the decennial periods, Ix-ginning uadl

in 1860 and ending in 1905, that last period being live years only, C^''- L"^^"'^'")
was, for the first period, from the United Kingtlom, 12,100,000^ ; foreign
countries, 4,000,000/. ; the next period (1870-79), from the United Kingdom,
14,400,0001; foreign countries, 4,000,()OOL ; the next period (1880-89),
from the United Kingdom, 21,700,000/.; foreign countries, G,90(),(,)00/ ; the
next decennial period (1890-99), from the United Kingdom, 18,400,000/. ;
foreign countries, 7,500,000/. ; and the last quinquennial period (1900-05),
from the United Kingdom, 20,800,000/.; foreign countries. in,700,000/.
Putting it in another way, if the trade of the United Kingdom l)e repre-
sented by 100, then the foreign imports into Australia for those periods arc
represented by 32, 28, .'->2, 41, and 06 respectively, showing a verj' remarkable
growth in the latter period.

Mr. LLOYD GEOIJGE : You have not the exports to foreign
countries ?

Mr. DEAKIN : Not in this. They, too, show an increase.

Mr. ASQUITII : Foreign countries have been buying your goods and
paying for them by selling their goods to you.

Mr. DEAKIN : Buying more wool. Formerly you took nearly
all our wool, but now foreign nations take a share. Those ligures
show that a change is taking place in the character of Austi-aliau
imports, and what that change is. The most important developments in
the foreign ti-ade of our country have been those manifested tluring
the last 20 years of that period. If we use qTiinquennial instead of
decennial periods the returns of the Statistician's Ofhce in Syiluey which have
been generally relied upon in local discussions show that in 1881-85
the imports from the United Kingdom represented a value of 24,J()0,( )()()/. as
compared with 6,800,000/. from foreign countries, the latter being 28 per
cent, of the former ; in 1901-05 the respective values were 20,400,000/. and
13,800,00t)/., the imports of Australia from foreign countries being, therefoi-e,
67 ■ 5 per cent, of the imports from the United Kingdom. Put that another
way. While British exports to Australia fell away during the 20 years to the
extent of 4,000,000/., foreign exports were increased by 7,0(111,000/. Here let
me guard against a misapprehension. The develo]>ment of Australian
industries, to which in some quarters this great slnfting of our purchases has
been attriluited, cannot be pleaded as a suflieieut cause for the decline of
the British-Australian trade, because, as the iigures just citetl show, however
local production may have grown, and whatever other influence it may have
had upon our growth there has been a sul)stantial increase in the cond)ined
British and foreign imports into Australia during the past 20 years. It is not
necessary for the purpose of this argnunent to trace in detail the classes of
British goods that are being replaced by foreign-made goods, Imt, speaking
generally, and taking the year 1885 as the point of conqjarison, the trade returns
show substantial losses of British trade are caused by foreign gains in haber-
dashery and apparel, cement, earthen and china ware, cabinet ami ujiholstcry
ware, glass manufactures, hardware and cutlery, wrought and un\vrou{;lit
leather, paper, silk numufacturcs, some classes of woollens, and many other
articles of minor importance. The character of the losses of British exj^orts is

E 48668. Q

242

Eighth Day. plain — they lie in mauufactiired goods and iu classes of those goods in which
30 April 1907. our local manufacturers are not conspicuous.

i REB'ERF'NTI AL

Trade. Mr. ASQUITH : Which are the classes of your own local or native

(Mr. Deakiu.) manufacturers which you have shown in this development — wool ?

Mr. DEAKIN : We do not reckon wool as a manufacture, except as
woollen cloth.

Mr. ASQUITH : Yes. I meant yarn or cloth.

Mr. DEAKIN : Speaking from memory, there has been a growth, but
not a large or rapid growth, of wooUen manufacture. There may be some
increase in the making of aj)parel.

Mr. ASQUITH : Boots and shoes ?

Mr. DEAKIN : Yes, some increase, but none, I think, in cabinet or
upholstery ware worth mentioning, nor in glass, hardware, and cutlery
(cutlery we do not manufacture^, nor in paper or silk manufactures.

Mv. ASQUITH : I suppose you have practically no cutleiy manu-
factures ?

Mr. DEAKIN : None. Our manufactures are still in their infancy.

To interpret these facts aright, one or two possible explanations suggested
must Ije disposed of. The expansion of the foreigTi at the expense of the
British trade with Australia is not due to anj^ superior quality or cheapness
of the foreign-made article. England can manufacture most descriptions
of exportable goods as cheaply as can any foreign countr}^, and there need be
no increase of general prices to the Australian consmner, had the Motlier
Country a larger share of the Australian import trade. Of course, some
portion of British loss of trade, has, undoubtedly, arisen from the conserva-
tiveness of British methods, but the extent of the loss thus arising has been
greatly overrated. The present position of British trade in Australia is
ahnost wholly due to the settled policy adopted by most foreign countries,
of reserving their home markets for their own produce, and reserving their
' competition for other, especially British markets, for by this policy they

are enabled, step by step, to oust Great Britain from the trade of her
possessions.

Something must be said of the manner in which foreign trade is
conducted, for this is detrimental to the interests of all the producing
States that receive their goods. It has been amply demonstrated that the
practice of " Dumping," or the placing of large quantities of produce below
cost price, tends to destroy established industries in the countries receiving
the dumped goods. This practice is at times largely employed by foreign
manufacturers to injure British trade, not only in Australia biit everywhere.
Great Britain gets nothing in return lor her gift of her markets from her
rivals. She makes them a present of it, and, so far as I have obsei"ved, does
not even secure their friendship in return.

Mr. ASQUITH : Can you give me any case of dumping iu Australia on
a substantial scale ?

243

Mr. DEAKIN : Wc have, of course, a fjood deal of what you may call Eifiliil) D«v.
casual or irregular dumping of cheap shijiloads. Those I do not dwell ni:>ou. 3o April 1907.
The chief danger that we had to cope with lately was with regard to
agricultural implements, which, from information received, were manu- '"^TuAnr^'*^
faetureil in the United States. Wc had reason to believe that these
were being brought in with the intention of being sold xmder cost in order
to cripple and destroy the local manufacture. We have dealt with that
in a very drastic fashion by an Act which will enable us to cope with the
great Trust that is understood to be behind this operation. That is the most
conspicuous case recently.

Mr. ASQUITH : Were not they let in free under your tariff ?

Mr. DEAKIN : Not harvesters, strippers, and l)inders to which I am
referring now, and w'hich were dealt with under a particidar law passed last
session.

Mr. LLOYD GEORGE : What is the tariff on those ?

Mr. DEAKIN : It was 12i- per cent, on the value, but now we have a
fixed duty of 121. each machine.

Mr. ASQUITH : When did that happen ?

Mr. DEAKIN : Last year. Foreign manufacturers are al)]e to attack
our market by having behind them the security of their own market with
fi'ce access to British markets, and by reason of llie conipuralive lightness
of the Australian tariff to invade Australian markets also.

Glancing for a moment at another aspect, may I notice in passing, the
extent to which foreign countries have prevented the natural increase of
British trade. In the ten years 1895-1905 British exports to British possess-
sions, including Aiistralia, increased from 91 to 134 millions, while the
exports of foreign countries increased from 51 to 103 millions. Taking goods,
the produce and manufacture of Great Britain, the export to British posses-
sions in 1905 was 113 millions, or only 10 millions in excess of the exports of its
foreign competitors. Indeed, if India be omitted from consideration, the
foreign imports into British Colonies exceed in value those of Ib-itish origin.
Now this great change has not been brought about by ordinary- connnercial
methods. The gradual exclusion of Great Britain and her possessions from
foreign markets is, of course, deliberate, intentional, and consistent. Not
onlj' do foreign countries, for the most part, reserve their home market to
themselves, as far as it has been practicable and politic for them to do so, but
by sulisidies, bounties, and trade regulations, they stimulate their own exports,
and materially restrict those of their rivals. 1 can only follow this part of the
subject a short distance, but it is a very important part, though the m(\ins used
arc much more than fiscal. The point which c'annot l)e overlooked, and must
he kept constantly in mind, is that our trade is affected very largely, and will
be injured in future b\' the aggressive policy adopted l)y foreign countries.
Australia, as a producing nation, would be vastly benetiteil if it could send its
goods everywhere on fair terms ; but our commercial rivals exclude us with
impunity from great areas which do not produce naturally the goods which Ave
could send them if these restrictions were removed. It is not possil)le, for
example, to send anything to German Colonies, for not only does their Govern-
ment subsidise its ships to cany produi'(> cheaply (the sum of 350,000/. a year
being spent in shipping bounties), but in German Colonies (ierman goods are
eillier exempt fi-om customs duti(>s entirely, or are taxed at a low sealcN while

Q a "

Preferextial
Trade.

(Mr. Deakiu.)

244

EigUth Ds.y. other goods have to pay high import duties. This is Preference carried to
30 April 1907. an extreme. It has the full effect intended by its authors of restricting
German Colonies to German commerce. But, beyond this, both on their home
Trade^^^'^ and colonial railways, German goods intended for export are carried at
almost nominal rates.

France adopts a somewhat similar position. The laws regulating the
commerce of that country with her Colonies and Dependencies are so framed
us to discriminate largely in favour of French products and French shipping.
Some little time ago an endeavour was made to open a market for Australian
produce in France ; it was then found that butter coming from 'Australia was
subject to more than twice the duty imposed on the produce of the United
States, Denmark, Belgium, and other countries, the produce of these States
being in turn subject to a considerable impost. In fact, the French market
was practically and designedly shut to our produce. Nor do our disabilities
end with duties on manufactured goods, for though few countries deliberately
put duties on raw material of manufactures, yet America levies over
50 per cent, on Australian wool, and this practically closes the American
market to the chief Australian staple. It is needless to recapitulate the
various difficulties which the Australian exporter has to contend with in all
other countries than Great Britain, especially while the Mother Country
herself will not discriminate between us. The only articles which foreign
countries seem willing to take are raw materials absolutely necessary for their
own manufactures. This is a subject which, from the British point of
view alone, might be pressed very far. Of course, that is not my business.
We have to face the facts as we tind them, dealing so far as we can with
political attacks upon trade by a political defence of trade, and undertaking
any reprisals which may be necessary to that end.

On all sides the export trade of Australia is blocked by ever increasing
barriers erected by foreign co^mtries. Europe ought to be an excellent
market lor Australian mutton and ])eef, as many European workpeople hardly
ever have meat to eat — or do not regularly have meat to eat— yet we have
practically no trade of this kind whatever with any European country except
England. Nearly every European Government has erected, in the interests
of its agrarian population, restrictions either by way of customs duties or of
regulations ostensibly in the interests of health, which elfectually prevent the
development of trade. I am indebted to Mr. Coglilan, the Agent-General for
New South Wales, who recently visited Germany, for the information that
the wliolesale price of mutton there is over Gd. per pound. That country
imposes upon meat a duty of seven-eighths of a penny per pound, with the
immediate possibility of an increase to 2kZ., which is the duty fixed under
the new tarilf. In any circumstances this latter duty is prohibitive, but in
order to make it absolutely certain that no Australian mutton can be sent to
Germany, the line of steamers trading between Germany and Aiistralia, which
is subsidised by the German Government, is expressly debarred by its
charter from bringing into Germany fi'om Aiistralia fresh or frozen meat,
butter, daily produce, and cereals. Here, again, a shijjping subsidy strikes,
and strikes hard, against British trade. As if this were not enough to prevent
importation there are restrictions, nominally in the interests of sanitation, of
the most rigorous order. It is provided, for example, that in regard to
frozen beef, the breast, peritoneum, lungs, heart, kidneys, and in the case of
cows, the udder also with the lymphatic glands belonging thereto, must be
united to the carcase in their natural arrangement. Carcases divided into
halves must be packed together, and the head of the lower jaw with the
masticatory muscles must be imported with the carcase in such a way that it
can be seen at a glance that they belong to it. This provision would exclude,
as it is intended to exclude, Australian meat from the German market,
even if there were no duty. A similar system is now being proposed,

245

I tliink, iu Sweden. Tu Fraiu'o tlic practice in regard to frozen mutton Eijjfatli Day.
and l)eef is much tlie same as in Ciermauy. The duty on mutton 30 April 1907.

is lid. per pound, with a surtax of 25s. per ton where the meat is not

imported direct from the countrj' of origin? Hence, if any Australia7i Pkffekkm'al

mutton is first sent to Enghind and then on to France, it has to pay a * ,'.

higher duty. At one time there ^vas the prospect of (;onsiderable develop- ^ '^' ^ '"'''

ment in the tinned meat trade of Australia, especially with Germany,

but the importation of this class of meat is now entirely prohibited. In

France, tinned meats are allowed to be imported ; but the duty of 4*^. per

pound" for direct shipment with the other charges on the tins and on the

cases, brings the duty to nearly l\d. per pound. The policies of other

coimtries of Europe follow on much the same lines. Where a nominal

duty is insufficient to keep out our products, the agrarian party obtains

the imposition of sanitary and port regulations which effectually prevent

any importation of meats and dairy produce whatever. These details 1

fear are rather tedioTis to you, but they are very practical to us.

Mr. ASQUITH : These are the very things we want to get.

Mr. DEAKIN : They show what we have to face in other markets.

Mr. ASQUITH : In reference to what you have been saying, let me call
your attention to two or three figures as regards Australian trade witli
Europe. The total Aiisti-alian exports to foreign coimtries in the year 189J.
were 7,725,000L ; in the year ]1X)5 they were 17,G19,OOOL ; iu other words,
they had increased betAveen two and three times. In the corresponding years
in 1891, the Australian exports to the United Kingdom were 2o,500,00UZ. in
round figures, and in 1905, 20, 700,tK )()/., an increase of -sjith. It hardly looks
as if you had been blocked out of the Eiiropean market.

Mr. DEAKIN : You have been blocked, in our opinion, from anything
like your fair share of our natural increase. Apart from the purchases
which they make from us because they are bound to make them, there was
no reason why your proportion of our trade should not have been increased
also.

Mr. ASQUITH : I was dealing with the argument that you were being
excluded from foreign markets. Take the markets you have mentioned —
Gemiany and France. 1891 seems to have been a low year, and therefore I
will not take it for Germany, but I will take 1892.

Sir JOSEPH WARD : I think that is wool, chiefly.

Mr. ASQUITH : I have here only the total exports.

Sir JOSEPH WARD : That is chiefly wool.

Mr. ASQUITH : No doubt, chiefly wool.

Sir JOSEPH WARD : That is avooI, a great proportion of which
formerly came to London for sale, and was then transferred to the Continent,
but their own steamers take it direct there now.

Mr. ASQUITH : Be it so. I only want the fact. For Germany the
total was 1,770,000/. in 1892, ami last year 5,088,000L ; for France it was
1,857,000?. in 1892, and 5,762,000/. hi 1905.

E 48668. Q 3

246
Eighth Day. Sir WILLIAM LYNE : Does that inckide minerals ?

30 April 1907.

Pref^tial Mr. ASQUITH : I tliink so.

Trade.

Mr. DEAKIN : Our wool and ores are taken to Germany to be snielted.
We mine, but imfortunately do not manufacture them. If you take out the
wool and the ores, you will find next to nothing left. The German manu-
facturers are using more wool. Their woollen manufactures are growing.
They have a high standing in metallurgy, and take our ores instead of
you.

Mr. ASQUITH : You could not send all that wool here, could you ?

Mr. DEAKIN : We send about 10,000,0001 worth. Formerly that was
bought here, or a good deal of it, for them ; now they buy direct.

Mr, ASQUITH : No doubt it goes .direct there.

Dr. JAMESON : Your argument wovld be that you cordd not send that
wool here if the German manufacturers did not come liere.

Mr. DEAKIN : There is a great deal I \voiild like to say on this point,
but feel I am saying so much already.

Mr. ASQUITH : Not at all. I thought you would not mind my pointing
out, in passing, that your total exports to foreiga countries have increased
from 7,000,0d0L to 17,000,000L

Mr. DEAKIN : No doubt ; Australia is very dependent at the present
stage of its development i)n the exijort of raw materials, and these are raw
materials. These are not affected by our fiscal policy or bj^ German fiscal
policy, l^ecause it does not pay them to do it ; but if tliej'- could deal with our
wool and ores as they deal with our meat or any of our manufactured products,
none of them would go into Gerinaiij' They are taken, at the present time,
in order that their manufacturers may be supplied. They turn our wool
into cloth, smelt our ores, and manufacture them into machinery, or into
pig iron and send it oiit to us to compete with your iron. Their tariff is
framed directly in their own interest. It is to their interest to get wool and
ores, and, therefore, they take them. It is not in their own interest to take
manufactured goods, and, therefore, they do not take either yours or ours.

Mr. ASQUITH : And, as you are largely producers of raw material, you
are not injured by the German tariff to that extent ?

Mr. DEAKIN : No, but we are injiu-ed in regard to the foods which they
decline to take.

Mr. ASQUITH : What do they do with your wheat ?

Mr. DEAKIN : They take some, but not much. Germany, like France,
is otiU largely an agricultural country.

247

Mr. ASQUITH : It imports a good deal. Eighth Day.

30 April 1907.

Mr. LLOYD GEORGE : Germany imports more tlian France. Prekerential

Trade.

Mr. DEAKIN : Yes ; but botli Fraucc and Germany, in contrast with
Great Britain, are agricultural producers themselves.

Mr. LLOYD GEORGE : There is increased importation of wheat every
year in Germany.

Mr. DEAKIN : I should think there would be owing to the development
of their manufactures.

Mr. ASQUITH : And the increase of their population.

Mr. DEAKIN : Yes, their popidation has increased very materially with
the increase of employment.

Mr. ASQUITH : I only interrupted to clear it up as we go along.

Mr. DEAKIN : Quite so. Fiscal qiiestions interest us a great deal, and
I was rather afraid how far I should travel if I did not limit myself to one
line of argument. I am speaking now from notes.

Mr. ASQUITH : This concrete part, if I may venture to say so, is most
important.

Mr. DEAKIN : Without going further into details or multiplying proofs,
it may, therefore, be broadly asserted that Australia obtains fair play from no
foreign country. Until a different attitude is adopted by such rivals our chief
hope of expansion lies in the further development of the trade we already
enjoy with the Mother Country. Although we receive neither more nor
less consideration here than they do, it would be well worth our while to enter
into an equitable arrangement with you to do so, if only because of the
business possibilities of that trade. Your market is a veiy valuable market
and an open market, while their markets, however valuable, in great
degree, except for raw materials and only for some of those, remain closed
markets. The next question is whether we are helpless, w^hether we have no
means left to us of protecting ourselves and helping each other against the
offensive action of foreign rivals. From the latest published returns it would
appear that Britain and British possessions purchase aimually goods to the
enormous value of 800 millions sterling. Out of this sum the share of the
Mother Country alone amounts to 5G5 millions, of which, it may be said in
passing, only 50 miUious are at present the subject of any duty.

A careful analysis of the imports into Great Britain has been made for
me, and from this it would appear that, excluding wool from the 5G5 millions
just referred to, 213,000,000/. represents the value of produce which Australia
could supply wholly or in part. At the present time, the import of Great
Britain from Australia of these goods is not more than 10,000,000L, while
produce to the value of 42 millions is obtained from other British possessions.
This shows that the share of foreign countries in British trade is 100,000,000/.,
that is to say, more than IC times that obtained by Australia, and between
three and four times that of the whole of the British possessions taken
together. As I have said elsewhere, in modern markets it is the seller who

Q 4

248.

Eighth Day. js the courtier — tlie buyer is king. That is the key of the situation. The
30 April 1907. possession and exercise of this huge purchasing power furnishes a strong
instrmnent by the courageous but cautious use of which justice couhl be
"''rKu'rE'^'^' secured to British goods and to goods of the Colonies, especially if the whole
,,, ,, ,'. , Empire %vere to combine as one. We need dread no retaliation nor employ
anythmg like the whole oi the authority which our xaurchasmg power carries
with it. A mere exhibition of readiness to use it on occasion would
enormously improve our opportunities, and to our minds your opportunities,
and might most materially muUiiily ours at the same time. So far as we
must import, it would seem to be true Imperial patriotism to iavour CJreat
Britain with our custom, and so far as Grreat Britain must import, that she
should obtain her goods from her Possessions beyond the seas. This Avould
be real and efFective patriotism with or without duties against foreigners. A
decay of British trade means the decay of British power and prestige, but it
is idle to expect that individual efforts alone can accomplish either unity for
the defence of our territories or unity in the defence of our trade. Only our
several States can act effectually and to act effectively, they must act together.

Preferential trade and retaliation against foreign countries which penalise
our trade are among the several means by which the Empire can recover its
Joss of ground and prevent further loss to its material interests. So far as
Australia is concerned the advantages of receiving preferential treatment from
Great Britain are too obvious to require demonstration. Allusion has,
however, been made to the produce imported into the United Kingdom which
Australia might siipi^ly, because an extension of our export trade is absolutely
necessaiy for us in the present state of our development. The j)osition of
Australia is, in some resT>ects, imicpie. It has an immense undeveloped
territory and resources, but a small population occupying that territory, and,
consequently, a very limited honl'e market. Moreover, as the Australian
population increases very slowly in proportion to its sphere and opportunities
its home market is not expanding equally with the develoi^ment of its
industries. Out of 2,000 million acres Avithin its territory there are less than
dl millions under cultivation, and this area could be added to almost
inimitably. Its total production, both of j)rimary and secondary industries,
amounts to 128,OO0,O0OL sterling, and of this quantity not more than
71 millions sterling are required for local consumption. It is, therefore, ])lain
that if further development is to take place, especially in the primary
industries of the country, one essential factor of that development is the
opening up and maintenance of outside markets for its produce. It is also
plain that the peopling and development of Australia makes for the
strengthening of the Emj)ire in men and means, in trade and in national
power.

The first resolution recorded on this subject by the Conference of 11)02
is an emphatic recognition and declaration of this all-dominating considera-
tion. The prominent politician here who said lately that you had greater
financial interests in the Argentine than in Canada afforded another illustra-
tion of the precept that where the treasure is there will the heart be also.
He also suggested the imperative iK^cessity of putting our treasure within the
Empire if we are to retain the patriotism of those who are governed by such
a strange Imperial doctrine.

Allusion has also been made to the present state o! the Australian export
trade. I have obtained since my arrival, thi'ough Mr. Coghlan, Agent-
General, and formerly Government Statist of New South Wales, a sunmiary of
the principal products which Great Britain imports from abroad, and in which
Australia is interested. It has already been pointed out that tlu^ volume of
such imports is 213 millions sterling out ol' a total import of 5-11 millions,
24 millions' worth of wool not being included. If the Commonwealth could
secure, as with her immense natural resources, she ought to secure, any

249

coiisitleral)lo })i)rtioii of the trado (if (xi-ciU Rritaiii now iii foreign hands, hi-r Kighth Day.
position wouhl most certainly Ih; assiin'd. What, however, is her actual 30Apiill907.

position? Exchiding wool, Australia supplies considerably less than 3 per

<'ent. of the goods imported into England, while the share of the foreign Prekekential
countries amounts to SU per cent. ; and even if wool be imjlnded. Great "

Britain's imports from Australia do not exceed 45 per cent, of the total. Is ^ '' *^" '"'^
there any point of view from which this condition of affairs can be deemed
natural or desirable ?

The question that is coming home to Australia is : Can the Common-
wealth without preference in the; Tiritisli markets retain even its present
trade ? And the answer undoid)ttMlly is that without fresh efforts and a
new policy it cannot. Foreign countries, b}- means of liberal shipping
boimties and concessions in railway tarilfs, are already placing their goods in
competing markets at lower rales than Australia can do under j) resent
conditions, and one country at least, Denmark, .Vustralia's most formidable
competitor in the supply of butter, has a concession of Imv freights for its
proibice on certain Britisli railways. This concession, with others of an
ecjually important character, enables the Danish farmers to compete success-
fully with the products of British origin. Tt is apprehended that even our
present small outlet in Great Britain will Ije effectually threatened, so that
if we are to retain our present markets, it is most essential that we shoidd
get at least as favourable concessions as foreign coimtries obtain. Tf wo are
to expand our markets, and to place ourselves beyond the reach of foreign
aggression, preferential treatment must be obtained. Preferential trade would
enable Australia to secure a large portion of the Britisli trade, many lines
of which are now largely or exclusively in foreign hands, with the result
that there would be a more rapid development of the territorj' of the Conunou-
wealth, an increase in its pojjulation and wealth, and a large increase in its
home market for maniJactures, to the manifest advantage of those engaged in
various forms of productive industry. Upon the enormous gain to the limpire
as a whole from the settlement, population, and development of its innnense
territories, it is unnecessary to dwell. There are no such opportunities
elsewhere, and there is urgent need of their immediate utilisation. We are
and shall continue to be far your best customers.

Taking some of the items in which Australia is interested, the
opportunities for expansion will be clearly seen. There is imported into
Great Britain annually butter to the extent of 207,000 tons. Of this large
quantity, 155,000 tons comes from foreign countries and 52,000 tons fi'om
British possesions, Australia's portion being but 24,000 tons. Under a
preferential duty it is most probable that the British possesions could
secure half the trade now in foreign hands. If Australia olitains only
one quarter of that new trade she would be able to add to her exports
19,000 tons of butter vabunl at 2 millions sterling, wdiich would mean the
direct employment of 41,000 persons. The import of cheese into Great
Britain, which is almost entirely in the hands of Canada, amounts to
6,350,O00Z., to which Australia contributes to the extent of 1,000L only.
Here again is an opening lor trade which preferential treatment would
greatly widen.

The imports of wheat and Hour into the United Kingdom amount to 41]
millions sterling annually, and of this quantity Australia sends oidy
4,30O,00OL (Jiven a ((Mtaiu market, such as would be open to us if Great
Britain granted a slight preferences on wheat, we might easily (;xpand our
imports to four-fold th(Mr present average, and send away 70,000,000 bushels
every year. Of other grains, principally oats, barley, and maize, the imports
of the United Kingdom are valued at 29 millions sterling, to which A-,istralia
contributes an insignilicant 9,000/. There is no reason why we should not
export maize, which grows well in New South Wales and Queensland, as well

Eighth Day.
30 April 1907.

Preferential
Trade.

(Mr. Dcakin.)

250

as oats and barley, which gTow prolifically on the highlands of all the States,
and obtain some share of the 29,000,0U0L now paid to foreign countries. If
we secnre only one-fifth of this trade, employment would be found for a large
niimber of farming hands, and if our export of wheat only reached the figure
of 8,500,000L, or twice the past year's total, and other grains 5,000,000L, as
they might very well be expected to reach under a slight preference, this
would mean the additional employment in the Commonwealth of 200,000
persons. All of these would be purchasers of British goods, far larger
purchasers than foreigners are, and of the goods you most wish to sell.
, Under preference we could obtain all our over-sea requirements within the
Empire.

The trade in meat and livestock offers wonderful possibilities. England
imports bacon to the value of 12,750,000?., other meats 25,750,000L, and live
animals for food 10,000,000L The total trade amounts, therefore, to
48,500,000Z, and of this Australia supplies only 1,750,000?., or less than
4 per cent. ; while under a scheme of preference no limit could be set to its
possibilities.

Mr. ASQUITH : I think no bacon comes from Australia ?

Mr. DEAKIN : Practically none.

Mr. ASQUITH: Why is that?

Mr. DEAKIN : As far as I understand the market is already in the
possession of Canada and the Argentine.

Mr. LLOYD GEORGE : I should say the United States of America
send a lot ?

Mr. DEAKIN : Yes, a great share.

Mr. ASQUITH : Canada has a very large bacon export.

Mr. DEAKIN : As regards fruit, produce to the value of lOh millions
sterling is imported annually into England, and of this Australia sends only
240,000?. Of course, I am looking at the Australian trade all through.
Many other articles could be eniunerated which, under a preferential
arrangement, could be exported from these States, but the articles named
sidhciently illustrate the possibilities of Australian development. The
French tariff shows how other countries foster their Colonies. In the
north of Africa the French have the Colony of Algeria, and the
Protectorate of Tunis, and it is to be expected that, sooner or later,
Morocco will come under French dominion. With a view of developing
French interests in these countries, their grain is admitted to France duty
free, while against other countries an import of 12.b-. od. per quarter is levied.
France is, therefore, already doing for its Colonies what England is
hesitating to do. It is clear that so far as its external markets are concerned
Australia has much to gain by preferential treatment on the part of the
Mother Country, nor is it obvious what it is possible for her to lose if she
in turn gave preference to the produce of Great Britain. Canada, South
Africa, and New Zealand all give preference to British goods, and their
export trade to foreign countries has not been prejudiced thereby. The
direct benefits of preferential trade have been plainly indicated, but there
are indirect advantages, especially to the Mother country, which are worthy
of consideration, particularly from the point of view of the Colonies as a

251

field for British immigration. England imports from Germany and America EigLtli Day.
three times the value of goods wliich she exports to these two countries, 30 April 1907.

and it therefore may be taken in a general sense that England's foreign

trade creates three times the amount of productive employment in Germany PREFERENTiAt

and Ainerica that it does in England itself. The Britisli people, therefore : — ^\^^^,'-

(a) Pay the foreign farmer instead of benefiting its own people beyond the ^ '^' *'" '"'^

seas ; (6) Pay the foreign railways for tlio carriage of the goods wliich

it imports ; (c) Pay foreign ships instead of British sliips for the carrying

of this merchandise. These are three very important considerations, especially

the last. On the mercantile predominance of Great Britain depends its Naval

supremacy, and upon Naval supremacy depends the security of the Empire.

By their huge trade with foreign countries Great Britain and its possessions

are helping to build up large foreign merchant navies which may be used

hereafter to undermine the strength of the Empire, for it shouhl never be

forgotten that all Foreign Powei's subsidise their mercantile marine with the

view of relying upon it as a Naval Reserve in war time.

Sir WILFRID LAURIER : I am afraid we must adjourn now, as we
have an engagement at one o'clock.

Mr. DEAKIN : Yes, I had hoped to finish this morning. I shall not
take much longer.

CHAIRMAN : We will resume this to-morrow.

Adioiirued to to-morrow at lO.oU o'clt)ck.

252

JJintli Day.
1 May 1907.

NINTH DAY.

Held at the Colonial Office, Downing Street,
Wednesday. 1st May 1907.

Present :

The Right Honourable The EARL OF ELGIN, K.G., Secretary of State

for the Colonies (President).

The Right Honovirable Sir Wilfrid Laurier, G.C.M.C, Prime Minister

of Canada.
The Honourable Sir F. W. Borden, K.C.M.G., Minister of Mihtia and

Defence (Canada).
The Honourable L. P. Brodeur, Minister of Marine and Fisheries

(Canada). ,

The Honourable Alfred Deakin, Prime Minister of the Commonwealth

of Australia.
The Honourable Sir W. Lyne, K.C.M.G., Minister of Trade and

Customs (Australia).

The Honourable Sir JosErn Ward, K.C.M.G., Prime Minister of NeAv

Zealand.
The Honourable L. S. Jameson, C.B., Prime Minister of Cape Colony.
The Honourable Dr. Smautt, Commissioner of Public Works (Cape

Colony).
The Honourable F. R. Moou, Prime Minister of Natal.

General The Honourable Louis Botha, Prime Minister of the Transvaal.

Mr. Winston S. Churchill, M.P., Parliamentary Under Secretary of

State for the Colonies.
Sir Francis Hopwood, K.C.B., K.C.M.G., Permanent Under Secretary

of State for the Colonies.
Sir J. L. Mackay, G.C.M.G., K.C.I.E., on behalf of the India Office.

Mr. H. W. Just, C.B., C.M.G., ) j^-^^ Secretaries
Mr. G. W. Johnson, C.M.G., ^ 'J (^^^^ ^e<^retaries.

Mr. W. A. Robinson,

Assistant Secretary.

Also present :

The Right Honourable H. H. Asquith, M.P., Chancellor of the

Exchequer.
The Riglit Honourable D. Lloyd George, M.P„ President of the

Board of Trade.
Mr. W. Runciman, M.P., Financial Secretary to the Treasury.

:i53

Mr. n. E. Kearley, M.P., Parliamoiitarv Secretary to the Board of Ninth Day.
Trade. I May lyoT.

Sir E. W. HiVMiLTOx, G.C.B., K.C.V.O., Permanent Financial Secretarj'
to the Treasury.

Mr. H. Llewellyn Smith, C.B., Permanent Secretary to the Board of
Trade.

Mr. A. Wilson Fox, C.B., Comptroller-General oi the Commercial,

Statistical, and Labour Departments of the Board of Trade.
Mr. G. J. Stanley, C.]\I.G., of the Board of Trade.

CHAIRMAN : j\Ir. Deakin. will you resume? rKEhEKESTiAi.

Tkaue.

Mr. DEAKIN : Lord Elgin and gentlemen, I should like to say in the
first place that the precis which appears in the newspapers this morning was
very kindly submitted to me yesterday afternoon, and I am responsible for it.
It appears, however, that some attention has been called to the figures quoted,
prol)ably an error due to a misprint. I have also to say that not reading
the whole of the manuscript, there is one sentence in it which I should
certainly have altered, Ijecause I did not use the phrase, and would have
carefully avoided using it. It is that in which I refer to a power of this
Empire to bring foreign countries to their knees. I certainly laid great
stress on the power of this country, but avoided, as far as my memory
serves mo — and I certainlj" intended to avoid — ^auy expression of that kind,
which, although it might be a summary of my argument, is conveyed in a
form that I prefer not to adopt. But, as I have said, the responsibility is
mine ; the precis was presented to me and that I did not read every sentence
of it was my own fault.

Yesterday I was endeavouring to bring to a conclusion my criticism of
preferential proposals or possiljle preferential proposals having regard
to the circumstances of Australia. I necessarily dealt in figures, but with
the propu-tious of totals, rather than with the totals themselves. In the
Commonwealth, though the increase of population has been much smaller
than we could have desii-ed, the extension of settlement and advances in
production have proceeded loy leaps and bounds. In recent years, owing
largely to improved methods of cultivation and machinery better adapted to
our agricultural conditions we have had immense increases in our exports.
These, of course, have affected every liranch of our business — imports as
well as exports. You have to look at the figures relating to Australia always
with the recollection that you are considering a community that, taking any
period of years together, is marching onward with very rapid stritles, always
buying much more and selling much more as it grows. If you look, therefore,
at our gross totals, you will say that these appear satisfactory and, suijject to
ihe qualifications which follow after any analysis of totals of that general kind,
are satisfactory. IE you look, therefore, at the totals of our trade either with
the Mother Country or with foreign countries, you will notice large increases,
though I have passed these by — and perhaps it was an omission — without
calling attention to them. All our figures up to now must be dealt with
recollecting that they relate to an ascending scale. It would occupy far
more time than I would be juslilied in occupying, even after attention had
been called to them, in order to dissect those figures so as to determine
their particular applicability to special issues. It seems sufficient, and I hope
it will prove to have been sufficient, to adopt the percentage method instead.
Hardly referring to total trade, I have referred always to its ratio, its progress,
its distribution. Again, in considering the question of the possible gains to

254

Ninth Day.
1 May 1907.

Preferential
Trade.

(Mr. Deakin.)

I'je derived from doing more Inisiness between the ilother Comatry and the
Colonies, I have followed the percentage system as one from my point of view
more accurately representing the trend of the distribution of that business
between the Mother Country and foreign nations. There has been an increase
in the gross total of both, but it is onlj^ by comparing them thus that we
arrive at the true view which I was endeavouring to reach.

My argument, as far as I remember it, when our proceedings yesterday
closed, related to the possible effect of preferential trade not only upon
ourselves, but upon those with whom we do business. If a fair proportion of
the 565 millions sterling, which is Britain's vast outlay for imported goods,
came to British Colonies, it would tend greatly to increase their wealth and
strengthen the British and Colonial navies, and the Empire as a whole.
British manufacturers are the greatest consumers of Australian raw produce,
and their prosperity means the promotion and development of the Common-
wealth, while the success of the foreign manufacturer does not necessarily
benefit the Australian producer. In the consideration of this queslion it
should be borne in mind that foreign countries would, if it were possible for
them to do so, follow America's example, and shut out from their markets the
raw material which we now send them, while by heavy subsidies and other
means, they are already ousting British products from our markets. The
intensity of the contest for markets on fair terms between the nations
to-day is but one phase of a contest for influence and authority, for prestige
and effective power, Avhich proceeds day by day and year by year with
increasing energy. It is a wrestle between rivals for sixpremacy — a
supremacy accompanying the expansion of the successful Power — an expan-
sion which means a corresponding contraction of its competitors, means of
resistance, the depression and deprivation of their trade, and perhaps
ultimately their absorption or extinction.

There is, of course, no complete analogy between the proposals for
preferential trade within the Empire and the trade arrangements and
conditions of other countries, but then, again, no empire ever existed which
really resembles that of Great Britain in its present stages of develojiment.
There is, perhaps, some slight analogj^ in the German ZoUverein. This
Zollverein was established because the producers of the different German
States found that they were suffering from the policy of isolation which each of
them then followed. They had erected tariff barriers between their purchasers
which prevented them from becoming one people— a nation with a national
policy and inseparable destiny. A customs union throughout the Empire
was, therefore, brought into existence, and the foundation was thus laid for
the present German developments, industrial, social, and Imperial. It is
true that the German States all lie together, but this does not in any way
impair the principle of Preference or the effect of its operation except so far
as distances amend it, and these, nowadays, are practically diminishing
every decade. As Lord Salisbury pointed out in 1887, the mere separation
by sea is no permanent obstacle to commercial unity. "'• It must never be
forgotten that rmder existing conditions, and while they last, the purchasing
power of the British Empire is inuncnse, and the possession of thjs pur-
chasing power — to which I venture to make one more illusion — is the
potent: instrument by which we believe justice can be secui'ed to British goods
and the goods of British Colonies ; that is to say, if the whole of the
Britisli Empire were to combine. The want of unity of the different
parts of the Empire enables foreign countries to adopt various courses
inimical to British interests, individual and collective, that is to say, looking
at its dominions individually, or taking them as a whole. If retaliation were
in prospect against foreign nations which now refuse to buy our goods on
equal terms with those of other nations, the discriminators would gladly

" [C. 5091] p. 5.

255

treat with the British Empire for the sake of gaining or retaining some part Ninth Day.
of its immense trade. I do not go anything like so far as to say that they ' May l-*07.
would be brought to their knees, bui I do go so far as to say that some of „
the illustrations which were yesterday put forward of the manner in which Tuade.

our exports are differentiated against in certain markets could not continue. /^j, Deakin ")
So long as we are content to ignore those differences and not to insist upon
at least equal treatment for our products, we shall fail to obtain the considera-
tion which much smaller nations with a purchasing power in no way com-
parable to ours actually have obtained and are obtaining to-day by means of
relatively inconsiderable concessions. One instance I think has occurred
which will be more familiar to Mr. Asquith and his colleagues than it is to
me, in which there was a proposal on the part of France, or a proposal
likely to be adopted in France, which would have indirectly affected Indian
trade. I think it affected coffee or some similar exports, when a strong
remonstrance from the Indian Government, backed up by an indication of
possible action on its part brought about an agreement in which, in return
for a concesssion relatively quite of a minor character, this dangerous and
threatening proposal was withdrawn. That occurs to me^ — I think sometliiug
like that happened — as one illustration of a method of dealing with tai-iff
discriminations, not as if there were no other contingency save acceptance,
but in an ordinary business fashion, on familiar business grounds, without
stepping outside the field of fair commerce. We are able to do that in many
cases. Certainly if I sought for illustrations I could find them plentifully
in the experience of other nations where concessions on one side have been
balanced by concessions on the other. That is well known.

The power possessed by the British Empire over foreign nations by
its possession of a great market — a market to be opened or closed to some
extent or any extent — is little realised, but the most casual observer must
recognise the strength of the Empire's position, which is certainly
enormous, should all its component parts, condjiuing together, use their
power to meet the fiscal attacks of foreign nations upon any portion of the
Empire. It is a case of all for each and each for all. This has been
illustrated to some degree by the retirement of Germany from its position
of antagonism towards Canada, which was assumed when Canada granted
preference to the Ihitish manufacturer. So far as I imderstand this event,
the retreat of Germany took place when it was obvious that l)ehind Canada
(to some extent, at all events) was the world-wide force of the British
Empire. Bargaining lietween Gemiany and Canada appears to be now in
contemplation, and whatever may be the result, it is perfectly certain that
far better terms wiU be obtained by a Dominion or by an Empire which has
shown its power to resist and its determination to meet discrimination by
discrimination. The treatment intended for Canada would l)e meted out
to Australia, if the Conunonwealth were to stand alone ; its trade and wealth
would not be sufficient to resist aggression. By itself the Commonwealth
would be ineffective to break down liie l)arriers which foreign countries
might choose to erect against its trade ; condjined with the Empire its
position like that of every otlier portion might be made impregnable.

The moral right of any country to exercise retaliation cannot now be
denied, and nearly every country in the worhl exercises it at the present
time. Russia quite recently retaliated against Britain for its tax on bounty
sugar by placing on Indian tea an extra duty, wliich duty remains in force
because the Empire has not resisted it. Germany has retaliated against the
United States, the United States against Germany, until an arrangement
between them appears inmiinent. An arrangement which, whatever its
nature may be, will have been undertaken as between equal contracting
parties. The contracting parties are not equal while one of them on some
theory of its own accord holds its liaiuls behind its back. All foreign countries

(Mr. Deakin.)

256

Ninth Day. adopt the principle of the most favoured nation treatment to those who
1 May 1907. are AviEing to offer them concessions, heavier duties being imposed where
concessions are not forthcoming. What I wish to suggest by this line of
^^Trade^'^' argument is not the adoption of an aggressive commercial policy any more
than in other foreign affairs, but merely an indication of a freedom and a
willingness to use the powers which each nation possesses in regard to its
trade and commerce and the terms on which it admits the goods of other
countries. We should not allow these to lie aside like rusty unused weapons,
but to hand and ready for use on occasion, employing them as they have been
employed by Germany and the United States and other peoples, in order to
secure fair business — no more than fair business. I am not for a moment
advocating that because the Empire has a giant's strength it shoiild use it
tyrannously like a giant in relation to small foreign communities, or large
ones, but merely that its possession of power should carry with it a responsi-
bility for its exercise at need. We should be quite prepared to take whatever
steps may be required to free us from obviouslj^ unfair competition in other
markets, and to secure our people fair competition all round.

If the nature of the whole of the commerce of the Empire be examined,
as Sir Edward Law examined that of India, it will be seen that Great Britain
had very little to fear fi-om retaliation. Germany may be taken as one
example. Last year 61,000,000L of German exports went to British posses-
sions. Could Germany retaliate against Great Britain for any preferential
treatment which it may give to British Colonies, and thus put itself in danger
of losing its present business, while 23 per cent, of the whole German export
trade is carried on with different parts of the British Empire ? The United
States of America may be cited as another example. Every year the States
send Great Britain and its possessions goods to the value of 175,000,000Z.,
while the import of British goods into the United States does not amount to
within 100,000,000?. of this sum. It is most unlikely that the United States
would risk losing so vast a volume of trade, amounting, as it does, to con-
siderably more than half of its own export, in an attempt to penalise Great
Britain for exercising the same policy of preference which the United States
hold themselves free to adopt in regard to their own possessions, and even to
other States with which they make reciprocal treaties.

What may be fairly contended for in the present stage of the discussion
in regard to preferential trade and fiscal retaliation, is the recognition that
the principle which these phrases embody, whatever extension may be given
to it, is a proper one to apply in the existing condition of the commercial
relations of the foreign countries with Great Britain and its possessions. It
is not as yet necessary to propound a definite schedule, which must in details
be largely a luatterof mutiial arrangement, differing almost with every country
dealt with, and with the same countries at different times, but it may be
glanced at to meet the objection, frequently heard, that however right the
principle of preferential trade may be in theory, in practice it coidd not be
applied to the Australian States. It is perfectly true that, as the second
resolution of the Conference of 1902 indicated, it is not possible for the
Commonwealth to abolish its customs duties, or reduce them in the aggregate
in any considerable measure. What is possible is discrimination and readjust-
ment in both countries by reciprocal concessions. It is and will remain
necessary that at least the present amoimt of revenue should be obtained
in Australia, but this allows ample room within which preference may
be given to British imports. In the first place, out of our total import
in 1905 of 3G,796,34GL (excluding specie), 12,521, 76CZ. or 34 per cent.,
were free goods. That is notable in itself. In addition to this imports
*o the value of 11,000,000?. odd Avere dutiable at 15 per cent, and under,
so that two-thirds of our total imports Avere in these categories. 15 per

257

cent, with us ranks as a very moderate duty, indeed, in most cases. Ninth Dnv.

Of course, rates of duty, as the Chancellor of the Exchequer and all autho- | ^j^^^ jg^y

rities know, vary immenselj-. 15 per cent, might be extremely heavy on one —

article, but very light on another, l)ut on many of ihose articles to which our Pkekekential

15 per cent, applied, speaking generally with the United States and foreign Thaue.

tariffs in mind it may be regarded as relatively a light duty. Our rates of (^•'- Ueakin.)
duty, including stimulants and narcotics, to-day only average IG'8 on dutialjle
merchandise, and ID'S on all merchandise, whether free or dutiable, taken
together. Here are wide margins for concessions.

Now, as regards the modes of preference to British goods, it is obvious
that the Commonwealth may proceed either to lower existing duties in
favour of Great Britain, or to increase these duties to the foreigner. This
latter course has been followed in Canada, New Zealand, and South x\frica,
and probably in no perceptilile degree influences the amount of duties
collected. The immediate object of preference in our case would be to
exclude foreign goods and to favour British goods. On a more general
view, and subject to this, its oliject is to obtain fair terms abroad where
fair terms are granted by us. It is natural, then, that the extent of the
preference should be such as to Ije calculated to accomplish the first of
these objects, that is, the cessation of • importation of foreign goods, and
an increase of present duties would seem to be the best means to achieve
this end.

But the increase of existing duties is not the only weapon available. It
is also open to the Commonwealth to use its present free list as a means of
preference towards the Mother Country. A free list which runs to nearly
34 i^er cent, of our total imports, affords a wide iield for preference, far more
extensive than is found in the foreign countries with which we trade. More
than half the imports that come in free are from foreign countries. If the
Commonwealth were to make British goods alone entitled to a free list,
making foreign goods now in this class dutiable for the future at the rate of
10 per cent., there would hardly be any question but that Great Britain woulil
in a very short time acquire almost the whole of the trade in the goods which
she produces that are now wholly free in Australia, derivetl from foreign
countries. An increase of local production must, of course, be allowed for
where our circumstances are favourable, though the nature of our industries
in their relation to the general circmnstances of our new and sparsely
peopled country modifies the inducements offered in many cases. An
inspection of the liet of goods not subject to duty in Australia will sliow
that very few of the articles enumerated therein are neither produced nor
produceable in Great Britain. The adoption, therefore, of this course would
probably be attended ])y an immediate diversion of trade from fonugn goods
to British goods, and having regard to the fact that one-tliirel of our tariff, or
one-third rather of our imports would be operated upon at once, or such part
of that third as Great Britain is capable of producing, this is in itself a very
considerable opportunity.

Taking into account also the other section of our tariff', in which the duties
are under 25 per cent., it is easy to see that we have by no means as yet put
to practical use the opportunities for retaliation which we possess in this
direction, for reasons to which I wiU allude in one moment. The atkiption of
a similar policy on the part of the ]\Iother Country towards the Commonwealth
would certainh- bring with it a considerable addition to our trade. I am
assured by an authority that a substantial preference to the goods of Great
Britain in our markets would result in an increase of British trade with
Australia to the extent of, perhaps, 50 per cent. This would be the effect of
substantial preferences and sul)stantial preferences are contemplated by the
third Resolution of the Conference of 1902. " That with a view to promoting

B 480(38. R

258

Ninth Dav '' *^ increase of trade within fhe Empire it is desirkble that th(? f'oloaies
1 M 1907 " should as far as circumstances permit give substantial preferential
' " treatment to the products and manufactures of the Mother Countiy."

^"?rade"^'' The fourth Resolution arrived at in 1902 : " That it is desirable that the

(M D kill ') " preferential treatment accorded by the Colonies to the products and manu-
" factures of the United Kingdom be also granted to the products and
" manufactures of other self-governing Colonies," has already been given
effect to in a certain measure ; and proposals are now in course of consideration,
or are likely to be soon in course of consideration, which would still further
extend this very desirable means of interlocking the several self-governing
dominions of the Empire. I shall not repeat it, but of course, the whole
tenour of the argument which I have been endeavouring to maintain applies
with equal force to arrangements of this character. Owing to the similarity
of our circumstances, none of these could have the scope or the value
of an arrangement made between any or all of them and the ]\Iother Country
if such were possible. But, nevertheless, small as these imj)erial reciprocities
may be, they are useful. It is perhaps not altogether beyond the horizon
of the immediate future to forecast a time when, from year to year, or at short
periods, some body or committee of experts will review the trade of the
Empire as a whole in order to see if fresh oj)portunities could not be found
for directing poi)ulation and trade, not only from the Mother Country to
the dependencies, but between those dominions themselves, in order to knit us
together each and all. At all events, that would be a perfectly proper and
wise business transaction. Broadly stated, such a prospect may appear to
arouse expectations difficult to realise, but so far as I am acquainted with the
history of our Parliaments of the British Empire, they have existed, and
continue to exist, by overcoming difficulties. A reversal of a forward policy,
by way of surrender to dithculties of this or any other kind would be fatal.
I am sure it is not contemplated by either of the parties in argument on this
subject. What we would iirge in this connection is our obligation at all
times to consistently pursue a close examination of the opportunities for
inter-Luperial trade. Even if they cannot be fomid, or cannot be found in
such abundance as we would desire, the time which is spent in seeking for
them would be far from wasted, and would be greatly appreciated l)y those
whom it was desired to help. I cannot see that any people held together by
the many ties which have constituted iis the nation we are to-day can lose.
It appears to us that there are many directions in which it could gain by a
recognition of the high value of the growth of a sense of corporate unity,
the growth of a sense of mutual dependence between British peoples, coiipled
with a recognition of the difference, and sometimes of a great difference,
between the demands which may be made upon each of our dondnions and
the Mother Country between themselves, and those made upon us by foreign
countries. There are communities whose strength may at times appear to
be intended to l^ecome a menace to the whole or parts of this Empire, and
siirely it cannot be maintained that a trade with them which is one half to
their advantage, to which they are j^arties, and of which they therefore share
the advantage, is comparable from a national point of view to the trade with
those of your own flesh and blood, under your own flag, with whom it is
your interest in the face of such rivals to strengthen yourself by everj-
possible means in your power V

Repeating for the last time that the Commonwealth postulates your
absolute independence in the judgment you are to exercise, and adding that
we are not ph3ading for something which is to involve sacrifices, but for a
co-operation which is to be mutually beneficial — repeating that for the last
time — surely the endeavour to look at this question from what I have termed
a corporate point of view, and the endeavour to secure corporate action,

259

can 1)6 profluctivp of nothiii,c; but ijood. 'J'his would ]«! tho best poseiblt? Ninth Day.

means of bringing about a butter understanding between us all, of removing i iiuy 1907.

nueasy apprehensions that we are neglecting valuable means of union, and of

assuring us that if we do fail to hud and use a path we can tread together I^kf.kkkf.xtiai.

• 11 !• ^ I- II- .• • 1 • J- 1 HAIiK.

It has not been lor want ol research or from want oi consideration, or Irom n.. w ^

want of the wish and -ndll to take every step in our power making for the *- '^' "-*'''"•-'
cohesion of the peoples now linked together, by what we hope are imperishable
ties to which we would be glad to add, so long as it shall be in our power.

What may be termed the British view of British iwssibilities or of
the condition and cost of any reciprocity, is not for me to discuss or even
spccidate upon. What I have attempted in brief has been the presentation
of the Australian case from an Australian point of view, so far as it appears
desirable to urge it upon this Conf(>rence. TIk^ policy is large, and the prin-
ciple of that policy applies not oulj' to trade and commerce, but is capable,
as already suggested, of indefinite expansion. It might be discussed from
many other standpoints, but I have been al)lo, under the circumstances of
personal pressure under which we are all ct)nducting these discussions, to
touch only those wliich appear to me pertinent here and now. The resolutions
which have been submitted by the Commonwealth embody in very slightly
different form those adopted in 1902, making them, as we consider, a little
more explicit and comprehensive, but in no way departing from the principle
then adopted.

It now remains for me, in response to a suggestion of the Chancellor
of the Exchequer yesterday, to say a wor<l or two in regard to the parti-
cular measure of preference which is included in this paper -Colonial
Preferential Tariffs.* Xo such scheiiiC of preference as 1 have been
foreshadowing or discussing has as yet been formidated in Australia.
The earlier years of our Federation — we are now in our seventh year of
existence as one Conunonwealth — have been tilled with discussions of great
difhculty and of absorbing mterest, accompanicnl by not a few exciting
changes and unexpected incidents of a Parliamentr.ry character. Public
opinion in our country still retains certain divisions, natural or artificial,
which have to be surmounted Ijefore our efforts can be focussed in a national
direction, but when you take into account the vast distances which separate
us, it is no ground for surprise that in the seventh year of our existence
as one political community we have not even yet entirely surmounted these
Provincial divergencies which have existed, often in a very acute form, for
the last thirty or forty years. The evidence of the last two general elections
of the Commonwealth proves that we are moving steadily towards such a
preference or such preferences as I have referred to, ])ut we have not yet
propounded a complete scheme of any of these on either basis ; that is to
say, neither as a one-sided preference tendered by ourselves, nor still less of
the possiljilities of a preference balanced by concessions from you. Our hope
of an early reciprocity from the j\Ioth(>r Country has never been strong
enough to encourage such a thorough stiidy of possilde tariff" changes as
would be necessary in drawing up proi^osals for a complete^ scheme. A\ e
have not even framed a finished plan for any preference, except in regard to
New Zealand and South Africa. We made a beginning with these under
very special circumstances.

Last year a Reciprocity Treaty was drawn uj) by the lat(> ^ir. Seddou,
my colleague. Sir William Lyne, our Minister of Trade and Commerce, and
myself, which required, among othcM- alt(M-ations, increases of duties upon
certain classes of imports from tliis country. 'J"o balance these increases
as well as was possible at that time in our Session, Ave accompanied this
proposal in respect to New Zealand with an instalment of preferential trade
to you. It was explained at the time by me, when introihicing it, to be

• See No. XXI. of [Cd. 3524] : Papers laid before the Conference.

R 2

260

Ninth Day.
1 May 1907.

Pkeferentiai,
Trade.

(Mr. Deakin.)

an iustalment only. It was not to be confounded with proposals for pre-
ferential trade even of an unilateral character which it Avas part of our
policy to submit. The present Bill included merely that portion of our
preference scheme which was pertinent at that time, which we could fairly
ask Parliament to accept, although it was approaching not only the close
of its Session under a great burden of Avork, but also appi-oaching the
close of the Parliament, and preluding an immediate appeal to the people.
Neither the time of the Session nor the circumstances in AA'hich our
Parliament then stood AA^ould liaA^e permitted us to launch a complete pre-
ferential scheme, even unilateral. As it was, this minor subsidiary proposal
attached to the New Zealand Treaty Avas only put through in the last
hours of the Session, and Ave AA^ere obliged under those circumstances to
accept it. We were not only obliged to retain our own projDosals in regard to
British ships which we had proposed to remove from the Bill, AA'hen the
Imperial Government unexx^ectedly pointed out to us that they inA'olved a
breach of treaty relations — Ave had to allow those to remain in spite of
ourselves after that admonition, because one of our Chaml:)ers refused our
request to withdraw that portion of the measure —
condition made in connection Avith Avliite labour,
appears to us to be anomalous and out of place.

-but there A\^as also another
AA'hich appeared to us and

Mr. ASQUITIi : That governs the whole, does it not ?

Mr. DEAKIN : In what sense ?

Mr. ASQUITH : The proposal only applies in so far as it is preferential
to British goods, to British goods Avhich are imported in British ships manned
by Avhite labour. That governs the Avhole ?

Mr. DEAKIN : Yes. The proposal as to British ships was inserted
in good faith Avithoiit any suspicion that any treaties by which we were bound
— and I am reserving that sul)ject for further special consideration — would
prevent its adoption. We Avould not have asked to withdraw our own proposal
unless Ave had been moved thereto by a communication from the Imperial
Government. Then, in regard to the condition as to Avhite labour Avhich Avas
inserted, I think by a single A'ote, I pointed out at the time the impracti-
calnlitj' of applying that restriction to this very limited proposal for preference ;
that it AA'ould be almost impossible to administer it , and asked the House
to remove it ; but in the last days and last hours of the Session, in circum-
stances Avith Avhich all members are familiar, it became a question of taking
the Bill as it stood — and even to get it to that stage had involved some
fierce political fighting — or to aliandou it aUogether. We chose to retain the
Bill. But it has to be remembered that the addition as to the Avhite labour is
not ours, tliat the requirement as to British shipping Avas introduced in good
faith, and Avas an intentional limitation, it is true, but one AA'hich Ave adopted
and approA'ed, and still approve, because it appears to us anotlier form of
preference affecting British trade and fostering British shix^ping.

Sir WILFRID LAURIE R : What do you mean ))y saying that this
addition of the white labour Avas not " ours " ?

Mr. DEAKIN : Was not that of the Government.

261
ilr. ASQUITH : It was that of the Legislature. Ninth Day.

1 May i;»()7.

Mr. DEAKIN : It was that of the Legislature, but not of the Govern- Pkekerential
ment, and it was that of the Legislature in the last clays of the Session when Trade.

time did not permit of its full consideration. In fact, the circumstances
under which it passed, as I have said, not only at the close of the Session,
but at the close of the Parliament, united to make it impossible for us to
prolong our sittings with a view to its reversal, l)ecause, owing to the great
distances that separate us, members were already leaving for their con-
stituencies some 1,500 or 2,000 miles away. The House was therefore, in
view of the General Elections, so to speak, disappearing by degrees, and there
was not the possibility that would ordinarily have existed of obtaining the
necessarj^ time to reconsider it. The Government had no choice, as I have
said, except either to lose the Bill or take it in its present form ; we took
the Bill imder those special circumstances, but that measure will be entirely
misunderstood if it be supposed that it expresses either the intention of the
Govcnunent, or even, I will venture to say, the deliberate will of Parhameiit.
Another reason why there was the less objection to the unusual course which
wo followed is that the new Parliament, Avhich has since been returned
and whose sittings have been a little postponed in consequence of this
Conference, directly it meets will consider the revision of the whole of our
customs tariff. In that revision of our customs tariff an excellent opportunity
for reconsidering our position will occur, not only in regard to that Bill, but
our position generally towards preferential trade from the Australian point
of view. As soon as my colleague and I return, it will Ije our duty to lay
before Parliament the proposals of the ]\Iinistry for an Australian tariff.
One of the chief advantages of our presence here, and cause of our iiiterest in
this discussion, is because we could give ahnost immediate effect to any
alteration that may be desired in our fiscal system. In Australia we are
never very long without fiscal amendments of some character, but this is a
major alteration implying a re-examination of the whole of our customs
schedule. We shall have an opportunity, such as but rarely occurs, of
reconsidering these questions and of dealing with them afresh. This is not
the place, of course, to outline our Ministerial policy, except to say that
it involves a reconsideration of this Bill. It was because it appeared to us
best, both in order to bring the question vividly before the minds of the
electors who were then about to be appealed to, and because it was the
fairest indication of our own views of the matter, to accept that measure as it
stood rather than consent to see it go with the " slaughtered innocents,"
that it was allowed to pass in its present form. It stands therefore as an
adundjration or indication of what we are aiming at. It was never more
than an instalment. It was never our proposal for preferential trade with
Great Britain. It was simply one of those practical means of taking wliat
you can get when you cannot get all you want, which have to be adopted
continually in constitutionally governed countries. We thought it fair, we
thought it necessary, when bringing forward the New Zealand Treaty, to
give this slice of the preferential proposals affecting Great Britain, wliich
we woidd have submitted completely if time hatl permitted, and quite
independently of that Treaty. As it was they had to be dealt with together.
The House had before it the changes for the benelit of New Zealand, jjroposed
to be made in our customs tariff, coupled with certain changes which we
believed would balance those changes, and more than balance them for
your benelit. The one caused and conditioned the other.

It is hardly necessary to remind the Conference that preferences may be
of all kinds, degrees, and extents. They vary and will vary from time to time

48668. K 3

Ninth Day.
1 May 1907.

Preferential
Trade.

(Mr. Dcakiii.)

262

between the same parties, and even more greatly between them and other
parties. The customs tariff which Ave shall submit will be framed on the same
principle I have been enunciating here. Our first consideration will be that
of the circumstances of AustraHa and its demands. The next will be the
possibility of giving a preference and therefore entering into closer com-
mercial relations with the Mother Country and our Sister Dominions. The
third will be how far and in what degree it shall apply to foreign countries
who single us out for special disabilities.

The larger trade exchange with the Mother Country towards which we
look, ample in its j)roportions and immense in its possibilities, will be
constantly before us, but the extent to which we can approach a complete
mutual exchange will, of course, be governed by the attitude which is adopted
here towards our proposals. I think I can fairly say that any encouragement
we may receive will be met, not in a spirit of barter but with a desire to
prove our appreciation of it and of our family relations.

Mr. ASQUITH : The arrangement with New Zealand did not go

through ?

Mr. DEAKIN : It did not.

Mr. ASQUITH : What caused it not to go through ?

Mr. DEAKIN : Because it was laid aside in the New Zealand
Parliament.

Mr. ASQUITH

They would not have it ?

j\lr. DEAKIN : No. You will remember the circumstances wliich in
part account for that. The treaty was made by Mr. Sedilon during tlie
absence of the present Prime Minister of New Zealand in the Mother Country.
Mr. Seddon's death unfortunately followed a few days after the final signing of
tliat treaty. Consequently when Sir Josei^h Ward returned and re-formed his
administration, he re-formed his policy, for reasons of which he is the best
judge and of wliich we do not complain, deciding that in the interests of New
Zealand the treaty should not be given effect to.

Mr. ASQUITH : And the Legislature took his view ?

Mr. DEAKIN : The Legislature took his view, and that treaty was not
adopted. But the probabilities of some substituted arrangements are, I may
say, present to my friend, Sir Joseph Ward, as they are to myself, and are
among the measures now in contemplation. I may also say that, vexatious
as the loss of that treaty was, and vexatious, if not more vexatious, as was
the clipped condition in which our Bill passed — whether it be owing to our
youthfuliiess or our inexperience^ — we take these reverses without great
discouragement. We believe that a current of public opinion is setting in
the direction of reciprocity, and that as we proceed it will take the same
course more strongly. I am confident that it will be quite possible to make
another treaty with New Zealand, which, however modest its proportions
may l)e, if they arc not quite on t]ie scale that Mr. Seddon and myself

263

hoped, will yet be advaiitageons. I am equally confident that vre shall be Ninth Day.

able to put the Bill now in suspense in such a shape that it will prove ^ ^J")' 1907.

acceptable to our Parliament and people. We meet these reverses and

disappointments if not more frequently than larger Parliaments, bearing P<'k|krkntial

1 hem more lightly. We face them more cheerful]}-, because our methods of

])()li tics permit us to face the same questions again in a comparatively short ^ '^' '"'"'v

time. If we do not succeed this year we will next. A project in our coimtry

is rarely crowded out. Our hands are fi'eer. I merely mention this as a reason

why we do not regard this situation as sei'iously as such circumstances in

this country would be regarded. A lost opportunity here does not perhaps

reeur again for years, but with us it may recur in a few months, or it is a

i-atlier unusual delaj- if it does not happen the next year.

The papers before j-ou show we have accomplished with South Africa
what we hope to accomplish with New Zealand and Canada, and tlien we
shall so far have completed our chain of relations. Cicnerally, may I say that
whatever is possible in. the way of preference within the Empire we hope to
achieve.

For the last time, I repeat our realisation that preference begins as a
l)usiness operation to be conducted for business ends. That is the preliminary
of it all. We firmly believe that the very best possible business open to us is
that which builds up tliis Empire and maintains its independence, securing
its 2)olitical and social heritages of freedom and cidture, and enlarging its
beneficial influence. To us it seems certain that these great ends can only be
accomplished by joint action and effective action, wliich shall embrace the
centre and all its parts. We live in the hope tliat we shall be economically,
industrially, and productively raised to the highest power of which each
])ortion, and therefore of the Empire as a whole, is capable. We wish to see
liritish people of British stock as far as possible kept to our own vast
territories, living under civilised conditions enabling them to multiply,
]irosper, and advance. Such conditions, wc believe, can be found to the same
degreo nowhere else in the world. We hope that our prefc^rences will alVect
pox)ulation as well as trade, and that in the diffusion of population the
outer parts of the I'^mpire will get the full advantage of it, so far as it can
be controlled without impairing individual freedom. Preferential trade
appeals to us as a potent inlluence to aid this growth.

I have already said that we do not limit this principle to trade, but also
api)ly it to the channels of trade. Whatever treaties may now hamper our
movements, and we are encouraged by the recent Navigation Conference to
hope that under your colleague, and with his help, Ave shall see encourage-
ment given to British shipping as comjtared with foreign shipping imtil all
lis troubles that we can remove are removed, placing it, if possible, in a more
unassailable position, than it occupies to-day. That with us is associated with
preferential trade as an integral part of the policy. While we maintain our
shipping we have one of the A'eiy strongest, if not the strongest, means of
maintaining our over-sea trade. In the same way, with regard to cable com-
inunieations, to wliich I have already alluded, and with regard to many other
matters upon which it would be inappropriate to touch, they are of a different
character but with the same aim. When Ave speak of preferences in trade, our
interest and enthusiasm are not dcA-oted onh* to trade as the most important of
its practical agencies. We include every means of co-operation Avithin the
Empire — shipping, cables, Suez canal charges, freights, emigration, con-
ferences making for national unity and poAver. Every kind of co-operation is
good as far as it is genuine witlunit soreness or unrequited sacrifice on either
side, and establishing the i^ermauence of our trade and other relations. We
think that each of those means would help the other, and that uniteil they
Avoulil form a A'cry powerful series of liidvs uniting tlu^ extremities Avith the

U 4

Ninth Day.
1 May 1907.

Preferential

Trade.
(Mr. Deakiu.)

264

centre. All of these are sustained by the sentiment of unity in which we
begin and end — the inexpressibly valua1>le inspiration, allied to the deepest
forces within us, upon whose propelling power this nation, this Empire
depends and must always depend, and which will decide its destiny.

As I have occupied a considerable time in dealing with the Australian
view, perhaps my colleagiie, in whose special department trade lies, might
be allowed to speak at a later stage when other members have addressed
the Conference, so that Australia may not monopolise too much time.

CHAIRMAN : Would you prefer that. Sir Willi;
Sir WILLIAM LYNE : Yes, I would prefer that.

lam ?

Mr. DEAKIN : I will hand in, as an illustration of my argument as to
our opportunities of preferential trade with the Mother Country, two tables,
analysing a year's imports. The first is headed " Produce other than wool
which Australia could supply," and shows that we supply 10,00l),0(>3/.,
British Possessions 41,000,0001, and foreign countries' 159,000,00(JL,
total 2I1,000,000L The other shows "A year's imports into the United
Kingdom of dairy j)roduce, grain, and hay" produced in Aiistralia and
other British Possessions, and imported into Great Britain. The total is
.38,000,000^, of which only If millions come from Austi-alia, and only
7,000,000L more from the other British Possessions.

The tables handed in are as follows : —

A Year's Imports into the United Kingdom of Produce
THAN Wool which Australia could supply.

1905.

other

From Australia.

From Other
British Possessions.

From Foreign
Countries.

Total Imports.

f

£

£

£

Butter - - -

2,307,835

2,905,382

16,373,405

21,586,622

Cheese - - -

—

5,007,516

1,332,295

6,339,811

Flour and wheat

4,291,027

11,110,194

25,923,550

41,324,776

Other grain - - -

8,585

5,031,260

23,790,922

28,830,767

Ejigs and poultry

—

173,543

7,638,483

7,812,026

Flax - - - -

—

16,400

3,213,742

3,230,142

Fruit

240,506

1,395,604

8,958,470

10,594,580

Skins and liides

693,27-t

2,569,119

6,774,721

10,037,114

Lard - - - -

—

630,425

3,062,148

3,692,573

Leather - -

265,786

2,492,349

4,985,540

7,743,675

'Meat

1,635,160

7,222,842

29,514,113

38,372,115

Olive oil - - - -

145,859

1,554,626

1,300,751

3,001,236

Sufrar ...

—

1,264,026

25,503,t)29

26,767,055

Milk (condensed)

—

343

62,299

62,642

Tallow . . -

768,996

458,633

1,141,757

2,369,386

Honey - - -

—

17,442

17,321

34,763

10,357,028

41,849,704

159,592,551

211,799,283

Wool

10,768,050

9,051,196

4,002,579

23,821,825

For details. $er next page.

265

A Year's Imports into the United Kingdom of Dairy Produce,

Grain, and Hay.

(1905.)

From Australia. u-^^Tp^'^" ' From Foreign i Total Imports.
British rosscssions., Couutries. "^

Butter -

Cheese

Flour iiixi wheat

Maize, oats, barley, and other
j;r:iin.

Mi; AT : —

liaeon ...

Fresh beef - - -

Salted beef

Hams - . -

Fresh mutton

Fresh pork

Salted jiork

Rabbits - - -

Preserved meat -

Uuenumerated

£

2,307,H36

1,750,714

£
2,905,382

£
16,373,405

£
21,586.623

—

5,007,516

1
1,332,295 1

6,3.39,811

4,291,027

11,110,194

25,923,555

41,324,776

H.5H5

5,031,260

23,790,922

28,830,767

—

2,755,149

10,019,706

12,774,855

30,748

217,738

8,683,107

8,931,593

—

8,414

199.893

202,307

—

698,471

2,419,901

3,118,372

988,049

3,164.712

3,183,729

7,336,490

10,837

14,124

1,137,409

1,162,370

—

16,226

236,380

252,606

485,935

82,406

267,498

835,929

223,086

220,339

2,203,770

2,647,195

12,059

44,913

1,168,720

1.225,692

7,222,582

29,514,113

3s, 48 7, 409

Ninth Day.
1 May 1907.

Preferential
Trade.

LiviNT, Animals : —
Oxen

Cows and calves
Sheep and lambs

2,488,701
27,966
45,580

7,129,293

19,846

233,173

9,617,994

47,812

278,753

Sir JOSEPH WARD : Lord Elgin and Gentlemen,— I think we have
been all very much interested iu the very full and very able speech delivered
by my friend Mr. Dcakiu. He has placed an immense amount of matter
before the Conference whicli I feel sure will be read with the deepest interest
by the people of Australia whom he represents. I am equally certain that it
will be read by the people in the Colony that I have the honour to represent.
We are approaching this matter from a similar standpoint, and we are anxious
to bring about that which Mr. 1 )eakin has at length placed before the Con-
ference. I feel justified in saying that in view ol the important details that
Mr. Deakin has in many respects fiiruished, it will very appreciably save
my time in placing some other aspects ol' this important matter before the
Conference. I feel, however, that the historical occasion should not be
allowed to pass by Avithout saying something from the standpoint of the
important Colony that I have come here specially to represent. I woidd
like briefly to state what the attitude of New Zealand in connection with
preferential trade is. We come here with an honest desire to place our
position before the British Government, and the British people through
the British Government, in the hope that if they see proper to return the
preference which we have already on some articles given we should be only
too glad in that respect to extend the system and have them added to ou
a mutual basis. I should like so much to say that if this comparatively
new question as between the Motherland and the Colonies could be by all

266

Ninth Day. parties in all'onr conntriea taken oiit of the arena of party politics, a solution
1 May 1907. o^' i^ would be reached, 1 think, at a A-ery much earlier period. I do not

profess for a moment, and would not presume, under any circmnstances, to

Pkefeuential enter into the sides of the internal political policy of England. The jDoint
luADE. ^^^^ confronts us in New Zealand to some extent draws us into the political

^''^vV'^^f'l'''' question, whether we like it or not. That we cannot help. I want to make
'"' '^ it clear in prefacing the observations I propose to make that New Zealand

is most anxious to be kept out of what one might call the hurly-burly of local
political warfare, either in the Old Country or in any other portion of the
Empire, hnt it wants to work for bringing about a stronger and better con-
dition of the Empire itself. While on this point, I should like to say that it
is very much to be regretted that the question of preference is mixed up with
that of Protection. It appears to me that there is such a distinct line of
demarcation between the two, that it is Avorth AA^hile for a moment to place
my own view upon record as to the great importance of the distinction. I
should like to say that if I were a public man resident in England, and Avith
the general knoAAdedge of economic conditions that I possess at the moment, I
should be found on the side of those who are fighting for cheap food for the
masses of the people. I believe that anything in the Avay of preference that
the Colonies might suggest, if it were calculated to raise the price of food to
the masses of the people, ought to be opposed, and rightly so, by the British
people. For my own part, if I thought that what New Zealand was m-ging
in that respect was likelj^ to bring about an increase in price of the food-
stuffs to the masses of the people of England, speaking as a New Zealander,
I Avould not urge it upon the consideration of the Conference, and I Avould
not urge it upon the attention of the people of New Zealand ; but it is
because I belicA^e that, with a system of preference on certain articles between
Britain and her Colonies, such a condition of increasing the price of food
would not arise, that I am an ardent supporter of a preferential system
betAveen the Old Country and the newer ones. New Zealand is in the position,
as oiir great coadjutor in Canada is, of having put a preferential and
reciprocal Trade Act upon the Statute Book. It came into operation on the
16th November 1903, and though Great Britain could not under its fiscal
sj'stem offer anything in return to us for mutiial i:)rcfereuce, Ave readily
and, I think, rightly, gaA^e preference to Great Britain under that tariff.
From one of the Returns placed before us by the officers connected
with the Colonial Office, I will just enumerate Avhat that preferen-
tial tariff provides for. " Goods enumerated in the First Schedule
" to the Act pay double the ordinary duty when of foreign production."
I may say tliat cement is the only article which is referred to in the schedule.
" Under the Second Schedide, foreign goods pay the ordinary duty plus one-
" half. Among the important articles included in this Schedule are boots
" and shoes, fancy goods and toys, hardware, holIoAv Avare and iron nails,
" ironmonger_y, iron pipes and fittings, pianos, eartheuAA'are and glassware.
" Under the Third Schedule, foreign goods pay a 20 per cent, ad valorem
" duty ou certain articles formerly on the free list, Avhilst British goods
" are admitted free of duty as heretofore." There is a handicap there of
20 per cent, against foreign goods which come into New Zealand without
any duty, against British goods. " The chief classes of goods included in
" this Schedide are iron (plain black sheet, rod, liolt, bar and plate) rails for
" railways and tramways, and printing paper," and the Schedule attached
to it shoAvs that since that tariff' has been in operation, giving a preference
of dutj^ to England as against foreign countries, there has been a very
considerable increase in the importation to New Zealand from England ou
some of the lines, and a diminiition from foreign countries.

Mr. LLOYD GEORGE : What has been the effect upon our purchases
from New Zealand ?

267

Sir JOSEPH WAI\D : T am going to refer to that a little later. Ninth Day.

1 May 1907.
Mr. ASQUITH: Do you say there is a ilimiuutioa upon the imports

from foreign countries to New Zealand ? Prekerextial

Sir JOSEPH WARD : There are six classes in the return in which there
has been an increase from England.

^Ir. ASQUITH : I thought your statement was that on the wlioh^ there
had been an increase.

Sir JOSEPH WARD : 1 did not say that.

Mr. ASQUITH : And a diminution from foreign countries.

Sir JOSEPH WARD : No, I did not say that. I said that in six clasess
there had been an increase under this tariff.

Mr. ASQUITH : I thought you meant on the whole.

Sir JOSEPH WARD : No, I did not say that. I propose to refi^r to
the i)oint of the decrease of the trade in British products to Australia and
New Zealand presently. I want to say that the result of a preference to
British goods imported into New Zealand, from information furnished to the
( Government r)epartment in New Zealand, has not brought aljout an increase
in the price of those articles to the consumers in New Zealand. On the
contrary, the increased opportunity for competition between British traders
by having a preference, by putting a duty against foreign countries, has kept
the price of those articles down. That is one of the points in connection
with preference as against the general system of Protection that I specially
want to keep before niyseK, and before others, in considering this question
of the tariff. New Zealand has also extended a preference tariff to Canada,
and Canada has done the same to New Zealand. New Zealand has also
entered into a preference tariff treaty with South Africa, and South Africa
with New Zealand. So we are in the position at the moment of having fully
10 to 20 per cent, against foreign countries in favour of Great Britain. We
liave entered into a recii:)rocal treaty with South Africa and a reciprocal
arrangement with Canada by which we each make a concession upcm our
respective tariffs. I refer to this in order to show we are in earnest in our
desire to bring aboTit mutuality of trade within dilTerent portions of the
British Empire.

In reference to this question of the trade to the Colonies, I want specially
T.0 refer to an aspect of it which I think is disconcerting, that is the trade
from the United Kingdom to Australia and New Zealand. The Returns
supplied to the Conference give the average between the years 1899 to 1901
as against 1904 to 190G. 'I'liere is a very remarkable feature about it in my
mind ; it is headed " Relative Importance of British Colonies and Foreign
Countries as Consumers of United Kingdom Produce."

Mr. ASCJUITH : It seems a rather useful table.

Sir JOSEPH WARD: Yes, it is. I am reading fi-om page 3.~ It will
be seen there that the only countries where the products of the United
Kingdom have been exported to, the oidy countries in which there has been
a diminution of trade, are the Australian Commonwealth and New Zealand
in th(^ respective peiiods of three years in each case — to the extent of
OlUjUOOi. — and a dimimitiou of 2,()4i,0UOf. to Russia. I make no comment

* ^ee No. XXIV. of [C<1. 3.52 1] : Piii.urs Laid Lcforo the Confc'icuco.

Tkahk.

268

Nintli Day.
1 May 1907.

Preferential
Trade.

(Sir Joseph
Ward.)

about Russia because I am not for the purposes of my argument concerned
with, that, and the extraordinary and unusual circumstances which have
transpired there doubtless are responsible to some extent for that diminution,
but the fact remains that those two countries are the only places to which,
the exportation of products from England have decreased. In the case of
British India and Ceylon, there is an increase of 10,000,000?. ; Germany,
3,600,000L ; United States, 5,200,0007. ; France, 53,000L ; British South
Afi-ica (Cape and Natal), 2,62I,000Z. ; Argentine, 7,700,000?. ; British North
America (Canada and Newfoundland), 4,600,000?. ; China, 4,900,000?. ;
Belgium, 644,000; Netherlands, 15,000?.; Italy, 1,600,000?.; Japan,
459,000?.; Scandinavia, 390,000?.; and Egypt, 2,561,000?. What is the
cause of the diminution of trade from Britain to Australia and New
Zealand ? My answer is it has gone to other countries, and England under
Xjreference ought to have the lot.

In connection with this I want to direct attention to what I regard
as a matter of some consequence from the standpoint of the possibility
of bringing into operation an improved condition of trade between Britain
and her dependencies. It will be assented to that the age of Australia
and New Zealand is comparatively young ; they are almost in their infancy
by comparison at least with some of the older countries. That, together
with their population, are elements in arriving at the possibility of the
development of the future by comparison with what it is to-day, that ought at
least to give us some matter for consideration as to how we should shape our
policy in order to improve the general condition of affairs. To-day, according
to the Return furnished by the Colonial Office, the third greatest purchasing
customers for the outward products of the United Kingdom are Aiistralia
and New Zealand. According to the return, the trade to Australia and
New Zealand is 24,896,000?. per annum, and British India and Ceylon is not
twice that ; it is 44,000,000?. Germany is only 29,478,000?., whilst the popida-
tion of Australia and New Zealand at the last census was under 5,000,000 —
about 4,800,000 — the population of Germany is some 60,000,000, and the
popidation of India is 239,000,000. I allude to the popidation of India from
the fact that it is a portion of the British Empire, though I am quite aware there
are different races there, and that is an element that requires some amount of
analysing before placing it in the same category as Germany, if you like.
But here is a featui-e, that looking to the future development of these
Colonies, I cannot dispel from my own mind as being of very vital consequence
from the standpoint that I regard it from. The trade of the Aiistralian
Conunonwealth and New Zealand last year was : Australia upwards of
110,000,000?., and New Zealand over 30,000,000?. You can put down
roughly that the combined trade to and from those countries as from
to 150,000,000?. They are in their infancy. There are tmder
of people there, against sixty millions in Germany and two
thirty nine millions in India. To-day they are the third
largest importers fi-om the old country. To-day the trade of Australia and
New Zealand is under 5,000,000?. less from Great Britain than the trade of
Germany is. To-day Germany has sixty millions of people as against under
five millions of people in our country ; she has twelve times the population,
and her age as a trading country with England, compared to that of Australia
and New Zealand, runs into centm-ies, as against New South Wales, which only
held its centenary ten or twelve years ago, and New Zealand, which is still
well imder the century. England's outward trade to Australia and New
Zealand is greater than it is to America. The imi^ortant fact remains that
these two great and growing self-governing British Colonies belonging to
the Old Country at this early period of their history have got to be in the
position of the third largest purchasers of the products of the United
Kingdom. They are in that position to-day in their very infancy, and with

140,000,000?.
five millions
hundred and

269

a comparative handful of people existing there I feel that as an element in Ninth Day.
connection with the line of argument I am submitting to this Conference, i May 1907.

as one calling, from either an Imperial standpoint or, if you like, from a

business standpoint, for at least the generous recognition and generous PREKEnENriAL
consideration of the powerfvd Mother Country. Our trade relationships arc Tuaue.

so material to each other. Our attachment and destinj' are on mutual lines, (sir Joseph
and we should try and shape a pohcy wliich we believe to be safe and Ward.)

beneficial for oiirselves.

I do not want to take up the time of this Conference by giving a number
of figures for the purpose of impressing upon them the view that New
Zealand takes of this proposal to have preferential trafh% and, indeed, it would
be unnecessary for me to do so in view of the veiy full and valual)le informa-
tion furnished bj'^ Mr. Deakin regarding this important matter. A point
that I want to impress upon the Conference is that in another twenty years
from now, which is a very short period in the history of Australia and New
Zealand, if they go on at anything like the proportionate increase of trade that
lias characterised their development up to now, they will be amongst the
most important of the traders with the Old World. 1 want to make this
point as I am passing, that I honestly believe that some of the great
foreign Powers — Germany, France, and Italy — if they have not reached their
purchasing limit, have very nearly reached it, and I will give my reasons for
it. Unlike Canada, Australia, or New Zealand, those countries having
populations fully as great as they can reasonably carry, fix for their
teeming millions within their own borders a policy of industrial development
and constructional development in the way of industries that means the
employment of their own people lor the producing of what thcj' require for
themselves. And as the outcome of the thick population within their
territories they will be bound to find employment for their o\\ti people in
regard to the manufacture of goods and I'uising of products their own people
require. In proportion to the development that wiU. go on in these great self-
governing Colonies Avitli their limitless tracts of land still available, especially
in Canada Australia, and New Zealand, for people to settle upon, I re-ailirm
that the possibility of the development of trade from Great Britain to the old
Continental countries, if it has not reached its limit, will be very small as
compared with the enormous development of trade that will go on in these
growing self-governing possessions.

That being so, what lam anxious to put before the Conference is — though
I know we can only go forward slowlj'-, and a great question such as this must,
in its ordinary cause, take lime to be matured — how anxious all of us are to
see our ideas put into operation at as soon a date as possible. What I
want to tiy to impress upon this Conference is the difference between
preference between Great Britain and the Colonies and what is known as
Protection. I draw the distinction for this reason. I take a typical case.
You may have an importation of meat, if you like, or dairy produce. You may
take Russia and America as cases in point who may be sending large
quantities of these articles to England at the moment. If you were to
put a duty against America and Russia upou a special article and give the
opportunity to Canada, Australia, New Zealand, and South Africa, to send
that same article to England, I am as persuaded in my own mind as I am
alive that the price would be as low by the competition and naturnl rivalry
between Canada, Australia, New Zealaiul, and South Africa, as it would have
been by allowing that product to come in from Russia or America. It is
because I believe that, that I urge upon the consideration of this Conference
the desirability of th-awing a line between the complex, difficult and certainly
controversial matter of Protection, in a great country such as England is, aiul
preference upou certain articles from our o^vn countries as against the same
articles from foreign countries. It is a very important matter from the

270

Ninth Day. standpoint from whicli we regard it, and I would earnestly like to impress

1 May 1907. it iipou the Conference.

J ■ ~ Again, we are all proud and delighted to know that recent develop-

Tbade ments in South Africa have brought it within the possil^le range of lieing a

rSir Jose )li gi'sat Confederacy before very long. Soiith Afi'ica in times of peace and with
V\^ai d.) <i settlement policy going on in the interior, as must take place, there will not

devote themselves entirely to the production of ores from their mines. They
are bound to have a land settlement policy in parts of the country. It is
only a question of time when we will have South Africa, to some extent, joining
with these other British countries in having an excess of exports to send to
the Old Country from the products of its soil. The position to-day is this—
and in our country we feel it — we recognise that the Imperial statesmen who
are responsible from time to time for the government of Great Britain have
far-reaching responsibility — far ^vider than any of us have. We kno\v from
time to tune the requirements of Britain necessitate treaties l:)etween Great
Britain and sonie of the powerful nations with whom she is working side by
side. But here is a factor whicli concerns us. The foreign comitries, I think
without exception, have got a high, almost prohibitive, tariff against the
natural x:>roducts of our comitries, with the knowledge of the fact that
England does not require to send them a single parcel of her products from
the soil of England at all. On account of our adhesion — proudly so — to
the Empire, to England, we find that British peoj^le, to the extent of 90 per
cent., settle in our countries, working in (season and out of season, making
homes for themselves and their families, helping to concrete our country into
a solid ijortion of the Empire, and helping and adding to the power and
prestige of Great Britain itself, and if they wanted to send their exports
out of New Zealand and trade with these other countries they find they
are liarred by a high wall of protection against their natural products.
Germany is a case in point, France another, Italy another, America another.
The tariff against us is of the character that, unless in an odd case where
they want somt^thing from our colon}^ for the purpose of assisting in their
manufactures, they take comparatively nothing from us, and their greatest
market is England. The increase of the trade to Germany referred to during
the course of Mr. Deakin's able speech yesterday by Mr. Asquith, will be found
largely to apply to avooI from Australia and also fi"om New Zealand.

I want to tell this Conference what has taken place — and I refer specially
to the products of Australia and New Zealand — within the knowdedge of the
commercial world in recent times. The Germans, with a comprehensiveness
and with a method that calls for the admiration of all of us, subsidise very
magnificent steamers, from which they leave no point of equipment out, in
order to attract all classes of people to travel JDy those steamers from the Old
World to the newer world across the ocean. Their courtesy, their attention,
their general aim in getting into this trade, and rightly so from their point
of view, is recognised by the whole of us. The outcome of these huge
subventions to their steamers in recent times has been to shift from London
— which for years and years was the emporium to which Australians and
New Zealanders sent their wool for the Continent for disposition by the
London merchants — a large proportion of the trade now passes London
direct to the Continent. Those powerful commercial rivals of England
and her dependencies, the Germans, who formerly bought through the I^ondon
merchants, now ship the wool to Germany direct from Australia and New
Zealand. T lliink it is right for the Germans to save all they can in the way
of double handling. I tliink it is a good thing for our commerce to save
anything it can in the way of transhipping and double freightage or double
handling, but the fact does remain that that is the aspect which to some
extent shows that upon some matters we are doing trade with those who
are higldy jirotcclcd against us, which formei-ly we did with them, no doubt,

271

but it filtered through TjoikIou and ihn>iigh Eughuid. I allude tO' £his Ninth Day.
onl}^ (() finish this important part of the argument. At one tinu- th(>n>. was a l May 1907.

general beliel', certainly in tlie minds ol' many pepplo who were studying th(!

developments and changes and alterations in trade ramifications throughout l^'tflj^lK'^KXTiAL
the world, and a number of us used to labour under the happy delusion, that .. "*"'^"

trade Jollowed the Hag. We know from actual experience in recent years Wann'''

that it is a delusion. It does not follow th(> flag, except conditionally. Trade
follows the ship, and if the British ship with the British Hag is pioneer in a
particular trade, or if the British ship Avith fh(^ British flag is trading side liy
side with the ship of any other country under another flag, and it is trading
on equal conditions, the British will proljahly get a fuller proportion of the
trade from those countries. It is a theoretical, fanciful, and misleading id(,'a
which used to exist, that if you find a flag on the top of a ship the commercial
world will tip everything into that ship for the mere parpose of doing so.
Nothing of the kind. Trade will follow the ship. The trade in the
British Possessions will follow otir flag as a matter of preference and
the Germans notably give their own ships a preference, and we all want
to see our British merchants give our British ships a loreference. The
Germans have recognised to a greater extent — I say it Avithout any depre-
ciation of the British shipowners and merchants — than we have the power
and usefulness of a ship getting into waters by the subventions they are
giving to them to enable them to compete against our ships, and they
draw a certain amount of trade fi-om the countries to which they go. What
do they get for it? Merchants in any j)art of the world as a matter of
business want to save all tlie money they can in order to enable them to
compete with their rivals, and a merchant says : " If I can ship my wool
" to Germany, and get certain things back, I save the rate of exchange
" which I should liave to pay if I had to remit the cost of the purchase
" of those goods to Germany." The moment you get into the position of
interchange of trade between those self-governing Colonies, wdiich are
extending to an enormous extent, and put them in the position of feeling
and finding that they arc being handicapped in their own Empire in th(^
matter of trade, you di-ivc them as a matter of necessity to other countries
in the same line of business, and by degrees you find a diversion of trade
which W(juld l)o Tiseful and valuable to the Old Countiy and useful to us — a
diversion which we ought by every rnean.^ in our power to try and avoid.

Mr. DEAKIN : Sometimes a British flag flies over a ship Ijecause it is
owned by a company registered in Great Britain, although its capital and
control are absolutely foreign.

Sir JOSEPH WAKT) : Tluit is so. I do not want at the moment to go
into that aspect of the question.

Sir WILLLVM LYXE : The White Star Line.

Mr. LLOYD GEOUGE : it is not tlie case with the White Star Line.

Sir JOSEPH WARD : 1 do not want at present to go into that aspect
of the question. We have now a great opportunity of meeting at this
Conference three r(>sponsible Ministers of Great Britain in the British
Government. Anxious as we are, I am certain, to do all in our power to
develop the best interests of the old land and help in the development of the

Ward.)

272

Ninth Day. newer one, the way in which it should be done is a matter upon which there

1 May 1907. may be difference of opinion, hut I beheve the desire of the whole of us is to

achieve the same end, and it is by interchange of opinion on some matters of

Prefeeential ^j^-g cliaracter that we may be able to help each other to arrive at a practical

,^. ^ ' , solution, and it is that and that alone that I am anxious to bring before the

(blT Joseph r\ t

w„,.i ^ Lonierence.

I am desirous of saying a few Avords about another question which has a
very strong bearing upon the develoi^ment of the trade of Great Britain with
her Colonies. If you, Lord Elgin, went out to New Zealand to-day, and
went into any town there you would find a representative of every important
coimtry in the world except Great Britain there. I am not talking of the
Governors who so ably represent the British Government, especially on the
diplomatic side, and upon matters concerning the carrying on of the Govern-
ment of the self-governing coimtry in relation to the old land, but I say if
you go to New Zealand and to Axistralia — and no doid^t the same remark
applies to Canada, though I do not know it fi'om my own experience — you will
find all over the country in every large town in New Zealand that there is a
Consul or Vice-Consul specially selected. Yon will find that those Consids are
full of valuable information on all important matters, and especially regarding
trade. That they are ready to furnish that information to every person
coming from their country. They help their Governments and their merchants
by the dissemination of information, mail after mail, year in and j-ear out,
upon all aspects of trade, whether it be from Britain to our Colonies, or from
our Colonies to Britain. They help the trader in our Colony to get any
information he wants upon any aspect of that trade Avithin the foreign
territory. You cannot find a single representative of Great Britain in any of
these seK-governing British countries, so far as I know, to whom any person
desiring to do trade with your manufacturers, or with your producers,
or with your professional men, in the Old Country can go. I say that is
a great blot on the system of the present commercial development and
the present commercial position, and it is a great Avant AvMch Avill be
more felt in the future, Avhcn help is wanted, to extend and develop our
commercial relationships with one another. The importance of it, from the
point of vicAv of a visitor to any of these countries, is so great, that in three
out of five cases, if a man cannot get the information he AA'ants, even regarding
the trade of Great Britain itself, he goes to one of the consuls of another
countiy and avails himself of his existence and of his system of collecting
information for the purpose of doing Avhat he desires. Within my oAvn
knowledge, and I say it advisedly, though I do not Avant to name the country
or the people, AA'ithin the last three years one of the great countries that is
commercially an active rival of England, has by more than one of its emissaries
travelled through our country for the purpose of getting information upon
every conceiA^able kind of trade and other matters uoav l)eing done Avith
Britain that might be of use to the merchants of his oAvn country.

Mr. LLOYD GEORGE : An emissary of the Government of the country
— an official ?

Sir JOSEPH WARD : I do not say that — I say emissaries — I knoAv the
actual facts — and I am a little giiarded in saying it. I feel sure that this
Conference Avill agree Avith me that it would he a derogation from the high
and essentially (Hguified position of the GoA-ernor of any of our Colonies to
be a medium for obtaining and furnishing information concerning great
industrial connnunities AA'hetlicr on tlie producing side or the manufacturing
side. It Avould be a most inconvenient method of obtaining such informa-
tion, even if it were desirable, and I feel sure it can)iot be desirable. As

273

an outcome of this Conference and of our i>reliminary discussions, in the Ximh Day.

desire to help trade development between the old land and the newer lands, 1 May 1907.

I hope we may see some elTort made to place ns side by side with our great ^

competitorsiu the matter of obtaining iufonuat ion and disseminating knowledge. ke|"ekextial

(Sir Joseph

Mr. ASQUITII : Do you know that &teps have already been taken for Wwd.)

that purpose V

Sir JOSEPH WARD : I was not aware of that.

Mr. ASQUITH : The Board of Trade have appointed trade correspondents
— five in South Africa and six in Australia.

Sir WILLIAM LYNE : None of them fitted to be appointed.

Mr. ASQUITH : That is another matter. There is a difference of opinion
about that. Whatever may be said about the personnel the office is brought
into existence.

]\Ir. LLOYD GEORGE". : About Australia, if I may say so, I have been
in consultation with Mr. Deakin as to the personnel. You must not assume
that the thing is settled here ; we are conferring with Mr. Deakin on the
point. May I say also, that with regard to Canada the name of the
gentleman sent over was suggested to us by Lord Strathcoua because he knew
hiu; well.

Sir WILFRID LAURIER : He could not be a better one.

Mr. ASQUITH : At any rate an attempt is being made to deal with this
very important matter.

Sir JOSEPH WARD : I am very glad to hear that is so, antl I
cougratidate Mr. Lloyd George upon the initial step which has been taken.
I have not had the opportunity of being consulted as to New Zealand, but
if I may, with some experience of what is necessary, I should like to suggest
that a trade correspondent is not sufficient. It would be quite inadequate
in my judgment in New Zealand. One's practical knowledge of it may be
of some use in extending what I recognise is a very valuable thing which
has already been conunenced. I would point out that the configuration of
our country is such that unless a trade correspondent was able to split
himself up into a dozen parts he would be bound to be located at different
times if not regularly in one centre.

He may move from that from time to time, but that is of little use to the
man who goes, say, from England — as many of them do — for the i^urpose of
obtaining information, and comes to a particular town and wants to find out,
generally speaking, promptly, the local peculiarities of the ti'ade there, or
obtain information on questions on the spot peculiar to that particular place.
I merely re-affirm the necessity of having a representative in every large town,
and I am sure it can be done very inexpensively if what I understand
Mr. Lloyd George has so well begun were extended so that we had in the
same manner as other countries a representative in every important town. If

E 48668. S

274

Ninth Day. your representative was, say, in Auckland, lie would be 1,200 miles away from
1 May 1907. a business centre at the other end of the Colony. A man requiring infonna-

: tion cannot wait until he meets the trade correspondent in the place in which

'"^Ti"r)^ " "' ^^® ^^" ■'■ P^^* it forward with all respect for the consideration of the Board of
,„. -. " Trade, which is such a valuable portion of the fabric of Government. In my

WardO^^ ' opinion it is worthy of consideration whether we should not, in order not to
be behind the competitors of England and of our Colonies, appoint repre-
sentatives to the duty of obtaining and disseminating trade information which
is so valuable in all j)arts of the Empire.

I want to say a word upon another important point. I am deeply in
earnest in my desire to see the possibility of drift of any kind, so far as
the Colonies are concerned, prevented. I am positive in my own mind that
unless both England and the Colonies progress, if they are allowed to stand
still, in the aspect of their sentimental . connection with the Old Country
being] sufficient, and in the aspect of the ties of kinship keeping them
together, and all that sort of thing, that to stand still means retrogression,
and retrogression means drift. Apart altogether from this question of pre-
ferential trade, the people of the Colonies wish to feel that they are in closer
touch with the people of the. Old Country, and I am very earnest in my
advocacy, which I have publicly expressed for many years, of a hope that the
British Government ma}^ coalesce with the Governments of Australia and
New Zealand, and in one respect, if not in all, v\'ith the Government of
the great Dominion of Canada, in bringing our peoples closer together.
There is one practical way in which it can be done, and, in my opinion,
it is the only practical way in which it can be done, that is, by taking a
lesson out of the books of some of oiir adversaries, and not merely giving a
subsidy for a line of mail steamers to carry a mail at a very rapid rate,
which is most important, but seeing that in some form or another the traders
of the Old World and of the New World are put into a position of equal
competition against their foreign competitors, who are doing so much ia
assisting their merchants by their own steamships. I will not name the
crowned head in one of the countries who takes an active personal interest
in the ramifications of that country's trade ; but they play the game so
thoroughly and effectively, that, unless we take similar methods, my opinion
is that, to a certain extent, the position of drift will arise. I believe we
ought at this Conference, without going into the intertwining difhcidties
surrounding trade, to consider in one or two respects its practical appli-
cation. I say there is nothing that would do our countries of New Zealand
and Australia more good than an alteration in the conduct of the Suez Canal.
I introduce that without any reservation. I say it from the Imperial point
of view, and I ask the Conference to put its iviprimatur in the course of
this discussion upoti improving what is one of the highways of the world.
The country — France — which has a large share with England in that Canal
would naturally have the same treatment extended to it as we wish to
extend to ourselves ; but my own. belief is that it would pay Great Britain,
and it would certainly pay our Colonies, to join in it, and I believe it would
pay the French Government handsomely to make that Suez Canal free for
our and their own ships, and to allow our respective countries to pay to the
shareholders the whole of the interest they are getting on their capital now.
To-day our cargo steamers which are trying to keep in touch with England
have to take a 45 or 50 days trip to get here with our perishaT)le goods.
Here is a highway of the world which is used by large steamship lines,
and there are some magnificent ships trading to Australia which
use it ; but unless you get some powerfully organised wealthy corporate
body, whose people paj^ the enormous dues upon ships, passengers, and
cargo going^through the Canal, you do not get it used generally, I mean by

Pkki'kukntial

TUADE.

275

cargo steamers only. You iire thus limiting its use to the wealthy, while the Ninth Day.

poor Tnifortimate tramps which uo lo and Irom our co\iiitry have to travel 1 May 1907

the oceans of the world, and lake ten days or a I'urtnigiit longer to carry our

products to England. It may be regarded as presumption on my part to

suggest this. I am in deadly earnest al)out it. I do not know tin- exaf'-t .^.- •. ,

method by which it can be done, but I have a mortal hatred of the toll-bar. 1 \Vnrd.)''

have only met with one during the last ten years, and that, I am sorry to say,

was the other day on the road to the Oiystal Palace. I have an absolute

hatred of the toll system, and if there over was a system of toll put as a

clog to the development of the trade of England and of the Colonies, to say

nothing of the trade to the East, it is the continuance of high ami almost

proliiliitive charges on vessels using the Suez Canal, anil minimises the

splendid effect of the masterstroke of the late Lord Beaconslield, of the

acquiring of the shares of the Suez Canal in the interests of the Empire itself.

If we are not to stand still in the Ohl Worhl and in the Xew \\'orld, I do

say we ought to recognise the march of progress which is going on, and

wo ought not, from the sordid [loint of view, or from the point of view of

the interest upon the shares, to allow this Canal to stand in the way of the

Empire's progress. The country I represent would willingly do its share

towards improving the present prxsition of tlie Canal. If we had the right of

going through the Suez Canal uniler tho British flag free we would help

towards paying the interest.

Mr. ASQUITH : It is a very interesting proposal. Do you propose to
free the Canal for all the world, or only for certain specified nations ?

Sir JOSEPH WARD : I said for the nations concerned only ; that is, those
who o^vn it.

Mr. ASQUITH : So that you would not allow the Germans to go through
free of toU ?

Sir JOSEPH WARD ; Not at the same rate. Why should we ? If you
own a good thing, why give it to an opponent who is trying to cut your
throat every day in the week upon even terms ? I fully admit it is a com-
plicated q\;estion to deal with.

Mr. LLOYD CrEORGE : I understand the Austrian Government does
remit a portion of the dues to its own shi])s going through the Suez Canal.

Sir JOSEPH WARD : It is a very sensible proceeding on the part of
the Austrian Government, I think.

Sir WILFRID LAURIER : The tolls are paid by the Austrian
Government ?

Mr. DEAKIN : It is another way of reaching the same end.

Sir JOSEPH WARD: I said it was a very important matter and I
approach it with some diffidence, because I recognise the difhculties
surrounding it ; but I want to take the opportunity because we are so anxious

S 2

§76

NintK Day. iq \)q brouglit iuto closer touch with the Old World. Our greatest difficulty,

1 May 1907. and indeed the greatest misfortune that Ave suffer from, is the time that it

-, takes to get our products and our people to and from England itself. What

Tr\de I have suggested may not be feasible, but I should be so glad if it were

(Sir Joseph possible for the poAverful British Government to, in some way, investigate the

Ward.) matter with a view to seeing whether this world's highway could not be made

in the interests of the development o£ the trade between certainly those

portions of the world that use the Suez Canal.

Mr. ASQUITH : Do you consider that the present rate of tolls is
prohiliitive to the cheaper kind of cargo and vessels ?

Sir JOSEPH WARD : I have been told repeated^, l)y people who are
concerned on both sides of the world, that for ordinary cargo purposes they
do not generally send their vessels through the Canal to or from Australia
and New Zealand l)ecause of the tolls.

Mr. LLOYD GEORGE : I know the tramps complain bitterly and say
that their interests are sacrificed to those of the liners.

Sir WILLIAM LYNE : It costs one steamship company 100,000Z. a
year.

Mr. DEAKIN : To the fortnightly boats running to Australia it means
100,000/. a year.

Mr. LLOl'D GEORGE : The tramps have been asking here for
increased representation on the London Committee ; but, unfortimately. we
have no power at all in the matter.

Mr. ASQUITH : This is a very important question which has been
raised.

Sir JOSEPH WARD : It is connected with trade, and I felt I must
allude to it. I do not propose to take up the time of the Conference very
much longer, but I also want to say how very much, certainly New Zealand,
and I think all the self-governing Colonies, would value the co-operation of
Great Britain witli them in their desire to come closer to the Old World.
I am not unmindful of the fact that you are doing a great deal, and a great
deal that is appreciated, in the direction of assisting in the carriage of mails,
and consequently helping to obtain improved and cheaper facilities for
passengers and cargo, on liners to and from our Colonies. I may, perhaps,
be allowed to speak for Mr. Deakin in this matter, and for myself, and I
know also for Sir Wilfrid Laurier, Ijecause we want to bring our coiuitries,
that is New Zealand, to within 20 daj's of London, and Australia and Canada
i:)roportionately to a very much greater extent.

Mr. DEAKIN : That makes for unity.

Sir JOSEPH WARD : Yes, I refer to this because it makes for unity,
because it makes for cohesion, and l)ecause it brings about a feeling or
recognition on the part of the people in our countries that the people in the
old World, whence they came, are in sympathy with them. Even if we
cannot to-day i)ut all we advocate into practical effect their desire is, if

277

possible, to see a closer union on practical lines consummated. We can Ninth Day.

only do it by bearing our own part of it, and we are prepared to do it. The i May 1907.

advantages are mutual and they are of as great importance to iMigland as

they are to the Colonies. It is because of the importance to all parts of " tkv^e^'*^

the Empire — not directly India or South Africa in this case, perhaps — that I rsir Joseih

earnestly urge it. "" Wardo' '

Mr. LLOYD GEORGE: How would you bring New Zealand within
20 days of England ?

Sir JOSEPH WARD : AVe can tlo it across the Atlantic from England,
then overland through Canada, and then across the Pacitic. We can do it
without any diihcidty whatever.

Mr. LLOYD GEORGE : Within 2U days ?

Sir JOSEPH WARD: Yes, within 20 days. Sir Wilfrid Laurier will
agree Avith me that it can be done. Four days and nights to Canada, four
days and nights across Canada, and 12 days on the Pacific to New Zealand.
It is capable of being effected without any dilliculty whatever, providing we
all co-oj^erate to eual)le it to be done. Steamers can be provided of a size
and speed that can bring New Zealand within 20 days of England. If you
want to come close together, it is necessary that large capital should be
invested and powerful vessels obtained on both sides of Canada. AVe in
New Zealand are prepared to do our part to the fullest possible extent.
Australia would, I am sure, Ije prepared tc) do their part. And so is Canada,
as I understand from Sir Wilfrid Laurier.

Mr. LLOYD GEORGE : Would that be for the purpose of carrj^ng
goods ?

Sir JOSEPH AVARD : No, passengers and possibly some goods;
certainlj' from England to Canada and from Vancouver to the Colonies.

Sir AA'ILFRID LAURIER : These steamers would carry some goods.

i\Ir. LLOYD GEORGE : AA'ould it pay to carry goods? They would have
to discharge the cargo at Vancouver and put it on to the Canadian Pacihc
Railway, and then discharge at Halifax.

Sir AVILFRID LAURIER : Yes, but it coidd be done ; it is done now.

Mr. LLOYD GEORGE : There would be so much labour involved in
handling the goods.

Sir AVILFRID LAURIER : There is more labour involved ; but the idea
would be to have services equal to the best services between England and
New York, so that the voyage between Canada and England should occupy
four days.

Mr. LLOYD GEORGE : I am thinking of the labour of discliarging the
goods at Vancouver and putting them on the Canadian Pacilic Railway, and
then discharging again at Halifax and putting them on another line of
steamers.

48668, S 3

278

Ninth Day. Sir WILFRID LAURIER : You couLl not do it with cargo; that is

1 May 1907. impossible.

^"^ TrIde"^'' ^r- LLOYD GEORGE : So I should have thought.

Sir WILLIAM LYNE : But it would increase the trade between Canada
and Australia.

Sir ^^'ILFR1D LAURIER : All express goods could be discharged very
promptly.

Mr. ASQUITH : It would be mainly a passenger and mail route, I
take it ?

Sir WILFRID LAURIER : Y'es, and perishable goods also — fruits and
things of that kind.

Mr. ASQUITH : How do you make your 20 days ? It seems rather a
short time.

Mr. LLOYD GEORGE : Four to Halifax, four across Canada, and 12
upon the Pacific, I understand ?

Mr. ASQUITH : That gets you to Auckland, I suppose.

Sir JOSEPH WARD : Either to Auckland or to ^^'eUington as the
steamers elected. We could do it easily in 20 days. It may to some people
seem a dream, but I am persuaded it is capable of being practically
worked, ajKl I am positive in saying that the Colonies want it. We are
anxious for it because we recognise the value to our people of being able
to come to the Old Country and meet your people here. We recognise the
enormous advantage of rapidity of mail comnnmication even allowing
for the speed that can now be attained across the cal)les. We know all
these facilities mean increased avenues for obtaining and developing trade.
The more you bring the teeming millions of England into touch with the
Colonies — Canada, Australia, and New Zealand — with their enormous iields
for the absorption of people, the greater chance you have of having those
countries settled by the excess of your British people from time to time
whom you do not require, and the more rapidly that will be brought about,
and the more rapidlj' will the trade between them expand. From the point
of view of Canada, Australia, and New Zealand it is most important, because
there will be an enormous trade development between those covintries on their
own account. If we could do the two things at once and also reduce the
charge for cable messages, it all goes in the direction of bringing about a
preference of trade imder the British flag between the outlying portions of
the Empire and the Old Country.

Sir WILLIAM LYNE : Y^ou would require to have an arrangement
regarding the service right through via the Suez Canal and via Canada fort-
nightly, because you coidd not keep up a double service of boats. We have
boats coming thi-ough the Canal now.

Sir JOSEPH WARD : It is a matter worthy of consideration.

279

Mr. DEAKIN : We have a weeklj' service alternately by two lines. Ninth Day.
One of the present lines couid be replaced by this new service. l M».y 1907.

I'UEKEKKSTIAI.

Mr. LLOYD GEORGE : You would not carry mails through the buez Tuaub.

Canal ?

Mr. DEAKIN : Yes ; one week through the Suez Canal, and the next
week this way.

Mr. LLOYD GEORGE: How long does it take through the Suez
Canal ?

Mr. DEAKIN : They could do it in 28 days, 1 thiuk. Wo dawdled for
four or five days on the voyage this year.

Mr. LLOYD GEORGE : Then the mails woidd be necessarily carried by
the shorter route.

Sir WILFRID LAURIER: In time the shorter route would take the
place of the other services.

Mr. DEAKIN : When I say 28 days I am speaking of Avhat the present
steamers can do without departing from their present conditions. The passage
by that Suez route could be lowered by several days more. I am not an
expert in the matter, but they are travelling now at a rate which shows me
that they could easily do their work in 28 instead of in 30 or 31 days.

Mr. ASQUITH : But you can hardly bring it down to 20 days.

Mr. LLOYD GEORGE : They have to caU at Marseilles, Genoa, and
other i)laces ; they woidd not be able to pay without that.

l\Ir. ASQUITH : If you assume the new route to be brought into effective

operation.

Sir JOSEPH WARD : We had a mail service across America in 28
days and sometimes less. It is only 400 miles longer from Canada to New
Zealand, and they wore comparatively sIoav boats. Twenty days could be
done easily enough. It is only a question of having sufficient money to do it.

Mr. ASQUITH : You would want first-class boats both in the Atlantic
and the Pacific.

Sir JOSEPH WARD: Yes, unless you have them of that character you
cannot do it ; and that is the class I am advocating.

I was going to refer to some other matters, but I may have a further
opportunity of doing so, but I will now bring my observations to a close. I
do not want imnecessarily to take up the time of the Conference. I have
endeavoured to show that in our coimtry we have already put \)pon oiu-
Statute Book trade i>reference upon some articles for England, which will
continue. It is fronL 10 to 20 per cent, against foreign countries, as 1 have
already pointed out, in favour of England. We have done the same in regard
to South Africa, and the same in regard to Canada, and we are anxious
to have it with England. How that should be done is a matter entirely for

S 4

280

Ninth Day. those who, like ourselves, are in charge of a self-governing portion of the
1 May 1907. Empire, namely, England itself, and in that respect I Avill not presume for a

moment to interfere ; but I want to say that the commercial policy of the

Pkeferential poTs'erful nations with which it is necessary for Great Britain to he in many
RADE. respects in touch is a policy which in the nature of things is hostile to the

%i"?^ self-governing Colonies.

What I look forward to, though I do not know how long it will he, hut
I believe it will come, is the time when Great Britain and her Colonies will
enter into a preferential system of trading, and when they have achieved the
position of being in a group of preferential trading coimtries, then they can
go with complete justification and with great hoj)e of success upon equal
terms, to any of these other powerful countries that have their high tariffs
against us now, and ask upon fair terms for reciprocal treaties, not for England
herself but for England and her self-governing Colonies, on matters which all
wordd be prepared to consider, and which would enable the bringing about
of fair conditions of trading between the Old World and the newer one.
These foreign countries now in their fiscal systems hit the Colonies all the
time. They do not hit England in the matter of external trade from England
in your natural products, because you do not send them out of the country.
You are naturally a large consuming people and you require to import from
over the sea food stuffs very largely indeed. Other countries do not in that
respect hit you in the same way as they hit the self-governing Colonies.
My own belief is that if the time arrives, as I believe it will, when we can
have a system of preferential trade between ourselves, we could, as common-
sense, practical people, in charge of our respective countries, without any
doubt enter into reciprocal trade relations as a whole ; and say the Germans
or the Americans would then, in respect of certain articles, be prepared to
allow them into their country in return for certain other articles being allowed
into ours. Italy and France woidd have to do the same. We should then
be all on fair terms. I honestly believe that it could be done without injuiy
to the masses of the people of England. If I thought it was going to injure
the masses of the people of this country, I for one would not be favourable
to it. I honestly believe preferential trade within our own countries would
vitalise and add to the strength and greatness of the Empire.

Sir WILLIAM LYNE : Does your preference to Great Britain extend
right through your tariif, or does it discriminate ?

Sir JOSEPH WARD : It does not go right through our tariff. Upon a
number of articles which are named we have a higher rate against foreign
countries, and allow England to come in on the free list for a number of
articles that we impose duty on against a foreign country.

Sir WILLIAM LYNE : Do you charge any items the same to Great
Britain as to foreign countries ?

Sir JOSEPH WARD : Yes, some of them.

Mr. ASQUITH : A good many ; the large majority, I tliink.

Sir JOSEPH WARD : I read them all out from the return. Tlie wliole
of the information is here.

Mr. ASQUITH : The preference only extends to about a dozen or a score
things at the outside. Speaking from recollection, 2U per cent, of the total
British imports are affected by the preference ?

281
Mr. LLOYD GEORGE : Yes, about one-fifth. Ninth Day.

1 May 1907.

Sir JOSEPH WAliD : Of tlio British imports to New Zealaiul, yos. K Pkek^tial
you applied the same system, and gave us 20 per cent, of the total articles Trade.

imported into England, we should say it was a good thing.

]\[r. ASQUITH : I am not complaining at all ; but I was only pointing
out what the dimensions of the preference are in answer to Sir William Lyne's
question.

Sir JOSEPH WARD : From our point of view what we have already
done shows an earnest desire for preference to be given to the old land.
Whether we are right in that or otherwise must ho left to others than
myself to judge. We believe that it is a good thing, and are quite prepared
to extend it. As far as New Zealand is concerned we are only too ready
to enter into a reciprocal treaty with our friends of Australia to which
Mr. Deakin has referred. We have also an adjustment of the Customs
Tarilf to put on the Statute Book next session, and we are most anxious to
bring about improved trade relationships between the Colonies, and most
anxious to assist in the development of trade between the old world and
the newer one. iVpart from feelings of sentiment which are so valuable,
we have an additional desire to build up our country by reciprocal treatment,
which will strongly develop trade between ourselves.

Dr. JAMESON : Lord Elgin and gentlemen, I shall be brief,^ indeed.
After the able and full speeches of IMr. Deakin and Sir Joseph Ward the
ground seems to be pretty well covered. At the same time, as Sir Joseph
Ward has said, this is an extremely important subject, I might almost say
vital, if you look to the future of our Colonies and of the Empire generally.
Therefore I do not thinlc the representative of any Colony would be justified
in not saying a few words in support of the proposition now before the
Conference.

As regards the Cape, which I represent, I think it is peculiarly fitting
that its representative should speak. Though economically, certainly, we are
far behind the representatives of the Colonies who have already spoken, yet
in the inception of this idea of preference, I think our statesmen were quite in
the front. We have had two great statesmen— somebody said the only two
men Ave have ever produced to whom you could legitimately apply the word
"s1atesmen"—]\[r. Rhodes and Mr. lloi'meyr. Mr. Rhodes as far back as
1890, 1 remember, immediately he took office, wrote to the then Prime JMinisters
of Canada and Australia, putting liefore them this proposition of preference
to the goods of the Mother Country. Again, when the Chartered Company
was established in Rhodesia, Mr. Rhodes insisted, and with great difficulty
carried his point, that there should be a clause put in the Order in Coimcil
establishing it that no British goods entering Rhodesia should ever be
charged more duty than the then Cape Tariff, which was 9_ per cent.
at that time. That has l)een carried out, of course, ever since. The
Customs Tariff of the South African Customs Union is 12 per cent., but
because of that clause introduced by Mr. Rhodes we have to allow Rhodesia
only to charge 9 per cent., 3 per cent, less than the Cape. Then
Mr. Ilofmeyr,' as Mr. Deakin has quoted already, in 1887 brought this
forward, returning to it again in 1894, at Ottawa, and certainly, with regard .
to that objection to preference that it might include bargaining, and might
also lead to strained relations between the Mother Coimtry and_ the various
Colonies, as brought forward by j\Ir. ITofnioyr, there Avas no question that that
would be done, not as a question of any advantage to the Colony itself, but

282

Ninth Day.
1 Mav 1907.

Preferential

TUADE.

(Dr. Jameson.)

as a question of uniting together in defence, which is the most important
subject, all the portions of the British Empire. Then also in the Cape and
South 7\ frica, the practical carrying out of preference with the Mother Country
was largely helped — certainly, I might say almost, brought about — by
Lord Milner. AVhen I mention these three names in connection with
preference, I think South Africa perhaps has given what I might call a useful
object lesson in a subject of this kind which affects the whole Empire, and
as far as the leaders of political opinion in South Africa at all events are
concerned, it was kept outside party politics, because I do not think anyone
could say that Mr. Rhodes, Mr. Hofmeyr, and Lord Milner were on all fours
in domestic j)olitics in South Africa.

As I have said, Mr. Deakin has practically put the whole case before us,
and any one following Mr. Deakin, especially as in my case I endorse every
word he has said, would in attempting to elaborate it only weaken the case.
So I am not going to attempt it. But I take it we are here to-day to try and
get something from the Lnperial Government. I am not going to split words
about it. I am not going to say we are makiiig a wonderfully generous offer
from the Colonies, and it rests with the Imperial Goverment to do what it
likes. Of course, it rests with the Imperial Government to do what it likes.
As Mr. Deakin quoted from a statement of the Premier of Queensland
yesterday, of course there was no question of insistence on the Imperial
Government or any other Government adopting this preference principle, but
I think we are all bound to influence in every possible way that we can, not
only the Imperial Government but the other Colonies, to enter into some
preferential arrangement. Therefore we are asking for preference from the
Imperial Government — however small, I will put in — we want, if possiljle,
the principle established. We who believe in preference believe it will grow
of itself. So, however small it is, we will not say we will be satisfied, but we
will be thankful. I know the objection of a certain section of the people is :
" That is exactly the thing ; we do not want a principle established ; we do
" not agree with it." To that I say, let us try the exj^eriment, and see
whether it will grow into a principle or not, and that might get over their
difficulty.

You, Lord Elgin, told ns, I think, in your opening speech on this
subject, that perhaps we are not all agreed, but at tlie same time we could
speak fully to each other on the subject, and perhaps come to an agreement
and miderstand each other. Although it may be presx;mptuoiis for someone
from abroad to attempt to influence the people in this country, I venture to
say it is our duty, if we can, to influence them, even at the cost of being
considered presumptuous. Remembering, as I say, that we are asking for
something fi'om the Imperial Govermnent. I would say at the same time,
from my view of the subject, we are not asking the Imj^erial Government to
change its fiscal polic}- at all. I take it we are all agreed that all that we
are really asking for is for the Government to change its methods with regard
to fiscal policy, and are not asking them to change at our bidding its fiscal
policy. I take it, some 60 years ago or more, when Free Trade was established
in the United Kingdoni, it was avowedly put forward that this was with a
view to getting universal Free Trade throughout the world.

Mr. ASQUITH : No.

r)r. JAMESON : Well, I have always understood so. If it was not so,
I say, from our point of view, our bringing forward preference at present is
with the object of getting universal Free Trade throughout the world. Then
we preference advocates at bottom are trying to go for Free Trade by steps,
not at one jump. We do not expect, after the experience of the last 60 years,

283

to cairv out anything we are doing by one jump. It seems to me that ^''"th Day.

GO years ago, when Free Trade was estaljlishud here, of course England could I May 1907

afford to do it. It was the very best thing she could do at the time ; she was

practically in the zenith ol her fame at the time, and wanted her raw material "^TnAu'"^''^'

and food in cheap. /r> t ' n

(Ur. Jameson.)

-Mr. ASQUITH : It was in her own interest.

Dr. JA^IKSON : It was in her own interest. She forgot how she had
luiill up that position to allow her to afford Free Trade. The last GO years—
we can look back upon that time— perhaps has shown us that she did forget
she was built up as a mauuracturin,t>' nation by Protection, by navigatit)n
laws. Then we can see that dm-ing that GO years other nations have adopted
the same method that was successful in England. They have caught u[) to
her, or many of them have actually caught up — at all events, they are going
to if they liave not. It seems to us if they do catch up, and she does not
change her methods, she is handicapped against them. They have got the
handicap, ol' course, of Free Trade as practised in England, but they have not
adopted it. Our idea is, as Sir Joseph War<l said just now, that having
preferential trade throughout the Empire, which is ultimately an ideal but
not practically so at present, might lead to Free Trade within the Empire,
and then, as Mr. 1 )eakin said, the enormous factor of the whole Ikitish
Empire being Free Trade could compel modifications of the fiscal attitude of
the rest of the world, and practically compel Free Trade throughout the world,
and the recognition of individual effort everywhere. That is the general idea.

That being our idea of what preference may lead to, it is natural that we
shoidd do our utmost to in{l^lence the Imperial Government to see eye to eye
with us on this subject. Already all the Colonies see eye to eye with each
other. Therefore it seems to me, the case having been put by Mr. Dcakiu
and Sir Joseph Ward, aU that is left for us is to tiy and show, if we can, that
it is not hopeless to get the Imperial (lovernment to see eye to eye with us on
this subject. I know we are met at the present time with the answer at once ;
" The nation has decided against yon, and of course the Government must be
" bound by what the nation has said at the last election." Even then I do
not feel hopeless because looking back to the last 1-i or 15 years one sees that
governmental and other opinions on this subject have considerably changed.
I should quote for instance that after the 189-i Conference at Ottawa,
Lord Ripon, the then Colonial Secretary, issned a memorandum'--" on that, giving
a series of objections why Mr. llofmeyr's proposal, as it was brought forward
at that time, could not he adopted. First, I think, he put that the Colonies
themselves could never sacrifice tlieir revenue to give preference. Well, they
have all sacrificed their revenue, so that objection is gone. The next point
was that any such preferential doctrine if it was carried out would inter-
fere with existing Hritish treaties with other nations, to the detriment
of Great Britain. I believe the ones alluded to at that time were Belgium
and Germany. Those treaties have l)een denounced, and I l)elieve with no
detriment to Great Britain. The third oiijection was that possiblj- ycm might
have specific tariff's between the United Kingilom and the Colonies, but it
would be so difficult to carry it out that it hati better be dropped. I think
that was very weak, surely it might be attempted, and you could not say
specific tariffs were impossible until a commission had sat and inquired into
the matter to see whetlu>r they Avere or not. It is a much bigger thing with
regard to the United Kingdom, Imt here we have in tabulated form
specific tariffs that are at work now between South Africa and Canada,
Australia, and New Zealand respectively — a whole body of them — which
makes a considerable difference I am sure iu the trade between those

• See [C. 7824]. "

284

Niuth Day.
1 May 1907.

Pkefekentiai,

Trade.
(Dr. Jameson.)

to Sit down aud go

and the Colonies. That

verj^ insistent that the

peoj)le conversant Avith

four dependencies. I may say when we were discussing in this room the
question of a secretariat the other day, I had in my mind that if we got
some "evy small concession which I am still hopeful of from Mr Asquith,
one of the first uses of that secretariat would he
into the tariff question of the United Kingdom
was partly the reason at that time I was
secretariat if possible should be composed of

the various Colonies and who would understand the tariffs. The last
objection was that any such idea of preference Avould interfere with the
natural channels of trade. I have a different idea of what the natural
channels of trade should be from what Lord Ripon intended oh that occasion.
That really meant the most profitable channels of trade ; but in the last few
years many words have changed their significance, and I hope we have come
to consider as the natural channels of trade those channels where our kith
and kin are rather than the foreigner.

I think that shows there has been considerable change in govermnental
opinion in the last Id or 15 years. Then in a much more recent period I
think we get a good deal of hope of a change of opinion even amongst the
present Government. We were all very pleased to see Mr. Lloyd George's
Bill the other day in connection with shipping, to make sure that the
foreigner should not have any greater advantages with regard to sanitary
arrangements and load line, and so on. That is all in the direction of
helping British shijjping against the foreigner.

Then, in a recent speech of the Under Secretary of State for the Colonies,
at the West Australian dinner, I think it was, 1 noticed Mr. Winston
' Churchill said it is a very easy thing for two tariff states to make
arrangements one against the other, but it is an infinitely easier thing for
two tariff states to make an arrangement to help each other. I do not
see why with the several Colonies with a tariif it should not be an infinitely
easy thing for them to make an arrangement with self-governing Colonies.
As to the idea that the Government is pledged not to give any preference to
the Colonies which it does not give to the rest of the Avorld, I wonder if the
Government remembers at the present moment that the British Government —
as represented by those two small protectorates, Basutoland and Bechuana-
land — is giAang preference to these Colonies that we have made treaties with
which it does not give to foreign nations. It is actually giving preference
at the present moment, not at our request, but at the request of the Lnperial
Government, to Bechuanaland and Basutoland, which are entirely under
the control of the Imperial Government. At the request of the lmj)erial
Government they were included in our South African Customs LTnion, Avhich
gives a preference to Great Britain and the other self-governing Colonies.

Mr. LLOYD GEORGE : When was that ?

Dr. JAMESON : At the last Customs Convention a year and a half ago,
at Marit'/.burg, and in the one l^efore also. I have only been three weeks in
England, Ijut I have received from various associations throughout England
I believe a little over 700 resolutions in favour of tariff reform.

Mr. DEAKIN : I have had hundreds.

Dr. JAMESON : I had them counted the day before yesterday, and it
was GSO then.

Mr. ASQUITH : Where fi-om?

285

Dr. .TAj\rESON: From different parts of the country— from England. Ninth D»y.
A large number of those, T am glad to say, arc from working men's ass(jciations. 1 ^^»y 1907.
As Sir Joseph Ward said just now, and I (luite agree, this tiling nnist work .,
slowly, but it is working slowly, and the working man is waking up to it. Tkaue.

When I\Ir. Asqnith interpolated j-esterday while Mr. Deakin was speaking,
and asked him how much of their goods go to Germany, and how nmch
come back, I think the working man would have answered that question very
well, and said : " Quite true, we could use all that wool in England " — and
that is what the working man is learning—" and we would be employed to
manufacture it." If you only put a tariff against Germany, probably it
would be worth while for England to ])iiy all that wool with that tariff
against it, and the workman is, I think, beginning to think a good time would
be coming for him. I agree with Sir Joseph ^\'ard that none of us would
be in favour of protection which would bear hardly on the working man
here — an argument frequently used, l)ut if that argument were carried out,
and the workman had to pay a little mure for some things he might be
better off.

Mr. ASQUITII : Ih^w is the wool that goes to Germany to be got
here ?

Dr. JAMESON : When the manufactured wool would be cheaper within
the Empire, which, as Mr. Deakin said, was a largo factor, then probably it
woidd not pay Germany to manufacture quite so much, and we would have
a little more manufacturing than Germany, and therefore employ more
people.

Mr. ASQUITH : My question was put with another object. Does wool
come within the suljject matter as to which you think preference ought to be
given ?

Dr. JAMESON : As a matter of fact, wool at present comes in free.

Mr. ASQUITH : I know.

Dr. JAMESON : I take it on the secondary subject of manufacture.
Wool is a raw material, and we do not want to put anything on it but if you
do not allow throughout the Empire the manufactured article from another
country which gets wool cheap to come in on the same terms, probably the
British will have the bigger market and bigger demand for the wool, and can
pay more for the wool.

Mr. ASQUITH : "\'ou represent Cape Colony, a country which exports a
large quantity of wool to this country and which exports no food to this
country, and I am thinking in my own mind how we are to give a preference
to South Africa.

Dr. JAMESON : I will come to that presently.

i\Ir. ASQUITH : I thought it might be pertinent to this question of

wool.

Dr. JA^IESON : We are rather, in South Africa, in the position of doing
a great good and expecting to get very little back, but we expect to grow, as

Ninth Day.
I May 1907.

Preferential
Trade.

(Dr. Jameson.)

286

Sir Joseph Ward says sympathetically just now, in South Africa. We do
expect to be federated. We do expect to have other things to export besides
the few articles that we now export. 1 will name presently the exports.
Even Avithout federation, at the present moment I have been making
arrangements, while I have been in England, for a very large amount of
maize to be brought over to this country where we can get a market. For
us it is a very large amount. I was making arrangements for 80,0U0 tons for
one season from a portion of Cape Colony to come here. In the future we do
expect greatly to benefit from a preference which now is only benefiting the
larger producers.

Mr. ASQUITH : T do not want to interrupt your argument,
perhaps you will tell us presently what the things are you export.

but

Dr. JAMESON: My argument was simply to try and influence the
Government as much as I could. As Sir Joseph AVard said, we have three
Ministers of the British Government here, and I am trying to impress upon
them as far as I possibly can, that we are asking and pressing all Ave can to
get something fi'om them and as a kind of inducement I was saying that
opinion is changing a little and we hope they will change a little l^it further
forward in the next two days ; and then it will give us a beginning on this
preferential question.

With regard to South. Africa, we certainly cannot get much benefit at the
present moment. There are some things we can get benefit from. The two
main things are wine and tobacco. You say that is so small it does not
matter, but take the wine alone ; supj)osing we return to the old conditions
before 1862, it would be a very great benefit to South Africa. In 1862 the
United Kingdom were establishing Free Trade, and at the same time Avanted a
market for their goods, and so they reduced the tariff on French wines to the
level of the Cape wines. The French wines were better then. I do not think
they are now. We think we are going to produce as good wines.

Mr. ASQUITH

You are going to.

Dr. JAMESON : I think we do now, but we are going to do better. At
that time the tarift" came down. For a little Colony like the Cape at that
time, 50 years ago, to get 130,0()0L a year for its wine was a very considerable
item, but it came down to 2s. 9d. on French wines, Avhich was the duty on
Cape wine at the time, and in a few years it was down to 80,000L ; at present
it is nothing at all. We have developed enormously since that, and are
producing infinitely better wine, and if we get a preference on Cape wine it
would give an enormous impetus to one of our most important interests in
Cape Colony. I may say, when I came into office at the Cape, 1 sent a long
and elaborate memorandum to the then Government, and they gave me the
usual sympathy, but they gave me nothing else. We know Governments are
not all the same, and we still hope that because the former Government
refused it that is no reason why the present Government should, and we may
get something.

Mr. ASQUITH : Do you know any British Government which gives a
preference to any form of alcohol ?

Mr. ]:)EAKIN

We give it to South Africa.

Mr. ASCJUITH : I do not know about that. Sir Wilfrid Laurier doesnot,
Aiistralia is not supposed to, and South Africa docs not, so this is an entirely
new departure in jpreference referring to alcohol.

287

Sir WILFRID LACRIEK : We do not. ^'"^ ^"y-

1 May 1907.

Dr. JAMESON : In South Africa we give a certain amount of preference. I'kkkekentiai,
Wc charfje your whisky from here 21.?., and an excise on our own article of Tr\de.

only 6s. We are quite prepared to nioclify that.

Mr. ASQUITH : That is giving a preference to yourself.

Dr. JAMESON : Exactly. You generally begin at home and then extend
to others afterwards.

Mr. DEAKIN : I think in our treaty with you we do give a preference
to alcohol.

Sir JOSEPH WARD : We do, I think, in reference to wines.

Mr. ASQUITH : As between yourselves ?

Sir JOSEPH WARD : Yes, witli South Africa ; not spirits but wine.

Dr. SMARTT : Canada gives a preference on wine also, I think.

Sir FREDERICK BORDEN : No.

Dr. JAMESON : For brandy the ordinary rate of duty in Australia is
14s. per gallon, and the rate to colonies under the South African Customs
Union is 10s. od. to 1.3s. per gallon. I believe the proposition before the
Conference is — I know it is the i^roposition of Canada — that we give, irrespec-
tive of the United Kingdom giving anything at all, a certain preference,
but when the United Kingdom reciprocates, then we are all prcpai-od to come
forward and give more. Paragraph 2 of the Cape Resolution is " The
" Conference, while adhering to the principle of preferential treatment of
" the products and manufactures of the United Kingtloni desires, to impress
" upon His Majesty's Government the opinion that the continuance of such
" preferential treatment to tlie producers and manufacturers of Great Britain
" is largely dependent ujmn the granting of some reciprocal privileges to
" British Colonies." I wisli to say at once, and empliatically, that there is no
question of a threat there at all. What we are doing is giving a warning
fi'om our own experience. 1 am giving my experience that 1 have had at the
C-ape that the majority, as evidenced by the Customs Union, are in favour of
preference. I know that in mj'- Ca^x^ Parliament there is a juiuority who
were not in favour of it, and in fact spoke against it, but at the same time
that minoritj^ brought forward an amenthnent saying that no pr(>f(!rence
should b(^ given unless there was reciprocity. Therefore, I am justified in
saying that llie whole Colony, with any reciprocity whatever from the United
Kingdom, would i)e unanimously in favour of preference.

Mr. DEAKIN : We have the same minority.

Dr. JAMESON : I only wanted to emphasise that it was iiol a threat at
all, but only that we might not be able to hold things together, that the
minority might become a majority later on, anxJ we, who believe tkit this is
one of the most important links between the various portions of the luupire,
are very anxious to say that our various Colouiea are absolutely in favour of

288

Ninth Day. preference if we have a reciprocity, however small. I was alarmed, if Sir
1 May 1907. Wilfrid Laurier wnll allow me to say so, to see that in the Canadian Pai'lia-

ment there is an intermediate tariff proposed. I suppose that means there is

Preferenti.\l ^ preferential tariff, a maximnm and a minimum. I suppose the probability

^'^°^" is with that intermediate tariff the minimum Avould be accepted and the

(Dr. Jameson.) pj-gference would probably go to other nations, or nations within the Empire.

Preference, I presmne, would remain, but suppose a treaty at the intermediate

tariff was made, say, Avith the United States for a term of years.

Sir WILFRID LAURIER: Do you think there is any probability of
that?

Dr. JAMESON : I do not know at all, but supposing it was with France,
Germany, Italy, or anywhere. Supposing a treaty was made on an inter-
mediate tariff, and supposing the Imperial Government gave a preference to
Canada, then Canada probably would carry out further preference to Great
Britain, but that further preference would surely be boimd by this intermediate
tariff, because this intermediate tariff", I suppose, would be made on the present
preference to Great Britain. So really the further preference would be
minimised. The point is Avhen once you begin to make treaties outside there
is no saying how far they go. When you once get commercial treaties and
commercial symiDathj-, Ave generally find political sympathy follows. That is
the last and the strongest argument. We hope the Imperial Government Avill
see their Avay to help iis in an experiment, at all events, of the smallest
recij)rocal preference to the various portions of the Emi:)ire.

Mr. ASQUITH : Is wine the only thing you mention ?

Dr. JAMESON : Tobacco, I might mention, too, and sugar.

Ih: ASQUITH : What about tobacco ?

Dr. JAMESON : I believe your duty on tobacco is os. at the present
moment. Certainly it would be a great boon to us if we had a shilling
preference on that, because in the Cape Colony Ave grow a very large amount
of tobacco. Tn the Transvaal, proportionately, they grow still more and
better. In Rhodesia, 1 believe, they are going to grow still more, and still
better than even the Trans\'aal, because the land in Rhodesia has been proved
up to now to be extremely good land for the growing of the highest class of
Turkish and Egj^ptian tobacco. Supposing Ave get one shilling relief, I
daresay the shilling Avould come off the excise in Ireland, and Ave Avould have
all the Irish portion of the Government to help us Avith that.

Mr. ASQUITH : They are just starting a tobacco industry in Ireland,
and there is a Bill to remove the prohibition on cultivation before the House
of Commons.

Dr. JAMESON : It does not come into force for a long time ?

Mr. ASQUITH : Next year.

Dr. SMARTT : A rebate of one shilling. I think the Irish Avould pay 2s.
and the ordinary people 3,s., or an excise of 2s., against the other excise
of 3s.

289

Mr. ASQUITH : That applies only to what is a mere experiment. Ninth Day.

1 May 1907
Mr. DEAKIN : Tliat is all we want.

Mr. F. R. MOOR : We only want the experiment.

Mr. ASQUITH : No, this is an experiment conducted over 100 acres.

Dr. S]\IARTT : But the experiment is on the basis of a 2s. duty instead
of a 3s. duty.

Mr. ASQUITH : As I say, it is only extended to 100 acres of land.

Dr. SMARTT : But ou the basis of a 2s. duty instead of a 3s. duty.

Mr. ASQUITH : We might as well not have imposed any duty at aU.
Practically the duty did not enter into it at all, but it was simply to see
wliether or not, as a matter of experiment, to])acco could be grown in Ireland,
and over those 100 acres we allowed them to experiment practically free of
duty.

Dr. SMARTT : Biit I luulerstood that the duty collected by the State or
Excise ou the product, whatever it may be, will be collected at 2s., or a rebate
of Is. will be given.

Mr. ASQUITH : On that 100 acres— nothing else.

Dr. SMARTT : But on that 100 acres ?

Mr. ASQUITH: Yes.

Dr. SMARTT : It is practically a rebate.

Mr. ASQUITH : It might have been made duty free. It was a mere
experiment to see whether tobacco could be grown in Ireland, and we allowed
them to have 100 acres for the purpose, but that is not going to regulate the
future growth of tobacco in Ireland. When they grow tobacco on a
practical scale they will pay strictly the same as other people. There is no
preference of ajiy kind.

Mr. F. R. MOOR : Lord Elgin and gentlemen, I have not very much to
say, as I think tlie ground has been very well covered by the previous speakers
as regards the Colonial view, and the points that have been adduced by
Mr. Deakin and Sir Joseph Ward have fairly stated the position.

I only want to say a few words about the arguments adduced by
Mr. Deakin with respect to the condition of things as regartls our opponents
in different parts of the world. While England and the Colonies have in the
past been giving equal treatment, these nations have buih, around them
impregnable tariff walls, and thus enjoyed free trade in a double condition —
having the whole of their population and also the population of England
and of India for their trade, which, in my humble opinion, must give our
competitors an enormous advantage. If there is one thing that has been
found to be unquestionally accurate it is that in modem methods the great

i 48CG8. T

Prekerential
Trade.

290

Niuth Day. volnme of production is the cheapest method for such production. Having
1 May 1907. those large markets, oiir competitors must to that extent have a far greater

advantage as against our limited population represented by these islands and

Preferential j^j^g other countries that happen to be within our control or purview here.

RADE. J -^^rJsli to point out also that this is going on in a more insidious

(Mr. 1*. K. i ooi.; ^^^^ perhaps more mischievous way against us all than is at present realised.
Your competitors are to day dealing with raw materials at the fountain heads,
and, as has been already pointed out, they are diverting from yoi; here those raw
materials for their own ends to work them up, and in working them up to
pay their own people the wages for the manufactured articles which will
eventually come directly into competition with you here and also in the
Colonies. It has been pointed out that a large amount of wool has been
diverted from Australia directly to your strongest competitors. This is going
on in South Africa. Mr. Asquith pointedly asked my colleague. Dr. Jameson,
how this was affecting the position of preference. By subsidies as regards
steamers, by rebates on State railways in those countries, force is being
employed against you to direct that raw material from your manufactures
here. That is having a very serious effect as regards your getting that
commodity in sufficient quantities to keep you going as against that com-
petition. I do hope that in talking over preference wo are not going to limit
it only to tariff reform, but we are going to embrace all the different links
that connect us in our industrial progress throughout the whole process of
such methods. The cheapening of your shipping freights, as has been
pointed out by Sir Joseph W^ard, is a very great advantage. The rapidity by
which the intercommunication is to be brought about is not to be calculated,
l)ut on the top of all that, if we are to have these railway rates so adjusted as
to further give the advantage to those who are competing against you, yo^^
have to be very much alive to see how far such insidious methods are leading
you and your industries to a very serious position. We realise it in South
Africa, because we have had there, and we unfortunately have now, a
tremendous trouble as regards these railway rates, and they have just as
important a bearing on the whole problem as the shipping rates and other
elements that lead to the progress of our industries.

I have had brought to my notice by the shipping people in South Africa
this condition of things, and I have been asked to call attention to it at this
Conference. It is very difficult to ascertain what amount of advantage is
being given to some of your competitors in this direction. I am unable to
give you in any way the slightest indication as to that, but surely with your
means of getting information you should be alive to this condition of things,
We, in South Africa, I am also informed, are likely to have one of the most
powerful lines of steamers opei'ating in these markets. This is a recent
development, and it is going to have under present circumstances, I believe,
a very profound effect as regards the trade conditions of that countiy.

When we talk of preference I wish all the different elements to be taken
into consideration. It covers the whole ground, and wherever we can assist
each other by that means we are going to promote to that extent our mutual
interests. Perhaps it is rather impudent of me to say that I am neither a
Free Trader nor a Protectionist. I think these past shibboleths have been
perhaps mischievous in crystallising us to one or other set of ideas. I
believe in a discriniiiuiting scientific tariff which is so adjusted as to meet
our interests to the utmost without committing ourselves either to one or the
other policy. We in South Africa have as many articles on our free list
as we have on our protected one. That tariff, although it is not a perfect
tariff — and we can never hope to have a j)erfect tariff, l)ecause a tariff, like a
growing tree, is ever throwing out fresh branches, and ever havijig fresh
requirements to adjust itself to a growing industry— I say we must always
be adjusting and re-adjusting our tariff to meet the changing conditions of

291

our various inclustries, but \vi> <lo Lave <iu iliat list a iiumbcr oi' lines free, as Nimli Day.

many as^ are protected. These are made free to promote our various indus- 1 ll»y lyoT

tries. You hero have lost many of your inchistries, I have been informed. I

may have perhaps the impudence to sav that it was because of your Free Trade ^'•";,';i^"kstiai,

policy. ■ ^"'^"E-

E.

(Mr. F. R. Moor.)

Mr. LLOYD GEORGE: What industries have we lost V

Mr. F. R. MOOR : I think glass.

Mr. ASQUITH : No, we have not lost it at all.

Br. JAMESON : There is not nmch left.

Mr. F. R. MOOR: Sugar refinery ; silk.

Mr. LLOYD GEORGE : No ; I had a deputation of silk manufacturers
before me last week, and one of them protested most strongly against the idea
that it was a dying industry.

Mr. F. R. MOOR : Clock-making is another.

Mr. LLOYD GEORGE : I Iiad a deputation from them, also, not long
ago.

I\Ir. F. R. MOOR : They still exist in a languishing condition. How-
ever, if in these cases you had some kind of protection for these lines, which
would not after all have increased the cost of living to your people, btit
would on the other hand have found em])l()yment for them — I say, had that
been the case tlicn to that extent, if your inchistrics suffered at all — and
I think Mr. Chamberlain did show it very stronglj' in his campaign

Mr. ASQUITH : I do not quite agree with liim.

Mr. LLOYD GEORGE : Nor did the nation quite agree with him.

Mr. F. R. MOOR : I say, had they sulfercd then to that extent, it might
have been remedied by giving relief in those directions.

You have already a tariff on wine, sugar, tobacco, and tea. 'i'ou are taxing
your people. I will take tobacco as one line, and we ask you to give relief to
your people to the extent of giving us preference on that tariff, say, on tobacco.
You would be helping us to build up a new industry in South Alrica which
is a very promising one, and from which I believe you can get supplies as
good as any in the world. At the same time you would be doing your
people a benefit by reducing taxation in their favour, wliich I believe is iu
the direction of your Free Trade policy.

However, it will be int(>restiug to know what objections you can have
to making an experiment in that direction as regards your own Colonies,
and in the interests of your own consumers by reducing laxalion. if
nothing comes of this at all the discussion we have had here is going
to be of value to us all, inasmuch as it is going to make us all think,
and having got the people of these different Colonies to think over
these large questions, and the people of these islands to think over these

T 2

Prefeeenti
Trade.

292

Ninth Day. questions, having got to that condition, I say it will do good, inasmuch
1 May 1907. as it will bring before ns all the chance of moving in the direction we
hope for, or of England being able to prove to her Colonies that they are
asking for an impossible concession. The movement has grown, and, I
CM F R AT "1 believe, is growing. Certainly with us it has grown in South Africa, and we
to-day are giving preference to you here. There is a large section of our
people who are still more or less not heartilj' with us, but I believe the
majority are stronglj^ in favour of continuing a preference to the Motherland
without j)rice or withoiit terms. We also have given reciprocity to our sister
States, Canada, Australia, and New Zealand, and I think South Africa to-day
is really in the forefi'ont of the movement.

CHAIRMAN : It is obvious that we cannot finish this discussion to-day,
and as we have reached the hour of adjournment I suppose it would be
convenient now to adjourn. May I make one observation? I thought we
had two more days this week, but I find that some members of the Conference
have engagements on Saturday, and therefore to-morrow is our only day. I
think it is very desirable that we should finish this subject now before the
Conference this week, if it is at all i)0ssible to do so, and I suggest that we
might meet, therefore, at half-past ten to-morrow morning, and perhaps it
might even be possible to have in reserve a sitting in the afternoon, if
Mr. Lloyd George could manage to attend.

Mr. LLOYD GEORGE: Yes, I could be here. Does Mr. Deakin
propose opening on the question of treaties, or does he propose to leave it
for separate treatment ?

Mr. DEAKIN : It was suggested at the beginning that we shoulcl leave
that for separate treatment. It is an independent question.

CHAIRMAN : Yes, it is.

Mr. LLOYD GEORGE : I quite agree.

Mr. F. R. MOOR : I have one more word, and that is, that as regards
these freights on steamers with respect to goods and other connnodities, my
argument would be just as strong in the direction of passenger fares. Here,
by mutual work and mutual assistance, I think we can do a vast amount of
good, not only to you but to the Colonies, by so adjusting these passenger
fares as to direct the emigration from these islands to the various Colonies
under the flag. It should be as easy, though not quite so cheap, certainly,
to convey people from these shores to these different possessions as for people
to go from one end of England to the other. This can be done only by the
co-operation of the Colonial Governments, together with the Imperial
Government, in connection with the shipping that plays such an important
part in all our interests. I do hope that this question will not Ije lost sight
of when your secretariat is established, so that they may take the matter up
and focus it before public opinion.

Sir WILFRID LAURIER : I do not understand exactly what is meant
liy (liftVrent treatment with regard to the question of treaties, which seems to
be absolutely germane to this question.

293

CHAIRMAN : Only that it falls to the Board of Trade rather than to the Nintl. Dav.
Chancellor of the Exchequer to deal witli. i May I907.

Sir WILFRID LAURIER : 1 mean so far as the discussion is concerned. TiIade.

Mr. DEAKIN : It is luidoubtcdl}- bound up with the discussion of the
whole issue, but it was suggested by the Chairman that it might be as well
to deal with the purely fiscal question first, and then take the argument as to
the treaties.

Sir WILFRID LAURIER : But it seems to me it could not be separated.
I understood we were to hear Mr. Asquith first, and then Mr. Lloyd George.

j\lr. LLUYD GEORGE : It is purely the Australian proposal with
regard to British ships antl w-hite laliour that interferes with treaties, but
I rather gathei"ed from Mr. I'eakin's speech that he did not consider that
an essential part of his proposals.

^Ir. DEAKIN : Not to that particular proposal, but I regard it as
important to have our relation to all treaties determined, and wish to sulmiit
the considerations which have led my colleague, the Attorney-Ceneral, to
contend that we are not at present bound by an\' of the treaties referred to.

Mr. LLOYD GEORGE : That is a very serious proposition.

Sir WILFRID LAURIER : It is difficult to establish, but at the same
time there is no question that it is of more importance to hear that than to
hear the condition of the treaties.

i\Ir. LLOYD GEORGE : I do not think it interferes at all with Canada,
but it does interfere with the Australian proposals very seriously.

Sir WILFRID LAURIER: But it is germane to the whole question,
and we are discussing it now. I do not know where such proposals would
land us.

Mr. DEAKIN : But it is not necessary to intermingle the argument
about treaties with that upon fiscal proposals. The intention was to
separate the arguments, and leave Treaty powers last.

Mr. ASCJUITII : I shoidd hope we might conclude what you call the
general fiscal argument by lunch time to-morrow.

CHAIRMAN : And then go on with the rest in the afternoon.

Mr. ASQUITH : Sir William Lyne wishes to say something.

IMr. DEAKIN : He will look at what I have said, so as not to repeat
anything.

i 486flS. 'i' ^

294

Ninth Day. Mr. ASQUITH : Sir J. L. Mackay wishes to say something, and he

] Miiy 1907. represents India.

^'"tr™"'^^ Mr. DExlKIN : Not in the sense in which we represent our countries.

He represents the British Government.

Mr. ASQUITH : He speaks for the Secretary of State.

Adjourned to to-morrow at half -past 10 o'clock.

295

TENTH DAY. Tenth Day.
2Mu.vl907.

Held at the Colonial Office, Dow.vixg Street,
Thursday, 2nd May 19U7.

Present :

The Right Honourable The EARL OF ELGIN, K.G., Secretary of State

for the Colonies (President).

The Right Honourable Sir Wilikid Lauimer, G.C.^M.G., Prime Minister
of Canada.

The Honourable Sir F. \\'. Borden, K.C.M.G., Minister of Militia and
Defence (Canada).

The Honourable L. P. Brodeur, ^linistcr of Marine and Fisheries
(Canada).

The Honourable Alfred Deakin, Prime Minister of the Commonwealth

of Australia.

The Honourable Sir W. Lvne, K.C.M.G., Minister of Trade and
Customs (Australia).

The Honourable Sir JosKi'ii Wai:d, K.C.M.G., Prime Minister of New-
Zealand.

.The Honourable L. S. Ja.mesox, C.B., Prime Minister of Cape Colony.

The Honourable Dr. Smartt, Commissioner of Public Works (Cape
Colony).

The Right Honourable Sir R. Bond, K.C.M.G., Prime Minister of
Newfoundland,

The Honourable F. R. Moor, Prime Minister of Natal.

General The Honourable Louis Botha, Prime Minister of the Transvaal.

Mr. Winston S. Churchill, M.P., Parliamentary Under Secretary of
State for the Colonies.

Sir Francis Hopwood, K.C.B., K.C.M.G., Permanent Under Secretary
of State for the Colonies.

Sir J. L. Mackay, G.C.M.G., K.C.LE., on behalf of the India Office.

Mr. H. W. Just, C.B., C.M.G., ) j ■ , a , ■
Tvr n \\^ T V, X. ri At n (Joint oecrclarics.

Mr. G. W. Johnson, C.M.G., )

Mr. W. A. Robinson,

Assistant Secrctarji.

Also present:

The Right Honourable doNii ^Iorlev, 0.:\1., ;M,P., Secretary of State

for India.
The Right Ilonourabk- 11. H. Asquith, M.P., Chanctdlor of the

Exchequer.
The Right Honourable D. Lloyd George, M.]^., President of the

Board of Trade.

T I

296

Tenth Day. Mr. W. RuNCiMAN, M.P., Financial Secretary to the Treasury.

2 May 1907. Mp h. E. Kearley, M.P., Parliamentary Secretary to the Board of

Trade.
Sir E. W. HiVMiLTON, G.C.B., K.C.V.O., Permanent Financial Secretary

to the Treasury.
Mr. H. Llewellyn Smith, C.B., Permanent Secretary to the Board of

Trade.
Mr. A. Wilson Fox, C.B., Comptroller-General of the Commercial,
Statistical, and Labour Department of the Board of Trade.

Mr. J. W. HoLDERNESS, C.S.I., of the India Office.
Mr- G. J. Stanley, C.M.G., of the Board of Trade.

CHAIKMAN : Gentlemen, while we are waiting for the Chancellor of the
Exchequer, may I take the opportunity of mentioning the agenda for next
week. I understand that we cannot sit again after to-day this week, so that
we have to consider what days are available to finish the proceedings of the
Conference, as I understand we must, somewhere about the middle of next
week. There are two adjourned disciissions ; one Naval Defence, and the
other Naturalization. With regard to Naval Defence, I understand from the
First Lord of the Admiralty that he has had a discussion with various
members of the Conference, but he does not seem to be quite clear whether
they wish to submit to him further proj^osals before the matter comes before
the Conference again. He suggested that we might take this question on
Wednesday.

With regard to Naturalization, I understood when we adjourned that
some members of the Conference wished to put on record their views with
regard to that subject, but I do not suppose there is any intention of taking
any definite decision on the matter at these meetings. Therefore that suljject
might be taken if it suited the Home Secretary (which I wiU ascertain) either
on Monday or Tuesdav.

Sir JOSEPH WARD : It will not take very long so far as I am
concerned.

CHAIRMAN : I think Sir W^ilfrid Laurier wishes to speak wpou it.

Sir WILFRID LAURIER : I have very few words to say upon it.

CHAIRMAN : Then there are certain other questions mentioned on the
agenda paper with regard to patents, trade statistics, company law, the metric
system and reciprocity of treaties, all of which I think would not take
any great length of time, and some of them at any rate fall to Ijc dealt
Avith, untler the new procedure of our organisation, by action subsequent to
the Conference. I suppose the Conference would wish, on all of these
questions, to have an opportunity of recording an opinion.

Sir WILFRID LAURIER : None of these questions seem very
contentious.

CHAIRMAN : None, so far as I know.

2»7

Sir JOSEPH WAHD : I suggest you might group those matters together.
The question regarding tlio metric system, in view of the interview we had
with the Chancellor of the Exchequer, I shoukl think couM be disposed of in
10 minutes ; and we might, if they are all grouped together, finish all these
questions in one morning.

Mr. DEAKIN : There are one or two matters I asked for iuforination
about as to the commercial treaties whicli have been concluded.

CHAIRMAN : That point comes really subsequent to this discussion.
Mr. Lloyd George is prepared for that.

Mr. DEAKIX : Then there is the question whicli is now associated with
that of the Secretariat, but was started independently of it, with reference to
the possible exchange of officials between the Colonial Oflice and the several
departments of the Emi^ire.

CHAHvMAX : That aho we have on the list. Hut 1 wanted to ascertain

from the members of the Conference what days next week are at our
disi^osal.

Sir AVILFRID LAURlEIt : So far as I am concerned I think we are
ready every day.

CHAIRMAN : Up to Thursday.

Mr. DEAKIN : And further if necessary.

CHAIRMAN : Some of the members are going to leave on Thursday.

Sir JOSEPH WARD : I am due in Edinburgh on Fritlay morning.

CHAIRMAN : I think we probalJy can arrange for the first four days of
next week to exhaust the matters still left to be discussed. At any rate I
will arrange on that footing that we will take either Naturalization or other
subjects on ^londay, and some of the other subjects on Tuesday, and the
Admiralty subject on W'ednesdaj'.

Sir WILFRID LAURIER : Then we sit on Monday, Tuesday, Wednesday,
and Thursday.

CHAIRMAN : Yes. Perhaps, as the Chancellor of the Exchequer has
not yet arrived we might hear the representative of India, if the Conference
have no objection.

Tenth Day.
2 Miiv 1907.

PREFERENTIAL TRADE.

Sir JAMES MACKAY : Lord Elgin and gentlemen. Ever since the
proposal that Great Britain should impose a general import tariff, and should
admit Avithout taxation, or at a lower rate of duty, imports from P)ritish

Preperential
Trade.

298

Tenth Day, IDomiuioDS SO as to establisli wliat has come to be described as "Preference,"

2 May 1907 tliose who are responsible for the Government of India, with which this

country carries on a very large and important trade, have given the subject

Preferential gerioiis and constant consideration. As in duty bound, they have looked at
„. ' the question fi-om an Indian point of view ; but they have considered it no

James Mackav ) -^^^^ from a wider and Imperial aspect. The interests of India are indissolubly
boimd up with the interests, not only of Great Britain, but also with those of
His Majesty's other Dominions beyond the Seas, and it may be safely asserted that
the interests of Great Britain, as ^vell as those of most of the over-sea Dominions,
owing to the intricate and inter-dependent web of commerce, are equally
bound up with the prosperity and interests of India. It is a matter of deep
I'egret to those responsible for the Government of India that they should find
themselves at variance on this most important question with the distinguished
statesmen Avho represent Canada, Australia, New Zealand, and South Africa,
and who have stated their case, if I may say so, with an earnestness and an
eloquence befitting that high patriotism and love of country which inspire
their proposals.

Under the existing fiscal system, India enjoys a highly advantageous
position. Since the establislunent of the gold standard in India securing a
stable rate of exchange, a measure initiated by Lord Lansdowne's Government
in 1893, and brought to fi-uition by you, my Lord, dui-ing your term of office
as Viceroy, the finances of India have been in a satisfactory condition. The
trade and commerce of the country have been prosperous and flourishing, and
have been fully equal to the strain of providing the means of remitting the
large amount annually required to discharge both her public and private
sterling obligations. There is no sign that this prosperity is insecure, nor
is any important trade or industry seriously menaced by the restrictive tariffs
of foreign countries.

The rapid growth of the external trade of India can be shown by a few
figures. In 189G- 97 the total value of the sea-borne trade (merchandise and
treasure) was 132,000,000/. In 1905-6 it was 214,000,000L sterling. This
is an increase of C6 per cent, in 10 years. Taking merchandise onlv, in
1896-97 the imports were 47,000,000?. sterling, and exports 66,000,000?."' In
1905-6 the imports were 69,000,000?. and the exports 105,000,000?. sterling.
Thus imports increased by 47 per cent, and exports by 60 per cent, in 10
years. A very good share in the increased trade of India has been enjoyed
by this coimtry. The value of British imports into India in that period has
increased by nearlj'- 40 per cent. They still represent 66 per cent, of the total
imports of India. A remarkable feature of the Indian figures is the growth
of the exports to foreign countries. Some of the best customers of India are
the protected countries of Eixrope. Without the markets which they supply,
it is very doubtful whether India could dispose of the particular commodities
which she is able to produce.

Mr. DEAKIN : Raw materials ?

Sir JAMES MACKAY : Mostly. Further particulars on this point are
given in the India Office JMemorandum on " Preferential Tariffs in their
application to India," which is being submitted to the Conference. It seems,
tiiereibre, to be clear that the interests of India call for no change in the
direction under discussion. It is equally clear that any change materially
affecting the present circumstances of Indian trade might be fraught with
danger. The maintenance of an excess of exports over imports sufficient to
discharge her sterling obligations is an essential requirement for India.

It is a fact of no small importance that the purchasing power of India in
British markets, and her ability to discharge her sterling obligations, are

299

largely dependent on licr trade with foreign countries. This is l)rought out Tenth Day.
in an analysis of the impcnl and export ligures, which shows that, while the 2 May 1907.
British Empire sells to India goods to the value of 50,000,000/. sterling, it „
l)uys irom India goods to tuc value ot --f!, millions only, and that, wlnle Trahf

foreign coimtries sell to India only 18,000,000/. sterling worth of goods, they .^.^

buy from India goods to the value of no less than 60,000,000/. sterling. It is james Mackav.;
obviously, gentlemen, the interest of India to retain the goodwill of our foreign
customers.

The risk of damage to Indian trade from retaliation by foreign
countries cannot be regarded as imaginarj', notwithstanding the fact that a
large proportion of Indian exports consists of raw materials useful to these
countries in their industries. It has indeed been suggested that India is in
a strong defensive position, as in the event of a war of tariffs she could resort
to a discriminating export dutj^ on certain classes of raw material. But apart
J'rom the economic objections to which such duties are open, especialh^ as
a feature in a scheme of preEerciitial tarilTs primarily designed for the
encouragement of exports, the practical dillicidties in the way of the
enforcement of such duties so that they should oi)erate by way of penalty
against a particular country, would be insuperable. For the comitry thus
penalised might obtain its supplies through the medium of British or of other
foreign ports, instead of direct from India, and it would be impossible to
prevent evasion of the duties in this nuxnner. Besides, it is not clear that
India enjoys an effective monopoly in any large numljer of articles that are
essential to the existence of foreign industries. Even with regard to certain
articles that are essential to the existence of foreign industries — even with
regard to certain articles, such as raw jute, oilseetl, lac, teak wood, mj-ro-
balsams, and mohair, in respect of which it might be said that such a
monopoly exists, it must be borne in mind that a substantial increase in price
produced by an export tariff might lead, sooner or later, to the production of
those articles in other coiintries, to the discoveiy of substitutes for them, or to
a lessened demand. In any of those eventualities, the export trade of India
would be seriously affected.

Ou the questio:^ as to whether India would avoid risk by remaining
outside preferential arrangements adopted for the rest of tlie British Empire,
it might be urged on the one hand that foreign countries would recognise the
attitude of India, and in the case of adopting measures of retaliation against
the British Empire would exempt articles of Indian export from their scope.
On the other hand, it might be said that India could not be certain of
obtaining such an exemption, inasmuch as foreign countries might impose
retaliating duties on Indian articles — and Mr. Deakin gave us an example of
this the other day — with the object of attacking (rreat Britain by injiu-ing
Indian trade. Furthermore, if isolated from the rest of the Empire, India
might be held to have forfeited any right to be supported against attacks
made on her trade ; whereas an essential condition of any general preferential
scheme would doubtless be that the Empire would act as a imited whole in
any tariff war, and that any one member who might be attacked wouhl be
entitled to support from all the other members. That, I take it, gentlemen,
is your idea. Mr. Deakin has referred to an incident which occurred with
France a few years ago in regaril to Indian coffee, and to another which
occurred a little later with Russia in regard to Indian tea. The facts are as
follows : —France had a fiscal dispute with Brazil. To put pressure on
Brazil a doidjle scale of duty on coffee, and some oth(>r kinds of Colonial
produce, was introduced into the French tarilT, and the higher scale was
made a]-)plicable to countries which were not specially admitted to the
lower scale. Indian coffee importc(l into France thus, quiti> incidentally,
became subject to tlie higher iluty. Wo ascertaineil that France had no
grievance whatever against India, and did not desire to penalise Indian coffee.

300

Tenth Day.
2 May 1907.

Preferential
Trade.

(Sir
Jaraes Mackav.)

and was prepared to admit it and other Indian Colonial products to the
minimum tariff, in return for a purely nominal, or what miirht be termed in
China, a "face-saving" concession. This concession eventually took the
form of the lowering of the Indian import duties, not for France alone, be it
observed, but for the whole world, on two absolutely insignificant articles —
vinegar and green copperas. No hint was thrown out in the course of
negotiations with France that India might possibly resort to retaliation.
Lord Curzon's Government, it is true, suggested that the possibility of
retaliatory measures should be mentioned, but His Majesty's Government —
and this was a few years ago — declined to adopt the siiggestion. Thej'-
doiilited its expediency, and they felt sure that when France had settled
her dispute with Brazil, she would take steps to remove India's griev-
ance. The second incident referred to by Mr. Deakin arose out of
the action of the British Government in excluding Russian sugar against
bounty-fed sugars, in accordance with the Brussels Sugar Convention.
The Russian Government protested against this exclusion as being an
infraction of the " most favoured nation " treatment, and followed its protest
by placing a surtax on Indian and Ceylon teas entering Russia by Europe,
or the Black Sea route. His Majesty's Government decided not, to retaliate
on behalf of Ceylon, and not to authorise retaliation bj^ India. The surtax
is still in force, but it has had, apparently, not very much effect on the export
to Russia of Indian and Cejdon teas, which has increased not inconsiderably
during the last few years, as the following figures will show. The Ceylon
export, which was 4,000,000 lbs. in 1890, was 11,000,000 lbs. in 1905. The
Indian export, which was 1,500,000 lbs. in 1901-02, was no less than
10,000,000 lbs. in 1905-06. The surtax has evidently not destroyed the
Russian taste for the best of tea.

Mr. DEAKIN
any action ?

If it had, would the Government of India have taken

Sir JAMES MACKAY : We might deal with that if it arises ; but it
has not arisen so -far. An analysis of the export trade of India supports the
conclusion that India has practically nothing to gain from the adoption by the
Empire of a system of tariffs, discriminating against the manufactured
products and food stuffs of foreign countries. In a few articles, such as
coffee, indigo, rice, and Avheat, it is true that some slight gain is possible if
these articles were admitted to the United Kingdom on better terms than
the same articles from foreign countries, l)ut the gain would l^e trifling. Tea
also has been suggested as a possible article for preferential treatment. But,
gentlemen, Indian and Ceylon teas have now a secure market, as the
competition of China has ceased to be important. In a total import of
321,O(J0,0O0 lbs. of tea — mark these ffgures — into the United Kingdom,
China is now represented by only 13,000,000 lbs. Furthermore, in the
Convention of 1902 with China, at the request of Great Britain, the Chinese
Government bound themselves — 1 would like Mr. Moor to note this — to
impose an excise duty on machine-made yarn and cloth manufactured in
China, when they came to raise the import duties on the abolition of likin, so
as to deprive the duties on these goods of any protective effect.

Mr. DEAKIN : I do not know \vhether you are aware of it, but to some
extent a distinct faclor in the development of the trade in Indian tea in
Australia was, in the lirst instance, the deliberate Preference given to India,
as a part of the Empire against China, a country exterior to the Empire.
]ti the earlier days of the Indian tea trade that was quite an influential
motive in Australia ; afterwards the taste for the tea became established.

301

Sir JAMES MACKAY : We are very much obliged to you for it. It
would be very difficult for this country to press China to observe this
undertaking, if, in the English market, Chinese teas were penalised. And,
gentlemen, what reason is there for discriminating against China ? She buys
from this comitn' no less than 17 millions' worth of goods, while the value of
our purchases from her ar(> something less than o millions sterling. A
reduction of the present duty in favour of all teas imported into the United
Kingdom, without discrimination, would no doubt, be of some importance to
the Indian trade ; but that would have no connection with a scheme of
preferential tariffs. Whatever benefit might accrue to Iu(h"a and Ceylon from
a reduction in their favour, would be obtained, to an almost equal extent,
from a reduction to the same amount made on all teas in accordance with the
existing policy of the United Kingdom of remitting taxation when no longer
required for revenue purposes. The same remark applies practically to
tobacco. The present s])ecilic duty falls heavily on Indian tobacco, because
that is of much lower value than the other tobaccos ordinarily consumed, the
duty being a specific duty ; but any alteration in the duty on cheap Indian
tobacco would be an ordinary adjustment of the tax, which could be fairly
granted without any departure from the present fiscal policy of the United
Kingdom.

Turning now to the other aspect of the question, namely, what advantages
India can offer to the rest of the Empire under a ])referential scheme, there is
no doubt that she has more to give than she could possibly receive. Not
only do the exports of India consist chiefly of commodities which are not
likely to receive a preference in the tariff arrangements of the United
Kingdom, but they go for the most part to foreign countries. On the other
hand, three-fifths of the total import trade of India is the produce of the
United Kingdom, and the goods belong to classes to which a discriminating
tariff could be effectively applied. It is estimated that a third of the goods
which the United Kingdom sends to India are exposed to the competition of
foreign countries. India, therefoi'e, has obA'iously more to give under a
preferential scheme, than she can receive under such an arrangement. But
the risks — and I say so deliberately — and sacrifices which this would involve,
are greater than India is prepared to accept.

There is another matter connected with the subject, namely, the question
as to Avhat bearing the adoption by the United Kingdom of a scheme of
preferential tariffs would have on the excise duty which is now imposed on
cotton piece goods manufactured in India, and ou the exemption of cotton
twist and yarn from the customs dutj' levied on other classes of cotton
manufactures. These exceptional measures were adopted when, under
financial stress, as his lordship knows, the import duties were re-imposed
in order to prevent them from protecting the Indian cotton industry in the
smallest degree ; and they were defended on the ground that the policy of
the British Parliament and the Ctovernment of India was one of strict Free
Trade. If that policy were modified, the matter would assume an entirely
new phase.

It has been suggested that India might join a preferential tariff scheme,
with liberty to impose duties of a protective character against imports from
the British Empire, if accompanied by still heavier duties against foreign
imports — sometliing the same as you propose to have in Australia. There is
no doubt that, if a i:>referential policy were adopted which admitted of the
establishment of protective tariffs by Great Britain, proposals in this
direction would Ije put forward and pressed l)y Indian inainifacturers. They
would claim the same right to protect their manufactures as the Colonies
enjoy, and it would be difficult to offer a logical opposition to such a demand.
I should like to add here, gentlemen, that a preferential arrangement clogged
by a clause against ships manned by natives of India, subjects of the King as

Tenth Day
2 Mav igOT.

Preferential
Traue.

302

Tenth Day. ^g are ourselves, would be extremely obnoxious, not only to Indian opinion,
- May 1907. lixxt to Indian feeling.

Tkade ^'"^^ Mr. DEAKIN : Is it obnoxious to Indian feeling that they are not

/gi,. engaged on ships in His Majesty's Navj^?

James Mackay.)

Sir JAMES MACKAY : No, I do not think so.

Mr. DEAKIN : Is not the Mercantile Marine a support of the Navy ?
It is with no intention of discriminating in ihe least degree against Hindoos
or any other people of the Empire, but solely with a view to the development
of the Mercantile ]\Iarine in connection with the general sea supremacy of the
Empire that our proposition is made.

Sir JAMES MACKAY : That is rather a matter for the First Lord of
the Admiralty. He finds he has no difficulty in recruiting for the
Navy.

Mr. DEAKIN : Read Lord Brassey and other critics.

Mr. LLOYD GEORGE: There is some difficulty in the British
Mercantile Marine, but no difficulty in finding recruits for the Navy.

Mr. DEAKIN : But the Mercantile Marine is the siipport of the
Navy.

Mr. LLOYD GEORGE : The real difficulty as regards the Mercantile
Marine is that sailors prefer going to the Navy ; and in the last few years we
have added about 30,000 or 40,000 sailors to the Navy, and consequently the
material we draw upon for the British Mercantile Marine has been constantly
diminishing. That is our great difficulty.

Sir WILLIAM LYNE : I do not think that was thorougUy proved at
the Shipping Conference.

Mr. LLOYD GEORGE : Pardon me, nothing was said about that at the
Conference.

Sir WILLIAM LYNE : Yes, something was said about it.

Mr. DEAKIN : I only wish to make it clear at this stage that it is no
reflection whatever upon the Hindoos or Lascars as sailors.

Sir JA]\1ES MACKAY : I can assure you Ave are very glad to hear that.
It is very acceptable indeed.

It is believed by the advocates of what is known as fair trade that this
coimtry (Great Britain), suffers severely whenever another country from whom
she buys does not in a corresponding degree buy from her. In my humble
judgment no greater delusion ever took possession of the human mind. If
this doctrine were applied to the case of the trade between India and
Gennany, India and France, and India and the United States, Germany,
France, and the United States, would have a serious grievance against India,
as they all take from her much more than they sell to her ; but we bear of no
such complaints.

303

Dr. SMART! : Do they take inafmfactured goods. Tenth Daj.

2 May 1907.

Sir JAMES MACK A V : Tliey take what they require.

tr>

Mr. F. R. MOOR : Raw materials.

Sir JA:\IES MAl'KAV : They buy Avli^^t they want. The prosperity of
a country's trade does not depend on her selling as much to any particular
country as she may Ijuy from it. Her balances must be adjusted in the
general trade of the universe. xVs London is the great clearing-house of the
world for money and credit, so India is one of the international clearing-
houses for commodities. Any measure which disturljs the natural course of
her trade as it now exists, must reilect unfavourably not on tratle of India
alone, but on that of the whole of the British Empire. i\s Mr. Deakin said
in his opening remarks, the interchange of trade only takes place where then;
is mutual advantage. The benelit cannot b(> wholly on the one side or the
other. To borrow a metaphor much favoured by the Mussidman, no single
country can drink up all the water in the sea. We believe that any
interference with the unrestricted flow of trade in this country, such as would
be caused by the establishment of a general tariff, with all its concomitant
customs examinations, appraisements, delays, and expense, would have the
effect of materially diminishing the volume of the foreign trade of those
islands, and of the trade of the Empire. We believe also that discrimination
by Great Britain or India against foreign countries who are India's best
customers would be prejutlicial to India's trade. It is on these grounds
that we take strong and decided objection to a change in the fiscal system
either of this country, or of India.

In view of the advantages derived by the Empire as a whole from the
possession of India, we suggest that any preference which the self-governing
dominions of His Majesty may, in their wisdom, decide to grant to the
Mother Country might reasonably be extended to the produce and
manufactures of India, and that Great Britain and India should be regartled
as one. I woidd ask Mr. ^loor, if I might say so, to remember tliat our
great Indian dependency is a heritage not solely of the people of these
islands. It has come down with aU its responsibilities from our common
forefathers to the whole British race, and its possession and prosperitj- are a
justiiiable source of pride to the inhabitants, not of Great iJritain alone, but
also to their brethen beyond the seas.

Mr. F. R. MOOR : Might I say with regard to that surtax by the
Russians on your tea, I did not quite catch what you said about it. It has
not affected your trade with Russia ?

Sir JAMES MACKAY : In spite of that tax our trade with Russia in
Indian and Ceylon tea has largely increased.

Mr. F. It. MOOR : Who is paying that surtax, Russia?

Sir JA^IES MACKAY : The Russian consumer, altliough he has to pay
a little more for his tea, he has not ceased drinking either Indian or Ceylon
descriptions.

Mr. F. R. :M00R : He is drinking i'our tea.

Sir JAMES ^lAClvAY: He is driidcing tliree times as much Ceylon tea,
and about eight times as much Intlian, as he did a few years ago.

rnEFERENTIAL

Trade.

304

Tenth Day. Dr. JAMESON : The point Mr. Moor wishes to make is that you need

2 May 1907. not, therefore, be frightened of retahatory measures by foreign countries.

There was retaliation on the part of Russia, and, notwithstanding that, they

Preferential ^^^.^ more tea. One of your points at the beginning of your address was that,
supposing this preferential system was adopted, India would suffer very much
probably from retaliation by foreign nations.

Sir JAMES MACKAY : One of the points in my address was that it had
been argued that India could not suffer by retaliation from foreign coimtries,
because in many of her exports she had a monopoly.

Dr. JAMESON : Then I made a mistake. That it might suffer I thought
was a strong point made against our theory of preference. If you say India
would not suffer from retaliation on the part of foreign countries, that is
satisfactory.

General BOTHA : Lord Elgin, and gentlemen, I have listened with
great attention to all the arguments on this question, but I have not been
able to bring myself so far to acquiesce and agree with all that has been
said here. The question of preferential trade is a matter that was handled
by the Crown Colony Government in the Transvaal, and they had a Customs
Conference, but the people of the Transvaal have never been consulted on
the question of preferential trade. I myself have had no time to get a
mandate from the people of the Transvaal on the matter, and I must state
that all I can now do is to express the opinion that the resolution of 1902
should continue to stand as it does. I do not see any chance of pressing
upon the Mother Country any addition to that resolution. The position that
we take in the Transvaal, now that we have Responsible Govermnent, is that
the ]\Iother Country ought to leave us alone as miich as possible, to regulate
our own affairs, and, therefore, it is all the more difficult for me to come here
and interfere with matters concerning the Mother Country. So far as I can
judge the situation, it appears to me that the British people made their voice
and opinion heard on this matter during the last general election in England ;
and, therefore, I am only prepared to stand by the Resolution of 1902, and
not to go further. And I only want to say this, that although no preference
is given by the Mother Country to the Transvaal, the bond Ijetween the
Transvaal and the Mother Country wiU not thereby be weakened. That is all
I have to say.

•

Sir ROBERT BOND : Lord Elgin, and gentlemen, the views of the
Colony that I represent were set forth by me at the last Conference, and
I stand in somewhat the same position in respect to the resolutions before
the Chair as the Prime Minister of Canada. The resolution which wiU
be found on page 36 of the Blue Book was concurred in by me, and I shall
therefore adhere to it, especially as my Government are at the present time
taking steps to see how the principle contained therein can best be carried
mto effect. I shall again support that resolution when submitted by
Sir WiKrid Laurier as I understood from his remarks on Tuesday last it vn\\
be. In the meantime I should like to express my deep appreciation of the
very able manner in which the resolutions now before the Chair were pxit
forward by the Prime Minister of Australia, and to say on behalf of my
government that we desire to co-operate in every way possible towards the
establishment of preferential trade between the Colonies themselves and
between the Colonies and the United Kingdom.

305

Elgin,

gentlemen,
frienc

it is now my duty in
and colleague, Mr. Lloyd

Mr. ASQUITH : Lord iMgin, anc
conjunction with my right honourable

George, to state on behalf oi" the Liiperial Government the view which they
take of the matters which have been so ably and exhaustedly discussed around
this table during the last two or three days. Let me say, lirst of all, that, 1
think, two things are abundantly manifest and will be gladly acknowledged by
all of us. The first is that whatever decision, or if you please, whatever
absence of definite decision, may result from our discussions and proceedings,
nothing that has been said here, or that can be said here, can in any way
weaken our sense of Imperial imity or the desire of every one of the great
communities representee! at this table, within the limits of its opportunities,
and, so far as the interests of its population allow, to promote that imity by
ever}-- means in its power. In the next place let me add another thing which
has appeared, I think, very clearly in the course of discussion, and that is the
advantage of debates of this kind. If this Imperial Conference had produced
no other results — and I am glad to think it is going to produce a number of
very definite and very desirable ones— I think the mere fact that it had
assembled round this table during the course of these three days the
representatives of the great self-governing communities and the Imperial
Government, for a free and frank interchange of opinion on matters of this
kind, enabling one to realise as we can never do until Ave are brouglit face to
face in friendly intercourse with one another, one another's points of view,
and, if we differ, to see that that difference arises not from mutual misunder-
standing but from a clearer and fuller understanding of one another's position,
would in itself have been well worth while as a result to be attained. I am
speaking, as I am privileged to do for the moment, on behalf of the Imperial
Government. I can assure you, in their name, that we have derived
great advantage and benefit from the interesting speeches, particularly
the speech of Mr. Dcakin, in which the case of preferential trade has been
presented during the course of these three days.

But, gentlemen, there is one other thing, one further point, which
emerges from the discussion, and which we may regard as common ground
between us all. Sir Wilfrid Laurier has often said, I know, fi'om what one
has read of his speeches and of his writings — and he was the practical pioneer
of Imperial Preference — that in this matter each community of the Empire
must primax'ily pay regard to the interests of its own members, and I was
very glad to hear that statement reiterated with great emphasis and
cxplicitness by Mr. Deakin more than once in the course of his speech.
There we are all agreed. We desire, as I said a moment ago, within the
limit of our possibilities and opportunities to increase the sense, to enlarge the
range, and to deepen the foundations of Imperial imity. But, particularly in
these fiscal and economic matters, the primary and governing consideration
with every one of vis — the first consideration— must be hovv does it affect
the community with which we are more particularly connected and wliich
we have the honour here to represent ? I believe, in saying that, I shall
carry with me the unanimous opinion of the whole Conference. Imperial
unity cannot be effectively or enduriugly promoted by ignoring local conditions,
interests or sentiments. As both Sir Wilfrid Laurier and Mr. Deakin have
said, nothing is permanently gained for the cause of Imperialism, particularly
in matters of this kind, unless what is given is spontaneously offered and
what is received is ungrudgingly accepted. I think again I shall have the
assent of you all to that.

Many people have endeavoured to explain in a formula or in a phrase
that which distinguishes our Empire from the other empires of history, and
I shall not enter into the competition. Mr. Deakin used some admirable
language in his speech which expressed completely the ideas which most of us
I think have in our mind, but we shall all agree in a general way that

i 48GG8. U

Tenth Day.
2 Mav 1907.

Pkekerentiax
Trade.

306

Tenth Day. the special feature of the British Empire has been that it lias combined,

2 May 1907. and has succeeded in combining to a degree unknown in any other combination

. in history, a loyal and att'ectionate attachment between the centre and the parts

Pre^feuential ^£ ^j^g Empire, and between the varions parts themselves, with complete
' practical local independence. That is the secret, if we may call it a secret,

{ r. sqni .; -vy^ijch we have contributed to the history of Empire. For the first time in
the history of the world we have managed to reconcile what hitherto has been
found irrecoucileable in every political combination, namely, the completest
development of local liberty and independence without impairing, nay, rather
with an enhancement of a sense of corporate unity and attachment between
the parts and the whole. If that is true, gentlemen, of our Empire as a whole,
of its structure, and of its foundations, nowhere is it truer, I think, than in
this department of fiscal policy. It is by giving, as the Mother Country has
done, complete fiscal autonomj^ to her Colonies — I will not say only by that,
but it is partly by that, and largely by that — that we have succeeded in
arriving at a working Imperial arrangement. We had our warnings. We
tried the opposite policy in the 18th century. We tried to impose our fiscal
system, or at any rate to impose taxation which was dictated from here, and
not from there, on our self-governing Colonies on the other side of the
Atlantic, and we all know the result. We lost them. British statesmen, to
whatever political party they belong, have never forgotten that lesson, and
during the whole of the Empire building and Empire developing which went
on during the 19th century, when every one of the great Colonies whom I
see represented round this table one after another received the grant of
self-government, our statesmen of all parties were wise enough to recognise
that unless they gave to those communities complete fiscal independence,
they were giving them a boon which, in the long run, Avas not worth having,
and instead of laying the foundations of a solid and durable Empire, they
were simply sowing the seeds of future discord and possible dismemberment.
The Colonies, every one of them — your presence here to-day, and the
statements and arguments we have heard during the last few days are
sufficient to prove it — have used that fiscal autonomy in its fullest possible
sense. They have adopted, practically all of them, a system which goes by
the name of Protection. It is not for us to criticise that. We do not pretend
to criticise it. Anybody who thinks that the British Government or any
party in this country is foolish enough, and short-sighted enough
aad I Avas going to say impertinent enough, to preach Free Trade
to other countries, and particularly to our own Colonies and Dependencies,
either as an academic doctrine or a counsel of perfection, or what
you please, entirely misunderstands the situation here. I am going
to explain, in a moment, why it is that we consider the maintenance
of Free Trade essential in this country to our own special interests. But do
not let anybody here go away witli the idea that we are seeking in anyway as
propagandists or missionaries, or still' less, as an Lnperial power, to press the
doctrine of Free Trade on the members of our own Empire. We are not ; and
the proof of that is, as I said, that the various Colonies have used their fiscal
independence, which was rightly and wisely granted, to build up tariff walls,
not only against foreign countries, but against the ilother Cormtry also. At
this moment in the Commonwealth of Australia itself, British gootls cannot
get in upon any more favourable terms than goods which come from any other
Power. 1 say again, we do not complain of that. We do not ask you to alter
that. You must be guided in a matter of that kind bj^ what you believe to be
the interests of your own fellow citizens in the communities to which you
belong, and if you conceive, as you do conceive, that in the long run, the
social and economic arguments in favour of fostering the growth and
development of your native inthistries by means of protective tariffs proves
•(o be the policy most consistent with the special conditions, and with the

307

dominatiug interests of your ovvu comniunitie?, uot one word — I will not say of Tenth Day.

remonstrance, because remonstrance would he a ridiculous thing to speak 2 M»y 1907.

of — but not one word of criticism will you hear from those representing

the Imperial Government. Kven now— 1 call attention to it again, not "'^Trai>e"*'^

as a matter of complaint, but as simply a matter of fact — in these very ,vj .. •' r >

preferential tariffs that have been the subject of discussion during the '^' *''"'

last few days, there is not one of them which proposes to let Jiritish

manufactures enter into the Colonial markets to compete on level terms

with the Colonial manufacture in regard to the class of commodities the

production of which you think it your duty to encourage by protective

duties. And quite rightly, from your point of view, if I may say so, because

what is the good of protecting and fostering the growth of native industries

if at the same time you are going to admit against them into the market the

most dangerous competitor in tlu> whole world —because that is what the

British manufacturer is.

Dr. JAMESON : We are going to admit the most dangerous before the
less dangerous, namely the foreign.

Sir WILLIAM LYNE : The Americans are the most dangerous.

Mr. ASQUITH : You do not quite take my point, which is this, that
you are not going to admit anybody, British or foreign, to compete on level
terms in your markets in respect of the industries which you desire to protect.
You could not do it. It is a negation of Protection. Obviously the thing
itself is self-contradictory. I will not go into the question whether the
British manufacturer will remain the most dangerous. I think at this
moment he still is, at any rate, very dangerous, and you cannot have him in.
You know you cannot without abandoning Protection. Why make anj^ disguise
about it ? We do not make any, and you do not make any. So that you see,
under the system of preference, or the mitigated form of Protection which it
is proposed your protective tariff should now take, it is essential for your
purpose in the exercise of your fiscal independence, and in the maintenance
as you conceive it to be of your economic interests, to exclude the British
manufacturers to a very large extent from your markets. I say I do not make
it a matter of complaint, but I note it as a fact taken for granted by everyone
round this table.

If we have given, as we have given, and as I have shown, complete fiscal
autonomy to our Colonies, and if they have made and are making the fullest
use of that independence in what they conceive to he their own interests, let
me say that we retain that autonomy for ourselves, and I do not believe that
there is a man here who will dispute not only our right, ])ut our duty to do so.
We retain it for ourselves, and just as you, examining the special local
conditions with which you have respectively to deal in your various com-
munities, liave coine to the conclusion— rightly or wrongly, I do not say — that
is a matter we must leave to the verdict of historj'- that for the proper and
rapid development of those communities the adoption of Protection is necessary
or at any rate expedient, so we here, having regard to the special conditions
and interests of our jjopulation, have come to the conclusion that the
maintenance of Free Trade in its fullest and widest sense, is not only
expedient Init absolutely vital to our economic interests. That is not a
sudden or hastily formed opinion on the part of the British people. They
came to that conclusioji GO years ago. Someone said in the couise of the
discussion yesterday, that that was in the belief that the rest of the world
wcndd adopt the same view. Nothing of the kind.

Mr. DKAKIN : Was it not prophesied by Cobden ?

L' -J

TltADE.

308

Teuth Day. Mr. ASQUITH : Mr. Cobden did, I think, at one time make such a

2 May 1907. prophecy. Prophecies are one thing, facts are another. Prophecies are

dangerous things at all times, and are sometimes the expressions of a hope.

Prefekential j^^t Q^i jiny j-^te that was not the ground — as anyone will see on reading Sir
Robert Peel's speeches — upon which Sir Robert Peel, the author of our Free
Trade system, adopted Free Trade. He was converted to Free Trade. Why ?
Not because he thought it was a good thing for the rest of the world, but
because he thought it was an essential thing for Great Britain in the
peculiar circumstances of her economic conditions. That opinion formed
then by Sir Robert Peel, and followed and developed, • subsequently,
particularly by Mr. Gladstone, has remained for 60 years the very
root and foundation of the fiscal policy of this country, and, gentlemen,
I am bound to say to you, speaking with the same frankness which
you have used in speaking to us, in my opinion, in the opinion of His
Majesty's Government, and in the opinion of the vast majority of the people
of these Islands, the vital necessity of Free Trade, and the maintenance of it,
for our economic interests, is far more demonstrable to-day than it was
60 years ago. How do we stand to-day ? Let me ask you to realise what our
position is : 43,000,000 of people in these two small islands bearing on our
shoulders — I do not complain of it ; it is a burden we are quite willing to
sustain — the whole weight of the debt which has been incurred in the forma-
tion and development of this Empire, bearing also the cost — at any rate, the
great bulk of the cost — of the Imperial defence, not only of these islands but
of the whole Empire, in all its parts ; 43,000,000 of people in two small
islands with this burden upon their shoulders, and substantially depen-
dent, both for their food and for the materials for the conduct of their
industries, upon extraneous sources of supply. Those are the dominating
conditions here in Great Britain and Ireland ; conditions which do not
prevail — happily, or unhappily, whichever way you like to look at it —
in any one of the communities which you who sit around this table
represent. It is those conditions which we have to bear in our minds,
and Avhich we have constantly to keep in view when considering whether
or not we shall make this or that change in the fiscal system of
the country. To what, with people so circumstanced as I have described,
is it due that we are able to maintain, to the extent that we have
maintained it, our predominance in the markets of the world amidst growing
rivalries ? We have seen the development of great industrial communities
like the United States and Germany, and the development of yourselves in
Canada and Australia, the development on the part of our own kith and
kin and fellow sid3Jects. How is it we have been able to maintain our
position so far as we have maintained it, and I think we have on the whole
maintained it very well ? It is due to three things : in the first place to our
special productive activity as a people which still keeps us, in many of the
most important departments of production, at the head of the world. In the
second place it is due to the profits which we derive from keeping open
to the whole world the biggest market -which is to be found anywhere, so
that London and England are the clearing-house in which a great part
of the intermediate business, as I may call it, of the whole commercial
world is done. And it is due in the third place to the earnings of
our shipping, which does the cariying trade, as you know, for more
than half the world. Those are the means by which our wealth is
maintained and secured, and, gentlemen, they all depend in the long run, as
ycu will see if you rell<3ct npon the special conditions to which I referred
a moment ago, upon our being able to maintain, unimpaired in quantity
and unenhanced in price, the food of our people and the raw materials
of our iiidustri(-s. Curtail the sources of sujjply, raise the cost of sujjply,
and you strike a deadly blow at the verj^ foundations of our whole industrial

309

system. I am not going to address a lecture to you, as I am sure you will Tenth Daj.
imderstand, })ut that, iu a nutshell, so far as I can undorstantl it, is the 2 May 1907.

economic situation in these islands. It is not because we have any belief iu

abstract dogmas, or what are called " shibboleths "—I am sorry to say 1 l*REF^EKE>fTiAL
heard the word used once or twice in the coarse of this discussion — it is no
question of abstract dogmas, or shibboleths, or anything of tliat kind. Our ^ '' *1"""-)
Free Trade system here is based upon practical considerations. It results
froni the circumstances which I have outlined to you, and so long as those
circumstances remain we cannot without treachery, not only to our own
convictions, but to what we believe to be the true and enduring interests of
our people, abandon the foundations of that system.

Gentlemen, I said it was established GO years ago, but that the circum-
stances now seemed to us to render it even more imperatively necessary than
it was then in the interests of our people. But I must remind you of this.
We have recently had perhaps the most remarkable manifestation in
modern politics, and the people have given their verdict upon this matter.
It is just four years ago since the movement iu favour of Colonial preference
— I do not like the i:)hrase, because I am in favour of Colonial preference as I
conceive it to be properly understood — by means of tariff manipulation was
started in this countrj^ I am not going into controversial politics, but I want
to recall one or two historical facts. It was started in this country by a
statesman, Mr. Chamlierlain, who presided for so many years with, such
distinction over the office in which we are now sitting, and who at that
moment, I do not hesitate to say, spoke upon Colonial matters to the people
of these Islands with a degree of prestige aud authority which did not attach
to any other individual in the country. It was started by him inrmediately
after his return from South Africa. No political or economic campaign
of our time, I suppose, was ever initiated under more glownng auspices,
and it went on for three years, and these matters \vhich we have
heard debated round the tal)le — I do not for a moment deny, witli
much freshness of illustration, for which I personally at any rate, as
rather an old hack in this controversy, am very grate hd — were for three
years debated upon eveiy platform and in every newspaper of Great Britain
and Ireland. I do not say it completely monopolised public attention, but
I can say, as I took some little part in it, that it was certainly in point cf
public interest the dominating topic during those three years. I myself
rarely spoke upon any other subject, and I am afraid some of my fi'iends here
could say very much the same. It was certainly a dominating topic during
those three j^ears, and it was therefore after the fullest anil most exhaustive
presentation of the arguments upon one side and the other, that the judgment
of the public was finally given. It was not a hurried judgment snatched in
moment of excitement or enthusiasm, but a deliberate judgment formed after a
most cai'eful and exhaustive presentation of the case, and the result is what
you see. Why is it that Lord Elgin, Mr. Morley, Mr. Lloyd George, and myself
have the privilege of meeting you here ? It is because of that very thing.
We meet you here as the spokesmen and interpreters of the verdict given
by our own feUow countrymen, and if I were to yield to the seductive argu-
ments of Mr. Deakin — which of course, if it were a personal matter, I should
be very glad to do —and to Dr. Jameson's blandishments of yesterday, and were
to go down to the House of Commons to-morrow and to say, " Oh, we
" misunderstood all this ; there is something to be said for it. I/ct us
" do what Dr. Jameson says and start on a very small scale, which wiU
" admit the principle and will not do anybody any harm if it does not do
" anybody any good " — if I were to go and make that proposition to-morrow
to the House of Commons in any shape or fonn, there is not a man ^vho
knows this Hoi;se of Commons who does not know that such a proposition
would be defeated by a majority of two or three to one. Those are the actual

J 48668. U 3

310

Tenth Day.
2 May 1907.

Preferential
Trade.

(Mr. Asqiiilh.)

conditions under which we are carrying on the debate at this moment, and
therefore, gentlemen, I shoidd not be honest, and should be guilty of the
grossest disrespect to you, if I did not tell you that in view of those circuni-
sta]ices it is impossible for His Majesty's Government to projjose (and if they
did propose it, it is perfectly certain that Parliament Avould reject it), any
scheme of Colonial preference by means of tariff manipulation. I am obliged
to state that bluntly and frankly at the outset. You will not suppose that I
am wanting in any way in consideration or respect for the various arguments
which have been used here.

Now having made that quite plain, as I am Ijuimd to do, I should like
to deal, and I will do so very briefly, with two or three points that have been
made in the course of the discussion. It was said by Mr. Deakin in his lucid
and exhaustive address, that we here — and he included the Colonies and the
other parts of the Empire — are being excluded iToni foreign markets by tariff
walls. Gentlemen, I do not think that is a proposition which is capable of
l^eing sustained. We possess, in the case of almost all the countries with
whom we are trade rivals, that Treaty stij)ulation which goes by the name of
the most favoiired nation clause, and I believe I am speaking well within the
facts — and my friend Mr. Lloyd George will, I daresay, be able to supplement
it if necessary by actual figures — when I assert these two propositions : that
v,-e stand better at this moment industrially in the tariff-protected markets of
Europe than any of the nations which have protected themselves inter se by
retaliation. That is one proposition. I say next — and I believe this to be
equally true as a matter of fact — that our foreign trade has been growing of
late years in those very protected markets even at a more rapid rate than it
has elsewhere. I will not say than it has in China or the Argentine, biit
certainly than it has in the Colonies. The reason is not very far to seek.
Nations may put up tariff walls as much as they like, but if they are well-to-do
and go-ahead people, there are a lot of things they cannot do without. You
know very well they cannot do without your raw material. We were
told the other day by Mr. Deakin that there are some provisions in the
German Tariif which operate particularly against Australian meat. I take it
from him that is so. But ihej cannot exclude your wool, and they do not
exclude it.

Mr. DEAKIN : America excludes a great deal of it.

Mr. ASQUITH : But I am speaking of Germany ; Germany does not.

Mr. DEAKIN: No.

Mr. ASQUITH : In the same way there are a lot of things we make.
Although we do not provide raw materials like wool, our expyorts to Germany
are manufactures which the Germans cannot do without, and they recognise
it, as everybody must do. We have seen it in the case of Canada. In the
long run you cannot go on selling without buying. There is no tariff wall
that has yet been erected, even in America, which is the highest of them all,
which has succeeded in excluding, or ever will succeed in excluding, British
goods from a market, so long as British goods retain their pre-eminence
in quality and adaptability to the neetls of mankind, and so long as those
needs remain a constant or growing quantity. You cannot do it, and no
power on eartli can do it.

It is a very curious thing, and worth noticing in passing, that in the
paper to which rehu-ence was made yesterday, " Miscellaneous Statements as
" to British and Foreign Trade," you will liiid on page 3 a list of the exports
of IJmltMl Kingdom produce for an average of years, given in the onhv of

311

the Itost customer coining lirsl. Hy far our best customer is British India
and Ceylon. As Sir James Mackay has pointed out so well to-day, it is far
and away our best customer. The annual average which they took from us
in the three years 1904, 1905, and 1906, was no less than 44,381,0OOL, an
increase ol" 10,CCO,OOOZ. as compared with the average of the previous
triennial period. India is a Free Trade country, and Ave get the benefit of
Free Trade there. Our second liest customer is Germany, with 29,478,OOOL
That is an under-statement of our exports to Germany, because a great deal
of what is put down to Belgium, and still more of what is ]n\\ down to the
Netherlands, is no doubt German trade. Germany is uuiioubtcdly our second
best customer. Our third best customer is the Australian Colonies and
New Zealand. Those are both protected up to this moment. I agree
New Zealand is not wholly protected, and gives us a slight preference, to
which Sir Joseph Ward referred, but Australia up to this moment is a
protected market. I simply quote three figures for the moment to illustrate
how^ little permanent ell'ect — I will not say tarilTs are not injurious ; they
are — a tariff wall has in exchuling trade where the natural forces that make
for trade, and in particular the productive power and productive flexibility
of a coimtry like this, are really pushing the trade and are determined to
force it in.

Teutli Day.
2 May 1907.

Preferential
Trade.

(Mr. As(juitli.)

]\Ir. F. R. MOOR : I do not like to interrupt, l>ut would j'ou tell us
whether that trade with Germany includes in and out trade with you in
connection with the raw products of the Colonies which may come here ?

Mr. ASQUITH : No, this is United Kingdom produce only.

Mr. F. R. MOOR : It has nothing to do with the Colonies?

Mr. ASQUITFI : No. It is our own produce. I do not think, therefore,

that the proposition that we are being excluded by tariil's

from foreign

mai'kets is a proposition which bears close examination.

There is another point which incidentally I should just like to mention,
not in any way as disparaging the value of the Imi^erial markets, but as
negativing some inferences which are sometimes drawn, I think, fi'om
incorrect or insuificient data. As a matter of fact if you take the trade of
the United Kingdom with foreign countries, and with British possessions, and
look at it for the last 50 years, you will find that the proportions of that trade
which have gone to foreign countries and British possessions respectiv(d}- are
practically constant. Take first the imports for the period 1855 to 1859,
50 years ago — and it is convenient to start there — the total imports into the
United Kingdom then were 1C9,500,OOOL Of this 7G'3 per cent came from
foreign countries, and 23 '7 per cent, from British possessions — that is not
merely the self-governing Colonies, but the whole Empire. I will not weary
you by going throiigh the different periods of five j-ears which I have here,
but you will find those figures vary very little. They went up in 1900-1904
as high as 79 ' 2 per cent, from foreign countries, and sank as low as 20 ' 8 per
cent, from British possessions ; but in 190G, which is the last year — ami this
is rather instructive — the total of imports having risen from 1C9,500,OOOL
50 years ago to no less than 008,000,000/., an enormous rise, the proportion
from foreign countries was 7GMj per cent, as against 7G*3 per cent. 50 years
ago, and the proportion from the British Empire 23 "4 per cent as against
23 ■ 7 — practically the same thing.

Now look at the other side of the account — exports — and here I am
confining myself to United Kingdom produce. In 1855 to 1859, 50 years
ago, the total was 11G,000,000Z., and of that, to foreign countries went G8'4,
and to British possessions 31 "6 per cent. This last year, 190G, the total had

U 4

312

Tenth Day.
2 May 1907.

Preferential
Trade.

(Mr. Asquitli.)

risen from 116,000,000L to 367,000,000L, and the proportions were to foreign
countries 67 ' 2 ; to British possessions 32 ■ 8 per cent. So the change has
been from 68 '4 to 67 "2 as regards foreign countries, and from 31 "0 to 32 '8
as regards British possessions. There, again, allowing for some temporary
fluctuation — as, for instance, during the South African war, when the exports
to a particular quarter were accidentally swollen by special and transient
circumstances —you will find, if you look through the whole period, that the
proportions are practically constant. So that, both as regards our import
and our export trade, we stand very much as we were — though the volume
has very much increased — as regards the proportions which are respectively
sent to the Empire and outside it.

I am going to inquire how preference would work out practically, if we
adopted your suggestion, but before I do that, let me say a word or two in
reference to these tariffs to which attention has been called, and very properly
called, as I think. One of the great advantages at a meeting like this is that
we can examine these things much more closely, with the advantage of first-
hand knowledge, than otherwise would be the case. We have four tariffs in
which preference, or what is called iDreference, is given or proposed to be
given to the United Kingdom. I will not say more than a sentence about
those of South Africa and New Zealand. As regards South Africa, I think it
is a very liberal tariff to us. 1 do not pass any criticism upon it ; on the
contrary, it includes the great bulk of British exports into that country. But
it has been in operation a very short time. The circumstances of South
Africa during that time have been to some extent exceptional, and I think it
is too early yet, as probably Dr. Jameson will agree, to judge what the ultimate
effect of that tariff is likely to be.

Dr. JAMESON : Yes.

Mr. ASQUITH : So far, I do not think you can say it has produced much
effect one way or the other, but I say that entirely without prejudice to future
developments.

Now, I will pass to New Zealand. Here may I say, in passing, how very
much indebted my right honourable colleague and myself are to Sir Joseph
Ward for the speech he made yesterday. 1 think he gave us a great deal of
naost valuable and suggestive information upon a great number of points, and,
if I may venture to say so, a most admirable contribution to our discussion.
The New Zealand preference, as Sir Joseph Ward knows, is only with regard to
20 per cent, at present of the whole British imports to New Zealand. In other
words, four-fifths of our imports are left entirely unaffected by it, and it takes
the form, not strictly of a preference, that is to say, of a reduced duty given
to British produce, but the form of an increased duty imposed upon foreign
goods. That, I think, is the effect of that tariff. There again, it has only
been in operation for a very short time, and I do not think it is possible to
say what its ultimate effect is likely to be, but I do point out that it covers a
very small part — only one-fifth — of the whole area of British exportation to
New Zealand. I have no doubt, knowing what the fiscal views of the New
Zealand statesmen are, it is contrived in such a way that it does not allow
serious competition with any native industry there.

I would rather refer at a little more length to the other two tariffs which
have been brought before us — the Canadian tariff and the proposed Australian
tariff. As regards the Canadian tariff, 1 acknowledge that it has been beneficial
to British trade, and particularly, I think, to our textile industries. I think
it has been beneficial perhaps more in the way of arresting a threatened
decline in trade than by actually increasing the volume of the trade, or at
any rate the proportion of British trade to the rest of the trade done wdth
Canada. But I should like to call attention, not in any controversial spirit at

313

all, to the Canadian tariff for the purpose of showing — because it illustrates
my argument very well — how in framing arrangements of this kind the
country which fi-ames them is inevitably constrained to look to its own
peculiar local and economic conditions. It is essential — and Sir Wilfrid
Laurier, I am sure, will agree with me— that those conditions are in the mind,
and must be in the mind, of Canadian statesmen when they are dealing with
this matter. See how it works out. I am not making this a complaint at all.
From their point of view they are perfectly right. Canada, in the iirst place,
admits cither free, or at very low rates, raw and semi-raw materials. I believe
all countries with Avhat is called a scientific tariff aim at that. These come in,
of course, from the United States of America, which is geographically near ;
and, as far as I can make out, about half of them come in free altogether.
That is their free list, and, of course, naturally we cannot benelit by that. In
the first place we do not export raw material at all to any great extent, and
in the next place if we did we probably shoidd not be able to compete, even in
coal, with a neighbour which has the advantage of geographical contiguity like
the United States of America, with its enormous and inexhaustible resources.
In the next place with regard to the Canadian tariff I notice that among
dutiable goods the average ad valorem rate paid works out at the same figure,
namely 25 per cent, for the United Kingdom and tlie United States, not-
withstanding the preference that is given to the United Kingdom. The
reason for that is quite plain and very natural. Our goods, which ai'e highly
manufactured and finished goods, belong to the more highly rated classes,
even after the preference has been allowed for ; whereas the dutiable goods
which come in from the United States belong to the lower rated classes and
therefore on the whole pay a lower average rate of duty. Thirdly, in regard
to the Canadian tariff, if you take all goods dutiable as well as free,
altogether, the average ad valorem rate after allowing for the preference on
United Kingdom goods is 19 jjer cent, and on United States goods 13 per
cent. In other words it is 6 per cent, lower ad valorem on the total
importation from the United States than it is on the total importation from the
United Kingdcmi. That is a tariff which has been, as we know, and we have
Sir Wilfrid Laurier's repeated declaration on the subject, not only honestly
conceived but carefully worked out, so as to give the maximum preference to
the goods of the Mother Country, which is regarded by Canadian statesmen
as being consistent with the general economic interests of Canada. I think I
am right in saying that.

Sir WILFRID LAURIER : Quite right.

Mr. ASQUITH : Even with the tariff constructed in that spirit and with
that intention and by such skilled hands the net result is that we are at a
disadvantage as compared with the United States of America, and we are
paying 19 per cent, import duty as compared with only 13 per cent.

I should like now to say a word about the other tariff, the Australian
tariff, which I think affords a still more instructive illustration of the
practical difficulties which embarrass one when one comes to deal with a
problem of this kind, not theoretically, but in a concrete form. Of course
I recognise to the full what Mr. Deakin said yesterday. So far as our means
of information will allow me, I study what is going on in Australia with very
great interest ; still we are not intimately familiar with all the currents of
Australian politics. But Mr. Deakin explained yesterday, and I accept in
full what he says - many of us have been through similar experiences in
this country — that this tariff" ultimately had to be rather hurried through
in the last moments of a moribund Parliament with the prospect of a general
election in the offing, and no doubt under those conditions things are done
or allowed to pass which if tlie conditions were more favourable to

Tenth Day
2 May 1907.

puekekentiat.
Tkade.

(Mr. Acqiiitli.)

314

Tenth Day.
2 May 1907.

Preferextial
Trade.

(Mr. Asquitli.)

deliberation and further consideration, would be done in a different way, or
not allowed to pass. I accept in full that general explanation, but still
this is the only formulated taritt" which has yet been presented to us on behalf
of the Australian Conniionwealth. I do not know, and nobody knows — not
even Mr. Deakin, unless he is endowed with that dangerous gift of prophecy —
what substitute for this, if any, will hereafter be produced. But I take it as it
stands, and examine it as it stands, as it has received the assent of both
Houses of the Australian Legislature. It was submitted to the Governor, and
because it was supposed to conflict in some respects with some of our treaty
obligations he was bound to reserve it for His Majesty's pleasure. Here it
is, and if it does not fully represent their considered opinion, being a little
hurried at the end, as I say, yet it is the only attempt to put down in black
and white so far as I know what the Australian Commonwealth is prepared
to offer to this country in the way of preference.

Mr. DEAKIN : As an accompaniment, remember, to the New Zealand
treaty, and only as an accompaniment. We did not deal with general
preference at all.

Mr. ASQUITH : But this is the only thing we have.

Mr. DEAKIN : Yes.

Mr. ASQUITH : I will deal with it as it stands and see what it amounts
to. I should note in passing, though it is familiar to all members of the
Conference, that the Australian tariff, like the New Zealand one, is not what
we call a preferential tariff in the ordinary sense of the word ; that is to say,
no duty is lowered on British goods, which remain at what they were, but the
so-called preference consists in imposing an additional higher duty on
foreign goods of the same class. That is the method adopted.

Sir Wn.LIAM LYNE
others.

But we start with a lower scale of duty than

Mr. ASQUITH : Than whom ?

Sir WILLIAM LYNE : Than Canada, and, I think, New Zealand too.

Mr. ASQUITH : I daresay. That is not the point I was making. I say
your method is to take the existing scale and build a higher brick on to the wall
for the foreigner, whereas the Canadian method is to take a brick out, which
is the opposite method. I am not comparing them. The whole of this
Australian tariff is subject to the condition that it is only applicable to British
goods imported in British ships, which was the proposal of the Government,
I \mderstand, and to which the legislature added " manned by white labour."
That condition in itself is a condition which curtails and cuts down, quite
apart from all questions of policy, which I need not go into, the actual ambit
of the siipposed preference veiy consideraljly indeed. I was going to say it
was a condition which renders it very nearly nugatory ; but certainly, in
regard to a very large proportion of our trade, it is a condition which is
quite impossible to realise. I shall not go into the political question which
is raised by the addition of the words "manned by white labour," because
that is not for us to consider just now.

Mr. DEAKIN : As a matter of fact, the only line of steamers it would
affect would be the P. and 0. Company, who carry a relatively small proportion

315

of those ^oods, because, Ix'iiii,' luail steamers, their cliarges are necessarily Temh Day.

higher. We opposed that projiositiori simply on the groxmd that it is imprac- 2 May 1907.

ticable. How could we tell by looking at goods whether they came by

P. and 0. or any other steamers^ Pkekerential

("Mr. Dcakin.)

Mr. ASQUITII : I am obliged to Mr. Deakin for what he has said. He
admits it would make it almost unworkable, but apart from that we should
never, under any conceivable circumstances, accept here a preference granted
to us only in respect of goods carried iu ships in which tiie whole of our fellow
subjects in India were not allowetl to serve. We could not possibly accede to
that, and everybody here would say we would rather have no preference at all
than preference limited by such a condition as that. For the moment I was
pointing out that to a greater or less degree, but to some degree at any rate,
it must limit the scope. What are the articles in respect of which this
preference is granted V In point of quantity and proportion, I find 8 per
cent, of the whole. Xew Zealand gives us 20 per cent., but this Australian
tariff woidd give a preference in regard to 8 per cent, of the total British
importation to Australia.

•

^Ir. DEAKIN : I think you will find that balances fully, and more
than balances the proportion of British goods on which tlic duties were being
raisi'd in connection with the proposed treaty Avilh New Zealand. Our idea
was to balance that for the time being.

Mr. ASQUITH : I heard you say that yesterday, but I am stating that it
applies only to 8 per cent, of the British importations.

Mr. DEAKIN : About that.

Sir WILLIAM LYNE : That tarifp was only as a forerunner, because we
could not at that time deal with the matter, in consequence of the Tariff
Commission.

Mr. ASQUITH : Mr. Deakin has already said that yesterday. He said it
was a forerunner, but I say I do not know, what is going to follow the fore-
rmmer, or whether anything is going to follow it. I cannot discuss hypotheses
and possibihties, and I must take the thing as I find it, and I am bound,
whether it is a forerunner or not, to take it for what it is worth, and see what
it amounts to. You tell me you are going to do something else. That may be
your intention. I am not sidliclently conversant with your politics or the
composition of the present Legislature to say whether you will be able to pass
through your Legislature any tariff which does not contain this condition about
ships being manned by white labour.

Sir WILLIAM LYNE : It does not afiect it very much.

'My. ASQUITH : It affects us enonnously. It is a thing which to us is
absolutely inadmissible, and I say that in the plainest terms. Let us sec what
the preference amounts to. In the first place, it applies to 8 per cent, only of
British importations into Australia. What is the amount of foreign trade
which conceivably, supposing it had its full effect, it woidd enable the British
importer to capture from the foreigner ? The precise amount put down is
928,O00Z. If you allow 10 per cent., which I should think was a veiy fair
figure, as the profit that might reasonably be expected to be made if you
secure the whole of that 928,00()/. of foreign trade, the net result of this

316

Tenth Day.
2 May 1907.

Preferential
Trade.

(Mr. Asquith.)

would be a possible profit of somewhere between 90,000L and 100,000Z. to the
British importer there, and to the exporter here ; that is upon a trade which
amounts to 20^ millions at this moment. Our imports into Australia, taking
the year 1905, were 2O-4- millions. 18f millions of that would not be affected
by the preference at all, and the profit arising from the possible foreign trade
which we could capture under it, if everything went well and we secured
every ounce under every one of the categories in this tariff for ourselves — the
total maximum profit which could accrue to the British importer would be
represented at the outside by 100,000L I am not complaining for a
moment.

Mr. DEAKIN : You are measuring it, and are quite entitled to.

Mr. ASQUITH : I am not in the least complaining, but pointing out
these things as showing the enormous difficulties which, with even the best
intentions in the world, enciunber the framing of preferential tariffs. Now,
I am coming to a point of the highest importance, though I do not want to
detain the Conference too long. I have been pointing out from the
illustration of these two tariff's, the Canadian and the Australian, the
difficulties which tariff fi'amers have who honestlj' desire to begin a
preference in countries like Canada and Australia, which possess a protective
system. It is a comparatively easy thing to give a preference when
Protection is the basis of your system, because you have only to lower a duty
which already exists in favour of the Mother Coimtry, or, as in the case of
Australia and New Zealand, to heighten a duty which already exists as
against the foreign competitor of the Mother Country. That is a comparatively
easy thing to do, and you can do it without any disturbance of the foundation
of your system. But just look at our case. Supposing we had to do this ! —
I pointed out in the early part of my remarks, why we regarded it as essential
that the basis of our fiscal system should be a Free Trade basis. A Free Trade
basis means a system in which duties are imposed for revenue, and not for
other purposes. Therefore we give at this moment to the Colonies the freest
possible market that any community in the world can have. There is nothing
that we can give you that we do not give you.

Sir WILLIAM LYNE : You can give us our wine.

Mr. ASQUITH : We tax everybody's wines. We do not tax your wine
more than other people's. We give you, I say, everytliing that is possible
for us to give, and under no system of preference could we give you more.

Sir WILLIAM LYNE : I am very sorry to hear it.

Mr. ASQUITH : I am 'speaking of facts. What you are asking when
you come here and talk about preference, and suggest that we should give you
preference, is not that we should give you more than at present — we cannot ;
we give you everything— but that we should take away from others.

Dr. JAMESON : Certainly.

Sir WILLIAM LYNE : If I had a boy, I should look after him, before I
looked after a foreign boy.

Mr. ASQL'ITH : I am not talking about the reason, which may be good,
bad, or indifferent, but the question what preference can be given. I am

317

poiutiug out that while it is an easy thiug, aud quite consistent with the
whole fabric and stricture of a protective system, either to raise or lower a
duty, with a view in the one case to punishment, and in the other case to
preference, wlien you have, as we have, a Free Trade sj'stem in which we
give everytliing equally to everybody, you cannot have preference without
excluding somebody who at present enjoys the open market from the privilege
which at present belongs to him.

In other words, in asking us to frame a preferential tariff, the Colonies
are asking us to introduce into our system a set of duties which do not at
present exist, and which have no analogy to anything which at present
exists, for the purpose not of revenue but for ulterior purposes — the purposes
ol' preference. Tliat which is quite consistent with the framework and spirit
of a protective system is a flagrant and undeniable departure from the very
basis of our principle of Free Trade. It is all very well for Dr. Jameson to
say, " Try it on a small scale ; give our Cape wines or the potential tobacco
" supplies of the Cape a little preference ; we do not care about the amount,
" but let us have some instalment as an earnest of the bargain." What
bargain ? The abandonment of Free Trade. That is the bargain, it is
not a question of greater or less — not a question of giving it on wine
or wool.

Tenth Day.
2 Mav 1907.

Pkekekential
Trade.

(Mr. Aaquith.)

Dr.
Trade ?

JAMESON

Is not that coming back rather to the fetish of Free

^Ir. ASQUITH : You call it a fetish, but for the reasons I have already
given, I call it the principle deliberately adopted and approved by the people
of this country, aud which they regard, an 1 we regard, as lying at the very
foundation of our industrial ])n)s[)erily. You can call it a fetish if you like,
you can call anything a fetish, but with us it is a conviction, not based upon
abstract argument, but upon solid experience of the economic conditions
imder which wo live aud move and have our being. I am not asking you to
agree with it any moi'e than you ask me to agree with what 1 might call
tlie fetish of Protection. I do not like to use such words.

^Ir. DEAIvIN : There was once a fetish of Protection.

Mr. ASQUITH : I do not ask you to agree with me any more than you
ask me to agree with you.

Mr. DEAKIN : English Protection 60 years ago was a fetish and
nothing else.

Mr. ASQUITH : People then did not think so. It is just the difference
when times move. It may be in time you wiU persuade the people of Great
Britain that Free Trade is a fetish.

Mr. DEAKIN : We think it is so now.

Mr. ASQUITH : Go and persuade the people of that, if you can
persuade them, and we will have anotlier Colonial Conference, and we will
see what happens. But you have first to persuade the people, and so long as
we sit here as their spokesmen, aud whether you call it fetish or anything
else, we have to express to the bor^t of i>ur ability their views. I do not like
these questions of terminology which are apt to generate heat. Init never
conduce to light. We may be an absolute set of lunatics, wandering in

318

Tenth Day. twilight and darkness — fiscal twilight — and the tinie may come when we
2 May 1907. shall have a rude awakening. We may think, on the other hand, that

Free Trade within the Empire will be recognised as an ideal which all

Preferential ^^^ various conmiunities of ihe Empire ought to aid in constructing.
KADE. g^^ J ^^^ pointing out so long as the British people have taken Free Trade

( r. sqiut \.) ^g ^j^^ basis of their fiscal system, that is to say, so long as they impose duties
for revenue and for revenue only, by seeking to introdixce this element of
a penal duty directed against foreign produce, the Imperial motive being
to benefit your own Colonies and Dependencies, you are introducing
something into the system which is absolutely alien to it, which cannot be
reconciled with it, and which will sooner or later, and even at once, develop an
antagonism which in the course of time must lead either to the exclusion of
the new element or to the complete abrogation of the old system. There is no
compromise possible between the two. I say that on general groimds. I say
while it is easy for you, although practically difficult, as I have shown by the
illustrations I have given, in principle to grant preference to us consistently with
your protective systems, it is impossible for us to doit without giving the go-by
to the very first principles upon which our fiscal system, be it right or wrong,
has been established. But let me add to that. What is it that we are to
prefer ? I have here a table which shows the exports to the United Kingdom
— and these would be the subjects of possible Preference — from our various
self-governing Colonies that are represented round this table. This is for
the year 1905, which I think are the latest fuU figures available. They are
classified here under four headings : " Food, drink, and tobacco" is the first
column ; " Raw materials and articles mainly immanufactured " is the
second column ; " Articles wholly or mainly manufactured " is the third
column ; and the fourth column is " Bullion and specie." I do not think we
need trouble about bullion and specie. Nobody proposes to give a preference
to that.

Mr. DEAKIN : We all give a preference to it.

Mr. ASQUITH : There is a natural preference we all accord to it ; but I do
not think it enters into this problem.

Under the first column, taking the self-governing Colonies, Australia,
New Zealand, Canada, Newfoundland, Cape of Good Hope, and Natal, in food,
drink, and tobacco, our imports, or rather your exports to us, were 27,742,000L
We have not figures for the Transvaal yet. I daresay what appears to come
from the Cape would include Transvaal produce and perhaps some that comes
through Natal too. I only say that by way of explanation, " Food, drink,
and tobacco " is 27| millions, roughly speaking. " Raw materials and
articles mainly immanufactured " 32,495,000 — 32 1- millions, roughly
speaking ; " Articles whoUy or mainly manufactured," 5,569,000. The Cape
and Natal figures only are for 1904. These are the latest figures we have,
and they will do roughly for the purj)ose. I do not pledge myself to precise
accuracy. The members of the Conference will see that of the total
importations to the United Kingdom from the self-governing Colonies, while
only 5| millions are articles wholly or mainly manufactured, 27f millions come
imder the category of food, drink, and tobacco, and S2h millions under the
category of raw material. It is therefore oln-ious that any preference which
we caji give which is not to be a nugatory preference, but is to be of real value
to the Colonies, miist be a preference which applies to one or other or both of
the first two columns. A preference given to this comparatively insignificant
quantity of manufactured goods, 5|~ millions, would be of little or no value
to the Colonies themselves. If we are to give you a preference of any value
AV(; uiust give it cither on food or raw materials, or on both, the considerably
larger item according to these figures being raw materials.

319

Now I have listened ami listened carefully to everything that was said by Tenth Dav.

Mr. Deakin, and by Dr. Jamesou, and others, and 1 cannot now make out, and 2 May 1907.

do not at this moment know, whether part of the proposal made is that we ^ ~_

should give a preference to Colonial raw materials. 1 have heard no answer TuuVe

to that question. I have often put it myself. I thought we should get .^j. ^gq„jtj, •>
enlightenment upon it in the course of these discussions.

Mr. F. R. MOOR : Are you iaicluding Canadian wheat in that ?

Mr. ASQUITII : Yes, certainly — in the food, not in the raw material.

Sir WILLIAM LYNE : Do you say only 5 j)er cent, of manufactured
articles came from the Colonies altogether ?

Mr. ASQUITH : 5,500,00UL It would be moix' than 5 per cent.

Sir WILLIAM LYNE : What struck me was, if you get such a sniaU
proportion as that, you have a tremendous margin Avhere you could give
preference on, say, wheat.

Mr. ASQUITH : That is just what I am coming to. It is obvious it is
no use giving preference on these manufactured articles. They are a mere
bagatelle — a mere drop in the ocean. Therefore, any preference to be really
effective and at all evenly distributed between the Colonies must be on food
or raw material — one or both. Raw materials, as I point out, come first in
bulk — 32| millions. Is it, or is it not, part of the jiroposition that wc should
give a preference on raw materials ?

Mr. DEAKIN : May I point out that I expressly put aside that question
upon the general principle, in which I thought you concurred, that what you
would give, the kind and form and extent of your preference, was entirely a
matter for yourselves, and it was not for us to attempt to suggest its character ?
That was my reason.

Mr. ASQUITH : I quite appreciate that, and jierhaps I ought not to
put it in the form of a question to you, and 1 will not. But I will j)ut it in
the form of a question to myself and I will suppose I am trying to con-
struct a tariff. I think you are quite right in saying that this is a matter
which, if the Imperial Government resolved to give preference it would
have to settle for itself. So as Imperial Chancellor of the Exchequer, having
got a mandate from the country to give preference to the Colonies, I am trying
to construct a preferential tariff which is to be fair to the Colonies, which is
not to introduce a new and much more objectionable form of preference — I
mean preferring one Colony to another Colony — which is not to introduce
another and equally objectionable form of preference, namely, the preferring
of particular interests in particular Colonies to other interests. Rut I am
trying to construct a preferential tariff which shall be really fair and just.
What do I find ? What materials have I to go upon ? First of all it is
perfectly clear my tariff must be a tariff' which will impose discriminating
differential duties against foreign importations of raw materials and of food.
I cannot do it without including both raw materials and food. I will take
just one illustration, which will show the gross unfairness which would result
from not doing so. Take the Cape, represented by Dr. Jameson, what is the
condition of things there V The Cape sends us, including all their wine, of
Avhich we heard yesterday, 2S,000L of food, drink, and tobacco, but the Cape
sends us 10,281.000?.. of raw material, very largely diamonds and wool. How

Tenth Day
2 May 1907.

Preferential
Trade.

(Mr. Asquith.)

320

can I possibly deal fairly with, the Cape, or possibly give to tlie Cape any
preference that is worth the name, unless I impose a differential duty as
against the foreigner upon those raw materials ?

Dr. SMARTT : Try us with a one-shilling reduction on tobacco.

Dr. JAMESON : Surely that is a difficulty for the Colonies themselves to
get over.

Mr. ASQUITH : I was told just now that this is a matter which the
Imperial Government must decide for itseK.

Dr. JAMESON: Exactly.

Mr. ASQUITH : I am not going to do injustice to you.

Dr. JAMESON : You passed the South African tariff over very lightly,
which is very significant, because it gives a preference not only on the bulk
of British goods, but on nearly everything.

Mr. ASQUITH : I agree— over 80 per cent.

Dr. JAMESON : It even goes so far as to put 25 per cent, on foreigners
now on our free list. The only people having a free list in South Africa are
the British Government. It was rather significant it was passed over. The
tentative tarilf of Australia, which is merely an instahnent of what is to come,
occupied your main criticism. Apart from that, the Cape is willing to give
25 per cent, of its Customs duty preference to the United Kingdom.
Knowing there is 28,000Z. of stuff that comes over and knowing that the
Cape cannot get much, the Cape is wishful to grow, and to get something.
This is a way in which it will grow if there is a preference on that very
small amount which they send at present. That is the answer to that
doctrine.

Mr. ASQUITH : Unless human nature at the Cape is very different from
what it is everywhere else, if the inhabitants of that Colony found we were
giving large preferences to Canada and Australia in respect of wheat, butter,
and meat, and things of that kind, which were being very beneficial, I will
assume, and considerable in their amount, I should be very much surprised
if the people of the Cape would be content to have a small preference on
28,000L of food, wine, and tobacco, when there is 10 millions of raw materials
being sent from the Cape to this country every year.

Dr. JAMESON : How does it hurt the Cape if the Cape has nothing of
that kind to send over ? Surely the Cape is not going to be the dog in the
manger and say Canada is not to get it. Of course Canada will get
infinitely more advantage than we, but we hope to grow in course of time.

Dr. SMARTT : You made a point upon the smaDness of the amount of
Cape wines sent to this country. Before Cobden made his treaty with France
we sent nearly one million gallons of wine — over 800,000 — for consumption
in Great Britain, and we send practically nothing now.

Mr. ASQUITH : I agree it has gone down.

Dr. SMARTT : It would grow up again if preference were granted .

321

Mr. ASQUITH : As regards wine and spirits, I pointed out yesterday, I Teuih Day.
believe, that under no preferential system anywhere is that given. ^ Mn> 1907.

Dr. JAMESON : We have the list here where Australia and Canada I'kefekentiai.

•■ Trade.

give it.

Mr. ASQUITH : I know yoxi have given it as between Colonies— a very
small affair — but Canada does not give us any preferencf on spirits either
upon the General or Intermediate Tariff, nor, if we take the Intermediate Tariff
as the standard, upon wine either, and none of the Colonies either give or
propose to give us any on either wine or spirits.

Dr. SMAKTT : The whole amount of those figures is 28,000Z. sent to
Great Britain. With a much smaller population than there is at present,
with preferential treatment on wine, the amount of money paid to the Cape
for wine alone was formerly at least four or five times the whole amount
now.

Mr. ASQUITH : It is quite possible, but that is not due to mere changes
in tariffs but to improved cultivation and improvement in taste. I sincerely
hope the Cape wine will become a large and flourishing industry.

Dr. JAMESON : It is very significant that it went down fi-om about
130,000/. to nothing, from the date the scale was changed.

Mr. ASQUITH : The whole question of alcohol and wine is one which is
very difficult, and it affects our relations with France, Spain, Portugal and
Germany. It is one which you cannot deal with in an isolated way. What I
am pointing out to the Conference — and I took the Cape as a very good
illustration — is that you cannot possibly give a preference which shall be
anything like an even-handed preference as between the different Colonies of
the Empire unless you include in it raw materials as well as food. No human
ingenuity could do it. That is a fact, and a very important fact.

Now, I will come to what is, after all, the crux of the whole matter. If
I can only create a preferential tariff in favour of the Colonies hj taxing food
and raw materials, that is to say, by imposing a duty upon foreign food and
upon foreign raw materials which I do not impose upon Colonial food and
Colonial raw materials, not only, as I said a few moments ago, am I practically
abandoning the very citadel of our fiscal position, but in the opinion of His
Majesty's Government, and in the opinion of the majority of the people of
this countr}^ I am curtailing the sources of supply and raising the price of the
necessaries of life and the necessaries of industiy.

Sir WILLIAM LYNE : That is what I dispute.

Mr. ASQUITH : I know you dispute it, and Sir Joseph Ward said
yesterday in his admirable speech that if he thought it would have that eflect
lie would not be in favour of preference. I was veiy glad to hear him say so,
and I am quite sure he would not. He does not think it would have that
effect, and Sir William Lyne docs not think it, and probably the majority of
you here do not think it. But we think it would, and the people of this
country think it would, and they believe that they have the best grounds for
so thinking — grounds founded upon experience. Let me state our position
— I am not arguing it — it may be right or it maybe wrong. This is the
position which is held by Great Britain and by the majority of the British
people. When you impose an import duty upon a commodity which is a
necessary of life or of industry, one or the other, and when the com-
modity is of such a kind that you cannot substantially make up the
^givn-oly that you want from domestic sources — given those two conditions

48608. X

322

Tenth Day. and I carefully limit my proposition in tliat way — sooner or later,

2 May 1907. though the process may be delayed or deflected for a time, that duty appears

in added cost to the consumer. Yoa may think that is nonsense, but that is

Prefeken-tial ^}j^g_j ^ye believe to be true. It is what the people of this country believe is
true, and so long as they believe that to be true, they will give no Chancellor

(Mr. Asqmth.) ^£ j.j^g Exchequer— I do not care what political party he belongs to — any
mandate or authority to impose a duty i;pon the things in those two columns,
which are the necessaries of life in the first column — wheat, meat, butter, and
so forth — -and which are the necessaries of industry, many of them, in the
second column — ^wool, wood, and the rest of it. They will not do it.
You may think they are wrong, but that is their view. Further, they hold
the view, which is also the view of His Majesty's Government, that if you were
to impose such a duty, and if the duty had the effect which we believe it
would have of raising the cost of these necessaries of life or industry to the bulk
of our population, it would not only have that effect, but by raising the cost —
because you cannot have two prices in the same market — of the whole of the
supply, it would put into the Exchequer a compai'atively limited proportion
of the additional cost paid by the consumer, whereas the bulk would go
to other quarters. There, again, you fly in the face of one of the
fundamental principles and rules of our Free Trade system.

Of course, gentlemen, you will not agree with many of the things I am
saying. You think, no doubt, other people are right, and that our economic
system belongs to the age of the dodo or some other prehistoric period. You
may think we are all wandering in Cimmerian darkness. But we are
43,000,000 people, still the richest in the world, still not afraid to speak with
our commercial enemy in the gate, and convinced that no system of preference
such as you have been advocating with so much ability round this board
during the last few days can be adopted in Great Britain which does not
involve taxation of our sources of supply, both of food and of raw materials,
and a consequent enhancement in the cost of the necessaries of life and of
industry, and a corresponding and necessary curtailment in the area and
profitableness of the whole of our productive industries. That is our position,
and I state it with the utmost frankness, reciprocating the frankness with
which you have been good enough to address us ; and I am sure you will
forgive me if I have used plain language and not equivocated or beaten about
the bush. That is our position, and that being so, it is impossible for His
Majesty's Government, anxious as they are by every means in their power to
promote the commercial development as well as the Imperial unity of this
great fabric for which we are jointly responsible, to recommend to Parliament
any such fundamental change in the fiscal system of this country as
would be involved in the adoption of the proposals which you have laid
before us. But I say. and this shall be my final word, while I could not
recommend anything in the nature of Colonial preference by the manipulation
of tariffs there are many ways in which I think it is not only the interest but
the duty of the Imperial Parliament to promote the commercial interests of
the rest of the Empire. I associate myself with a good deal of what was said
by Mr. Deakin, and particularly with what was said by Sir Joseph Ward, and
also I think by Mr. Moor. I have no doubt that in South Africa as in
New Zealand you suffer from what may be called artificial impediments, for
instance the subsidising of these foreign lines of steamers, and the imperfection
or undeveloped condition of our means of communication as between the
different parts of the Empire.

Mr. F. R. MOOR : And the rates on state railways.

Mr. ASQUITH: There again that is an intricate thing with which it is
difficult for us to deal. Take the important point raised by Sir Joseph Ward

323

as to what may be called the development of Imperial commercial intelligence. Tei.th Day.

Mr. Lloyd George has already taken steps, but I hope by consultation with -' May 1907.

you, and Avith Mr. Deakin's assistance particularly, we may be able to develop '

that on a much larger scale, because I think it is a monstrous thing that in ""-radV*^

our own Colonies the foreign tout — if I may use a common expression — going -v.^. ^^^ .* .

about to look after business can find one of his own nationality to give him ' ' '

all the information he needs for the prosecution of his business, while a Briton

or a Colonial who goes to another Colony finds no corresponding facilities.

That is one of the things that urgently needs refonn, and which cannot be

too strongly insisted upon, and which 1 think we are very much indebted to

you for having brought so clearly before our notice.

Again there is this great question — and I do not like, particularly in the
presence of Sir James j\Iackay, to definitely commit myself about it — which
affects the Antipodes very much, the question of the Suez Canal and the
possibility of doing something to cheapen and facilitate the means of
communication through that great waterwaj'.

There is the question referred to by Sir Joseph Ward and Sir "Wilfrid
Laurier, and also I think by Mr. Deakin, of what I may call inter-Imperial
communication. You Avill not expect me at this stage to commit myself
definitely to any particular scheme, but I can assure you that the proposals
which Sir Wilfrid Laurier has adumbrated, and which were referred to
by other speakers yesterday, are so important and so interesting, and appeal
so strongly to the sympathy, and the intentions of His Majesty's Government,
that if they can be reduced into a practical form and shown to be of a
workable character, you will find no lack of co-operation, nor — I may safely
add I think, though I am Chancellor of the Exchequer — any lack of the
necessary material assistance on our part in order to bring them into effect.
We are most anxious to assist in all those ways.

Take another great question, the question of emigration. I do not know
whether the Conference has already dealt with that.

Mr. DEAKIN : We have, in part.

Mr. ASQUITH : That is a most important matter, and a matter as to
which there ought to be constant co-operation between the Imperial authorities
and the difl'erent local communities. I only mention that, not as an exhaustive
catalogue, but as an illustration of the ways in which we not only might, but
ought, as the Government responsible for the Mother Country, to do aU in our
power to develop and promote better commercial relations between all parts
of the Empire. 1 can assure you, and I am speaking quite sincerely, that it
is a most thankless task for a Minister in my position to combat propositions
which are conciirred in by so large an amount of representative opinion in
different parts of the Empire. It is not an agreeable duty at all, but it is one
I am bound to perform to my colleagues, and to the House of Commons, and
to the countrj'. But, having stated to you quite frankly, and without any
reservation or qualification, what our position in that matter is, I can assure
you that in all these other directions we are only too ready and anxious to
receive and entertain, and so far as we can to co-operate, in carrying into
practical effect any suggestions which your combined wisdom may bring
before us.

I thank you veiy much, gentlemen, for the indulgence with which you
have listened to me to-day.

Mr. DEAKIN : Might I ask one question, having special reference to the
exceedingly interesting points which you have just made. I notice that you
have for one reason or another excluded from reference the proposition once
associated with these various suggestions as to Imperial inter-communication

X 2

324

Teuth Day. and assistance proposed by Mr. Hofineyr. I do not know wlietlier you are

2 May iyo7. in a position to say whether it is or is not worth while for us to initiate a

~ discussion, which some of us, if there was time, would be most glad to enter

^^Trade^'^^ upon, as to the imposition of a small uniform duty all round the Empire

^ ' upon foreign goods, the proceeds of which should be devoted to what may

^ r. ea -iQ.) i^g termed Imperial purposes, such as the inter-communication you have

spoken of. This proposal would not affect either Free Trade or Protection.

It would not be a tariff but a surtax, if such a word might be used, to

include goods not now dutiable, the proceeds of which would be devoted to

Imperial purposes. Since Mr. Hofmeyr proposed it, Sir G-eorge Sydenham

Clarke has fully developed it.

Mr. ASQUITH : I think that is an idea of Sir George Clarke's.

Mr. DEA.KIN : If there was a possibility of any practical result coming
from its consideration, that is a method which, quite apart from all fiscal
matters whatever, would provide a common fund that could be used for
Imperial purposes. Perhaps it is not fair to spring the question on you.

Mr, ASQUITH : No, please do not ask for my answer now.

Mr, DEAKIN : Perhaps you would take it into consideration.

Sir WILLIAM LYNE : Lord Elgin and gentlemen, I have listened with
attention to the speech which has just been delivered by the Chancellor
of the Exchequer, and from his standpoint, I must admit that it was an
able speech and affords food for reply ; perhaps not reply on the instant,
but I feel when it sees the light of day — I do not know when it will
— ^it will be replied to pretty vigorously. I cannot help saying, my Lord,
that the whole tenour of .that speech, if I may be allowed to use the term,
and I scarcely like to use it, was alien to Bi-itain's Colonies, it was
treating the British Colonies on a par with foreign nations. When one
remark was made regarding the desire on the part of G-reat Britain to be
allowed to deal with her tariff as she desired and to deal with her domestic
question as she desired I could not help thinking that that was equivalent
to saying that the Colonies were not on a par with or not part of the domestic
Empire of G-reat Britain.

Mr. ASQUITH : No, I said the exact opposite, that we onh' claim for
ourselves what we concede to them.

Sir WILLIAM LYNE : That is just the point. I feel when Great
Britain, our mother, is claiming anything for herself, she should practically
be claiming it for all her Colonies too as a part of the domestic machine,
because, if we are to have Imperial — I do not like the word, our people
do not like the word " Imperial " — Defence and Imperial laws we surely
should not be excluded from Imperial consideration as far as our commerce is
concerned.

I, as you know, altogether differ — it may be pi-esumption on my part —
from the foundation up to the very summit of the structure which the
Chancellor of the Exchequer has attempted. I do say from a firm conviction
— as firm a conviction as my fiiend Sir Joseph Ward gave expression to the
other day — that if I was under the impression that the proposals we are
making would increase materially the price of food or make the condition

325

of the people of Great Britain Avorse than it is, I do not tliink lliat I shonld I'entli Day.
advocate it, however much it might be desired. I do uot like your absolutely 2 May 1907.

ignoring the whole of the British Colonies excepting India. India cannot

be placed, in dealing with a matter of this kind, in the same category 1 refekential
as the self-governing Colonies. India is not a self-governing Colony in the ,c-.\v i \
sense in which we are, and therefore I put on one side to a very large ^ "
extent the remarks made by the representative of that country. When
India is prepared to improve and keep up the position ol' her people, or if
I may so term them, her numerous people, to a lair stati' of living, a fair
wage, and to place them nearly in fair comparison with ours — I ilo not
say quite — with all other white people of the self-governing Colonies, then
and then only is the time Avhcn we can make ct)m])arison.

Mr. MORLEY : What do you mean by " payment " ?

Sir WILLIAM LYXE : They get 4|J. a day on board the boats against
our men's 5.s. With the P. and 0. Companj' they get 4i(Z. a day or there-
abouts and our men get 5.s. or thereaboxits in our country. When Sir
James Mackay speaks of tariffs being no barrier to the f>xports of India, I
can well understand it, because the labour of India is so miserably paid that
it does not matter much what tariff it is, they can overcome it ; but heaven
protect our white self-governing Colonies from our labourers ever being
brought down to the condition of the Indian people. I therefore cannot
bring myself to compare the conditions of India with the conditions of
either Canada, Australia, or South Africa.

I do not wash to say much with reference to the speech that has been
delivered by the Chancellor of the Exchequer, because if I were to talk, or
we all were to talk, for the next six months, evidently, from the decisive way
in which the arguments have been met, we would not have the slightest
hope of altering the position. I regret very much that we have come all
this distance — my Prime ^Minister and myself — to get such a reply from the
Government. It is to my mind one of those things that will not and does
not help to draw together the British Empire. In the onset of the
Chancellor's speech, he referred to the unique effect of Great Britain's
attitude and her laws and her administration as bringing together and
keeping together the peoples of her self-governing Colonies extending over
the world. I do not think the Chancellor's statement will help that position.

I have prepared several notes, and I do not intend to go much lieyond
them at pj-esent. Perhaps I may have a reply from my frieml, Mr. Lloyd
George, but it is not for me, after the replj- that has been received on behalf
of the Government, to feel that we can do more than, if it. is projiosed, and I
hope it will be proposed, pass a resolution in favour of what we have
come all this distance for, and then leave it in the position, almost, but not
quite, that it was left in in 1902. I heard the remarks made b\' General Botha
when he spoke, and, I think, also the representative for Newfoundland, Sir
Robert Bond, in reference to leaving the position exactly as it was by the
resolution of 1902. The position has advanced. ITnder that resolution I iind
one subsection was : " That the Prime Ministers present at the Conference
" undertake to submit to their respective Governments at the earlie
" opportunity the principle of the resolution, and to request them to take
" such measiires as necessary to give effect to it." Well, in Australia, which
is the wealthiest and the first of all the Dependencies of Great Britain,
we have done it. We have not only done it but we have done more.
We have appealed to the country partly on this question, and as far as I
can judge at the present time from the election only last December we ha\ o

48668. X 3

326

Preferential
Trade.

(Sir W. Lyne.)

Tenth Day. a House wliicli I think will be nearly unanimous upon it. We passed the
2 May 1907. short preferential tariff, which w^as onlj^ an indication of what w^e intend to
pass hereafter. I maj^ say that when that tariff was submitted by myself
with the consent of the Prime Minister and the Cabinet, we did not know quite
what the feeling generally of the country was. But now we know, and now
we both speak with a very much stronger sense of that feeling than we ever
could have done before. I must be allowed to say — and I hope I shall say it
without offence in any way — that I think the Chancellor of the Exchequer did
not fairly treat or deal with this particular question. He took that instal-
ment of preferential trade that we wish to give to the Mother, Coimtry and
New Zealand as though it was aU that was intended. The ChanceDor of the
Exchequer says that embraces only 8 per cent, of the imports from Great
Britain into Australia, that leaves 92 per cent, that we do not touch at all.
He admits the 8 per cent, would give Great Britain 100,000L, but says
sarcastically Avhat is this 100,0001. in twelve months ? On his own showing
it is about 1,200,000L that we offer to give to Great Britain w^hen we deal
with the Avhole tariff, and I did feel, and do feel, that it was not dealing fairly
to Australia and to the representations we have made of our instinctive desire
— I use the word " instinctive " because it is an instinctive desire, and not
absolutely a commercial desire on the part of Australia to be linked closer
with the Mother Coimtry. I Avish to emphasise this particular fact, that on
the basis according to the Chancellor's showing of the small forerunner, w^e
offered a preference of some 1,200,0001. profit to Great Britain in the year
on extra trade.

I hope, in spite of what has taken place, that the Prime Minister and
the Cabinet will agree to my testing this matter right through and further
impress on the people of Great Britain and on the j)resent Ministry here
what is in the minds of her Colonies. Whilst the Chancellor of the Exchequer
was speaking he referred to the 43 million of people in Great Britain.
Roughly, as far as my memory serves me, the Colonies that are prepared to
give preferential treatment to Great Britain have nearly 20 million people.
That is getting towards half the number of the population of Great Britain.
Surely they should receive some consideration. It is not as though it was
5,000 or 50,000 or five millions, but it is nearly 20 million of people that
practically unanimously are asking Great Britain to consider this question.
ISiot demanding it, not in any way saying you shall or you shall not, but saying
" We offer you this, and we hope that your people will see the necessity of
" dealing with the matter hereafter."

As to the question of extra cost of living I do not believe that it wiU be
any more than no-w to the British consumer. In fact I am sure it wiU not,
and in this way. At this present moment we have hardly commenced to
grow wheat in Australia. We have a large enough area fit to gro^v wheat in
good districts and with a fair rainfall, if j)roperly put imder crop, to supply
Great Britain altogether, but rmless we know that we are to get a market —
and we are satisfied with the price of to-day — we cannot get our fanners to
enlarge the area of farming to the extent we desire. But if we could know
that we should have preference with Great Britain we should certainly supply
a great deal more than 4^ or 4| per cent., which is all we supply to-day of
food-stuffs to Great Britain. If we had the opportunity of putting a larger
area of grain in, we could do it 3d. or 4d. a bushel cheaper than we can now
send it. So, under these circumstances, I do not think there need be the
slightest danger of any additional cost so far as the consumer in Great Britain
is concerned.

I hope I may be permitted to have what I say placed on record ; it is more
necessary now than it was before the statement we have heard to-day from
the Chancellor of the Exchequer to let the Australian people know exactly

327

what we have attempted since we came here. We came hero primarily to Tenth Day.
deal with this question. It is not the last, the laggard qtiestion, of the Con- 2 May 1907.
ference in our estimation, nor is it so in the estimation of our people. It is
the primary- reason, if I may so term it, lor our being here to-day. Trade.

Speaking from the standpoint of an Australian who has never before ,j,.^ ^^ Lvne.)
been out of Australia, I do not come here, and I think my Prime ^finister does ' ' ' '
not come here, to plead in an abject way for anything. We do not come here
to filch anything. We do not come here with a view to place the British
consumer in a worse position than he has been in. But, speaking as -i.
representative of the greatest, though most distant part of the Empire, I
desire clearly to lay before you matters which seem to me to be of great
moment to the Empire, and I do not speak with any wish of derogation
fi-om that great country Canada ; if, however, Sir Wilfrid Laurier will look
up statistics, he will find that the export trade of Australia last year was
nearly 14,000,000^ more than Canada, and the total trade of Australia I think,
from memory, is nearly 5,000,000Z. more than that of Canada ; this when we
have hardly commenced, as 1 say, to develop our country.

Sir WILFRID LAURIER : What was the total trade of Australia ?

Sir WILLIAM LYNE : Last year exports approaching 70,000,000L,
and altout -16,000,000?. imports. I think it is between 4,000,000?.. and
5,000,000?. more than Canada. During my lifetime in the southern
hemisphere I have seen changes occur of startling moment to the
Empire, and I feel it my duty to speak to this Conference, and try to
give them some idea of these changes which have and are now even
to a greater extent taking place so far as we are concerned. The
changes I refer to are hard solid facts — to which we in our distant
country cannot close our eyes. They are gradually sucking away the
trade— and I say this advisedly — and with it the employment and life's blood
of the people of the Mother Country, and I also say that liecause the trade
would be here were it not being forced to foreign countries, and the
emplojTnent, too, would be here. I feel that these changes are attacking
the very heart of the Empire, and I want it to be understood, with yom-
permission, that I am a strong Britisher. Why ? Because my father came
from Britain, and because my grandfather came from Britain, Imt as each
new generation comes it has been presented to me very vividly that you
want something more than that to keep up the interest that liitherto has
been held by our forefathers, and ourselves in Great Britain, and nothing
Avill do that so well as closer unity in commerce. That is one thing that I
am very anxious for. I see the younger generation callous to some extent,,
thoroughly loyal in a sense but callous. That is not so with the original
stock, who were imbued with the feelings of their fathers and grandfathers;
in regard to Great Britain. This has impressed us very keenly. We want
to know more of Great Britain, and they want to know more of Great Britain,,
and Great Britain should know more of us. Unless some means can be devised
the foundation of Great Britain itself, the foundation of this great Empire, will
be undermined. That is my humble opinion. I also believe that the people'
will see their commerce slipping away to the foreigner and the various;
branches of the Kingdom will liecome scattered units instead of a great,
united whole. We cannot forget that Great Britain is the Mother of the-
Empire, and that for generations at least the whole future of our vast,
Kingdom must depend upon her retaining her predominance as a world:
power. We readily acknowledge that in the time of our infancy Britain has.
protected her children, and that for many generations we hope she wiU be-
the mainstay of the Empire. And when in the over-sea portions of the
Kingdom we see Britain's trade slipping away, I feel that we, as guardians,

X 4

Teuih Day. of the Empire's outposts, are compelled to warn you of the dangers we see

2 May 1907. attacking the whole of the Empire. You cannot know, except on paper

and in cold type— and that is not the best way of knowing — what is to a

Preferential j^j-o-e extent the feeling regarding what is occurring.

Trade. '^ o o o • r n /-i i •

(Sir W. Lviic.) Britain herself is specially interested in this question, for the Colonies,

with their vast expanse of territory and immense resources, must develop,
must expand, and the only question with us is whether our trade is to increase
with Great Britain, or with Britain's competitors, which it is doing now. If
with the former, the Empire must prosper ; if with the latter, our competitors
will gain the benefits Britain is entitled to reap. Australia's raw products
are in sucli great demand all over the world that financially it may seem of
little immediate moment to Australia whether they are disposed of in the
markets of Great Britain or in those of the foreigner ; and that is a matter
that is coming very uppermost in the minds of our people too. But when I
see trade slipping away from Britain, which trade in years gone by has
employed, and in many years should employ, greater numbers of her working
people I am struck by the injustice being done. I do not want you to be
misled by those who tell you that if Britain refuses the preference suggested,
we shall of necessity make treaties elsewhere. No, Australia is loyal, but
that action may compel us to sell our wares to the foreigner instead of to
Britain, and we are doing it to a very large extent in some parts now. We
can only warn you of w^hat we see, and when you have the full knowledge of
things before you, we must, as has been said to-day, and said more than once,
leave the matter entirely in the hands of the British people.

When I see our Australian harbours, formerly filled with British ships,
now largely filled with foreign, am I not bound as a member of the Empire
to tell you of the impression it has made upon my mind ? Twenty years ago
as one looked over the vast expanse of Sydney harliour you saw the British flag
flying at nearly every masthead. Shortly before I left last month a great
proportion of the shipping in the harbour was foreign ; I found on further
inquiry that nearly half the shipping in Sydney harbour when we left was
foreign and a great portion of it was from France. Huge German steamers
were at the wharves and in the bay. These carry products of German
manufacture to us and some of them are liberally subsidised by their
Government to enable their merchants to land their goods on our shores at
prices below British ; and so they do. Great American liners, Japanese boats
liberally suljsidised by that far-seeing government, French steamers and
" sailers," the latter waiting for our wheat crop ; but subsidised by the
Government. I saw these cutting into trade that Avas in years gone by
wdioUy British. When we realise that naval supremacy must largely depend
upon mercantile supremacy, surely this increase of the foreigner at the
expense of Britain must make us pause and consider if all is well. As a
matter of fact some of those great steamers are readj^ to be converted into
armed cruisers — that 1 know — and to attack British shipping, if the
opptn-tunity should ever arise. I can recollect the early sixties when
Britain's imports at Sydney Harbour reached 4,000,000L while German
imports only amounted to 20,000?., and when 200,000L worth of goods only
reached Sydney from the whole of Europe outside Britain. Then out of the
total tonnage in Australian waters, 93 per cent, was British and of the crews,
90 per cent, w^ere Britishers.

One word as to a remark made by Mr. Lloyd George regarding the
question of 40,000 men increase, I think it was, being taken to the Navy
from the mercantile marine. That was referred to in the Shipping Con-
ference and in a paper laid on the table by the shippers ; in reply I laid
another paper on the table, which I think quite met that statement ; there
it is to speak for itself.

329

it was not until L>S8i that the increase of foreign shipping began to 'I'emli I^ay-

become noticeable. Last year only 18 " 9 per cent, of the outward trade of 2 Mny 1907.

New South Wales went to the Tnited Kingdom, as compared with 22" 5 per

,. . 1 ,• .1 ■ 1 1 X 1 . i- \- 1'kekkkevtial

cent, to foreign countries, and oi the inward and outward tonnage ot Aew Tr.vdk.

South Wales shipping, the United Kingdom only furnished l()-8 per cent, (.sir w. Lvne.)

of the whole as compared with 22 per cent, furnished by foreign countries.

That, my Lord, in itself, is an answer to all the very clever, and if I may be

permitted to say so, rouml-about arguments, that are made to try and prove

sometliing else. Those facts— and I think my Prime Minister will say I

deal in facts as a rule — were submitted to me after very considerable work

by the Department over wliich I preside, that is the Customs Department

of the whole of Au.stralia, and therefore, I think you will admit they must be

correct or fairly correct. When you see as one can state positively, that this

is taking place in Australia, then I think surely it must have son^e effect

upon those who deal with this question in the United Kingdom.

In New South Wales, the foreign tonnage has increased sinee 1880 from
172,855 to 1,221,389 tons, and appro.ximately last year, 7,400,000 tons of
shipping entered and left Australian waters, of which less than 2,000,000 tons
Avent to or came direct from the United Kingdom.

During the last 12 years, for which figures are available, the tonnage of
the United Kingdom in Australian waters has increased by only 41 per cent.,
while that of (iermany has increased liy 155 per cent., I'nitcd States by
89 per cent., and foreign, as a whole, by over 100 per cent.

:Mr. LLOYD GEORGE: What are the actual figures without the
percentage ?

Sir WILLIAM LYNE : I have not them with me, Ijut 1 believe I have
them all.

Mr. LLOYD GEORGE: Percentages are a little misleading unless we
get the actual figures.

Sir AVILLIA]\I I^YXE : I will try and get the figures for you.

Mr. DEAKIN : The totals also are apt to be misleading without the
percentages.

Mr. LLOYD GEORGE : Yes, I should like them botl..

Sir WILIilAM LYNE : Still the shipping returns after all are only like
a finger pointing to dangers ahead, and (ireat Britain still possesses 35 per
cent, of the external tonnage in Australian waters, or just ecj^ual to that of the
foreigner. I want to say in regard to this, that a great question is, is there
anything that will weaken the position of Australia or any of the over-sea
British Dominions, and make a hostile nation attack quicker, than lessening
the bonds of commerce with the Empire, and the balance of that commerce
being taken by the foreigner ? It seems to me that there is nothing that will
do greater liarm in the futiire than this. .

It is in the trade returns that we see far more disastrous results have
occurred 20 years ago, of 34,000,000Z. worth of imports, 25,000,000/. worth
was from Great Britain, or 73 per cent. Last year, of 38,000,000?. imported,
only 23,000,000^. worth came from Great Britain, or actually 2,000,000i. less
in the tofal than 20 years earlier, and showing an aU round loss of 13 per

330

Tenth Day.
2 May 1907.

Preferential
Trade.

(Sir W. Lyne.)

cent. 10,000,0001. worth of ^oods, or more than one quarter, came direct from
foreigners, or if, as should be done, the goods mamd:actured in foreigrt
countries but exported via Britain be added, you will find that of the
38,000,000Z. worth of imports 13,000,000i. worth— or more than one-third—
were the products of foreign countries. Compare this with the early sixties,
when Britain's share to New South Wales was -4,000,000?., and the rest of the
continent of Europe 200,000L only. Taking the returns of New South Wales,
it is alarming to find that whereas in the quinqiienuial period, lSSO-8-4,
imports from the United Kingdom reached -49 " 76 of the Avhole, in the period
1900-0-4 this had fallen to 32*06 per cent. During the same period imports
from foreign coimtries increased from 9 "71 to 17 "71 per cent.

Australian figures show that there has been an appalling decrease in the
employment of some sections of your people, and I wish to refer to th&
speech that was made by the Prime Minister of Great Britain the other day,
wherein he said that in 1880 or 1881 the employment of labour on the soil of
Great Britain was 1 million or over 1 million, and to-day it had gone down
to a little over 600,000—1 think 630,000 or 640,000.

You have lost in that one industry alone, according to what 3'our oaati
chief said, between three hundred and four htmdred thousand persons-
employed.

Mr. LLOYD GEORGE
manufactures.

They have gone into other industries — into

Sir WILLL4M LYNE : They are driven into the cities or driven away.
It is the worst thing you can do for them.

I desire now to mention just a few matters in which it seems to me your
Avorkmen have lost employment, and it meets a statement made by your
Chancellor of the Excheqiier where he quoted the imports from British
Colonies, and showed what proportion was imported of manufactured goods
and what proportion was imported of raw material and food stuffs. I will take
a very small thing first. Take matches : in five years the imports from
Britain have decreased hj 25,000L in this one small item, while the imports
from Germany have increased by 23,000L Take metal pipes: the imports
from Great Britain decreased 26,000?. I want Mr. Lloyd George to listen to
this ; I have had this checked very thoroughly : in metal pipes the imports
from Germany increased 17,000?., and from the United States increased
10,000?. Then on wire the British imports have decreased 7,000?., German
have increased by 10,000?., and the United States increased by 20,000?.
On paint the British imports decreased 35,000?., German increased
1,000?., and the United States increased 20,000?. Then on stationery British
imports decreased 54,000?., and German increased 4,000?. Then on tools of
trade the British imports decreased 12,000?., and the German increased
2,000?. On wicker work the British imports decreased 1,000?., and the
L^nited States increased 20,000?. These changes have occurred during the
last five years only, and if we went back 20 years the figures would be far
more appalling. Many more lines might be mentioned, but perhaps these
suffice to show you the trend of trade, and how foreign workmen are
supplanting the Britisher in Australia. During the last few years several
of the Australian Governments have tried to divert the trade of Great
Britain again to them by directing that in Govermnent contracts British
goods are to be bought, if possible.

After an adjournment.

CHAIRJ\L\.N : Sir James Mackay wants to make one word of personal
explanation before you begin, Sir William.

Prefeuestial
Trade.

331

Sir JAMES ]\IACKAY : My Lord, I was anxious not to interrupt Sir Temh Day.
"William Lyne in the course of his remarks, but there was a point where I 2 May 1907.
think he was not quite accurate, and it would only be right to correct him. I
understood him to say that the Indian sailors on P. and O. steamers were paid
at the rate of 4W. a day. This would be equivalent to nine rupees a month,
and there are no Indian sailors, as far as I am aware, who are paid at less than
18 rupees a month.

Mr. DEAKIN : Ninepence a day.

Sir JAMES MACIvAY : That would make 9tZ. a day, in addition to which
they get their clothes when they come into cold climates, and the steamers
carry, as a rule, double the mmiber of Indian sailors that they would of
Europeans. What induces shipowners engaged in tropical trades to employ
Lascars or Indian sailors is not economy ; but it is because they are really more
used to the heat, and they stand the climate better than Europeans do. It is
a great hardship for European sailors to be constantly employed in the tropics,
and I think, as Mr. Deakin pointed out the other day, the men employed in
Xorth Queensland, when thej' first go there, before they are acclimatised are
inclined to give waj' to drink, and Indian sailors are sober, steady and well
behaved men. These are the reasons that induce shipowners engaged in
the Eastern trade to employ Lascar sailors. I hope you will excuse me,
Sir William.

Sir WILLL\M LYNE : Certainlj'. I am very much obliged, my Lord,
to Sir James Mackay for his information. What I said was, that when
India placed her people upon nearly the same footing as our British white
people in Australia regarding wages and other conditions, then it was time
enough for India, which is not in the same category as Australia or the other
self-governing Colonies, to make a comparison between one set of men and
another set of men ; and, in addition, I said that I believed the wages paid
were 4:\d. That is what I was informed on the P. and 0. boat the
" Britannia." If it is otherwise, I am glad to know it ; but that does not do
away at all with the point of my argument.

Sir JAMES MACKAY: I do not know from whom Sir WiUiam got
his information on board the P. and 0. steamer.

Sir WILLIAM LYNE: From several of the officers— not the chief
officers, but the petty officers. That, however, does not change at all the
comparison I was making, even supposing it is 9(7., and I presume it is not
QcZ. when they are employed in India and not on the boat. I do not know
what their wage in India in rupees is, but I know it is very low. Our men
in Australia — and I am not going to compare, nor did I desire to compare,
the white men on the boats with the black naen, what I compared was
the wage of the black men with the wage of the white men in Australia- —
our sailors get, I think I am quite within the mark in saying, from 6/. to 11. a
month ; I am not quite sure, at any rate it is not much imder that, if any,
and the difference between that and QJ. a day is a very great deal even to
sailors. That was the object I had in making the comparison I did,
although I am thankfid for the correction as far as it goes.

Sir JAMES MACKAY : If I may say so. Sir William, I do not think
it has ever been proposed in this country, by the Board of Trade or by the
shipowners, that Lascar crews or Indian crews should be employed in the
coasting trade of Australia.

Sir WILLIAM LYNE : But they are.

Tenth Day. Sir JAMES MACKAY : Dear me, no, not in the Australian coasting

•2 May 1907. trade — siu-ely ?

Prefekential Sir WILLIA^NI lA'NP] : Yes, they are ; the P. and ( ). boats carry tlieni.

Traije.

Sir JAMES ^tlACKAY : The P. and 0. steamers run from London and
call at Fremantle and go on to Adelaide, ^Melbourne, and Sydney, possibly
up to Brisbane.

Sir WILLIAM LYNE : They do not go to Brisbane.

Sir JAMES MACKAY: The P. and 0. are taFkiug about going to-
Brisbane. Although they do call at Fremantle, Adelaide, Melbourne, and
Sydney, that is only a continuation of their voyage from England.

Sir WILLIAM LYNE : That does not matter ; under our arrangement
they are in our coastal trade.

Sir JAMES MACKAY : To that we can take no possible exception, liut
surely you cannot object to Indian sailors being employed on vessels making
voyages from England or any other country to Brisbane, calling at Fremantle,
Adelaide, Melbourne, and Sydney ?

Sir WILLIAM LYNE : We do, if they compete in the coasting trade,,
which they do a great deal.

Sir JAMES MACKAY : The interportal or coasting trade of Australia
is, of course, a matter which it is entirely within your rights to deal with.

Sir WILLIAM LYNE : They largelj- enter into the coasting trade.

I do not want to be long in dealing with this question, and at this
stage, after the announcement made by the Chancellor, perhaps it may be
thought not worth while using any further arguments in favour of our
cause, but I feel, and my excuse must be that I am completing my argument,
that this is a question which will be read throughout the British Empire, and
I hope, and I understand, that in the Blue Book which is to be issued, all that
is said here and the arguments advanced will be foiind, so that everything
that is submitted to the Conference will be for the use and infonnation of
every British Colony as well as Great Britain.

I wish further to say that while Britain has decreased her exports to
Austraha by over two million pounds sterling during the last 20 years,
Germany has, in direct exports alone, increased hers by 27S per cent., and
the United States by 115 per cent., while if the goods actuaUv made in these
countries and exported via Great Britain be added, the figures would be even
more impressive. All nations except Britain show an increase in their
exports to Australia during the past 20 years. To digress a little, I interjected
yesterday, or I think Mr. Deakin did, and I supported it, that there were vessels
owned absolutely outside of Great Britain that were flying the British flag,
and cutting trade between Great Britain and Australia, and that line to which
I Avas referring was the White Star line. I had a deputation from shipping
merchants between Great Britain and Australia who gave me the information
that that line was seriously injuring the British trade and bringing from
America, via Great Britain, exports to Australia at something like 15s. or
1/. less per ton than that at which they could be sent from Great Britain to
Australia.

Now, my Lord, I have, to demonstrate my arguments, a small chart which
I desire to submit and have printed Avith the other docinnents, becaitse I find
that the best way, as a rule, to bring a matter before people to impress
the ett'ect.

333

A)i..Ci^£Ln..ourrr^/Ji,inxAy^ -hxA. ce^rJ^OM. cd clnUlA Ju^rt^J/rrri^tfi^

UK "•"fBrtttih

i/rt » i'cd Ki nodtm yi

Posieiiititi will

Vntttd Kino^icm

Brtfitk Pttsesijnii

to

.)■>■'

w

334

Tenth Day. That chart shoAvs the effect of trade between Great Britain and Australia

2 May 1907. with foreign and British Possessions from 1880, and if gentlemen will look

at it, the second is the line which shows the British trade with Australia from

Preferentiai. 1880, coming down to 1905. The one above represents the trade with
Irade. British Possessions coming down to 1905, line three shows the increase of

(Sir W. Lyne. ) foreign imports. The fourth line shows British Possessions nearly even as
far as Australia is concerned. There is one point I wish to refer to. It will
be seen that there is a great drop at one particular point in part of the
years 1902, 1903, and 1904. I find on examination that that has caused
correspondingly an inunense increase from foreign countries .during these
three years of great depression, when a large quantity of foodstuffs, corn,
hay, and one thing and another for stock, were imported fi'om South
America, some from the United States, but mainly from South America into
Australia.

Mr. LLOYD GEORGE : Is that 1903, Sir WiUiam ?

Sir WILLIAM LYNE : Yes, it is part of 1902, 1903, and 1904.

Mr. LLOYD GEORGE : May I ask another question now, or if you like
I will ask it after you have finished explaining the diagram. I should like to
know whether these figures represent percentages or the actual trade done.

Sir WILLIAM LYNE : I think it is the actual trade done,

Mr. LLOYD GEORGE : That cannot be.

Sir WILLIAM LYNE : You will find 87 down to 73, and 75 down to 62.
They are percentages.

Mr. LLOYD GEORGE : That does not represent a drop in the actual
trade ?

Mr. DEAKIN : In the totals.

Sir WILLIAM LYNE: It may not be the totals, but it is the
proportion.

Mr. LLOYD GEORGE: That is what I want to make clear— that it
does not represent a drop in the actual trade.

Sir WILLIAM LYNE : It does not follow that it does ; it follows that
there is a proportionate drop in comparison with others.

Mr. LLOYD GEORGE : This represents percentages and not actual
trade.

Sir WILLIAM LYNE : According to the figures, it is percentages just
referred to.

I am convinced that the preference we offer Britain would do much to
lectify this — would increase your shipping — and would greatly add to the
employment of your working classes. So Australia offers preferential duties
on your goods and with it increased emolument and employment to the

i'uepebential
Trade.

335

British workman, aud to give liiia tlie work and wages that now go to the TeutL Day.
foreigner. I tliink there is no question about that. 2 May 1907

Preferential trade l)etween tlie German States made that country tlift
great and mightj'' country it is. Prior to that they were scattered units, l)ut
with the advent of the policy of giving their own people better terms than the ,<• w I ^
foreigner and of protection against the outside world the broken units becn.me ' ' ^^"^''
a great and mighty Empire. Of course, the cases are not exactly parallel ; for
the German States were all equally old settled countries with no \vide
difference between the social circumstances of the workers, while in Australia
infant industries have to be built up, and the high social condition of the
workers must be maintained at all costs. So to put the Australian manu-
factured goods on an equality as regards price with those of Britain, it is
necessary to have some slight duty even on the latter's goods, though
this duty will be only trifling compared with that on foreign. Whilst
dealing with this question let me add it would be, I think, incomprehen-
sible for anyone to argue that in a great country like we have, and great
Colonies such as Great Britain has, with a production of raw material to the
extent we have (sufficient to supply Great Britain with all she wants, and a
great deal more) we should not protect against outside foreign nianufactiu-e
mainly. We want to deal, if we can, with Great Britain, but we also want to
increase our niuiibers and wealth by employment on manufactures, and to make
ourselves what we should be, a greater country than we are, and a populous
country can only be made by the establishment of manufactures.

The German Zollverein in some respects resembles the present
proposals for preferential trade within the British Empire. It was founded
because the producers of the separate States saw they were being ruined by
the policy of isolation followed by each. A Customs union throughout the
Empire was brought about, and the foundation laid of their future greatness.
Our Empire may look for equal success if we give greater privileges to
each other than to foreign nations. What I emphatically complain of in the
able speech I listened to this morning is— it was placing our own flesh and
blood, our own kith and kin, in the same category as the foreigner.

It may reasonably be asked what we expect in return. We are making
or seeking no stipulated bargain. The whole of this question is founded on
aspirations and ideals verj"- much higher than that. It is the unity of the
Empire that we are looking to, and we believe that preferential trade will
bring this about at no cost to Great Britain. I will just refer briefly to
a few of the chief items from your last trade returns with which your
Colonies coidd readily supply you. This is the importation that you have
taken from foreign countries :^Grain and flour, 70,000,000/. worth ; wool,
25,000,000L; meat, 4],000,000Z. ; sugar, 39,000,000/.; butter, 21, 000,000L ;
wine, -±,000,000/. ; cheese, 0,000,000/. ; leather, 8,000,000/. ; and eggs,
7,000,000/. Now there is a margin there of importation which comes
mainly fi-om the foreigner ; that we seek emphatically to be given
an opportunity over the foreigner to supply, and at no greater
price, the margin of trade with which you enrich the foreigner but
apparently do not wish to help your Colonies with, is sufficient to leave
a great margin for your Colonies to supply to the consumer of Great
Britain ; whilst from various parts of the British Empire could be obtained
immensely increased quantities of the tea, coffee, fruits, cotton, tobacco,
and other like products which you now obtain from the foreigner. The
slight preference which in the past has been suggested from you in
return would not, I venture to assert, make your people one penny the
poorer, but it woidd give an additional revenue at the expense of the
foreigner — not at the exi^ense of the consumer, but at the expense of the
foreigner. The Chancellor this morning — or I rather think it was Sir James
JVlackay — when asked the question at whose expense was it, who paid the

336

Tenth Day.
2 Mar 1907.

Preferential
Trade.

(Sir W. Lyne.)

to Russia

In actual

and where

it is the

get

differeuce, who paid the extra cost, said, in the increased trade
from India, though having a higher tariff, " the consumer."
practice where you do not put duty on for revemie purposes,
you reasonably can produce it yourselves or manufacture it,
foreigner pays and not the consumer, and that was demonstrated to an extent that
never should be questioned in the effect of the German tariff when introduced
by Prince Bismarck. If any one would take the trouble to read the opening
speech when he introduced his tariff, his prophecy of what would take place
six or seven years afterwards, and to read his speech six or seven years
afterwards giving in detail the results, they coidd not, if they followed
argument at all, say that in those cases to which I have referred the
consumer pays much. The producer who is receiving those goods helps to
maintain the treasury of the Empire, but it would give an additional revenue
at the expense of the foreigner and create a fund — and I want to emphasise
this — out of Avhich your country could follow Australia's example and pay
pensions to your old folk who are in need of a well-earned rest in their
declining years, and in doing so relieve the community of the enormous
burden of poor rates which now fall so heavily upon your middle classes.

I may say that in New South Wales the effect of a Protective tariff, small
as it is, averagely low as it is, has given that country a revenue through the
Customs which has enabled it to pay about 600,000L a year as pensions to the
poor of the commimity. We are enabled to give them 10s. or if man and
wife, IZ. a week, and if it had not been for the increased revenue we
through the Customs we would have had diflficulty to carry that out.

Opponents shelter themselves behind the plea that such preference will
raise the cost of food to the working classes. That such is not the case may
be seen from the fact that in 1902, when a duty of Is. per quarter was
imposed on wheat in Great Britain, the price fell slightly (it can be proved
whether that is true or not), while it rose soon after Mr. Ritchie took off the
tax. Again, in 1902, when the duty on wheat was raised in Gerjnany, the
price fell 9 per cent., and in France in 1895, when the duty was raised, bread
fell 7 per cent.

Now, I give you these instances where the statement that has been
made and the argument that has been relied xipon are absolutely shown to be
fallacioxis. In fact, tariffs on wheat, unless excessive, have very little
influence on the price. It is a commodity regulated far more by conditions of
exchange, currency, transport and production. That is what I said previously ;
give us your market and it will cheapen our cost of production, cheapen
our cost, and we can supply you cheaper than Ave are doing to-day. Also,
it is often forgotten in Britain — where popular opinion is that only a small
proportion of the wheat used is supplied by British Possessions, that Great
Britain itself is a British Possession, and coimting " home " supplies and
Colonial — it will surprise many to learn (and it did surprise me), that in 1905
55 per cent, of the wheat consumed in Britain was British production,
and only 45 per cent, foreign. When these facts are borne in
becomes of the argiiment of those who allege — mistakenly allege,
a duty of 2s. a quarter on wheat Avould raise the price of bread,
that contention is ridiculous. Yet this little duty of 3d. per bushel would
encoiirage the Colonies to put 15 to 20 million more acres of their land under
wheat, and to find employment for at least 200,000 more men— Britons I hope
— and I wish again to say — I referred to it this morning — that the way in
Avhich that could help to be done to a large extent is giving opportunity to a
quantity of wheat to be grown in centres ; giving the Railway Commissioners,
as they are now trying to do in New South Wales the opportunity of
taking that wheat in full train loads and in bulk, with special trains at a
cheaper rate than they can take it now, although they carry it about or nearly
400 miles for Ad. per bushel, and it would enable the ship to receive the

mind, what
I say — that
I conceive

337

wheat without the expense of handling, and when it gets to its destination to Tenth Day.
place it in nulls or storage withont handling again. 2 May 1907.

Mr. LLOYD GEORGE : 100 miles for id. in Australia, Sir William ? Puekekestial

TUADE.

Sir WILLLVM LYNE : Yes, I think it is a little over 400 miles, but 1 (Sir W. Lyne.)
know it is al)out 400 miles for kl.

Mr. LLOYD GEORGE : This is over a State railway ?

Sir WILLLVM LYNE : Yes. As I say, this would iind employment for
at least 200,000 more men — Britons, 1 liope-who with their wives and
families would consume the manufactured products of Great Britain, and
thus increase employment in the Old Country. The same may be said of
dairying, meat, and many other industries, preference to the Colonies would
mean the employment of millions more Britons in your Colonies, and increased
markets for ]?ritish manufactures. And let me remind you of another reason
why this trifling dutj' of l)d. per bushel would not fall upon the consumer ;
it w^ould be encouraging the growth of wheats such as the strong
wheats of Canada (I presume thaj; 1 should ])e supiiorted in this by Sir
Wilfrid Laurier), and the full-lioured wheats of Australia. Do you know that
a bag of these wheats will make more flour, and that floxir, on account of its
greater strength and nutriment, will make more loaves per sack than the
weak-floured wheats of the Argentine, Russia, or anywhere else. lu fact a
200-11). sack of Canadian and Aixstralian stronger-floured varieties will make
10 to 20 per cent, more l)read than the same quantity of Russian flour. On
these points, far more than on a trifling duty, depends the price of bread.

Of course, unless some sort of preferential arrangement is arrived at, it is
not by any means certain, for reasons already pointed out by Mr. Deakin,
that Britain or the Colonies can retain even their present place in the British
or foreign markets. Australia, like the rest of the Empire, loses much in
foreign markets through not having behind her the voice of the vast
purchasing power of the Empire as a whole. On all sides Britain's export
trade is being restricted bj' ever-increasing barriers erected by foreign
countries. And yet the sobation of the danger is at hand in- the system of
preferential duties and tariff retaliation ; and in answer to that little indication
from Mr. Lloyd George I wall tell him that if he will be fair and not talk
of totals, but talk of proportions as between Great Britain and foreign trade,
he jnust admit it is only a question of time before what I say comes about.

Mr. LLOYD GEORGE : That little interjection of mine had reference
rather to the statement you made. Sir William, about the export trade of
Britain being restricted more and more owing to the tariff barriers, and I
could not repress the exclamation.

Sir WILLIAM LYNE : That is exactly what I thought it did, and I say
in answer to that that your trade is becoming more restricted in proportion to
foreign trade.

Mr. LLOYD GEORGE : In proportion to foreign trade '

Sir WILLIAM LYNE : Yes, that although you supply us with a very
large proportion, what we receive from the foreigner is catching you up and
beating you in the race.

Some fear that if we enter into this bond of imiou other nations will
permanently retaliate and injiire us. That they will permanently do so I do
not believe, for nearly ()0,000,OOOZ. worth of German exports go to British
Possessions. If all British countries were united, I do not believe that
Germany, for example, would retaliate and risk losing this vast purchasing

B 48668. Y

Tenth Day.
2 May 1907.

Preferential
Trade.

(Sir W. Lyne.)

338

power. They are too dependent upon British trade, seeing that over
40 per cent, of their whole exports are sold within the British [dominions,
but that is not in Great Britain. In trade England alone takes from America
and Germany goods to the value of 150,000,000L, while they only take
54,000,000L of English goods. The United States total exports to Britain
and British Colonies amounts to 143,000,000L annually, or nearly 50 per cent,
of their total exports, and they will not jeopardise this market I feel sure.
Rather, if properly handled, they and other nations will take off some of the
burdens they now place on our export trade with them.

One of the most common arguments against preferential trade is that
its adoption would lead to reprisals, and would tend to endanger the peaceful
relationship of the British Empire with the other nations.

In view of the fiscal j)olicies of the various nations it is remarkable
that such an argument should be heard. As each individual justly claims
the right to arrange his domestic affairs so that they may contribute the
maximum amount of happiness and advantage to his family, so surely each
nation has the right and undisputed ]:)rivilege of preserving the welfare of
its people and protecting the fruits of their industry.

I do not wish to go over the figures that Mr. Deakin gave. I have most
of them, and I will only mention that the British possessions purchase the
enormous smn of 800,000,000?. worth of goods anni;ally. Great Britain
alone purchases annually 565,000,000?. worti, of which only 49,878,000?. are
at present subject to any duty. Herein — in this huge purchasing power if
all combine, lies the strength of the British Empire. Foreign nations,
which now refuse to buy oi;r goods on equal terms with those of other
nations, will treat, and gladly treat, Avith the British Empire for the sake of
gaining or retaining portions of this immense trade. The power over
foreign nations, given by the possession of this great market to be opened
or closed at will, cannot be too widely realised, and the Empire's future
depends on all combining and using this power to meet attacks by foreign
nations on any part of the Empire.

This leads us to another view, and perhaps the most important one, of
the advantages to be gained by preferential trade. The Empire creates
nearly three times the amoimt of productive employment in Germany and
the United States that these countries create in England.

Mr. LLOYD GEORGE : How is that, Sir William ?

Sir WILLIAM LYNE : That is so, and I have obtained that information
from certain of the Australian offices here.

Mr. LLOYD GEORGE : That the trade of the British Empire creates
nearly three times the amount of productive employment in Germany and
the United States as it does in England ?

Sir WILLIAM LYNE : It acts in diverting ; and what it has diverted
and what it will divert into Germany and the United States is to make three
times the amount of proiitable employment that it does in Great Britain. It
has diverted an immense quantity of trade — for instance, a great deal from
Australia to Germany — and it is diverting a great deal to the United States
that ought to be here and is not, and you do not get the employment.

Dr. JAMESON : If you got it all, you would have three times as mucli
work to do.

Mr. LLOYD GEORGE : That is what I want to know,
to challenge it, but I want to know what the proposition is.

I do not want

339

Mr. DEAKIN : We say yoii will not he able to challeuge it very soon.

Mr. LLOYI) GEORGIA : 1 thought it would save time if I understood
what the j)roposition was.

Sir WILLIAM IvYNE : It is very easy for Mr. Lloyd George to check it.

Mr. LLOYD GEORGE : 1 caunot check it unless I know what it is.
However, Dr. Jameson has explained it.

Sir WILLIAM LYNE : As Dr. Jamesun put it, you woulil liavc liad
three times as much diverted employment.

Mr. LLOYD (GEORGE : If it had not l)een for the trade we divert to
Germany and the United States.

Tenth Day.
2 May 1907.

Preferential
Trade.

Sir WILLIAM LYNE : The prosperity of Germany is through Britain's
action to some extent. On the mercantile predominance depends Naval
supremacy, on which, again, depends the security of the Empire. Great
Britain and the Colonics are helping to build up huge foreign merchant
navies which will undermine the strength of the Empire, and it is to be
remembered that many foreign Powers subsidise their mercantile marine with
a view to relying on it as a reserve in war time. Why should not more of
Britain's vast outlay — 5G5,000,UUO/. annually which she pays for imported
goods — go towards building up the British Colonies ; to increasing their
wealth ; and to strengthening the British and Colonial merchant navies and
the Empire as a whole V Colonial agriculture goes hand in hand with British
shipping ; increased Colonial production means more material for the British
manufacturer and greater purchasing power for the people as a whole.
Success of one means success of both. At present we, as a whole nation, are
not utilising our powers. Even Adam Smith— the most practical of writers
— says " retaliatory duties are a matter for delilieration when a foreign nation
" restrains by high tariffs or prohibits the importation of some of our
" manufactures into their country." Not only are foreign nations gradually
prohibiting our imports, but l)y heavy subsidies to their traders they are
actually ousting British products from ib-itish markets. All approve of the
commercial union of England, Scotland, and Ireland ; of tht) consolidation of
the United States, the federation of South Africa, and of Australia — then
what reason can be urged agasnst the commercial imion of the whole
Emjiire.

Although it has been partially eclipsed here for a brief period (I say
" here " because it is eclipsed by the action of Great Britain) by the inter-
vention of political questions of purely ilomestic character, the time is at
hand when I hope there shall be a fresh awakening to the benefits of
reciprocitj- and trade preferences in the relations of the component 'parts of
the Empire. For long an earnest advocate of the policy of preferential trade,
my faith in its wisdom, and its ultimate realisation, has never waned.

It is impossible to believe that a nation nuij' continue to mark time in the
presence of its advancing competitors and yet retain its power and prestige.
And, in view of the very serious problems which have to be faced, who can
say that the last word has been said, or that this or that economic faith is for
all time and for all conditions '?

In regard to that, let me say that the remarks made and the basic
principle laid down by the Chancellor to-day that because Great Britain sixty
years ago adopted the principle of Free Trade it is a good one to-day, has not
a sound foundation, although it suited Great Britain at that time, a time when

Y 2

340

Tenth Day.
2 May 1907.

Preferential
Trade.

(Sir W. Lyne.)

she outpaced all her neighbours and was at the zenith of her powers in
manufactures, surely there is a time when all the people will not say : " I am
a Free Trader hecanse my grandfather was " — and that is what most of
them do say ; they cannot give yon any other reason. If you ask nine out
of ten, especially those who come to the Colonies as Free Traders (they do not
remain Free Traders long) the question why they are Free Traders, the answer
of most is, " Oh, my grandfather was one."

We are accustomed to look upon the Empire as a concrete quantity. It
is nothing of the kind, Ivat rather a scattered mass of units, some great, some
small, bound together to a large extent only by the ties of blood and
sentiment. Whether it makes for strength or weakness no man may surely
say. In ray opinion, compared with the United States and other great
Empires, it lacks that cohesion, those qualities of strength and unity of
purpose which, welding the whole in a common destiny, afford an unbroken
rampart to each storm and danger ; and in regard to that, if anyone looks at
the ]nap they AviU see how diversified and how distributed the Colonies of
Great Britain are — the Empire of Great Britain ; thej^ will see it is the most
vulnerable Empire that the world knows, and that is all the more reason why
it should be more cemented than it is at the present time, with ties of
kinship and of commerce.

The greatest administrative genius of modern limes is said to have
exclaimed, "Give me ships, Colonies, and commerce," and therein lies the
watchword of the present time — British ships, British Colonies, and British
commerce.

In a recent reprint of the work of John Barnard Byles, originally
published in 1849, entitled " Sophisms of Free Trade and Popular Political
Economy Examined," there is a remarkable anticipation of the aspirations
which are now finding expression throughout the length and breadth of the
Empire : " The great Lord Chatham was not only a Pi'otectiouist but an
" ultra-Protectionist ; jealous even of the Colonies " — and that is what it seems
to me the present Government are — and he said, " They shall not make so
much as a nail." That seems to be the policy of Great Britain at the
present time ; because we want to convert raw material into the manufactured
article we are not to have preference unless we pull down our tariff barrier to
the ground. " The true policy woidd differ from Lord Chatham's, for it
" would treat the Colonists as if they inhabited an English coxmtry, giving
" them full liberty to grow and manufacture what they pleased. It would
" differ from the system of the Free Traders, for in place of disadvantages it
" would give them in common Avith all their fellow sid^jects an advantage in
" the Imperial markets, and take in return a i-eciprocal advantage in the
" Colonial markets ; the first markets in the woi'ld, instead of being opened
" as now to all without distinction, would give a preference to British
" subjects. It requires little foresight to perceive how powerfully self-interest
" would bind the Colonies to the Mother Countrj', and the Mother Country to
" the Colonies. .... If the vast Dominions of the British Crown do
" not compose a State without a parallel for greatness and prosperity, the
" fault must be in the policy of the Imperial Government," and not of the
Colonies. That is truer to-day than at the time the foregoing was written.

The proposals lately made have given life and shape to the ideals. They
possess the very ingenious and masterful advantages that whilst each self-
governing State may retain its full freedom in regard to domestic and fiscal
affairs, it may also participate in an Imperial Customs Union (I refer to those
proposals made by Mr. Chamberlain), and whilst preserving its own industries
each unit may share and contribute to the prosperity of the Empire as a
whole, giving preference to our own people, and combating the competition of
the foreigner, lu 1889 the late Lord Salisbury, dwelling upon the future of

341

the Empire, sounded a note of warning in tlie caution : " We must bring Tentb Day.
" minds not biased by the reUections of the past. We have to deal with a 2 May 1907.

" different set of problems, in respect of which names, political connections,

" and traditions of parties will help us very little." ^"^ Tu^oe"''''

Then the late Lord Carnarvon, of whom it has been said : " lie was (^gir \\ Lync.)
" amongst the very first of British statesmen to see clearly on the horizon
" the coming dawn of an actual Greater Britain, and the first to counsel
" timely prei^aration for dealing with its earliest necessities," said, in the
course of a speech at the London Chamber of Commerce, in 1887 : " You
" have in the first place, a vast Empire, vast in area, population, and
" resources, of which, as we may honestly sa.y, the world's history knows no
" counterpart. It is the first and foremost of its kind. Within the compass
" of this great Empire, you have all the products of nature that can be

" named If all the interests and parts of this Empire can

" bo adequately bound together, the commercial interchange of necessities,
" comforts, and luxuries ought to be achieved within the compass of our
" own dominions. I lielieve, myself, the solution will be found m\ich rather
" in the practical adaptation of means to ends " (this is what he says), " and in
" common-sense determination to comlDine, as far as may be, the difYcreuL
" interests and resources of an Thnpire, which, though divided and scattered
" geographically, over the whole face of the worhl, is singularly and
" marvellously united in the heart and feeling, as well as in interest."

I quote these utterances since they reflect the opinions of by far the
greater nixmber of Australians.

So far, Canada, South Africa, and New Zealand have pledged themselves
to this policy, and the Commonwealth has made a modest and initial step
towards the common goal, and in Australia we look with anxious eyes to the
Motherland for the development of events which will lead to the result we so
much desire.

Amidst the stirring events of recent years which have brought Australia
closer and closer in touch with the Old World's activities and tragedies, we
realise that we must either face the responsibilities of our own protection or
be drawn closer to the head of the Empire.

Whatever views to the contrary may find expression, we recognise that
our future is inseparably bound with the fate of the Empire whose glorious
record has been so remarkable. Our faith is in the Empire, and our belief is
that its unlimited resources may supply us with most of our wants. We desire
to so arrange for the mutual benefit of each portion of the Empire that we
may help each other, strengthen each other, and, above all, prefer our own to
all others. We want to concentrate the wealth, strength, and progress of the
race by a business relationship which, whilst consolidating its power and
prestige, realises its highest ambition in the welfare of its own people.

When we are warned by the oponents of preferential trade against the
artificial regulations of trade, it is pertinent to ask, how is it, in the face of
modern competition, we find that artificial regulation is winning the race, not
alone in the British Possessions, but throughout the globe.

It has been truly said that the boast, " Trade follows the flag," is not
borne out by experience. What really happens is that the British flag is
followed by foreign trade. It was Lord Farrer, an ardent Free Trader, who
said " Free Trade can beget no possi1)le qualities in man ; it leaves tlie power
" of nature and man to produce whatever is in them, to produce imchecked
" by human restrictions."

It seems to be a strrnge pecidiarity of the British race that it rarely, if
ever, foresees or is found prepared to meet those greater emergencies which
periodically mark the record of every nation in history. With characteristic
4Rfifls. y 3

342

Tenth Day. coufidence it ignores the most potent warnings, trusting to blunder througk
2 May 1907. sonieliow or other, absolutely unconscious of any other idea than ultimate

success.
''^rRADE^' ^^ "^^^^ -^^^ almost, without exception, characterised each war, as well as

fS' w r - ") '^^'^'^ serious crisis, in which it has been involved.

' It may be possible that this feeling of self-complacency is the real

stmnbling block in the way of fiscal reform. There has been a growing
laneasY feeling for some years past that all is not well Avith British trade, biit
the very thought that the fiscal system has outlived its period of usefulness is
intolerable to those who have worshipped at its shrine.

In war, a disaster of to-day may be retrieved by the victory of to-morrow,
since the reserve strength of the nation is available in all its power for the
recovery of its honour and prestige, but with commerce the disasters of to-day
cannot be so readily compensated for by any victory of to-morrow. Once the
tide of trade has drifted into other channels, he sure that it has also carried
with it much of the reserve strength of the nation.

Bearing in mind the implicit blind faith of the many in the policy of
free imports, it is not difficult to imagine one of its adherents standing beside
Macaulay's New Zealander on a broken arch of London Bridge amidst niius
of our Empire, self-confident and self-satisfied that in spite of wreck and ruin
his faith remains supreme.

I have just a word or two more. In reference to some remarks that were
made this morning by the Chancellor, to which I slightly referred previously
in regard to the preference that Australia had commenced to give, I wish to
point this out, that ours I believe at the present moment is the lowest average
tariff known in the British Dominions where there is a tariff at all, that is for
Protection, and it is much lower than Canada, I think Canada's is 10 per
cent, higher than ours, or thereabouts. Ours averages about 15, while, I
think, Canada's averages about 25, or something like that.

Sir WILFRID LAURIER : Between 25 and 26.

Sir WILLIAM LYNE : I think so. Therefore when we offered 10 per
cent, preference — that is the average of what was offered over the whole of
our tariff" — that is a very much larger proportion than offering 10 per cent,
on a tariff such as that of the United States or Canada, or any other place.
We went to the extreme limit, I may call it, of offering 10 per cent,
when our average is only 15 — that is, that Great Britain would have the
advantage of all our markets at 15 per cent., wliile the States Avould have
to pay us the 25 or 10 per cent, more ; and surely if Great Britain's
manufactures are so much superior, as they were described this morning, to
those of America and other parts of the Avorld, with the 10 per cent, it ought
to be a iDretty good thing for them. That 10 per cent, is applicable on an
immense volume of importation that we do not produce to-day in our
manufactiu-e in Australia. To give you an idea— I will not detain you to
give you every item- — our imports of steel and iron into Australia average
7,000,000L a year, and a very large proportion of that comes from the United
States. We want all we can get from Great Britain, and I want to tell
you a little incident. You will bear with me for a moment, but this is
rcaUy emblematical of what Great Britain is not doing. At the present
moment in Canada (that is not a foreign coimtry, and therefore we do not
complain of them), in the United States especially, and in Germany, they
adapt their methods Avith a great measure of foresight so to our require-
ments that they absolutely kill the British trade. There was a place
called the Clyde Works manufactory near Sydney, where they were
supposed to manufacture farming machinery, principally for Australia.
J used to see coming from Melbourne as I Avent over, train loads of

343

manufactured inachinery, some coming from the United States and some Tenth Day

from Canada. I asked the managing director of tliis Clyde works how ^ ^ay 1907.

many agricultural ploughs he had sold that year, and he said : " I do not """

know how many " ; I said : " Have j'ou sold any ? " and he said, " Yes, one " ; Tkai.e!^'

and that year I suppose there were thousands, ahnost tens of thousands, .^-^ ^ j^^,^^ .

which came into our farming districts. I said to him : " As long as you do ' " '

" what j^ou are doing you will be ruined, and you will not get the trade. What

" sort of plougli do you make ? " and he answered : " A single-furrow plough."

I told him that the farmer scarcely ever used less than a three or four-furrow

plough, and they are catered for by the ingenious American. Now, this is

the tyi^ical part of it — I was referring to a man being a Free Trader because

his grandfather was, and this man's answer to me was : " Well, 1 cannot

help it, what is good for old Great Britain is good enough for me." That

was his answer, and his works closed shortly afterwards. The man is alive

still, but he is a Protectionist now.

I recognise that this position is an awkward one for the Imperial Govern-
ment. I should feel it awkward if I were in their place, hut at the same time
it is not insurmountable. I recognise that a general election has taken place,
and it is said that Free Trade was one of the principal questions before the
electors (whether it is so or not I do not know). What we are proposing,
however, is not a question of Free Trade ; it is a question, as described by
one of those I have just quoted fi'om, to be dealt with under special circum-
stances and not interfering with the principle of Free Trade, therefore it
might reasonably be considered under that heading, and not interfere witli
the question of Free Trade or Protection. If the Ministry are afraid of that,
or if they do not want to do anything to interfere with what they conceive
to be the decision of the electors, Ave in our coimtiy are often told that a
good way to get over that difficidty is bj'' way of referendum ; they could
easily remove it from party obligations, and it is important .1 think to be
dealt with in that way if it cannot be dealt with in any other — put it to the
electors of this community free from any other question, free from the
Education Act, free from any combination of any kind, and ask the British
people whether they are in favour of drawing closer together the outlying
parts of the Empire, the oft'shoots li'om themselves, their flesh and blood
coming from (ireat Britain, and give us some consideration in a preference,
even, we will say, in food and drink.

I was surprised at the answer this morning to the interjection made about
wine. What on earth there is to prevent the Government and the British
people from allowing some consideration to us in regard to our wine I do not
know. I forget at this moment what the tariff in France is, but in my own
electorate a large proportion of the wine that is protluced there goes to
FiMnce — it does not come here — and it is then mixed up Avith the French
light Avine and sent to Great Britain. We Avould like to treat directly in our
Aviues Avith Great Britain, and there can be no question of dearer food.
There are other things ; but I refer to that only.

Mr. LLOYD GEORGE : You have got the cheapest rate on your wine,
I may point out.

Sir WILLIAM LYNE : It used to be Gs.

]\Ir. LLOYI) GEORGE : I Avent into it a little wliile ago in the case of
Portugal and Spain, and I found that Australian Avinc came in under the
lower rate. 1 aui not sure about the Cape.

Sir WILLIAM LYNE : I want you to consider us a part and parcel of
the Empire and not to treat us regarding our trade as though avo Avere

Y i

Tenth Day.
2 May 1907.

Peeferential
Trade.

(Sir W. Lyne.)

344

Russians (Mr. Deakin : or Italians or Spaniards), as yoii now treat ns. Yon
treat us as thongh we were aliens, and the speech I listened to this morning
makes me think we have little chance of any alteration.

Mr. LLOYD GEORGE
Spain or Portugal.

We give you t]ie lowest rate, much lower than

Sir WILLIAM LYNE : How much is it ?

Mr. DEATvIN: Are you
other nations ? Why not
Dominions ?

not hoping to make commercial treaties with
make commercial treaties with your own

Mr. LLOYD GEORGE : That is a question which is entirely oj)en.

Sir WILLIA]\I LY^NE : I thank the Conference for listening to me for
so long, hut I felt I had to place on record my views, because this is an
historical Conference I think, and will be known as an historical Conference,
and I certainly hope it is not going to stop here — that the Government will
see their way clear to meet us in some way or other and show to o;ir people
that we are not those aliens which the treatment we receive seems to
indicate.

Adding just a word with regard to what Sir Joseph Ward said the other
day, I do hope that some means will be adopted to shorten the time between
Australia and New Zealand and Great Britain. In that to my mind, or on
that, hangs a great deal. We cannot shorten the distance, but if money can
cpdcken the time and bring your people to us and our people to you, as our
railways did before federation, and they brought about federation in Australia,
it will do an immense amount of good. I have spoken to my Prime Minister
on this more than once. Y'ou talk about emigration : I cannot see that it is
going to be very successful at present, but spend your money, even if it
amoimts to half a million annually, in giving cheap and quick connnunication
and we will soon have plenty of emigrants, also have our people amongst
you, and yours amongst iis.

Dr. SMARTT : After the full, exhaustive, and I might almost say the
forciljle manner in which this subject has been discussed, it really leaves
very little furtlier for any member of the Conference to say, and I feel that
all the more, Lord Elgin, after the very able and clever speech to which we
have listened from the Chancellor of the Exchequer, because without
desiring in any Avay to appear to criticise that extremely able statement from
his i^oint of view, I, as a member of the Conference, and one taking a deep
interest in trying to arrive at some solution of binding more closely together
the different portions of the British Empire, could not help feeling that that
speech, clever as it was, was a l)rilliant example of special pleading. It was
a speech which, perhaps, might have been admirably delivered in support of
the flocrtrine of Free Trade as against any controversion of that doctrine, but
I must say I did look for some more sympathetic desire, while maintaining the
doctrine of Free Trade (with which we, as members of this Conference, do not
want in any way whatsoever to interfere) to try and arrive at some arrangement
Avhereby the differences which separate us might be bridged over instead of
meeting us with the proposition that it was absolutely and entirely impossible.

I can only say, Lord Elgin, that looking round the table and seeing the
other members of the Governnient, we may, perhaps yet, get from them a stiU

345

more sympathetic treatment of the case as we have presented it. I have no
doubt that you, Ijord Elgin, with your intimate association witli the Colonial
Office and, your knowledge of the fact that it is not in any way whatsoever a
matter of " squalid bonds " that makes us urge this question, but an ardent
desire to do something whereby you will link up in the future more strongly
the bonils that bind together the different portions of the Empire. With your
knowledge and intimate association with the Colonies, perhaps you will be
able to treat us in a more sympathetic manner than the Chancellor of the
Exchequer foimd himself able to do this morning ; because this is absolutely
certain, that you have now in the British Colonies large numbei's of people
who either were born in (Ircat Britain or who have had intimate associations
with Great Britain, but as your Colonies increase in size, as your population
increases more and more, there will be vast numbers of those people wdio
cannot have the old attaclmient and the old sympathy with the Mother
Couutiy that existing colonists have, and I feel convinced that in the
distant future, if something is not done to unite more strongly than by mere
sentiment the bonds of Empire, the result may be such as manj' of us here
would not at all wish to contemplate.

Now, I thiulv. Lord Elgin, I woidd perha]")s be in order in referring as
^vell to the speech of the representative of India as to that of the Chancellor
of the p]xchequer. I followed very carefully the speech of Sir James Mackay,
representing India, and I was really surprised when he said he regretted to
say the Government of India was at variance with the views expressed by
the majority of the other representatives of the outlying portions of the
Empire.

Tenth Day.
2 May 1907,

I'HEfEKE.NTlAL

Tkaije.
(Dr. Smartt.)

]\Ir. DEAKIN : The self-governing portions.

Dr. SMARTT : The self-governing portions of the Empire ; and w-ere he
here at the present moment I would have liked to have had the opportunity
of asking him the question whether, although that may ])e the view of the
Government of India, is it the view of the majority of Anglo-Indians ? —and is it
the view of the majority of the Indian people ? My advices tell me it is not the
view of the majority of Anglo-Indians ; and it is also not the view of the
majoritj' of the Indian people, but though the Indian representative said that,
from the point of view of his Government, he was entirely at variance with the
argmneuts put forward by the representatives of the self-governing Colonies,
he still, in the close of his remarks, went on to show us that he was extremely
in sympathy with some of our projjosals because, while stating that preferential
treatment would ]je disadvantagous to India, almost in the same breath he
stated that it Avould be a great advantage to India if he could have some
reduction on the duty upon tobacco — Indian tobacco being a specially Ioav valued
article as compared with higher valued articles from other countries ; and he
finished up his remarks by saying that he hoped that Avhatever advantages
the self-governing portions of the ICmjjire gave to Great Britain, they would
give those advantages to India, i think I am qiute right in thus interpreting
what he said ; and really Ave might reply that, while we would be onlj' too
delighted to do so, surely we must say that there must be some recognition
on the part of India in the way of recii^roeating the advantages which he is
desirous that we should give to that important portion of the l'2mpire.

Now, Lord Elgin, the Chancellor of the Exchequer stated in his opening
remarks that Imperial unity cannot be furthered by ignoring local conditions
and local sentiment, ^\'ith that statement I think every meml)er of this
Conference agrees, but my contention is that there appears, on the part of
the Chancellor, a tendency to ignore local conditions and local sentiment ;
and it is because we consider that the local conditions are of such a character

346

Tenth Day.
2 May 1907.

Pkeferential
Tkade.

(Dr. Smartt.)

and that the local sentiment is so strong that we do think we have a right
to appeal to the Imperial Government, and expect that, while not departing
from their fixed policy of Free Trade, they will be prepared with some means
to meet vis on those articles on which they have already a tariff, without
asking them to go so far as to put up a tariff i;pon articles which, at the
present moment, are practically subject to no tariff whatsoever.

I was surprised when, as an example, Mr. Asquith gave us his historical
resume of the reason of our loss of the American colonies ; because really
the position is so different from what we are asking for. The reason of
the loss of the American Colonies was that Great Britain desired to force
her tariff in the interests of her manufactures, without any reciprocal
advantages whatsoever ; but that is not what we ask for. What we ask for
is that there should be some mutual understanding, that there should be
some mutual consideration ; and I do think that we have a right to expect,
at the hands of the Imperial Government, that they will earnestly try and
meet us, and reason Avith \is, and see if there is no way whatsoever in which
they can meet a sentiment which is very strongly existent throughout the
length and breadth of the Empire.

When Mr. Asquith, in his able address, stated that he felt convinced that
if this question of Free Trade as against Protection was to be laid before the
House of Commons the vote would be two to one or three to one against
any alteration of the principle. We do not ask the Imperial Government
in any Avay to alter principles to which they are pledged, and which are their
conscientious convictions, but I do make bold to say this. Lord Elgin, that
if Mr. Asquith would go to the House of Commons, and, while retaining
the doctrine of Free Trade, would plead as strongly the possibilities of
meeting us in some way, as he has pleaded hard in the opjjosite direction, the
majority might be entirely different. Because I hold before me at the present
moment a Bill dealing with the tobacco industry in Ireland, and it was news
to me, and I have no doubt it was news to many people in Great Britain,
that the laws of this country are of such a character as to make it absolutely
prohil)itory to grow tobacco, which could be made a very profitable industry
in Ireland. That really brings me back to the fact that although things may
have been very good 60 years ago, really there comes a period of time when it
is worth while considering whether they should not be altered.

Now with regard to the tobacco : I am perfectly certain that Ireland
would accept it. You are now introducing a Bill withdrawing the restrictions
in Ireland when the Excise Department have made proper arrangements
for collecting the excise ; and surely a reduction in the duty on tobacco
might be accepted by the Imperial Government and by the House of
Commons. I believe at the present moment there are arrangements whereby
the Imperial Government have committed themselves to the princij)les of
preference in connection with tobacco that is grown in Ireland ; and I slioidd
like Mr. Lloyd George to tell me if I am incorrect, although it may be stated
by the Chancellor that it is grown for experimental purposes ; and whereas
the excise upon ordinaiy tobacco coming into England is 3.5. a lb., the excise
upon this tobacco is 2s. a lb., making thereby a differentiation in favour of
the Irish article, even although you may meet any argument by stating that
it is only for experimental purposes. Surely it would be very welcome to the
Irish members, who are strong supporters of the Government, as also to the
Colonies and India. That will at once reduce by 80 the majority which
Mr. Asquith said would be opposed to any alteration of the tariff. Surely it
would be advantageous to Ireland, which has great possibilities for growing-
tobacco ; and surely it would be eiiormously advantageous to South Africa and
to Australia if, instead of jjutting up tlie duties, you were to reduce those

347

duties to your own people who can grow tobacco within the Hritisli Empire.
I hope, Lord Elgin, this is a question upon which you, and the other
members of the Govennnent, have not yet detinitely made up your minds.

There is another matter (wine) that was referred to very fully by
])r. Jameson ; and I really was surprised when the Chancellor of the
Exchequer said, while Dr. Jameson was speaking j'esterday, that no country
had given a preferential tariff in so far as alcohol was concerned. I have
before me here the reciprocal arrangement that has been entered into between
South Africa under her Customs Union and the Commonwealth of Australia,
and I find in that tariff, notwithstanding what has been said to the
contrary, there is a differentiatiijn made in favour of South African alcohol.
That is, that although the Commonwealth of Australia are producers of
alcohol themselves, having under our preferential Treaty protected alcohol
for reciprocal considerations tliat have been given them l)y the Colony of the
Cape of Good Mope, they are prepared to receive our alcohol at an advantage
over that of foreign countries. With regard to our wine, my friend Sir
Wilfrid Laurier will bear me out, that whereas wine entering Canada pays,
I think, Is. Ohd. a gallon up to 20 degrees of strength, plus 30 per cent, ad
valorem, and wines exceeding 2() degrees but not exceeding 40 degrees are
charged an additional duty of 1 Ul. a gallon for each degree, the whole ad valorem
duty on Cape wines up to -iO degrees is rebated under the reciprocal arrange-
ments we have with Canada in the case of that duty ; and it is especially
suitable to Cape Colony, many of our wines being of high alcoholic strength.
We are relieved from the 30 per cent, ad valorem duty on the wines of over
26 per cent. ; and our wines up to 40 per cent, are entirely relieved from
the duty. That was the reciprocal arrangement entered into with Canada,
and I believe Sir Wilfrid Laurier will agree with me that it is to the
mutual ])cnefit of South Africa and Canada, because we are not a wood-
producing coimtry, and surely if we require wood and lumber in South
Africa, is it not better, is it not just, is it not right, that we should
sacrifice something to buy that lumber from another portion of the British
Dominions rather than buy it from a foreign country — every increase in
their trade assisting them in competing against Great Britain in securing
their hold on the markets of the world ?

Tenth Day.
2 May 1907.

Pkefeuential
Tkai>e.

(Dr. Siimrtt.)

Mr. LLOYD GEORGE : Would you extend that to wool?

Dr. SjMARTT : What I would at once say with regard to that is that I
am not prepared to bring the matter forward now. It is a matter to be
fully considered by the British Government ; and it is a matter to be fully
considered by the British people — the whole position as to what reciprocal
arrangements will be to our mutual advantage ; but I do say that because you
may not l)e prepared to bring that forward at the present moment in connec-
tion with wool or in connection with food, it should be no reason to
prevent your considering it in connection with wine and tol)acco ; and
perhaps in connection with sugar, on all of which you can reduce your duties,
and in each case you will assist your fellow coimtrymen in the Dependencies
of Great Britain beyond the Seas. I might at once answer further to that,
that, as Sir William Lyne has pointed out, perhaps the Is. duty upon corn
did not in any way cost the consumer in England anything extra, and I will
call as a witness, in favour of that, the representative of India, who told
us that notwithstanding the surtax upon tea in Russia, the Indian people
continued to send increasing quantities to Russia. What was the reason ?
That the Indian people had to reduce their prices to meet the conditions
which existed, and the consumer in Russia was paying nothing extra
whatsoever for the tea — otherwise^ they could not possibly have materially

348

Teuth Day.
2 May 1907.

Preferential

Trade.

(Dr. Smartt.)

increased the amount of their suppHes to that country ; and the same
principles might apply to corn.

Now, the Chancellor of the Exchequer stated that Great Britain was
retaining her predominance in the markets of the world, and he gave us
figures to show that the imports and exports during the last 50 or 60 years
(I did not take a note of his figures) had materially increased, and that the
proportion of those imports and exports had practically remained upon the
same basis. That is true. But have not the imports and the exports of other
countries that, 50 years ago, had practically no manufactures at all, increased
in a much greater j)roportiou than the imports and exports of Great Britain ?
I think it only right. Lord Elgin, here, in the interest of British manufacturers
as well as of tlie British Empire, to make a statement which can be sub-
stantiated by facts ; viz., that we in the Colonies do not feel that Great
Britain is retaining her predominance in manufacturing goods as she did
in the past. At the present moment the Colony of the Cape of Good Hope,
to secure their rolling stock and railway material from the manidiacturers
of Great Britain, is obliged to instruct her Agent-General to give 10 per
cent, preference to the manufacturers Avithin the Empire ; and I ask you.
Lord Elgin, or I ask anybody if that is not an advantage to the British
manufacturers, and if it is also not an advantage to the British workman
who turns out the things which the manufacturer supplies ? Some short
time ago, we ordered a million and a qiiarter pounds' worth of rolling stock.
It may be a small order, but on that million and a quarter pounds' worth of
rolling stock, we were prepared to back our opinions by paying 125,000f.
extra to purchase it within Great Britain, and I say unhesitatingly, that
had we refused to pay extra, that order would have gone to a Continental
nation, and gone to a nation which was Britain's greatest trade rival. Surely
we must acknowledge that every order of that sort that does go to a rival of
Great Britain allows that country still further to protect her means of
manufacture and allows her still further to improve her naval power and
everything that appertains to assisting and protecting her trade.

There is another matter I might mention with regard to the predomi-
nance of British manufactures. I think if I were to go to Manchester and
discuss matters with the Manchester print nianufactiirers, if they were honest
they would recognise that during the last 10 or 15 years, owing to the
admirable commercial and technical training that the German people are
receiving, Manchester at the present moment has an enormous competitor,
especially in her prints and things of that sort, owing to the magnificent
commercial training that the workmen of Germany are receiving, and
Germany is thus securing a great hold in these articles in the markets of the
world and in the markets of the British Colonies ; and were it not the case
that in the Cape Colony Ave give 25 per cent, preference in our tariff on
manufactures of that character, Germany Avould more and more supplant
Manchester in supplying those goods which are so largely used by the people
of the country and fonn one of the great staples of dress of the native
population. I see that Mr. Lloyd George perhaps does not agree Avith me.

Mr. LLOYD GEORGE : No.

Dr. SMAPiTT : Well, I know that if you would get a return of the
amount of print and art things of that sort that are entering the Cape
Colony, you Avould be surprised to find how, by degrees, Germany is securing
a market Avhich was formerly held by British manufacturers.

Mr. LLOYD GEORGE: Cotton fabrics'

349

Dr. SMART'J' : rrints especially, those cheap designs of ])rints Avith Tfnth Day.
colouring and everything of that sort. The Chancellor of the Exchequer has 2 May l-iOT.

said, and to he sure it is very depressing to us to hear it, that the people of

this country for three years have had the case of preferential tariffs put 1'«kkekential
hefore them in the most admirable manner, but nevertheless they had
unmistakably and unalterably made up their minds. I am very sorry to
hear it. Personally I do not believe that it really and truly describes the
situation, because I think anybody who looks round here will aclcnowledge
that there is a very strong undercurrent among the people of Great Britain
in the direction of recognising that tariffs must be treated scieutilically like
everything else, and that there are periods of time when you must revise
everything you have done in the past, and sec what is necessary to be
done in the future, and I hope tliat that is the spirit in which the present
Government will look into the whole situation.

With regaid to the statements which have been made as to the amount
of Colonial goods, especially raw products, going to foreign countries, I
must say, Lord Elgin, that I cannot view that with the same equanimity
with which the representative of India or the Chancellor of the Exchequer
viewed it, because what does it mean ? The Chancellor of the Exchequer
referred to the Avealth of London ; he referred to London being
the clearing-house of the world, but surely your returns show that
London's pre-eminence is day by day and year by year becoming under-
mined. Surely anjdjody that has any knowledge of the wool intlustry
in the Dependencies knows that, year l)y year and day by day, that
industry which formerly ramified in London is gradually leaving the
London market, and is being sold direct on the various markets of Europe.
You may say that is necessary, that it reduces the cost of the raw material,
but surely when Sir James Mackay and the Chancellor say that the countries
that are supplying these articles are still getting more largely goods from the
foreign countries in payment, I would say at once, w^oidd it not be better if
by some mutual understanding we should see that that wool is worked by the
looms of Bradford, antl that the goods made from that wool are sent to the
Colonies from the looms of Bradford, and not sent to the Colonies from
German or other manufactories ? This is the reason why Ave desire to ask _you
fully to consider this question, because there is no doubt that in the Colonies
we see day by day that we are receiving more foreign supplies, and it
is because those of us especially who feel the deepest sentiments of
attachment to the Empire realise that without preferential trade it will be
impossible to prevent that drift of trade which is taking place that Ave so
strongly urge the Lnperial Govermncnt carefully, dispassionately, ami
absolutely disassociatetl from political considerations, to reconsider the Avholo
situation.

With regard to food : I can thoroughly understand the feeling of a
large section of the people of Great Britain Avho hesitate to do anything
that might be said to increase the cost of living, but have the Govermncnt
of Great Britain, or have the people of Great Britain ever considered Avhat
their position aa-ouIcI be in the case of a great I''iin)]u>an Avar ? We are
ahvays told that Avhile the Navy holds the seas England Avill be able to
feed herself; but supposing you had a gi-eat European Avar, and you had
a combination of great Avheat-producing countries against you, and by your
policy you refused to encourage Canada, Australia, and other i^ortions of tlio
Empire — Avith their enonnous resources — the command of the seas Avould be
useless if the countries Avho groAV Avheat Avere banded against j'ou and Avould
not slii]5 that Avheat to feed your starving population. Surely that is worthy
of consideration on the part of an Empire whose existence in a period of
Avar depends on being able to feed her people.

350

Tenth Day.
2 May 1907.

Preferential
Trade.

Mr. WINSTON CHURCHILL:
alliance.

You have suggested rather a curious

Dr. SMARTT : Mr. Winston Churchill suggests it would be rather a
curious alliance. We have seen extraordinary alliances ; and I say that for
the safety of a great Empire like Great Britain and her Dependencies, we have
no right to take any chance in the matter, however small that chance may be.
Nobody would take a chance of that character in his ordinaiy business
matters ; he would insure his goods to the fullest extent and I do not think,
although the contingencies may be very far distant, we have any right
whatsoever to take a chance of that sort.

Now, Lord Elgin, I feel I have really taken up perhaps too long the time
of the Conference, but I am only mentioning these things because I feel
them very acutely. ■ I should like to assure you, Sir, and I believe I speak the
views of everybody in this room, that we have no political considerations in
any way whatsoever, as between the two great parties in this country ; we
only consider that it is our duty to urge upon the people of Great Britain the
advisability of considering whether there is not some small wa.y in which they
can meet what in the Colonies is considered to be a matter of vital importance
to the future well-being of the Empire.

Mr. LLOYD GEORGE: I suggest, Lord Elgin, that now we might
adjourn because I should like, before I say anything, to hear from Mr. Deakin
what his view is about the treaties. I cannot deal with that now, and I think
it is so much better, as Sir Wilfi-id Laurier has suggested, to deal Avitli the
whole thing at once. It would be an advantage to me if Mr. Deakin were able
to put that point before I reply.

Mr. DEAKIN: Certainly.

Mr. LLOYD GEORGE : I know he is not prepared this afternoon.

Mr. DEAKIN : I had no expectation that this would come forward, and
have not the papers with me.

Dr. SMARTT : As the figures were quoted, I wish to put the case of the
Cape as fairly as possible vrith regard to the condition of the wine industry.
Previous to tlae Cobden Treaty of 18(30, I think we sent over 800,000 gallons
of wine to Great Britain. When Mr. Cobden went to France with a view to
getting a market for certain British manufactures a reciprocal understanding-
was arrived at whereby France reduced her duties upon certain manufactures
and we were then so desirous of ajjpearing not to ask for advantages for
ourselves, that we said they must be reduced to the whole of the world, we
being the only people who benefited by them. Great Britain, on her part,
reduced considerably her duty upon silk ; and at one sweep of the pen
reduced her duties upon French wine (which were 5s. Qd. at that time) by
2s. dd per gallon. From that moment the wine industry in the Cape,
which iinder preference was becoming a verj'- profit al)le industry and by
this time woidd have been an enormous industrj^, was absolutely strangled
owing to the fact that many of the French wines were of slight alcoholic
strength, and they absolutely at once took possession of the market. At
the present moment oi;r wine exports to Great Britain I do not think are
more than 5,000L or 8,000Z. a year. Surely that is a case in which Australia
and the Cape could l^e met by the British Government as sympathetically as
Canada has done on the question ?

351

Sir WILFRID LAURIER : Shall we take up tlu> treaty question on Tenth Day.
Monday morning ? 2 May 1007.

CHAIRMAN : I understood the Chancellor of the Exchequer would
prefer to have Tuesday, Imt if you will allow me I wiU communicate with him
and fix either Monday or Tuesday.

Sir WILFRID LAURIER : If you could take up this question on Monday
it would be preferable, I think.

CHAIRMAN : I proposed that wo should tak(^ naturalization and othor
subjects on Monday.

Ih: LLOYD GEORGE : It nmst either be Monday or Wednesday for
me. Have yon enough to go on with on the Monday ?

CHAIRMAN : It has boon suggested once or twice in the course of the
discussion that we should have a publication of this debate, and I have to
say that, so far as we are concerned, we have no objection, if the Colonial
representatives have not, and, of course, the interval will probablj' allow this
to be in your hands.

Mr, WINSTON CHURCHILL : It is not proposed to publish until the
debates are complete.

Mr. LLOYD GEORGE : I wish it to be distinctly understood that the
whole of the Government case has not been presented, although I am not
vain enough to think that my argument is going to affect the thing at aU.

IMPERIAL SURTAX ON FOREIGN IMPORTS. Imperial

Mr. DEAKIN : I was suggesting to the Chancellor of the Exchequer Foreign Imports.
to-day that possil^ly before this debate concluded, as it is closely related
although rather as a substitute than a development of our proposals, we
should consider the proposition originally submitted by Mr. Ilofmeja-, after-
wards elaborated by Sir George Sydenham Clarke, and since more or less
favourably criticised by different writers. The proposition is to impose
1 per cent, or some small duty of that sort all over the Empire, the proceeds
of which should be devoted to Imperial purposes in each country in proportion
to the sum raised. This may be looked at from several points of view, and
if we are unable to obtain any possible preference, reciprocal or otherwise,
from the British Government, might it not be worth while to look into tliis
question? It would fulfil some of the ideas and aspirations expressed
by the Chancellor of the Exchequer himself for unity of action in connection
with improved means of conununication, cables, steam services, and the like,
because by this means the funds for that development coiild be provided
without in the least degree affecting the fiscal policy of any of the countries
concerned. It does not touch the fiscal question in any way, because the
1 per cent., or whatever was agreed upon, would be levied in connection
not only with any existing tariff, but would still irrespective of any alteration
of the tariff. I mean an extra 1 per cent, imposed on all foreign goods and
distributed in proportion to the contributions made.

Dr. SMARTT : Y'ou put 1 per cent, upon everything.

Mr. DEAKIN : Yes, on everything. I might mention, in conclusion -I
could not launch into a debate at this moment — tliat there is one further
possibility — that if in the United Kingdom that proposal was not favoured

352

Tenth Day.
2 May 190".

Imperial
SuitTAx ox

FoUEIGN IjIi-uRTS.

(Mr. Deakin.)

because it was regarded as perhaps a little difficult to collect so small a sum
as 1 per cent, from a great variety of imports, it is perfectly possible for the
Government and Parliament of the United Kingdom if they so prefer to
provide their quota by a grant equivalent to the amount that would be raised
by a duty of one per cent, if levied.

I want to put the fiscal question right out of consideration in this
connection, and want to recognise the difference in the situation of the Mother
Countrj', but if you are going to imdertake Imperial purposes it must be
done more or less by expenditure of what may be termed Imperial fimds.

Mr. LLOYD GEORGE
raise our contribution.

It does not matter to the Colonies how we

Mr. DEAKIN: Not the least.

Mr. LLOYD GEORGE
ourselves.

How we raise ours is entirely a matter for

Mr. DEAKIN : That is wdiat I am trying to point out. This is at least
a possible and practical proposal for raising funds for the various purposes
to which reference has been made. Otherwise you will cast us upon our
resources, each of us going to our own Parliaments to propose, so far as we
share in them some expenditure which would require to be made upon any
new combined effort for a better steamship service, better cables, for the
Suez Canal project — about which I long since commimicated with the Imperial
Government, and upon whieli my fi'ieud. Sir Joseph Ward, has made a bold
proposition.

Wherever the funds have to be foimd, the question of finding them will
be met in all the different parts in the same way, wath the possible exception
of the United Kingdom. If common action could Ije devised by which
certain funds were raised and set apart, that woidd simplify Lnperial action
and make for rmity.

Mr. LLOYD GEORGE
simplify it at all.

I do not think so ; I do not think it would

Sir WILFRID LAURIER : I would not be prepared to agi-ee to that
proposition of yours, Mr. Deakin, to levy a special duty for a special purpose.
We have just fixed our tariff, and it has cost us months of A'ery hard work.
We have fixed our duty on the scale which we think most acceptable and
most convenient to our people with the point of view of the revenue first of
all and other expenses incidental to the revenue. Now I would not be
prepared, as far as Canada is concerned, to levy either 1 per cent, or any sum
at all above what we have done. If the view we entertain of having a better
service between England and your country, Australia, through Canada, is to
be viewed favourably, and I hope it will be, we should have to take our
share of the burden, and we should be prepared to take a general share, but if
in addition to the tariff wdiich has cost us months of labour to prepare we were
to add another 1 per cent, or any amount at all it might mean a considerable
disturbance. Sir William Lyne, who is accustomed to frame tariffs, knows
how difficult it is to adjust a tariff with regard to the exact amount the old
tariff can bear or the exact amount it cannot bear and 1 or 2 per cent,
sometimes gives rise to very serious discussion.

Sir WILLIAM LYNE
to foreign goods.

I thought this was only a proposal with regard

353

Sir WILFRID LAURIER: It is an additional tarill', call it what you Tenth Day.
please. Yon propose to add 1 or 2 per cent., and I do not caro what kind ~ May 1907.
of goods it is. The goods arc foreign on which you levy the duties, or if . ";
that is not so then you introduce another element of disturbance. What Sihtax ov
you propose, Mr. Deakin, is that in addition to the tariff which in Canada Foreicx
is levied on an industry which in Australia is also levied up, you should put iMi-ouTr^.

another one per cent. From my e.xperiencc that question of one per cent,
more or less causes very serious debates in the preparation of the tariff
and I would not be prepared to follow that course, as in mj^ opinion it woidd
upset all that we have in view in framing the tariff.

Sir JOSEPH WxVRD : I am inclined to think, Lord Elgin, that as the
matter is a new one altogether to me, at least, that it had better be deferred.

Mr. DEAKIN : As we were deferring it I mentioned it now in order
that when suggested again on the next occasion, it may be examined without
further delay. The President of the Board of Trade could be heard to speak
upon it.

Mr. LLOYD GEORGE : I would be prepared to speak to it, but I agree
with Sir Wilfrid Laurier and Sir Joseph Ward that it is simply adding
another complication to the one which is involved in the preferential
proposal.

Mr. DEAKIN : This is a very complex Empire, and only complex means
can deal with its needs.

Mr. LLOYD GEORGE : I think that very often the simplest proposals
are those which deal most effectively with complicated situations.

Dr. JxVMESON : I think it would be better to defer the discussion for
the present.

Sir JOSEPH WARD : 1 should just hke to say that at the first blush,
I am inclined to think that this suggestion of a surtax is a mistake from the
point of view of New Zealand. I am a supporter of Preference on certain
articles as between our country and the Old Country. If there is any
intermediate proposal of putting an all-round surtax upon all foreign goods
into the Old Country as well as into our countries that is going to divert the
more material one from the point of view in which I regard it in trying to
bring about in the future an interchange by way of Preference between
Britain and her Colonies. It would mean in our country that all we would
require to do in our Customs tariff next year would be that instead of saying
we had, say, an . increase of 10 per cent, against foreign goods, which wo
have now to some extent upon some articles, it would mean making it 11 or
12J- per cent. I do not think that is the best way, and my belief is that it is
far better for us by steamship and mail subsidies and reducing the cost of
our cabling to try to bring about improved conditions which will be generally
beneficial. I do not like to commit myself to the idea of Mr. Hofmeyr's
suggestion — I have not read it myself — of a surtax. I think it better to
work for preference upon certain articles between the old country and our
countries.

Dr. SMARTT : You could ear-mark one per cent, of your preferential tariff
for Imperial purposes.

354

Tenth Day.
2 May 1907.

Imperial
Surtax ox

FOREIGX

Imports.

Sir JOSEPH WARD : What occurs to me is that if ever we get
preference estabhshed it will be on three or four articles at first, and, if
we had an overriding surtax I am afraid it would give grounds for those
opposed to it to say : " As you have a surtax you do not want preference."

Adjourned to Monday next at 10.30 o'clock.

355

ELEVENTH DAY. Eleventh Day.

6 May 1907.

Held at the Colonial Office, Downing Street,
Monday, Otii i\[AY 1907.

Present :

The Right llunouraljle 'I'liE IvVUL OF ELGIN, K.G., Secretary of State

for the Colonies (President).

The Right Honourable Sir Wilfkid Laurier, G.C.^I.G., Prime ]\Iinister
{jI Canada.

The Honourable Sir F. W. Bouden, K.C.M.G., Minister of ]\rilitia and
Defence (Canada).

The Honourable L. P. Brodelr, Minister of Marine and Fisheries

(Canada).

Tlie Honourable Alfred Deakin, Prime Minister of the Commonwealth
of Australia.

The Honourable Sir JosEi'ii Ward, K.C.lM.G., Prime Minister of New

Zealand.
The Honourable L. S. Jameson, C.B., Prime Minister of Cape Colony.

The Honourable Dr. Smartt, Commissioner of Ptdjlic Works (Cape
Colony).

The Honourable F. R. Moor, Prime Minister of Natal.

General The Honourable Louis B(jtiia, Prime j\Iinister of the Transvaal.

The Right Honourable Winston S. Churchill, M.P., I'arliamentary
Under Secretarj^ of State for the Colonies.

Sir Francis Hopwood, K.C.B., K.C.iM.G., Permanent Under Secretarj'

of State for the Colonies.

Sir J. L. Mackay, G.C.M.G., K.C.I.E., on behalf of the India Office.

Mr. H. W. Just, C.B., C.M.Cr., ) 7 • , r. , •
Mr. G. W. Johnson, C.M.G., j ^''"^^ Secretaries

Mr. W. A. Robinson,

Assistant Secretary.

Also present :
The Right Honourable H. H, AsQurrn, M.P., Chancellor of the Exchequer.

The Right Honourable D. Lloyd George, M.P., President of the Board
of Trade.

Mr. W. fiuNCiMAN, M.P., Financial Secretary to the Treasury,

22'

356

Eleventh Day ^^i'- ^^- E. Kearley, ]M.P., Parliamentary Secretary to the Board of

6 May 1907. Trade.

Mr. H. Llewelltn Smith, C.B., Permanent Secretary to tlie Board of

Trade.
Mr. A. AVii.sox Fox, C.B., Comptroller-General of the Commercial,
Statistical, and Labour Departments of the Board of Trade.

Mr. G. J. Stanley, GMG., of the Board of Trade.

Preferential CHAIRMAN : I think when we broke off at our last meeting, Mr. Lloyd

Trade. George was going to address the Conference.

Dr. JAMESON : Before Mr. TJoyd George says what I presume will be
the final word on the subject of Preferential Trade, might I be permitted still
to say a few words. I feel Ijound, as I said the other day, to do my utmost
on this subject, because of what the Cape embodied in the second Resolution
which is brought forward, which, as I explained the other day, of course is no
possible threat, liut merely a warning. I daresay the members of the
Conference have seen in the papers telegi'ams from South Africa during the
last few days showing that while we were discussing this question in this
room, the most aljle statesman we have in South Africa at present Avas also
speaking at that hour in South Africa on this subject and emphasising very
strongly what I have tried to i)ut here, namely, that reciprocity was an
absolute necessity if the existing preference in South Africa, at all events,
was likely to be continued. Feeling that, my I^ord, I felt that I must make a
very last effort in order not to get really a definite answer, which, after
Mr. Asquith's speech of course we know we cannot get ; but if I could even
get an expression, not of opinion, but an expression from the Imperial
Government that they would be willing to consider us in these difficulties — if
I could get that, I feel that possibly I may have done something. I am looking
forward from Mr. Lloyd George, perhaps, to getting a somewhat more
sympathetic answer than from the alile, clear, and decisive refusal
which we have had from the Chancellor of the Exchequer. When we
were asked in the Colonies by the Secretary of State for the Colonies to frame
resolutions that we wanted to bring before the Conference I sat down to
frame resolutions on this question of preference, and I thought of several ;
in fact there Avere four lines on which I formed resolutions ; one a very
strong one, and so on, getting down to the smallest. I thought perhaps it
would be much better merely to send in general resohitions : first, the
confirmation of the Resolutions of 1902 ; and, secondly, the slight warning
on tlio want of reciprocity, and until I heard the discussion here to see what
practically \ve might get, however small, so as not to ask for something too
small if we were ^oing to get something bigger. Therefore it is that I would
like now, having heard the full discussion on this subject, to move a further
resolution Avhich I now read : " That Avhile affirming the Resolution of 1902
" this Conference is of opinion that as the British Government through the
'• South African Customs Union, which comprises the Basutoland ami
" Bechuanaland Protectorates, do at present allow a preference against foreign
" countries to the United Kingdom, Canada, Australia, NeAv Zealand, and all
" other Britisli possessions granting such reciprocity, His Majesty's Govern-
" mcnt should now take into consideration the possiijility of granting a like
" preference to all portions of the Empire on the present dutiable articles in
" the British Tariff."

,3o7

I move that resolution, Lord Elgin, and in doing so I would like to Eleventh Day.

emphasise the mildness of it. I am not asking llis Majesty's Government to 6 May 1907.
commit itself to anything except to consider the possibility of carrying into -^

effect the object of the resolution. " Ti{"ue.

(Dr. Janiesou.)

Mr. DEAKIN : In fact, all that you propose here is the granting of a
like preference. Of course, the preference granted in South Africa was a
preference by reduction of duties, not by increase of duties.

Dr. JAMESON: Undoubtedly.

ilr. DEAKIN : Consequently, this Resolution is, when explained,
narrower than might be supposed. It relates onlj' to preference by reduction.
Is that your intention ?

Dr. JAifESOX : That is our intention.

^fr. DEAKIX : Under those circumstances, to take into consideration a
proposal is something a Government does very frequently in the course
of its life, and to take into consideration the possibility of granting
preference, which amoimts to a preference only by reduction, is surely
something to which no objection can be taken. I hoj^e the consideration will
be favourable, or as favourable as the meml)ers of th(! Government can
give it.

Sir Wn.FRID LAURIER: I think. Dr. Jameson, that might be
postponed. Put it on the table and postpone it until we come to the main
Resolution.

Dr. JAMESON : I am quite pleased to do that, but T merely wished to
get it in before Mr. Lloyd George answered.

CHAIRMAN : Nobody has moved anything yet ?

Dr. JAMESON: No.

Sir WILFRID LAURIER : But it is a notice of motion.

:Mr. LLOYD GEORGE : Lord Elgin and Gentlemen,— Dr. Jameson has
not only raised a fresh issue, but he has presented it in quite a new forni to
the consideration of His Majesty's Government. But still I am afraid it is
really presenting the same question to us in sidjstance and in fact, and I
think it is veiy important when we come to discuss matters of this kind that
we should be perfectly frank with each other, and the oidy way in wliii-li we
can help each other is by recognising freely each other's dilliculties and the
position in which we are respectively placed in reference to those who have
connnissioned us to attend this Conference. Of course, I would not o])ject
personally — and I am sure His Majesty's Government would not object — to
take into consideration any suggestion that came from a responsible Minister
like Dr. Jameson, who represents an important Colony of the Empire. But it

48668. Z 3

358

Eleventh Day.
6 May 1907.

pREFERENTIAT

Trade.

(Mr.
Lloyd George.

woidd not be fair for me not to state that in my judgment that consideration
would not be likelj' to induce us to fchange our fundamental policy with
regard to preference. We cannot. We are not in a position to pledge
ourselves to anything which will involve the setting up of a tariif on food
stutt's and raw material in this country. If Dr. Jameson means something
) short of that, something that would not pledge us to that, then I am perfectly
certain His Majesty's Government would be willing to consider anything
which would help the trade between the United Kingdom and the Colonies.
But he has not informed me more explicitly on the sidiject.

Dr. JAMESON : May I interrupt you for a moment ? I want this passed
as it stands. I do not want His Majesty's Government at the present moment
to pledge itself to change its policy with regard to " setting up a tariff," which
were the words you used.

^h: LLOYD GEORGE : That is it.

Dr. JAMESON : I merely want to limit this to what it contains. There
is nothing behind it except, of course, there is behind it that Ave who believe
in the whole qiiestion of preference believe, in the future, apart from
governments or anything else, that this policy will prevail. In the meanwhile,
all I want His IMajesty's Government to do is, as stated in this resolution, to
consider the possibility of this small preference or rebate on these duties.

Mr. LLOYD GEORGE : Would Dr. Jameson mind explaining to me — ■
I must not pretend to know when I do not exactly know — wdiat happens in
Basil toland and Bechuanaland '? What is the precedent to wliich he refers ?
How does it actually work ?

Dr. JAMESON : The position is, that the States in South Africa have
joined in a customs union. Thej^ have passed certain tariffs with a certain
preference to the United Kingdom and to every portion of the Empire.

Mr. LLOY'D GEORGE : And a very substantial preference it is.

Dr. JAMESON : It is while they are given leciprocal privileges. His
Majesty's Government, then absolutely governing and directing tariffs and
everything else in the Basutoland and Bechuanaland Protectorates, ai:)proached
the Customs LTnion of South Africa through the High Conunissioner and
asked to be included in it, adopting everything that had been passed at the
Customs Conference.

Mr. LLOY'D GEORGE : Does that mean that the Bechuanaland and
Basutoland Governments make concessions on the basis of reciprocal
advantages conceded by the Customs Union ?

Dr. JAMESON : Yes.

Mr. LLOYD GEORGE : But they had a tariff already in existence.

Dr. JAMESON : I should think they had a tariff.

!Mr. TjLO^'D GEORGE: All they did was to make certain abatements
upon already existing rates of duties.

359

Dr. JAMESON : I do not know that tlicro was a tarifT really. As a Elrvonth Day.

matter of fact, at the time when Basutoland and Bechuanaland first joined in 6 Mav 1907.

the Customs Union, they woidd l)c free while imder the British Government, -^ —

and there woidd be what was at that time called a transit due from whatever ^ Refkrestiai,

port it was up to their border. When the Customs Convention of 1903, Tb^de.
which did not include any thine; l)eyond the three States, was passed, all those
transit dues were abolished, and then His jMajesty's Government asked that
these Protectorates as you riiay call them, should be permitted to enter the
Customs Union of South Africa.

Mr. LLOYD GEORGE : They are inside the Customs Union now ?

Dr. JAMESON : Yes, at the present moment.

Mr. LLOYD GEORGE : And it is since they entered into the Customs
Union that they, in common with the rest of South Africa, have made this
concession to the Mother Country.

Dr. JAMESON : As soon as they were in, they adopted the tariff of the
Customs Union, which gives them a tariff on which they can make these
reductions and preferences to the United Kingdom and to all the other
reciprocating Colonies ; so they are actually following the conduct of South
Africa at present in their tariff, and also in preference against foreign
countries.

Mr. LLOYD GEORGE : Of course, but there is a tariff. That is the
real difficulty, and it is no use ignoring it. That does involve ""setting up a
tariff, if preference is to he given in that form. There is no tloubt at all
about it.

Sir JOSEPH WARD : Except that this particidar proposal is not a
suggestion that you should set up a tariff' here ; but I take it the proposal
from this Resolution is to make a reduction upon the present articles in
your own tariff which are dutiable. That is the difference.

Dr. JAMESON : I began by saying that this is not to set up a tariff.

Mr. LLOYD GEORGE : That, I think, is very important.

Dr. JAl\IESON : It is only to give some help to our trade, to our
products coming over here as against the foreigner.

Mr. LLOYD GEORGE : As regards the duties already existing in this
countr\^ ?

Dr. JAMESON : ^'es, only on the articles where a tariff does exist,

Mr. DEAKIN : It is only a prospect of getting that— a possibility.

Dr. JAjMESON : Yes, a prospect.

Mr. LLOYD GEORGE : If I may, I will proceed. I regret that it
should be necessary for me, not merely out of courtesy to Sir WiUiam Lyne
and Dr. Smartt, but also from a full appreciation of the importance and the

Z 4

360

Elevanth Day. weight of the arguments they addressed to tlie Conference on Thursday, to
6 May 1907. continue Avhat I cannot help thinking for tlie practical purposes of this

Conference, is, after all, a purely theoretical discussion as to the rival merits

1 REFERENTIAL q£ jTygg Trade and Protection. I should have been very pleased to have left

the matter as it was dealt with in the speech, of the Chancellor of the

I ]^^] .■^'„o\ Exchequer; but Sir William Lyue and Dr. Smartt have since made certain

■I-' ' 'jy tl \jr60rL G. J -*- T*!"" 11* I'll*

statements, C|uoted certain ligures, and used certain arguments, which, having
regard to the fact that this debate is to be published, the Government cannot
permit to go altogether unanswered. I had hoped we might have fxankly
acknowledged the limitations imposed upon us by the convictions wo
respectively hold, and Avhich those who send us here hold, on fiscal issues,
and that we could have proceeded on that understanding to take counsel
with each other in order to ascertain whether it is not possible to find other
means of serving the object we have a common interest in — means which
would not bring either or any of us into conflict with convictions or
constituents. We are quite aware that the Colonies regard a tax on our
goods as Avell as on foreign goods to be necessary, not merely for the
purpose of raising revenue, but for the protection of their own industries.

Mr. DEAKIN : A " duty."

m-. LLOYD GEORGE : A " duty " on our goods— I do not mind the
word. I am prepared to substitute that word. Mr. Deakiu informed us
in his impressive speech that the last general election in the Australian
Commonwealth was fought on the issue of i^referential tariffs within the
Empire. 1 believe that at that election Mr. Deakin also sought and secured
a mandate for raising the protective duties now levied by the Common-
wealth against the importation of goods in Avhich Britain drives a very
considerable trade with the Australian consumer at the present moment.

Sir WILFRID LAURIER : I do not understand from Mr. Deakin that
the last issue in the Australian elections had been directed to the cpicstion
of preference or no preference.

Mr. DEAKIN : Mr. Lloyd George has inverted the order. There are
two issues ; the first issue, as we put it, was Protection.

Mr. LLOYD GEORGE : A higher tariff.

i\Ir. DEAKIN : Yes, because without the tariff we do not get the
opportunity of preference. We mentioned preference second in order
of importance. In logical order we say Protection and preferential trade.
You in your argument take them in the inverse order. There is nothing in
that. Both issues were submitted. I have convincing evidence of that in
the statement made by the Leader of the Opposition when the House met
two months ago, after the elections, in which he expressly acknowledged
that those two issues had been submitted to the country and decided beyond
any dou1)t whatever, although that decision was adverse to himself.

?ifr. LLOYD GEORGE : I accept Mr. Deakin's statement. I am
building my argument on that basis. It was quite open for the repre-
sentatives of the Imperial Government at this Conference to have ignored
this mandate, and to have endeavoured to commit their colleagues sitting,
round this taljlo to a policy to which wc knew in advance they could not

361

possibly assent without Lcing false to the trust reposed in tliein by their
own peojile. For instance, Ave might have proposed a resohition in favour of
Free Trade within the Empire, that is, the achnission of British goods into
Colonies on the same terms exactly as Colonial goods are permitted to enter
our markets, free from toll or tariff. We might have repeated, in support of
our resolution, arguments we have advanced on a thousand platforms alreadj'.
We might have quoted the German Zoilverein as an illustration of a case
where Imperial Federation was effected, and an Empire consolidated, on the
basis of absolute Free Trade withiii its own boundaries. Sir William Lyne,
in his speech the other day, said that " all approve of the commercial union
" of lilngland, Scotland, and Ireland ; of the consolidation of the United
" States ; the Federation of South Africa and of Australia." Then he went
on to saj' : " What reason can be urged against the conmiercial imiou of the
" whole Empire?" May I point out that in each and everj'one of these
cases the commercial union was based on the abolition of all tolls and tariffs
between the States that entered into the union? We might have pressed
similar j)roposals on the various States of the Empire, with au utter and a
callous indifference to Colonial mandates and to the settled policy of the
Colonial Statesmen.

Eleventh Day.
6 May 1907.

Prekerential

Trade.

(Mr.

Llojd George.)

Mr. DEAKIN

and of our own ?

What would become of the revemie both of this coimtry

Mr. LLOYD GEORGE
consideration.

agree.

We have taken that point into

Mr. DEAKIN : You would have no revenue.

Mr. LLOYD GEORGE : That is what I point out. Our Colonial
friends woidd have been bound to reject our resolution, — to adapt words
which have l^ecome the commonplaces of a press which is hostile to Free Trade,
they would have refused to listen to the appeal of the Mother Country to be
put on equal terms with her children. We might then even have said that
the door had been slammed in the old Mother's face by her imgrateful
progeny.

^Ir. DEAKIN : If you are willing to give up j'our Customs revenue we
might have something to propose.

Mr. LLOYD GEORGE : Wo have not taken that course. We have
recognised the essential unfairness of ignoring those local conditions and
exigencies which miist be jDaramount in the minds of the statesmen who are
responsible for the well-being of the population in the respective States of the
Empire, and we have consequently not thought it just to put them in the
predicament of appearing to deny to the comitry, for which we know they
have such genuine regard, and on behalf of which experience has taught us
they are ready to make such sacrilices — to dem- to that country a boon which
millions on this side of the water might regard as a perfectly reasonable one
to ask of their kinsmen in distant lands. We are not here to endeavour to
manoeuvre each other into false positions, but to discharge the practical
business of the Empire. We are in perfect accord as to the objects we would
strive to promote. I agree, absolutely, with the eloquent words used by
Mr. Deakin in stating what all our objects ought to be. We are in conq)letc
agreement with the Colonial Delegates in their belief that the attainment of
this object would be assisted by any scheme or system which would dcvelox^

362

Eleventh Day.
fi May 1907.

Preferential
Trade.

(Mr.
Lloyd George.)

inter-Imperial trade, provided such a sclieme did not inflict sacrifices
on any individual community so great as to produce a sense of
grievance with the conditions of Empire, so deep as to introduce
elements of discontent and discord into the confederation, and tlnis
imperil its efficacy and maybe its continued existence as an organisation.
We heartily concur in the view which has been presented by the Colonial
Ministers that the Emj)ire woiild be a great gainer if much of the prodiicts
now purchased from foreign countries could be produced and purchased
within the Empire. In Britain, we have the greatest market in the world.
We are the greatest purchasers of prodiice raised or manufactured outside
our own boundaries. A very large proportion of this produce could very well
be raised in the Colonies, and any reasonable and workable plan that woidd
tend to increase the proportion of the produce which is bought by us from
the Colonies, and by the Colonies from us and from each other, nnist
necessarily enhance the resources of the Empire as a Avhole. A considerable
part of the surj)lus population of the United Kingdom which now goes to
foreign lands in search of a livelihood might then find it to its profit to pitch
its tents somewhere under the Flag, and the Empire would gain in riches of
material and of men. We agree with our Colonial comrades, that all this is
worth concerted effort, even if that effort at the outset costs us something.
The federation of free Commonwealths is worth making some sacrifice for.
One never knows when its strength may be essential to the great cause of
human freedom, and that is priceless.

I am not one of those who believe that the value of great ideals is to be
assessed always by Board of Trade returns. In the main purpose, therefore,
which has brought you and ourselves to this Conference, we agree. We differ
only on ways and means. But that is a difference which in my opinion can be
bridged over by men honestly seeking the same end in the same spirit. But the
first essential condition of co-operation under such circumstances is to recognise
frankly and tolerantly each other's point of view and above all to slum
pressing methods of solution about which there is an irreconcilable difference
of principle. Let us rather search out other devices wherein common action
is attainable, although the proposals made may not, in the opinion of
partisans of rival schemes, be the most efficacious that could be devised.
We have made sacrifices to found and maintain this great commonwealth of
nations known as the British Empire in the past ; we are still making
sacrifices to the same end in the present. We are prepared to face even
greater sacrifices in the future, but we are convinced that to tax the food of
the people is to cast an imdue share of that sacrifice on the poorest and most
helpless part of our population, and that a tax on raw material would fetter
us in the severe conflict we are waging with the most skilful trade competitors
with whom any nation has ever yet been confi'onted. That would be a
sacrifice which would diminish our power for further sacrifice, and we doubt
the wisdom of making it.

May I also point out that in the resolution submitted by Mr. Deakin you
are asking us to do what no protectionist country in the world woidd think
of doing ; you are asking us to tax necessaries of either life or livelihood,
which ^ye cannot produce ourselves and of which you cannot for many a long
year supply us with a sufficiency ? iVnd that is why we cannot see our way
to agree to this particular method of drawing the Empire together which is
contained in the resolution we are now discussing.

Mr. DEAKIN : Will you be good enough to take me as registering a
formal objection whenever the word "tax" is used instead of "duty?" I
tried to explain that duties are not always taxes.

Mr. LLOYD GEORGE : I do not wish to iise words giving offence.

3G3

Mr. DEAKIN: They do not give offence, but they imply something F:ieveutli Uuy.

which is not necessarily implied in our proposals lor duties and certainly q jjay 1907.

not implied in all of them. - —

1'rekekential

Mr. LLOYD GEORGE: I will use the words you are most accustomed 'A'kai.e.
to here, but, as the Chancellor oi; the E.xchequer points out, the word I use
corresponds with tlie facts from our point of view.

!Mr. DEAKIN : It may or may not apply.

Mr. LLOYD GEORGE: However, I do not want to use the word if I
can possibly use another word to which common consent can be given.

Mr. DEAKIN : A duty is not necessarily a tax upon the consumer.

Mr. LLOYD GEORGE: But before I proceed to consider alternatives
which have been suggested, I am sorry that I have to take a little time in
referring to some figures Avhich were used by Sir William Lync, and some
criticisms passed l)y, I thiidv, Dr. Smartt, upon our present commercial
position. I gather from these speeches, and I think also from Mr. Deakin's
speech, that there is an opinion that our trade is on the down grade.

Mr. DEAKIN : No, only proportionately ; the amount of British trade
must be taken in proportion to the trade of other countries. Our idea is that
if in any year or period yo\i desire to measure the trade of a country, you
look not only to the gross output of that country biit to the general circum-
stances of conunerce throughout the world and in reference to particular
communities. Y^ou must measure j'our own conunerce against the growth
of commerce elsewhere, by the residts in particular countries. It is only
by those means that you can enable the figures of one year to be compared
strictly with the ligiires of another year. A season of world-wide depression
affects all figures, and if you look at your figures alone you might say British
trade is falling off seriously, but when you look at the figiires for the rest of
the world you may find it is not so, and vice versa.

Mr. LLOYD GEORGE : Then on the whole I gather that Mr. Deakin
would direct his observations rather to our foreign trade.

Mr. DEAKIN : To its proportions to your own.

Mr. LLOYD GEORGE : And in comparison with our foreign com-
petitors.

Mr. ASQUITH : The comparative rate of growth,

]\lr. LLOYD GEORGE: The comparative rate of growth. Sir William
Lyne is especially distressed about our condition, and if he had been here,
I should have been very happy to try and cheer him up witli a few figures.

Mr. DEAKIN : Unfortunatelv he is in Shefiield this morning.

Mr. LLOYD GEORGE : I am so anxious to reassure him on the subject,
because I could see he was altogether very imhappy about it. I would
take first of all the point Mr. Deakin has made now — our position in
comparison with foreign countries.

364

Eleventh Day. Mr. F. R. MOOR : Are your comparisons proportionate or simply in

6 May 1907. volnmes of trade ?

Tkade. Mr. LLOYD GEORGE : I am going to take both, for the simple

reason, as Mr. Deakin pointed out — I wish he had pointed it out in advance
to his colleague — that it is xuifair to take either percentage or A'olmne ; you
have to take both. Sir ^^'illiam Lyne simply took percentages, which may
mean anything in the world. For instance, take our exi:)ort of motors. Our
exports of motors have gone up, I think, by nearly 200 per cent, in the last two
years. I think the exports of France have only gone up by something like 30
or 40 per cent. Supposing I had merely said that, it would have been grossly
misleading, because our exports have only gone up by a few hundred thousands,
I believe, whereas France's exports have gone up by millions, so that if I had
used simple percentages, it would have lieen grossly misleading and altogether
unfair. It is fairer to give the actual figures, because any man can draw
inferences himself as to percentages, whereas if you give percentages you do
not know where you are ; you have no idea what the figures are. I propose,
therefore, to give the figures, and where I do not give the percentages it will
be open to any gentleman to make out the percentages for himself. Let us
take our three great trade competitors, which are France, Germany, and the
United States of America. France has a population which is roughly about
equal to our own, Germany has a population which exceeds ours hj 50 per cent.,
and the United States of America have a population which is almost double
ours. I think those figures with regard to population are very useful. The
exports from the United Kingdom of manufactiired articles per head of the
population, taking the average of the years 1901-5 were 5L 12s. 9d., whereas
the corresponding figures for France, Germany, and the United States were
21. 10s. Od., 21. 16.S. Od., and IL Qs. Od. respectively. I propose now to take
the figures for those three countries, and I will take the last 10 years. I agree
it would be unfair simply to take one or two years, and pick out the year
which suits me best, and compare it with another year which equally suits
me. I think you ought to take the trade for a whole cycle and that is what I
propose doing. Take the case of France. In 1895 the exports of manu-
factured articles from France amoimted to 7C,000,000Z. I have not yet got
the figures for 1906 with regard to France, but in 1905 they amoimted to
110,O00,000Z. The export trade of France in manufactured goods has gone
up by 34,000,000L, France being a very highly protected country. Take
the United States of America, another very highly tariffed coimtry. Their
exports have gone up fi-om 38,O0O,000Z. to 127,000,000?. in 1905, that roughly
being an increase of 90,000,000?. Coming to Germany, in 1895 their exports
of manufactured goods amounted to 109,000,000?.

Mr. DEAKIN : Do you take 1896 to 1906, that makes 11 years in the
last two cases ?

Mr. LLOYD GEORGE: I think on the whole we had better stick to
1905, but I will take 1906 if you bke in the last cases, I cannot get 1906
iigures in the case of France. In 1905 the export of manufactured goods
from ^Germany was 191,000,000?., that is an increase of 82,000,000?. Take
the United Kingdom ; in 1895 the export of manufactured goods, excluding
ships, was 192,000,000?. ; in the year 1905 it went up to 264,000,000?., that
is an increase of 72,000,000?., but the increase in the last five years is more
marked than that in the first five years. It is rather extraordinary that from
about 1885 up to 1895, neither Germany, the United States of Ataerica, nor
France, nor ourselves, made very nmch progress in the export of manufactured
goods;. I have here the figures from 1890 to 1895. Thev are not altogether

365

stationary, Init there is no very distinct advance in the tigures. Then, about Eleveuih Dity,
1895 — and that is why I am taking that year — there is a sudden rise in the 6 Maj 1907.

trade of all these countries. For the first five years following 1895 Germany

on the whole lessened the distance between her trade and ours. She I'i'ejkkential

increased her exports of manufactures by 40,000,000Z., we only increased "^t'^

ours by 28,(100,000^., excluding the value of new ships, as to which we have Lloyd Goorce ")

no information i)rior to 1899. In the last live years Germany has increasctl

her trade Ijy 42,000,OOOJ., and we have increased our trade by 44,000,000?.,

excluding ships. Includini: ships, the value of our exports of manufactured

goods in 19015 amounted to ol 1,000,000^., while the best estimate we can

make as to the value of the German exports of manufactured goods in 1900

is 208,0O0,0OOL It is only fair to state, however, that this estimate is leased

upon prices ruling during 1905, and that it may consequently be found,

when official figures are available, to be somewhat below the mark.

Mr. DEAKIN : I do not wish to divert you from your argument in the
least, but can you put your finger on the particular causes which seent
to have operated between those two quinquennial periods — anything in the
world's harvest or other circumstances which would account for the imiversal
stoppage in the first, and then the general advance in the second ?

Mr. LLOYD GEORGE : I wonder whether peace had something to do
with it.

Mr. DEAKIN : Was not 1890 to 1895 peaceful ? I think so.

Mr. LLOYD GEORGE : I really have not gone into that matter, and
should not like to express a hastj^ opinion about it. I understand from
Mr. Llewellyn Smith, who is the Permaucmt Secretary of the Department
over ^vhich I preside, that there was a general deiaression throughout the
world at that time, the cause of which I could not at present explain. But
undouljtedly there have been good times since then. \\'hat I want to impress
upon the Conference is this : that we have profited by those good times to a
larger extent than any foreign country so far as foreign trade is concerned ;
and I am taking our three greatest trade rivals. It is really a remarkable
fact. The United States has endless resources of raw material, to begin witli,
which we cannot compare with for a moment. We have, for instance, to get
our iron ore from Spain, and Sweden, and the ends of the earth ; the same
is the case with our copper ; and we have to get our raw cotton from thousands
of miles across the sea ; whereas the United States of Amci'ica have got
these things at their feet. We have to bring them all hero and then start
manufacturing, after paying for the carriage of the raw material. '

Mr. DEAKIN : Very often railway carriage for a short distance is
heavier than shipping carriage for a long distance. We have found that so.

Mv. LLOYD GEORGE: IJut take the case of Pittsburg; tliere is no
carriage of raw materials there; they have their iron ore, coal, gas, and oil
practically all in the same factory. There has nev(-r been anything like it in
the whole history of the world, and yet in spite of that we beat the United
States of ^Vmerica by more than 2 to 1.

Mr. DEAKIN : In iron V

Mr. LLOYD GEORGE : I will come to that. In the export of manu-
factured goods, we beat them by more than '2 to 1. Then j\lr. Deakin asks me

366

Eleventh Dav.
6 May 1907.

Preperextiai,
Trade.

(Mr.
Lloyd George.)

about iron. Yes, in tlie finislied product, machinery and ships, the product
that employs not merely most labour, but the best kind of labour, the most
highly paid labour, we have beaten the United States out of the market, and
we do that in spite of the fact that they have all these pi-odiicts at their feet,
and advantages that no other country in the world has got, and certainly not
Britain.

We have not those great petroleum wells, we have not those great
resources of natural gas Avhich can be turned on to the works by pipes
and enable two men to look after engines which would employ probabh^
100 men to look after here. In spite of that we have beaten the United
States completely out of the field.

Mr. DEAKIN : Have you in iron ?

Mr. LLOYD GEORGE : Yes, in all the finished products — machinery.
There is another fact which I wish to impress upon the Conference in that
connection. The ingenuity of the United States in the matter of invention
is certainly greater than ours. That has been explained to me by reason
of the fact that they are forced to resort to labour-saving appliances which
may not be necessary here. I frankly admit that in the United States of
America, as in all new countries, labour is more expensive than it is in an
old country like ours — and I am coming to the question of labour. There-
fore they are forced to use all their ingenuity and mental resource for the
purpose of finding out some means of saving labour.

Mr. DEAKIN : Their patent laws help them.

Mr. LLOYD GEORGE: No doubt, the patent laws of both America
and Germaiiy help them immensely. But although they have all this
inventiveness, we beat them in the export of machinery ; and the same
thing ajpplies to Germany.

Dr. JAMESON: I think your words were "beaten out of the field."
You do not mean that, surely. They have a market, and they are catching
us up. It is quite true they are not catching us up so much, but they are not
going back in their exports.

Mr. LLOYD GEORGE : I am very glad Dr. Jameson has called my
attention to it. That reallj' does not accurately represent what I wished to
convej^ because I had alreadj^ given the figures. They cannot be beaten out
of the field liecause they were selling 127,000,000Z. of manufactured goods
in 1905, and Germany, at the same time, was selling 191,000,000?., so I agree
that the phrase is exaggerated in its form.

Dr. JAMESON : But my point is, we are in the position of a man with
a large'capital who expects a ver\^ much larger interest than a man Avith a
small capital who expects a smaller interest. Surelj^ we are not getting such
a very large interest for our capital. I do not mean money capital, bixt after
having the markets of the world in our hands qua capital, these younger States
are coming in and getting a larger interest considering the capital in the form
of the markets of the world — they are getting more than we are now.

Mr. LLOYD GEORGE : I am afraid I do not quite follow that. If
Dr. Jameson means they are catching us up in actual fact— ^ — ^

Dr. JAMESON; Yes, I do,

367

Mr. LLO"^'D GEORCilC : Then I have pointed out by tlio li^urcs I have El.venth Day
given, that during the last few years we luive increased the distance between g Mhv 190".
us and Germany, our most formidable competitor.

PitEKEKENTlAI.

. . Tkake.

Dr. JA]\IESON : You do not quite understand my meaning. Before

these people really got on to their legs, 3,00OL a year might be a bigger

increase for us than even 7.000,000/. Avould be at present. That is mj'

point.

Mr. LLOYD GEORGE: I agree, and that is why I object to the
doctrine of percentages ; and as for Germany and the United States of
America and France getting on their legs, they have been on their legs pretty
long. It is not because they are new countries and not fully developed ; they
are certainly developed up to their highest pitch, as far as manufacture is
concerned, and as far as the conditions of the moment are concerned. Their
mechanical appliances, and everytliiiig of that kind, are simi)ly perfect,
and I am not sure they are not better than ours fnnii all 1 hear.

Dr. JAi\IESOX : Yes, I believe they are.

Mr. LLOYD GEORGE : Therefore, it is not the case of infant countries
just struggling to find means of establishing a business. The United
States and Germany have established an enormous business, and, as far
as the home market is concerned, it is a much bigger one than ours,
because their population is more than three times as large as ours. Here
you have these tAvo great countries with an aggregate population of
l-i( ),000,000, ours being only a population of about 40,000,000, and we
export veiy nearly as much of manufactured products to the world as
both of those great rivals put together. Really, I do not think it can be said
that we are altogether in this very distressful, wretched condition which
so stirred Sir William Lyne's commiseration. We are doing rather well as
far as our prodxicts are concerned, and before we proceed further it is much
better that we should really get the facts and that we should be under no
delusion upon this point.

]\Ir. DEAIvIN : Will it fall into your argument presently to examine your
British trade with your two great rivals, Gennany and the Lnitetl States ?

Mr. LLOYD GEORGE : I have done so.

Mr. DEAKIN : Your trade with Germany, France, and the United
States as compared with their trade to Great 13ritain — is that part of your-
argument yet to come ?

Mr. LLOYD GEORGE : No, bxit I am willing to go into it.

Mr. DEAKIN : You have taken the collective trade with the world of
each of those countries, measuring it with yours, perfectly fairly ?

Mr. LLOYD GEORGE : Yes.

Mr. DEAKIN : Is it part of your argument to examine their trade with
yourselves in the last few years, showing how far your ti-ade has gone or
gained in the German, French, and American markets?

3C.S

Klevcntli Day. Air. LLOYD GEORGE : I can easily do so, aud I am not afraid of the

6 May 1907. Comparison.

Preferential t^t-k^ itt r- • • t i

TiiADE. Mr. DEAKIN : We are afraid of no comparison, I hope.

Mr. LLOYD GEORGE : Especially during the last few years our trade
with Germany has grown considerably. Not merely our imports from, but
our exports to Germany have grown.

Mr. DEAKIN : In manufactured goods ?

Mr. LLOYD GEORGE : Yes. Not only that, but I may point out as
regards manufactured goods, where our men are engaged in these industries
they are paid higher wages than the Germans who produce the goods which
they send us in return.

Mr. DEAKIN : I am very glad to hear that.

Mr. LLOYD GEORGE : I will take the case Dr. Smartt referred to, of
cotton. We sell cotton yarn to Germany a good deal ; they sell cheap goods
to us — goods which it does not, on the whole, pay us to turn out ; that is,
it does not paj' us on the whole to put our brains into them. I do not
mean to saj^ we have not mills and factories in this country that do produce
goods of that sort, but we do not give our best thought to turning out this
sort of stuff. In cotton we turn out the best stuff that the world j^roduces, and
that is how we maintain our superiority. Pardon this little bit of bragging.

Mr. DEAKIN : I can assure you it is very welcome. You are not
bragging for yourselves only Ijut for iis.

Mr. LLOYD GEORGE : I thought you would naturally take a pride in
that. 1 was sure you would. The Germans still sell us these cheap goods.
You must not take these figures as final, but they sell us three or four millions
of this cheap stuff which we find it better, on the whole, to buy from them than
produce ourselves. We think it a much more profitable transaction. They
liuy from us cotton yarn. On the face of it it will be said : " You are selling
thorn cotton yarn to enable them to compete with you in manufactures."
\Vhat is the real state of things ? The man in Lancashire who is engaged in
producing the cotton yarn is paid more by at least 60 per cent, for his labour
than the man who is engaged in Germany in producing the cotton goods which
come here in return. AVe are paying more for our labour than they pay for
theirs.

Mr. DEAKIN : Cheap labour for the cheaper product, dear laljour for
the dearer product.

Mr. LLOYD GEORGE : And that is the argument that has impressed
the pul)lic in the interests of Free Trade. Our labour has given us the
highest product, and, as Mr. Deakin points out, that means the market in
the highest paid product. Dr. Smartt is quite right when he says CJermany
is pushing its trade in reference to cheaper goods, and I should not be
surprised if they beat us in things of that sort, because we caimot find the
lal)our that woidd enable us to turn them out. I should like to see the man
in Lancashire who tried to turn out these cheap goods on the terms on Avhich
the German maker can turn his out, in, I think, Wurtemburg. He could not
do it ; there would be a general strike there.

369

]\Ir. DEAKIN : You do not think you can compete with them l)ecause Eleventh Day.
of the cheapness of their labour cost in that particular line ? (5 May 1907.

]\lr. LLOYD GEORGE : I would not like to say we could not compete, I'ifEFERESTiAL
because I have not goue into it. But I am not prepared to challenge raue.

Dr. Smartt on that point. I accept his statement with regard to it, and I
think it is very likely. I remember wlieu 1 was in the xVrgentine they were
rather getting aheatl of us in the cheaper and shoddier kind of stulf, but
could not come near us in the better class of article ; and in the long run I
iind that tells. I was in the Argentine it is true at a time of depression of
trade between this country ami the Republic ; but I find in the long run that
quality has told, and as the Argentine liepublic has become richer and richer
it has got the money to buy the better article, and our trade with the
Argentine Republic is going up by percentages that woidd delight the
ehart of Sir William Lyne, if I could give them.

Mr. DEAKIN : Why should you not make both V You make the best
article, and have the market for it. ^'ery good. That is the best thing, if
you have to choose. But why cannot you keep that and beat them in the
cheaper kinds also ?

Mr. LLOYD GEORGE: I am coming to cotton by and by; but it is
very difficult to retain both, because the moment wages go up, of course, you
are driven into the lietter class of trade l)y the price.

Mr. DEATvIX: I wanted to find out whether labour cost was the sole
factor in making the distinction between your success in one and their
capture of the other, or is it due to anything else ?

Mr. LLOYD GEORGE : Xo, there arc the profits. We can make a
better profit out of the better article.

Mr. DEAKIN : Why not make both ? Good profits on the dear and
smaller profits on the cheap goods.

Mr. LLOYD GEORGP^ : As I point out, we have no reason to complain
of our cotton market. I have been rather led away by the cross-examination
of J\Ir. Deakin — not that I object to it for a moment ; on the contrary, I am
very glad he has put those questions, if I have been able to answer them
satisfactorily, Init I have lieen rather led into a suljject that T did not mean to
go into, that is, into our present position in reference to our great trade
rivals.

Now, let me put another figure which will illustrate the position of things,
I think, even better than the actual figures which I have given. I have given
the amounts of our exports of manufactured goods ; I should like now to
give the exports of our manufactures per head of the population, because
after all that is what counts. Eighty millions of people working 10 or 11
hours a day could turn out naturally more than 40 millions of people
working eight, nine, or ten hours a day. You juust take population into
account as a factor. We are a smaller country than any of those countnes.
I am not sure how we compare in mileage Avith l*' ranee, but we are certainly
smaller than (icrmany.

Mr. DEAKIN : You are much smaller than France.

Mr. LLOYD GEORGE : I accept that statement from Mr. Deakin. For
the moment I forgot. We are much smaller than Germany, and of course,

I is(!(is. A a

EleTenth Day.
6 May 1907.

Pbeferentiai,
Trade.

(Mr.
Lloyd George.)

370

only one-thirtietli of the United States of America, and cannot tliereforo
extend and increase onr population as they can. Per head of the popidation,
as I have already said, France exports al)ont 2/. lO.s. ()(/. of manufactured goods.
The position of Oermany is only slightly l)etter although she makes con-
siderablj' more fuss aliout her manufactures than France does. iShe sells
21. IBs. Of/, per head, although she resorts to all kinds of devices anfl schemes
in the way of using her State railways to the very fullest, a matter which
I am looking into at the present moment, and upon which I received a very
valualDle report only two days ago, wliich I shall be very glad to show the
members of the Conference. I have to thank Mr. Law . of the Foreign
Office for having provided me witli these materials. He wired for the
report on Tiiesday or Wednesday, and I had the whole of the information
on Saturday from one of the ablest Consuls we have in the Empire, and
very valuable information it is. It was aftei- the statement made by Mr. Moor.
We had heard something aljout the matter, and in fact I had sent two or
three investigators over to Germany to look into it, and we are noAv getting
the facts. • There is no doubt that the (lermans are using their State
railways for subsidising their trade to the Levant by means of through rates,
and probably they may capture the trade of the Levant ; at least they will
develop a great trade there. I am sure they will. The}' have very largely
secured the trade of East Africa, and I think that is attributable to a very
large extent to our own fault. We spent millions of money in constructing a
railway in Uganda to open up the resources of a part of our Empire.
Whether that was good policy or bad I think we ought to have finished it.
It is no good opening \vp a country of that sort unless you bring it somewhere
near a market. What we do is we just open up the country and we allow the
Germans to capture the market. I think that is the most stupid and short-
sighted policy that could possibly be entered upon. Luckilj^ the present
Government have not got that on their conscience.

Mr. DEAKIN : But the Uganda Railway is paying now.

Mr. LLOYD GEORGE : 1 should not think so.

CHAIRMAN : It is increasing very much.

Mr. DEAKIX : I thought it was paying its working expenses.

Dr. JAMESON : It is not paying.

Mr. LLOYD GEORGE : I do not think you have many first class
passengers on the line.

Mr. WINSTON CHURCHILL : U0,000/. profit on its working expenses.

CHAIRMAN : It does not pay interest on tlie caj)ital.

Mr. LLOYD GEORGE : No, nor its sinking fund. The Germans are
extending their operations to South Africa.

Dr. JAMESON : And Australia, I understand, is now in contemplation.

Mr. LLOYD GEORGE : No, I think not. There is the line to the
Levant, to German East Africa, and there is a third to somewhere, but not
Australia.

Mr. DEAKIN : South America and the Argentine markets, perhaps.

37]

?»lr. LLOYD GEORGE : No, t hoy have not doue that. Elevomh Day

6 May 1907.

Sir JOSEPH WARD : hulia and the Cape ?

Mr. LEO YD GEORGE: No; I can let the Conference know Later on.
There is u third line, and 1 shall be ahie to supply the information.

I come to another point put by Mr. Deakin, who asked lue about the
trade with protected couutries. "When Mr. Chamberlain first raised the
point, in the year 19U3, the trade to protected countries had gone down very
seriotisly. It is no use sliutting our eyes to the fact that it was due, of
course, to the imposition of tariffs against our goods. Tariffs had had
their effect, and, as the Chancellor of tlie I'^xchecjuer said, Ave are the most
formidal)le trade competitor, and the tarilfs were very largely directed against
us. Germany, France, and other countries wanted to build their industries
within this wall of tariffs, and they undoubtedly managed to exclude our
goods to a very large extent. 1 think Mr. Cham1)erlain was quite right
in saying that our trade with protected countries had gone down. But there,
again, there has been a turn since 1902, and our exports of manufactures,
excluding ships, to the principal protected countries have gone up from
71,5()0,00()/. in 1902 to about 90,0O0,O0OL in 1906. May I point out that during
the same years the trade with the Colonies has gone up from 94,0O0,UUOL to
107,()00,006Z. ?

Mr. DEAKiN : That is all the Colonies ?

Mr. LLOYD GEORGE: That is all the Colonies. That is an increase
of ahout 19,000,000/. in our trade with the principal protected countries, and
an increase of 13,000,000/. in our exports to the Colonies. Adopting again tlie
method of percentages, it is an increase of 2C per cent, in our trade with the
principal protected comitries and an increase of 14 per cent, in our trade with
the Colonies.

Mr. F. R. MOOR : Yoii do not compare populations there. What is the
population of your Colonies against these protected couutries ?

Mr. DEAKIN : You are not comparing one with another.

Mr. LLOYD GEORGE : Not at all. I am not in the slightest degree
trying to disparage the trade with the Colonies. 1 was answering the point
put by Mr. Deakin, specillcallj' how our ti-ade with ( iermanj-, the United
States of America, and France, ami these protected countries was faring, and
in answer 1 pointed out that there had been an increase of 20 per cent, in the
last five years, and I also admitted that before that our trade with the principal
protected countries had rather sulfered from tlie high tariffs put up against it.
This does not apply to our total exports, but to manufactured goods. No doubt
if I had included coal the trade would have gone up consideral)ly higher than
even 20 per cent., liecause there has lieen a great increase in our export of coal.

Dr. JAMESON : The reason of that, you may take it, is the general
increase in the wealth of the world.

Mr. LLOYD (,ii':ORGE : ^es, there is no delusion about it at all. The
only point I make is this : that in this general increase in the wealth of the
world, which has increased the volume of trade of the world, we have
had a larger share than any other country as far as foreign trade is
concerned. There is no doubt at all about that.

A a 2

pueferenxii.1.
Tkade.

372

Eleventh Day. I)r. JAMESON : Because we liegan wl\h a much larger amount to get a

6 'May 1907. share on, I repeat again.

'^''™de"'''' ^^^'^ LLOYD GEORGE : Pardon me, I cannot accept that. We have

had no advantages except the advantage which in my judgiiient a free
fiscal system gives ns — absolutely no more advantage. Germany has
advantages over iis which in many respects we do not possess. There
she is in the centre of the most oj)ulent consumers in the world, Avith the
accumulated wealth of centuries ; she is right in the centre and can run
her trucks to any country in Europe ; she needs no transhipment. What an
element transhipment is, after all, when you come to trade ! As Sir AVilfrid
Laurier knows perfectlj^ well, that is one of the difficulties of the trans-
continental route to New Zealand. Germany is right in the centre of Europe,
and can run truck loads to every countrj^ We cannot do that. But in spite
of that we have had a bigger share of the good things going, owing to the
excellent trade of the world, than an}- country, and ahnost than any two of
those coxintries put together.

Dr. JAMESON : And if you had not you would be in a hopeless
condition at this stage, because you formerly had the whole of it practically
speaking. In general terms we all know how difficult it is to divert trade
from a particidar country, and when diverted how difficult it is to get it back.
The process of diverting is only going on naturally, slowly, because we had
it all at the beginning. These people are in the process of diverting it,
which is a slow uphill game.

Mr. LLOYD GEORGE : All that is very good in the abstract, but
unfortunately facts are against it. Take any of those great countries — take
any country you may name. Australia I shall have to come to by and by,
because, I agree, something seems to be wrong in the trade between our
country and Australia, and I should like to know something more about it.
It is no use concealing that fact. I do not quite like the figures to which
my attention has been drawn since I have been in this Conference. I think
it is a matter which requires looking into. I think it is a great misfortune
that there shoidd be any drop in our trade with so important a market from
our point of view, and I think there must be something wrong there; But
take any other market in the trade.

^Ir. F. R. ]\100R : It is tlie only Colony which is not yet giving
reciprocity.

Mr. LLOYD GEORGE : I am obliged to Mr. Moor for pointing that
out to Mr. Deakin.

Mr. DEAKIN : He uses the wrong word. No Colony is getting
reciprocity.

Mr. TJ^OYD GEORGE : Yes, they are getting reciprocity. You are
giving us reciprocity. It was something which we started by giving. I ain
trying to answer now the point raised by Dr. Jameson. There is not a
great market in the Avorld in which we have not more than held our own in the
last few years. I pointed out that there were markets where it looked at
one time, as if Germany and the United States of America, our most
formidable competitors, were rather gaining upon us — South America is a
case in jjoint.

373

Mr. DEAKIN : These totals you have given us show the published Eleventh Day.
totals of excess of exports of the United Kingdom over those of Germany 6 Mav 1907.
in 1891 to 1898 were 8tiS,0( )(),()()()/. ; while in 1899 to 190G they were down - —

to 847,000,000?. In the same way as regards the United States our excess Preperential

of exports over theirs in 1891 to 1898 was C97,000,OOOL, but '^"^^e-

Mr. LLOYD GEORGE : Which year do you tal^e ?

Mr. DEAKIN : Seven years as printed in this paper " Colonial Conference
" 1907. Miscellaneous statements as to British and foreign trade in continua-
" tion of those laid before the Conference of 1902 by the Prime Minister of
" New Zealand ; revised and brought up to date at the request of the Prime
" Minister of the Australian Commonwealth." You will find on page 2 a
Table headed Germany and the United States, and for the period 1891 to
1898 the excess of exports of the United Kingdom over those of Germany
was 868,000,000?., and in the second period 847,000,000?. In the same period
the excess of exports of the United Kingdom over those of the United States
was 697,000,00OL, but it dropped to 493,000,000?. in the later period.
Comparing the growth of the export trade it shows that the United Kingdom
increased its trade in the second period over the first by 058,000,000?. ;
Germany hers by 679,000,000?., and the United States by 863,000,000?.

Mr. LLOYD GEORGf] : I will take if you like the very first figure you
gave me, or anj^ year you like. I do not care which, because I do not wish to
take the responsibility of choosing the year.

Mr. DEAKIN : Take the period 1891 to 1898.

Mr. LLOYD GEORGE : In 1891 the exports of manufactured goods
from Germany amounted to 102,000,000?.

Mr. DEAKIN : You give here seven years.

Mr. LLOYD GEORGE: Yes. In 1905, the exports came to
191,000,000?.— that is an increase of 89,000,000?.

Mr. DEAKIN : You gave that for these years.
Mr. LLOYD GEORGE : No, not 1891.

*

Mr. DEAKIN : I take the table circulated to us.

Mr. LLOYD GEORGE : In the year 1891 we sold 210,000,000?. of
manufactiired goods, excluding ships, and we have increased to 264,000,000?.
in 1905, and to 311,000,000?. in 1906 including shii^s and parcel post.

Mr. DEAKIN : You are taking some other period then.

Mr. LLOYD GEORGE : No, the period you gave me— 1891.

Mr. DEAKIN : This is not given in single years at all

374

Eleventh Day. Mr. LLOYD GEORGE : Your figures are the total Gernian exports,

6 May 1907. iucluding raw material.

Preferentiai. Mr, DEAKIN : Yes, evervtliing.

Trade. ' "

Mr. LLOYD GEORGE : I am taking uianufactured goods. I shoiild
not be a bit surprised if Germany beats us in raw materials ; sbe is a
bigger coiintry. She produces sugar ; we cannot produce sugar here.

Air. DEAKIN : You do not. Do not say you cannot.

Mr. LLOYD GEORGE : We do not think it worth our while because it
employs such low priced labour. Sir William Lyne referred to a reduction in
the number of agricultural labourers employed, That is very largely due to the
fact that agricultural labour is the lowest priced in this country. You cannot
get it. The agricultural labourer prefers to go into the tOA^'n, where he gets
much better pay and a better time altogether. It is most difficult to find agri-
cultural labourers at any time. So difficult is it that we have had to import
agricidtural labourers from Ireland for harvest operations in this country,
though, owing to the use of machinery, that has not been thought necessary
in the last few years.

With regard to raw materials I do not know how we stand in comparison
Avith Germany. I should not be a bit surprised if she beats us there. I am
taking manufactured goods becai;se they afford far and away the best test in
my judgment of the present position of Great Ih-itain and other countries. I
have been drawn into a general argument upon questions I never thought of
discussing'.

^(r>-

Mr. DEAKIN : Then you were not making a statement from this
table ?

Mr. LLOYD GEORGE : I do not know anything about that table. I
believe that is a Colonial Office table. I understand it is one of Sir Joseph
Ward's returns.

Sir JOSEPH WARD : You may depend it is absolutely correct,

Mr. LLOYD GEORGE : I am sure it is.

Mr. DEAKIN : They are not Sir Joseph Ward's figures, but they are in
the form of statistics which were laid before the Conference of 1002, but
revised and brought up to date.

Mr. LLOYD GEORGE : I do not challenge them at all. No doubt the
figures are absolutely correct. I am not impugning them at all ; but I have
not had time to examine them, so I do not know at all what their comparative
elTect is.

I should like to point out another thing, and it is this : When you come
to the wages and hours of labour, and compare our wages and hours of labour
with those obtaining in any proteclionist country on the continent of Europe,
this is the general effect. This is a comparison which has been made under
the auspices of the late (government, and I am quoting fi-om a docmnent
for which they are responsible. Mr. Chamberlain, I believe, was a member
of Ihf! Government at the time this very document was issued ; at any

375

rate, Mr. Balfour was. This is the coiK-hisiou they have come to after Klevcuth Day.
examining the wages sheets of the Continent and comparing them with ours. 6 May 1907.

" We might, without great error, take the average for Germany as two-thirds, ^

and for France three-fourths, of that which prevails in the L'uited Kingdom." ^''"^-^^^^^'''^

That is the result. That was in 1902. I have much later figures than that, '^^^.

and I have here a table of the current rates for certain skilled occupations Lloyd George.)

in the United Kingdom, Ciermauy, and France. In the United States of

America the rate of wages is higher than on the continent of Europe, but that

is for reasons which, in my judgment, jiave nothing to do with the fiscal

question.

Dr. JAMESON : Is the argument that the rate of wages is lower in a
tariff country because of the tarill, because that is contradicted by the United
States ?

Mr. LLOYD GEORGE : I am not putting that argument at all, but
that we are not suffering by our Free Trade system, and on the contrary have
more than held our own in all the essentials of trade — in volume, in profit, in
the pickings which not merely the producer and the manufacturer, but the
merchant and the workman, derive out of the system. We compare favourably
with every other country on the continent of Europe.

Sir JAMES MACKAY : And there is the shipowner's profit.

Mr. LLOYD GEORGE : I have not forgotten him. I am coming to
that, which is our greatest pride. I have these later returns. You must have
some sort of standard figure, and I used the Ll^nited Kingdom as lUO. Take
compositors to begin with : for every 100s. paid here in London you get in
Berlin 72s. paid for the same work. Lithographic printers, for every 100s.
paid here get G7s. in Berlin. Cabinet makers, for every 100s. paid here get
S7s. in Berlin, and in all other towns in Germany 74s. I have got 15 trades
here, and if you take ail those trades put together you will find that for every
100s. paid here you will get S'os. paid in Berlin for the same job.

Mr. F. R. MOOR : Why are you quoting those figures ? What is the
relative purchasing power of the shiliiug in Germany and over here ? Probably
it is better living in Germany than in this country.

Mr. LLOYD GEORGE : I am obliged to Mr. Moor for reminding me of
that, because that is one of our strongest arguments. It is not merely that our
workmen are paid higher wages, but tlieir sovereign goes much further than
the corresponding coin in Germany — much further. I shall be able to quote
figui-es to show the reason why. Those figures are very relevant to the
proposition which is now before the Conference. Our wages are higher ; our
hours of labour are shorter even than in the United States of America. In a
comparison between the United Kingdom, the United States of America, France,
and Germany ; Germany, I think, comes out worst ; France conies out next,
the United States of America next, and the United Kingdom is best.

Mr. DEAKIN : Are you still including only manufactured goods ?

Mr. LLOYD GEORGE: Yes. lam not referring now to the agricultural
labourer working on the land.

Mr. DEAKIN : Nor to the miner.

A u 4

376

Eleventh Day. Mr. LLOYD GEORGE: Yes, I certainly take the miner. Tlie miner

6 May 1907. is better paid and his hours of habonr are better.

Preferential

Trauk. Mr. DEAKIN : Better than iu America ?

Mr. LLOYD GEORGE : Not better than in the United States of America.
J freely admit that wages in the United States of America are considerably
higher than here.

Sir WILFRID LAURIER: In everything.

Mr. LLOYD GEORGE: Yes, substantially. I am perfectly certain they
mnst be.

Mr. DEAKIN : That is why I asked. You mentioned the United States
at the time.

Mr. LLOYD GEORGE : I mentioned the United States of America
merely as to hours of labour. I freely admit that wages in the United
States of America are much higher than here, and infinitely higher than in
Germanj', France, or any other country, but I am comparing our old country
with another old coimtry simply because the conditions are so different in a
country like the L^uited States. If the United States became a Free Trade
country to-morrow, she might pay higher wages — I even think she would —
but at any rate the money would go further.

Mr. Moor said : " What abovit your purchasing power ? " and I agree
that is the real test. Food is cheaper here than in am^ country in the
world.

Mr. DEAKIN : The Old World.

Mr. LLOYD GEORGE : Yes, I ought to limit it to that perhaps. I can
give the figures Avith regard to the price of wheat. I forget Avhether it Avas
Dr. Smartt or Sir William Lyne who said that if you piit your duty on corn,
it will make no difference at all to the price.

Mr. F. R. MOOR : 1 think he quoted the Is. you had here during the
war, ami argued that it made no difference. Whether that is a fact or not, I
do not kno^\^

Mr. LLOYD GEORGE : I should not be a liit surprised if it were the
fact. At any rate, I have not gone into the matter. I Avill accept this from
Sir William Lyne.

Mr. WINSTON CHURCHILL: That the Is. tluty made no difference?

Mr. LLOYD GEORGE : No, he said when the Is. duty was put on, the
price of wheat fell, and when it was taken off, the price of wheat Avent up.
That is very likely, but that is due to the fluctuations of the market. What
1 Avish to point out is the difference it makes as regards comparison Avith the
markets of other countries. That is the real difference. There is a difference
betAveen 1901 and 19U2 of Is. M. in the price of Avheat. There is a difference
betAveen 1898 and 19U2 of 6s. in the i)rice of Avheat. Of course, that Is. or
2s. v.-ill not bridge the difference between those tAvo figures, but the difference

377

it would make will be seen for eaoli particular year by comparing the
market in our conutry with the niark(>t in any other country. Now, let us
take Ciermau}-. I i'orgct wlio sai.l thai llic price ol' wheat in ( ii'riuanj' had
not been affected at all by the duty Avhich had been imposed by the German
Government on imported wheat. 'I'he gazette price of British wheat in the
year 1902 was 28.s-. I J.

-Air. F. R. AIOOH: Is that per quarter ?

Eleventli Day.
6 May 1907.

Pkeferential

TUADE.

(Mr.
Lloyd George.)

Mr. LLOYD (IEORl;!-:: Yes. The gazetted price, the official average
price of wlieat in Prussia for the same j-ear was -ins. 9(/. Tliat is, the price
was higher in Gerinany by 7.s. SrZ. per ([uarter than it was here for that year,
the amount of import dutv in Germany f)eing 7s. 7UL Take France for the
same year, tlic ollicial avcrag(> price in France for that year is 3Ss. tkl. per
quarter. Tliat is higher than the price in the United Kingdom by 10.s. bd.,
the amount of import dutj' being 12s. 2d. We have been told repeatedly
that 2.S'. on corn would make no difference at all. I take a year in Germany
when the duty was only 2s., and that really ought to operate as a warning to
ns. What we are more afraiil of than merely a l.s. or 2.s-. duty on corn is that
it will not stop there. A 2,s-. dnty on corn would not help our agriculturists
very much. They would soon realise that, and pressui'e would be brought to
bear on the Government. 1 am certain no Liberal or Cons(>rvative standing
for an agricultural constituency could face his constituents if once you
started that system of putting up a tariff against all conmiodities that
come into this country, unless he could pledge himself to raise that 2s. to
OS., and 3.s-. to -is., and so on, initil you would end at a figure which
would enable them to grow wheat at a profit — which they cannot do now.
The example of (lermany is a case in point. Germany started in 1S79 with
the small import tlnt\' of 2s. 2d., which is practically the proposal which is
now made for the United Kingdom. She went on to (is., she went np to 10s.,
then there was a drop to 7s., and now they have gone back to a still higher
figure. That is really what we are afraid of here. But take the last year when
the duty was only about 2s., and in that year I find the price of wheat in
Germany was in excess of that in the United Kingdom by 2s., the duty l)eing
2s. 2d. So really, I do not think, having the experience of Germany and
France in our minds, we can possibly say that the duty will not, somehow or
other, be an element in the consideration of the price. Probably not to the
same extent, l)(>causethc fact that you would give a preference to the Colonies
vrould in ]ny judgment, I agree, affect the price, and would to a certain
extent break down the pric(> (j^uoted for the wheat in the market, but after all
you are not supplying enough for us by millions of bushels. 1 am not sure
that I cannot say tens of millions of ijushels — and you could not do it for
years to come. After all you are dependent upon climatic conditions. In
Ganada, for instance, we luul a great failure a short tinie ago, and we had to
fall back on the Argentine, on India, on Fgj'pt, and on Russia. Australia
has, owing to drought failed to supply us with wheat. That is a very
serious thing for our poor people ; and that is what I Avant to press
more than anything upon our Colonial friends. We are not refusing to
meet you I can assure you. Wc are anxious in our hearts to do it, but we
have here a poor popidatiou that you know nothing of. Here numbers of
our poor people are steepetl in poverty and we have to think of them. It
would be wrong of us, it would be cruel of us, it would be wicked of us, if we
did not do it. 1 am sure if you realise that it would mean 2s. more lor people
who are already short of shillings to buy the very necessaries of life, you would
be the last people in the world to come and beg us to add to the troubles of
this poor population of ours. That is really why wc are hesitating.

378

Eleventh Day.
6 May 1907.

Prefekential
Trade.

Mr. DEAKIN : Xo oue has begged yon to do so yet.

I have not heard it.

Mr. LLOYD GEORGE : Yes, that is the proposal as it has been
presented to ns — the proposal as presented to us by Mr. Chamberlain —
and we are liound to take the Preferential suggestion in the form in which its
great chamjsion has presented it to us.

Atr. DEAKIN : Did he put it as a proposal ?

"Mr. LLOYD CtEORGE : I say this, if it had not been for the great and
distinguished position of Mr. Chamberlain, nobody Avould have dreamt of
giving it serious consideration here for that reason. It is not becaiise we
would not consider anything that would bring our Colonies nearer to us or
would help the Colonies, but l^ecause we refuse to contemplate the idea of
making the food of these poor people more difficult to get.

^Ir. DEAKIN : Did Mr. Chamberlain ever admit that any proposal he
fathered was to raise the price of food ?

Mr. LLOYD GEORGE : No.

Mr. DEAKIN : That is the point.

Mr. LLOYD GEORGE : No, but Mr. Chamberlain is much too astute
an advocate ever to admit that.

Mr. DEAKIN : I understand you Avere referring to somebody who was
begging you to increase the price of the food of these poor people, and as far
as the outer dominions are concerned, am not aware that any such rec^uest
]ias been made.

Mr. LLOYD GEORGE : I simply tiuoted figures to show that the
effect of a 2s. duty on corn, was to add 2s. to the price of that com-
modity to the people who purchased it. This is not 2s. added to the price
for the poor man who buys it almost in slices ;' it is 2s. added to the price
of the merchants, who has got to get his profit upon that 2s. The inference
1 drew was that if it meant 2s. more in Germany, and 2s. more in France,
the same cause would produce the same effect here, and it would mean 2s.
more here as well.

Mr. DEAKIN : Subject to the free colonial competition lor whicli you
allow.

Mr. LLOYD GEORGE : I said that too. I have been absolutely fair.
I did allow for it before I drew my inference, because I want to be
absolutely fair. I do not want to exaggerate the case against the Colonies by
one iota ; on the contrary, I wish it were possible for us to do something to
meet you on any lines which would lead to increased trade. I am only
presenting to you really the diflficulties Avhich present themselves to our
minds, and that is what xow want to know when you come to consider a
problem of this kind.

Dr. JAj\IES<_)N : It is really again in two Avords, the difference between
Preference and Protection. You have been arguing against Protection, and
we quite agree it would affect the poor man. Sir Joseph Ward, at the very
beginning of his argument upon this question, made the statement which we
all endorse : "if this is going to increase the cost of living to the poor people

379

in this ''oiintry, we do not ask it." Onr opinion is, it will not increase the
cost. We know we differ from you on that subject. Our proposal is
" preference," which we say will be better for the poor men of this country.
\Vc have no business to urge an opinion against the poor men of this country.
We have no idea of imposing any burden upon the po(jr men of this
country.

Mr. LTjOYD GEORriE : Of course, you have every right to present it
to us, and we are doing oiu- best to give it the most careful and the fairest
consideration we can. I point out why we are alarmed, and genuinely
alarmed at this proposal, from the point of view of our poor people.

Dr. JAMESON : But it seems to me your argument was not the
2.S'., Init the risk you might take here, by following the exajuple of ( iermany
and raising it up to oZ., but surely nations must take risks occasionally.

Mr. EEOYD (;E0R(;E: I put l)otli points. First of all, I put the
danger Avhich undoubtedly we wovdd incur from the temptation which has
been found irresistible in France and Gennany, the temptation to increase
the duty. In Franc(^ the duty started at Is. ; it is now 12.9. In Germany
it started at 2s. and it stood at 7s. 7d. in 1902, and has gone up, and I
think it is now somewhere in the neighbourhood of 12s.. If these powerful
governments have been imable tn lesist the clamour for increased duties
for the protection of agricidturc, Avhy f^hould we l)e able to resist it ?

Mr. DEAKIN : Because youi mamifacturing constituencies send in
such an inmiense majority over your agricultural districts and have such an
immense majority of representatives to safeguard their interests.

Eleventh Day.
6 May 1907.

PUEFERENTIAL

Tkade.
(Dr. Jameson.)

Mr. LLOYD GEORGE : But take the case of Germany. I have not
the figures and would not like to express an opinion at once, but I think
you will find, that in Germany there is a similar state of things.

Dr. JAMESON : I think the answer is, you have enormous Colonial
possessions which will keep down this price. You have put the time forward
by years and years, but I am told by Canadian and Australian authorities, it
is not a very long time before they will be able to supply the needs of
the Empire.

Mr. LLOYD GEORGE : Asking you oii your responsibility, how many
years do you think it would takf; before the Colonies oould supply us with the
delicit of aljout 150,000,000 bushels of wheat v.-Jiicli is now made up by foreign
supplies V

Dr. JAMESON : I think lean leave tliat to tlie rei)resentatives concerned.
It would best come from Mr. Deakin and Sir Williid Laurier, and they have
told me it would be very rapid. I think two years was mentioned.

Sir WILFRID LAURIER : Canada produces now 100,000,000, and we
expect to reach a figure of G0( ),(J00,000. But 1 woidd not venture an.y
prediction as to the time. That is very conthigent.

Air. DEAKIN : Then there are Australia and New Zealand.

Mr. LLOYD GEORGE: But we cannot make the poor mens bread
contingent. A poor man cannot wait three years for his bread.

380

Eleventh Day. My. DEAKIN : Are you goiug to confine yoiirself to wheat ? Yon take

6 May 1907. wheat as the typical food. You are not going to deal any further with food ?

Preferential]
Trade.

Mr. LLOYD GEORGE : I am not going to touch food again.
]Mr. DEAKIN : Are vou going to touch rent ?

Mr. LLOYD GEORGE : In what way ?

Mr. DEAKIN : You compare the cost of food in Germany. Is there a
comparison of the cost of rent in Germany ?

Mr. LLOYD GEORGE : That is exactly Avhat I am making a study of
at the present moment. I have three investigators in Germany who are
looking into this question of rent, wages, and employment.

Mr. DEAKIN : Steadiness of employment is a very important factor.

Mr. LLOYD GEORGE : I am looking into this. I have no right to say
what the opinions of my investigators are, but there are three absolutely
impartial investigators, chosen for the express purpose of getting these facts ;
and some of these facts, I do not mind sajung now, as to the growth of
German prosperity, are very startling, and they will all lie jiulilished without
the slightest consideration as to whether they will alTect the iiscal argument
one way or the other.

Mr. DEAKIN : What you have said we understand so far as it asserts
a high price of labour in Great Biitain when compared with the Continent.
Then, Avhile alluding to your food, you draAv attention to the fact that a large
proportion of the population are steeped in poverty. They can not be engaged
in the well-paid trades, but in some other business or want of business ?

Mr. LLOYD GEORGE : That is a very important problem, and I am
sorry to say that this is not the only country where you get a population of
that kind. As you know perfectly well, in every old country you get these
men who are hanging on the outskirts of society, as it were, and very often
they have no regular work to do. It is often due to the fact that they have
no physical stamina that enables them to enter into the conflict. In new
countries like yours, first of all the men who emigrate there are men of some
stamina before they cross the ocean ; and stock counts in these matters.

i\Ir. DEAKIN : That is why we want a British stock all the time.

]\Ir. LLOYD GEORGE : I agree, and I should be very glad if emigration
could be encouraged to these new countries, but here in the old coimtries
you have these people who form almost. a separate race, and they go on from
generation to generation until they die out.

Mr. DEAKIN : Do they die out ?

Mr. LLOYD GEORGE : They do in about the third or fourth generation
in a city like this, but I am sorry to say that through economic conditions
and the keenness of the conflict this great army of people is constantly being
recruited.

»

381
Mr. DEAKIN: The "submerged tenth." Eleventh Day,

6 May 1907.
Mr. Lr.OYD GEORGE: The siibmoro-eil tenth; but tlial is a question „

111 1 • 1 1 -in '1? 1 i> . ,• 1 •,• I'kF.I F.RENTlAt

wliicli Jias notliing to do eitlier With Tree I rade or 1 rotectioii, l)eeauso il you Tuaue.

go to the highly pi-otec;ted coiintrios in Europe you will find the churches
swarming witli men anil women of this class, wlio go begging for alms.
Thereioi-c, it has nothing to do with lisc.d considerations. I am sorry to tak(!
up so much oi' the time of the Conference.

Mr. DEAKIX : It is very interesting to all of us.

Mr. LLOYD GEORGL: I meant to have calbil attention to oae or two
other facts rather in rejily to Sir William Lyne. lie referred to the great
question of xuiemjdoyment in this country. At the present moment our
unemployment has been reduced gradually to a minimum, because trade is
good. Still, we have a percentage of unemployment which is rather
unpleasant to contemplate. The only thing I can say is this, that after
comparing the figures of uuemployment for 20 or 30 years, it is not on the
increase. Unemployment on the whole is very steady and the fluctuations in
this country are less than they are in other countries, especially in very highly
protected countries : our fluctuations are considerably less. It is very
dithcult to compare with Germany, until we have fuller facts, and that I
hope to be able to get in the course of a year or tvvo. iMuployment in
Germany now is undoubtedly veiy good. There is as much work to do as
they can find peo]ile to do it.

Mr. DE.AKIX : They are importing Ldjour.

Mr. LLOYD GEORGE : That is purely in th(- case of a strike. They
have done that in this conntiy.

Mr. D1v\Kl\ : And for agricullural purposes.

.Afr. LLOYD OEORCiE: From where ?

^Ir. DEAKIN : They are drawing from the partially Oerman countries to
the south. I have seen it statetl that they are coming in by thousands for
harvestins- work.

"O

Mr. LLOYD GEOUOE: Thai I have not heard of yet, but I accept the
statement from you. There are two or three figures about employment which
I think are rather important. There are certain classes of occupations which
are a very good test as to the prosperity of a country — building, for instance.
If you find a coimtry which is not prospering, its liuildings are tund)ling
dowm ; there is not niucli new building going on. When a man does well,
the first thing he does is to go into a better house. If he builds, he does
it because he has money to spare. On the whole, buihling is al)out the best
test of the prosperity of a country. It means that you are putting up new
factories, new worksh:>ps, new quays, and new railways. If you will compare
the numl)er of people employed in building, for instance, according to the
census of I'JOl, with the i.ianber of people employetl in buihling in 1881, you
will find that in 18S1 there were 920,01 )<) in this country engaged in buihling,
and in I9()l there were 1,336,000. That is an iiicrea&'e of 410,000 or 14 per
cent., our population having increased 19 per cent. The same thing applies
to trades like furniture.

382

Eleventh Day. .Afr. DEAKIN : Voii stop at 1001 .

6 May 1907.

Preferential ^I-- LLOYl) GEOKGE: \ es, that is our last census, I cannot give later

Teade. figures. Our next census will be in 1911.

Mr. DEAKIX : The President of your Local Government Board,
Mr. Burns, when he was here the other day called special attention to the
depression of your building trade just now.

Mr. LLOYl) OE01x(!E: There is temporary depression jusf now.

Mr. DEAKIX : When discussing emigration he said there were a great
number of those engaged in the Iniilding trade who would be only too glad
to emigrate.

Mr. LLOYD GEORGE : It is a very curious trade. You will find the
building trade doing well when there is depression in other industries. On the
other hand it is the very last industry which picks up. When the depression
begins they are still building as a result of the boom which has taken place,
and the building has nut been completed. They do not start fresh building
luitil a boom in trade has been going on for some time. The prosperity of
our building tra(k' will hardly Ijegin again for perhaps six months or a year ;
then it will begin. If you compare the nmnber of men engaged to-day in the
Ijuilding trade with those engaged in 1901, I guarantee there is a higher
percentage of people even now engaged in it than in 1901.

Mr. DEAKIN : By " engaged " you mean " employed."

Mr. LLOYD GEORGE : Yes, actually employed. The same thing
applies to furniture, and to those engaged in the food, drink, and lodging
businesses, but I do not want to weary the Conference by giving all those
figures.

Something was said by Dr. Smartt with regard to cotton, and he seemed
to think that our cotton trade was being driven out from South America, and
that Manchester woidd have something to say to this. Let me give these
figures. There has been nothing like the boom in the cotton trade during
the last few years. In 1903 we exported from the United Kingdom of piece
goods alone* (which does not contain the whole of our cotton exports),
55 million pounds' worth. Last year we exported 75 million pounds' worth
of piece goods. That is an increase of 20 million pounds' worth.
Germany exported, in 1903, six million pounds' worth ; last year they exported
seven milbou pcjuuds' worth. That is an increase of 20 millions in the
export trade of the United Kingdom, and an increase of something under
one million in the export trade of Germany in cotton piece goods. The
exports from the United States increased from five millions to nine millions
during the same period, and France has increased from four millions to
five million pounds' worth. So taking all these countries together, they
exported last year 21 million pounds' worth of cotton piece goods, where we
exported 75 million pounds' worth of cotton piece goods, showing an excess
of over 50 millions sterling in favour of the United Kingdom. That is doing
rather well.

Mr. F. R. MOOR : I am sorry to interrupt, but what are the relative
values of the raw material as regards this cotton in these years, because, of
course, if the raw material is considerably higher now it makes a great
difference in your finished value.

383

Mr. T.LOYD GEORGE : It has increased, but it does not account
certainly for all that enormous increaso, and if it does, what of France, and
what of Germany, and what of the United States of America V

Mr. F. R. MOOR: It does not alfect the proposition. They have all to
pay the same price for their raw material.

Mr. T.LOYD GEORGE : 1 agree, but I want to point out that the
increase in the value of the products expoi'ted from (lermany tluring those
five years is only one million pounds, and that is to cover not merely the
increase of quantity but the increase of ])rice. The increase here is 20 million
pounds. As far as I. can see, Mr. Moor would suggest that Ciermany has
rather gone back than otherwise, anil, if so, we have gone on enormously. I
am not sure that the million would vovov the difference in the price of the raw
material in Ciermany, but certainly the iliffereuce would be covered two or
three times over in our country. But I also have the figures here in yards.
The figure I gave was for 1001. This will reassure Mr. Moor. In I'.kU, we
exported 5,3(34 million yards of cotton jnece goods from this country. I^ast
year we exported 0,261 millions. That is an increase of nearly 900 million
yards of cotton piece goods in the course of five years. That seems to me to
be a very satisfactory state of things, so far as cotton is concerned.

Dr. JAMESON
statistics.

It may be. It would be very interesting to have the

EleTeiitli Day.
6 May 1907.

Preferkntial

TUADE.

i\Ir. LLOYD GEORGE : They are very interesting to us. We have to
live on them. They represent bread and meat from Australia and C'anada.
They represent our purchasing capacity, and you really ought to
rejoice.

\)t. JAMESOK : I do, and I hope you are always going to have that
prosperity.

Mr. LLOYD GEORGE : Because there is not one single yard of it that
does not mean a threepenny choj; of Australian mutton, or something of that
sort.

Dr. JAMESON : But how many or how few years ago is it that
Germany, France, &c., were exporting none, and now they are cxp)orting
seven million pounds' worth.

m. LLOYD GEORGE : Really, if you are not capable of being satisfied
by figures of this sort, you are the most insatiable of uhmi. Nothing will
satisfy you. An increase of business in lour years of 20 millions pounds is
as nothing in your sight. Really I cannot do better than that.

Mr. DEAKIN : He wants to keep it.

Mr. LLOYD GEORGE : You are not merely keeping it hut improving
upon it. Really, I thought you were more reasonable, Mr. Deakin.

Mr. DEAKIN : That explains his anxiety.

Mr. LLOYD GEORGE : We have increased our business in cotton alone
by 20 million pounds in four years — more than the whole of our trade with
Australia.

384

Eleventh Day.
6 May 1 907.

Prekerential
Trade.

Mr. DEAKIN : Tliat is good.

Mr. LLOYD GEORGE : I think so. WiU you convince Dr. Jameson
that that is good enough ? The total of our exports of cotton nianiJactures — I
am sorry to disturb Dr. Jameson by these figures — last year came to
somewhere about 100 million pounds' worth. Now, imless I am mistaken
that is twice as much as the total of the cotton exports of all the protected
countries in the world put together. If you are not satisfied with t-\vice as
much you are hard to please.

Dr. JAMESON : I am quite satisfied with the size of the figures, and I
am very glad they are large, and that there is so much margin for a very slow
decline.

Mr. LLOYD GEORGE : Germany has really increased very little in the
course of 10 years.

Mr. DEAKIN : So much the better.

Mr. F

MOOR : AVhat are the figures of the United States in that

comparative statement ?

Mr. LLOYD GEORGE : The United States has increased by 4,0()0,000L,
Avc have increased l)y 20,000,000/. Just think of it. The United States of
America has got the cotton in one field and the factory in the next. At least
she coidd have it ; there is no reason -why she should not. We have on the
other hand to carry our raw material thousands of miles across the sea, and
still we beat them. If that is not a real triumph of British grit, skill and
brains

Mr. DEAKIN : Long may it reign

IMr. LLOYD GEORGE : And a triumph of the free fiscal system, I do
not knoAv Avhat it is.

]\fr. DEAKIN : That is an incubus. In spile of it yon sometimes
manage to increase. My memory ^vas correct as to "what I said about the
building trade. Mr. Burns says : " At this moment we liave, I am sorry
" to say, through reasons that I need not go into, a very large number of men
" in the building trade Avho are slack of employment."

Mr. LLOYD GEORGE: There is no doubt about tiiat.

Mr. DEAKIN : " We also have, proportionately to the Colonies, more
surplus unskilled labourers than any of the Colonies possess, and it does seem
to me that if those men in the Ijuilding trades, who are a type of men that
many of the Colonies pre-eminently waiit in opening up new countries,,
were more closely informed as to the colonial requirements of labour, we
slioidd see a very considerable number of the men of the building and
similar trades, seeking work in Colonies AAhere their Avork AvoukI, perhaps,
be for the njoment better, and perhaps' ultimately more regular than it
is now.""

Air. LLOYD GEORGE
Sir James Mackay, I think.

Somebody said something about shipping —
The net tonnage of shipping belonging to

385

the United Kingdom, is 10,7()l),()0() ton:^. (lonnany, wliidr is our only real Eleventh Day.
competitor, has 2,50(),0()() tons ; so ours is just four times as much as '' May 1907.
what she has got with all her subsidies and through transit rates. Pueferestial

TltAOE.

Mr. DEAKIX : That is only the Mercantile ^lariue ? (Mr.

Llovil George.)

Mr. LLOYD GEORGE: Yes. France has 1,400,000 tons, and the
United States of America have harely 1,000,000 tons, exclusive ol vessels not
registered for oversea trade. Do not forget that at one time the United
States of America divided the trade of the Atlantic witli us.

:Mr. DEAKIN : Before the war ?

Mr. LLOYD GEORGE : P.efore she became a high tariff countiy. I
know tlie war drove her imdoubtedly into high tariffs and into bail waj's.

^Ir. DEAKIN : War destroyed her shipiiing.

Mr. LLOYD GEORGE : As Mr. Deakin says, it destroyed her shipping.

Mr. DEAKIN : The " Alabama " helped to destroy her shipping.

Mr. LLOYD GEORGE : The " Alabama " and JilcKiulcy between them
destroyed her shipping.

Mr. DEAKIN : That is a matter of opinion as to IMcKinley.

Mr. LLOYD GEORGE : K I were interested in Britisli shipping
financially, I Avould say, long may she (America) remain pi-otectiouist !

AVith regard to the Colonies, Sir William Lyne was very disturbed when
he left Sydney Harbour at the spectacle of half the shipping there flying a
foreign ilag. Well, I do not think he need be very disturbed about our
shipping trade witli the Colonies. The Ih'itish tonnage, sailing and steam, in
the inter-Colonial trade amounts to 20,500,000 tons.

Mr. DEAKIN : Does that include Australian shipping — local steamers ?

Mr. LLOYD GEORGE : No, this is our sliipping.

Mr. DEAKIN : Ours is your shipping, too.

Mr. LLOYD GEORGE: I mean now our United Kingdom shipping.

^Ir. DEAKIN : All the world over V

Mr. LLOYD GEORGE : In all our Colonies.

Mr. DEAKIN : I thought you might refer oidy to those owned iu
Australia ?

Mr. LLOYD GEORGE : No. The foreign tonnage is 3,200,000. That
is between one-sixth and one-seventh of ours. That is keeping a good
distance ahead. 1 have the figures for Australia, if Mr. Deakin likes to

K 4SC«S. Ji I)

386

Eleventh Day. have them, Tlie total of entrances and clearances in tlie oversea trade of

6 May 1907. Australia in 1905 under the British flag was 5,500,000 tons, whilst that under

~~~ foreign flags was onlj' 1,900,000 tons. The proportion there, I agree, is not so

"^TuADE^'^^ favourable to us as when you take the whole of our inter-Colonial trade.

Lloyd Georpc.) ^^^"- DEAKIN : Yoli ^viU remember Sir William liVne speaks, as any one

of us would speak, with an experience beginning 20 years ago, when you
liardly saw a foreign flag there. Tliat is what makes a great impression in
Australia.

:\Ir. LLOYD GEORGE : I know. One reason for that is that foreign
countries are buying more from Australia than they ever did before — more of
3'our wheat and wool.

J\Ir. DEAKIN : Formerly they carried it in British ships, now they
carry them in their own.

Mr. LLOYD GEORGE : They did not carry it at aU. They were not
customers of yours to the same extent as they are now. There is another
reason, no doubt — and there is no use concealing these things, liecause they
are quite obvious. In the old days the wool was bought by us and sold to
the Continent. Now you have a direct trade between the Continent and the
Colonies. European countries prefer buying direct. They do not want to
employ the British middleman, and they are quite right from their point of
view ; but that was quite inevitable. This is really the great Free Trade
argument. The moment they buy from you, that creates trade ; you start
buying back ; it has had the iuevitalile effect. As long as we were the
purchasers we got the whole of the advantages ; as soon as they became
purchasers they got a share of the advantages ; and that has always impressed
us in our Free Trade argi;ment. The mere fact that we are able to trade freely
with the whole world and open our markets to them makes them l^uy from us.
Therefore, if we go to any market — the Argentine, China, Japan, France,
Germany — to sell there, we come home with something we have bought. That
is imdoubtedly the reason why there is more ti'ade between the Colonies and
foreign countries than there used to be. That is all 1 have to say about these
figures. If there is anything further anj^body likes to ask 'before I finally
leave them, I shall be happy to giA'e it. I am afraid in the Colonies the
towering figure of Mr. Chamberlain has given undue prominence to the gloomy
views he has littered about the trade of the British nation. Of course, every-
thing he said would be rej)orted veiy fully there, and when he said our iron
trade had gone, and wool was going, and cotton was disappearing, it naturally
created an impression in the Colonies that things were really very bad with
British trade, but 1 am glad the matter has been raised here, as it has enabled
me to elucidate it Avitli the figures which I have quoted to you.

I do not propose to deal with the separate point raised in the Australian
resolution as to preferential trade between the Colonies and this country
being carried in British ships. I understaiid Mr. Deakin is going to raise the
point aliout ti'caties, and I think 1 will defer what I have to say on that point
until I have heard his remarks.

We have been told that we have met all the apj)roaches of the Colonies
with blank negatives ; that for all the stdjstantial concessions — and I am very
happj' to recognise that they are substantial — which have been made in their
tarifi's in favoiu- of our trade, we are prepared to offer no return. Let me
here express for the Board of Trad(>, whose duty it is to watch carefully all
that affects our trade in all parts of the world, our appreciation of the enormous
advantage conferred upon the British manufacturer by the preference given
to him in the Colonial markets liy j-ecent tariff adjustments. The Canadian

9.Q7

87

preferential tarilT has produced a marked effect on our export trade to Kleventh Day.

Canada. It is true that it seems to have bcnelitcd Canada even to a hirger 6 May 1907.

extent than it has profited us, for I observe from our Trade Returns that our

purchases from the Canadian producer have increased, and arc still increasing Tueferential

by leaps and bounds, with one ov two set backs, and I attribute the great "■^'''^•

improvement in the trade Ijetweeu Canada and this country very largely to ^^^ ioeor ' ^

the wise policy of reducing the duties on gooils imported from the Mother •''' ^^'^^^■'

Country which Sir Wilfrid Laurier initiated in l.S'JT. It has undoubtedly

stimulated trade between the two oomitries. The South African and the

New Zealand preferential tariffs have not yet been put to the test by much

actual experience ; but I cannot for a moment doubt that in some

measure the happj^ residts wliirh have ensued from Canadian preference

will be repeated in these cases. The same observation of course applies

to Australia ; and Great IJritain feels, and ought to feel, gratefid, not

merely for the actual concessions which have been proposed, but even

more for the spirit of comradeship— and I think 1 may even say of affection —

whicli has inspired this new policy. 15ut it is said, it is not enough that you

should express your gratitude. The question is, what are you j)repared to do

in return ? I know this has not been put in this form by the Colonies. There

is something in Dr. Jameson's resolution which looks i^erilously like it, but I

am sure that the Colonies would not wish to present their case in that form, as

they know it w^ould detract from the real value of their action and certainly

from its spontaneity. It has been so put by others, and we are bound to take

note of it. My first answer would be that Great Britain is the best customer

the Colonies have for their products. In the last year for which complete

information is available the exports from the Self-Governing Colonies to all

foreign countries amounted to 40^ million pounds, whilst the exports to

the United Kingdom amounted to 93 million pounds, or, excluding bullion

and specie, to GG million pounds. But I should also observe that it is

certainly to our mutual advantage that everything wathin reason should

be done to promote connncrcial intercourse between Britain and the Colonies,

and I should be exceedingly sorry if this Conference parted without devoting

itself to a careful consideration of every suggestion which has been made

for the purpose of developing inter-Imporial conmierce. One danger of

giving undue prominence to a controvertible suggestion for arriving at a

particular end, is that the controversy about that suggestion tends to obscure

all other proposals for attaining the same end. Nations Avhich have been

accustometl to self-government are apt to attach exaggerated importance to

the controversy of the moment. That is our danger just now. I am afraid

the question of preferential tariffs looms so large on the political horizon that

its friends may lose their sense of proportion, and think that every alternative

proposition is too insignificant to waste time and thought upon. I am glad to

think that Mr. Deakin does not think so.

Mr. DEAKIN : No, preferential tariffs are only part of the policy of
preferential trade.

Mr. LLOYD GEORGE : I am glad to hear that, but may 1 appeal to
the members of the Conference before they separate to devote some part of
their deliberations to the examination of other proposals \vhich have been
made for the development of Imperial trade ? If they fail to do so, in my
hmnble judgment, opportunities may be lost which may not soon recur. 1
have an idea of what may Ijc passing in my friends' minds on this point,
though they are too courteous to express it at this Conference. They have
been assured that Colonial preference is much nearer than we seem to imagine.
I know they have been told that tlie electors have repented of the hasty
verdict which they deliveretl so emphatically eighteen months ago, and thali
when the opportunity recurs for them to reconsider their decision, it Avill be

B b 2

388

Eleventh Day. giveu for the policy whicli is embodied in this resolution. Well, this is no

6 May 1907. place to embark Tipou a review of the political situation here, or elsewhere ;

but it is not altogether irrelevant to the discussion to present two or three

Preferential considerations for the members of the Conference to reflect upon. This is

Trade. ^ot the first time the question of Protection has been an issue between parties

(Mr. in tbis -way even within my memorj^
Lloyd George.)

Dr. JAMESON : That horrid word " Protection " !

Mr. LLOYD GEORGE : I will accept any word, I do not want to
quarrel about words. What is your word V

Dr. JAMESON : Colonial preference.

Mr. LLOYD GEORGE : Well it was not presented in that form then.

Li 18S5 it was called " Fair Trade." They always change the name. In 1SS5

it Avas presented in the form of Fair I'rade. The Conservative Party took it up

very heartily. At that time it looked as if, to iise Lord George Hamilton's

phrase, it were " a winning liorse," but it was beaten ; Free Trade won, I

think, l)y a majority of 100. That was a time of very bad trade. So these

proposals, with regard to imposing tariffs on foreign goods, had every

atlvantage which the circumstances of the moment could give them. But

what frightened the country off Protection then is what will frighten it off

Protection again, and that is not imimportant for you to consider when you

think of your proposals for Colonial preference. What frightened the

country then was the fear of a tax, or a duty, on food. The agricultural

lalH)urers in the counties, the miners and the artisans, Avould not have it.

What happened in 1886 — and here is a thing I want you to reflect upon,

if I may put it in that form without offence — was that an opportunity then

presented itself for the Fair Trade party to come into power on one

condition, and that was that it should jettison its Protectionist polic3^ The

Liberal Party proj)Osed a measure which alienated a very considerable portion

of its own friends. The Liberal Unionists were then Free Traders, and they

said to the Tory party: "We are quite willing to combine with you on a policy

" of resistance to these L'ish proposals on one condition, that the administra-

" tion, when it is formed, is to be a Free Trade one." And Protection was

abandoned. In 1885 no one could possil)ly have prophesied what would have

happened in 188G. It Avas something which occurred quite suddenly and

unexpectedly. It was a shock even, I think, to Mr. Gladstone's best friends,

and in ISSO the Conservatives, who were pledged to Protection and tariffs,

came in as a Free Trade party and remained in power as a Free Trade

party for 20 years. So much Avere they a Free Trade party, that even

tiie sliilling duty on corn which Avas put on in an emergency Avas taken

off Avhen it might very Avell liave l)een used for the purpose of preference

to the Colonies. They did not take it off for the sake of preference. The

Unionist party Avere in as a Free Trade party, and Avere in for 20 years

as a Free Trade party, and the proposal Avhich you are now making to us

for a jireference on Colonial Aviue they would not look at, they were so

squeamish in their Free Trade jirinciples : that Avas the Unionist party

for 20 years. Although in ISSf) they Avere Protectionists up to the

lips, in 1886 they became Free Trade, because, I Avill not say it Avas the

temptation of getting in, because that Avoidd be an unfair reflection, and

the sort of reflection that, though parties make them against each other,

is, I think, unjustifiable — but they felt there Avas a bigger, a more urgent

and more imminent issue ; in their judgment, the countr,y Avas face to

face with a possible disaster, and they had to save it even at the risk

of throwing over their Ftiir Trade principles. They never became a

Protectiouist party again until the last election. They were beaten in 1S85

389

by 100; they were beaten ia lUOG by 300, at least, and 1 have no hesitation Eleventh Day.

in saying that whatever tlic contributory elements to that disaster were, 6 Mnv 1907.

there was none that was more potent than the proposals made for a — —

preferential tariff which involved a tax on food. I do not say that was the l*iiEn:nKNTiAL

only issue. It would not be fair for me to say so. You are all gentlemen kade.

who have fought elections, and you know you caimot say that 45 per r|,.|"(''"

cent, of the result is (hie to this consideration and 20 per cent, to another ' '" ' ^^^'^f^"-)

consideration. But 1 do say that this was one of the largest elements.

That is twenty years after the proposals were made, and now it is a time

of booming trade. Then it was a very disappointing time of bad trade.

What is your position now? Have you noticed —and here I want to keep

clear of party politics — that our party is solid against taxing food ? I

am going to put this frankly. Is the oLiier party as solid in favour of

it? ^Mr. Ba [four, the late Prime Minister, when he was Prime .Minister and

Leatler ol the Pai"ty, said at SheHield that this country, in his judgment, lor

historical reasons, could not be induced to put a tax on corn, lie stood by

that position for two or three years, and at the last general election not hall" of

the Conservative candidates in the country ever put a duty on corn on their

programmes. They were asked " Will you do it ? " They either avoided the

question or said : Xo, they would not. I do not think I am exaggerating when I

say that was the case with fully one-half of them. Some of the most powerful

members of that party now ai'e men — I do not want to name them- -who are

opposed to the idea of a duty on corn to the very utmost extremity. Their names

will present themselves to your minds. Dr. Jameson knows them very well.

Where is ]\Ir. Balfour now ? Two months ago the question was put to him

directly in the House of Commons : " Would you put a duty on corn as a

basis of your preferential tariff " ? He aljsolutely refused to reply. He said

something about wine, but that is a small matter from any point of view —

too small a matter in my judgment to affect the position one way or the

other. But when you come to the large and the most important matter,

the question of corn, the Leader of the Opposition refused to pledge

himself. Has he done so now? I have seen two or three interpretations

of the declarations he has made — interpretations placctl iq^on them \)y his

own supporters. Were you to write a letter to him to say : " Does this

" mean, Mr. Balfour, that if you were returned to power next year you

" would propose a duty on corn in order to give a preference to the

" Colonies ? " the Liljeral Pu1)lication Department would pay a good price

for the answer, if it shoidd be in the affirmative. You will not get it. I

am certain you will not. What may happen in the course of the next two

or three years, heaven alone knows. You may have some other great issue

precipitated into the arena which will divide parties and recast them. You

cannot tell. No one can predict now how much tlu; fiscal issue will count

at the next general election — things change so rapidly in our politics, as in

the politics of other countries. There may be a cond)ination to fight the

present Government on other issues which may be sprung upon them. But you

must not assume too readily that the question of preferential tariffs is going

to bo, I will not say a dominating factor, but even a factor at all in the next

appeal by the other party to the electors of this country. ]\Iy reason for

saying this is to ask whether, having regard to all these considerations, it

would not be well to devote some time to the consitleration of proposals of a

different character.

]\lr. DEAKIN : A bird in hand.

Mr. LLCYD CEORGE : That is it. Would it not l)e well to devote some
time to the consideration of projwsals which are none the less important in
practical eilect in that they are not flavoured with an element of bitter

jsiwis. B 1> 3

390

Eleventh Day. controversy ? Sir Joseph Ward, the Premier of New ZeaLuul, in the important

6 May 1907. Speech which he delivered in this debate, has brought Ijefore the Conference

two or three propositions to which it would in my judgment be well worth

Preferextial q^^^, -^yi^iig ^Q devote our most careful consideration. He made, as far as I can
'^ ■ recollect, three important suggestions : one was the improvement and the

Llovd Gcor e ") cheapening of cable communications with this country ; the second was
the appointment of commercial agents or consuls in the Colonies, whose
business it would be to assist British trade ; and the third — and this is
undoubtedly the most important and also the most difficult, if I may say so,
of the three suggestions which Sir Joseph Ward made — was the improvement
of the commiuiications for the transport and passenger traffic between the
Mother Country and the Colonies. As to the first, it Avould be an undoubted
advantage to the traders in all these countries if they could communicate
their orders quickly at rates which would not be practically prohibitive.
Our main object ought to be to shorten the distance between oiirselves and
our Colonies by every means at our command. It is the distance that
handicaps colonial trade in competition with foreign countries which are
more favourably situated. As to the second suggestion, a good deal has
already been done ; but I am not at all satisfied that we have by any means
done all that it is in our power to do on this point. I think we have
proceeded on much too frugal a scale. If Canada, Australia, and New
Zealand had been foreign countries, we shoidd have appointed first-class
consuls at a remuneration which would make it worth their while to attend
to the business of our merchants in those countries. It would have enabled
us to secure iirst-class men. But seeing that they are British Colonies, \ye
have satisfied ourselves Avith running our trade intelligence in these vast
territories, with their endless possibilities, on the cheap. That, I agree, is a
flaw which has to be repaired.

I am doubly glad that the Prime Minister of New Zealand raised this
question while the Chancellor of the Exchequer was present to hear his
observations. I am not blaming the Treasury, and I certainly am not
blaming the Chancellor of the Exchequer, w^ho has invariably — and if I may
add, ungrudgingly — acceded to every request made to him by the Board of
Trade to spend money in improving the equipment of our Commercial
Department, and he has answered our appeals on a very generous scale in
the course of the past year, when much greater demands have been made
upon him than for manj^ years past. But it shows the advantage of initiating
discussions about practical proposals, that Sir Joseph Ward's reference to
this subject has encouraged us to go to the Treasury again.

Mr. ASQUITH: Already?

Mr. LLOYD GEORGE : Yes, and the Chancellor of the Exchequer has
arrived in this room at a most opportune moment. We have app)roached
the Treasury for the purpose of asking them to grant us more lavish
assistance in organising our S3'steni for obtaining more complete commercial
information in the Colonies, and for assisting our traders there. All we
want them to do for us is what they are doing for us already in
foreign countries. We do not ask for more at the j)resent moment.
We are now considering the question of appointing what I may caU " Imperial
commercial travellers," if I may put it in that form, whose business it will be
to move about in the Colonies to investigate trade conditions and require-
ments, and to see especially where our trade rivals are getting advantage over
us, and to report fully on all these points to the Conmiercial Department of
the Board of Trade. From that Department th(^ information will be confi-
dentially ilisseminated in the proper (piarters. They will also visit the great
industrial centres of this country, and will ascertaiq. what kind of produce

391

raised lu our Colonies there is a i-oal demand for and how best, it can he met
by the colonial producer. We hope by tliis system to produce greater
commercial intercourse between the Colonies and the Mother Country, Avhich
will be to the advantage of all. This is only one out of the many things —
small in themselves perhaps, but important in the aggregate — which we are
not merely thinking over but taking steps to put into actual operation. Any
further suggestions of a kindred kiiul that come from the Colonies -we shall
be most thankful for. We have a natural preference for trading -with our
Colonies, and we would like to know how we could best acliieve our ends in
this regard in a way that would not hurt, but would rather help our people
as well as yours.

Now, we come to tlu' third and undoubtedly the most momentous
question of all. It is also, I need hardly say, the suggestion, the working of
Avhicli is most fraught with dilHcidty — I will even say with danger — and it
has therefore to be approached very carefully and very guardedly with a
sincere desire to give it as favourable a consideration as the exigencies of our
world-wide trade woidd justify. It was also put forward in the iirst instance
by Sir Joseph Ward, and it received the support of all those who have
hitherto taken part in this great del)ate. I think also ^Ir. Deakin and
Mr. ^loor referred to it, and I think also Sir Wilfrid Laurier.

i\rr. DEAKIN : They are all parts of one j)olicy.

Mr. ASQUITH : Sir Wilfrid Laurier had already made
on the subject, I understand ?

a I

Icfinite proposal

Eleventli Day.
6 May 1907.

Pkekerential
Trade.

(Mr.
Lloyd George.)

Mr. LLOYD GEORGE : Yes, he has. It is to improve the connuunica-
tions for transport and transit between the Mother Country and the Colonies.
Let me say now that in considering this proposal we ought at once to
eliminate any idea that a policy oi general subsidies would in the least degree
benefit our shipping. From that point of view, it has been proved by the
experience of France and other coimtries that any notion of helping shipping
by means of general State subsidies is thoroughly unsound, and may even be
disastrous ; ami I therefore at once dismiss any suggestion -which may be made of
approaching this question of improA-ed commimicat ions from that point of view.
The P)ritish Government, you may depend upon it, has gone into this matter
very carefully. I do not mean merelj' the present Government. When our
trade rivals are subsidising steamshijDs, there is naturally enough a panic
from time to time in this country amongst those who are financially interested
in our shipping, and any momentary set back which is inflictetl on
our shipping is always attributed to the aggressive policy of foreign
Governments. We have subsequently always found on investigation, that the
extent to which foreign governments do aid their shipping has been in every
case grossly exaggerated. The subsidies of Germany are not, with one or two
exceptions, at all considerable factors in the development of their trade. In
fact, if you compare the subsidies of Cicrmanjf with Avhat we are giving
to our shipping in the way of payment for postal services, I do not think
that they pay their shipping on as generous a scale as we do. With those
one or two exceptions, which I have already mentioned, where by means in
the one case of a direct subsidy to their East African line of steamers,
which has now crept on to Durban, ami in other cases, by means of through
rates of traffic on their railway system, by which undoubtedly they are
assisting, not merely their shipping, but to a much larger extent their export
trader (he is the man who benefits most by that and not the shipowner)

Mr. DEAKIN : Tliere is the extraordinary growth of the Nord-deutscher
Lloyd in recent years ; its recent union with tlie Hamburg-Amerika ; and the
dividend it pays.

H 1. 1

392

Eleventh Day. Mr. LLOYD GEORGE : I am not reflecting upon our own shipowners,

6 May 1907. but tliat is very largely due to the extraordinarily skilful management of a

Preferential
Trade.

most magnihcent organisation.

Mr. DEAKIN : That adds to it.

Mr. LLOYD GEORGE: There is no doubt about that. Fortunately
some time ago the late Government appointed a committee to inquire into
shipping subsidies, and I think bj' way of giving confidence to my friend
Sir William Lyne, I ought at once to say that four out of ths six members
of the Committee appointed for that purpose were strong Tariff Reformers.
They heard a good deal of evidence ; they examined a good many documents ;
they sat long and they sat late ; and after I think weeks, if not months, of
careful sifting of all the evidence, they came to a conclusion which was
unhesitatingly adverse to a j)olicy of general government suljsidies for British
shipping. As this is a matter of great moment, I will make no apology for
referring to the conclusions arrived at by this important Committee, 1 will
not read them out but I Avill put them in : —

Recommexdatioxs of the Select Committee ox Steamship Sibsidies.

" Your Committee trust, in conclusion, that they have collected a
large amount of valuable information ; they are not directed l)y the terms
of the reference to make recommendations, but it may be convenient to
summarize their opinions expressed in the course of this Report. They
are : —

" 1. That the granting of shipping subsidies at consideralile pecuniary
cost bv foreign Governments has favoured the development of com-
j)etition against British shipowners and trade upon the principal routes
of ocean communication, and assisted in the transfer from British to
continental ports of some branches of foreign and colonial trade ; but
that, notwithstanding the fostering effect of subsidies upon foreign
competition, British steam shipping and trade have in the main held
their own, and under fair conditions British shipowners are able to
maintain the maritime commerce of the country.

" 2. That sidjsidies are the minor factor, and commercial skill and
industry the major factors, of the recent development of the shipping and
trade of certain foreign covmtries, and notably of Germany, Avliere, for
example, the granting of through bills of lading via the State railways
has had an important effect. In some other countries subsidies have led
to no satisfactory results.

" 3. That the subsidies given by foreign Governments to selected lines
or owners tend to restrict free competition, and so to facilitate the
esta])lishinent of federations and shipping rings, and therefore that no
subsidy should be granted without Government control over maximum
j-at.es of freight and over this combination of subsidised with unsubsidised
owners to restrict competition.

" 4. That the competition of British shipowners with their commercial
rivals upon fair conditions, wdthout Government interference l\v way of
subsidies, or l\v way of control of freights is more healthy, and likely to
be more beneficial to the nation and Empire than a State-sul)siilised,
and State-controlled system under which the shipowner would have to
depend less upon his individual energy and skill, and more ii]kiii the
favour and support of the Government.

393

" 5. That n qciieral system of sul)sidies other than for services rendered -Eleventli Day.
is costly and inexpedient. .6 Mav 1907.

" G. That rare cases occur where in view of special imperial considera- Prefekestiai.

tions subsidies are necessary for establishing fast direct British com- •Tkauk.

muiiication and that at the present moment sucli a sid)sidy shoidd l)e (^Mr.

favourably considered for a lino to East Africa Avhere there is no direct Lloyd iJeorge.)
British steamship service, and where British trade is handicapped liy
foreign subsidised steamship lines.

" 7. That in all cases of subsidies it is desirable as far as possil^le to
oliserve the following principles :- -

" (i.) That every endeavour should be made to maintain the pre-
eminence of British lines, and that it is desirable to secure imification
of control by placing the final negotiations in the hands of a small
permanent Committee.

"(ii.) That a condition of adequate speed should form part of every
subsidy, to ensure rapid communication within the Empire, or to
secure fast carriers of food supplies in time of war, or to meet
Admiralty rei|uircments.

"(iii.) 'i'hat no British subsidy should be granted except on
condition that the whole or partial sale or hire of any ship in receipt
of the sul)sidy caiuiot take place without permission of the
Government.

" It is desirable that the nuijority of the boards of dii-ectors of
subsidised companies should be British sul)jects.

" (iv.) That on sidjsidised vessels tlio captain, officers, and a
proportion of the crew ought to be British subjects.

" S. That with a view to the fair competition 'of British shipowners
with their foreign rivals-

"(i.) Board of Trade regulations should l)o enforced against foreign
ships equally with British ships.

" (ii.) Light dues should be abolished.

" (iii.) M(>ans should be taken to obtain the removal of foreign laws
and regulations which exclude the British shipowners from the trades
appropriated by various foreign Powers to their own shipping as
"coasting trade," and that if need be, regulations for the admission of
foreign vessels to the British and Colonial trade of this Empire should
be used with the object of securing reciprocal advantages for British
shipowners abroad."

Mr. LLOYl) GEORGE: The Committee rej)orted very strongly against
general subsidies, and they came to the conclusion that subsitlies are the minor
factor, and commercial skill and industry the major factors, in the recent
development of the shipping and trade of certain foreign countries, and notablj'
of Germany, where, for example, the granting of through l)ills t)f lading by
the State railways has had an important effect. In some other countries
subsidies have led to no satisfactory resiUts. May I say this, that in my
judgment if we wanted really to give the best possible CfOvernment assistance
to our trade it would be by means of a reconsideration of the whole problem
of our railway system, because the railway system in Germany is so worked
as to assist the export trade of Germany. Gur railway system is worked
here so as to help the man who wants to import JVom foreign countries. The
German railway is a bonus on exports ; the British railway is a bonus to the
foreign exporter to this country.

394

Eleveuth Day. ]\[j._ DEAKIN : One of your lines of railway discriminates in favour of

6 May 1907. foreign imports as against Colonial imports.

Trade. Mr. ASQUITH : A\ hat is that m reference to?

Mr. DEAKTN : Danish Ijutter and dairy produce has a preference on
one, if not more, lines of railway in this country. I have that on the
authority of people in the trade.

Mr. LLOYD GEORGE : There are very bad cases. We are being
driven to consider very carefully the whole policy of our railway system.

Sir WILFRID LAURIER : What is the system you refer to ?

Mr. DEAKIX : The through rate.

Mr. ASQUITH : An inclusive through rate.

Sir JOSEPH WARD : The German through rate I understand is given,
provided it is shipped in a German ship.

Mr. LLOYD GEORGE : It is a through rate. For instance, you pay,
let us say, 56s. a ton from a point inland in Germany to Durban. Siipposing
you have to go 400 miles further inland to get those goods, instead of paying
what would be a fair and reasonal^le railway rate for the transport of the
goods, say, from Magdeburg to Bremen, you only pay an additional Is. or
2s., or some trifling sum of that sort. It is obvious that it does not pay the
railway to carry these goods at a half-penny or a farthing per ton per mile.
Therefore, somebody must be making up the loss, and the loss falls upon the
railway system as a whole. The shipowner gets his 51s., or whatever the
charge may be. The loss does not fall upon him ; he does not contribute.

Sir WILFRID LAURIER : That is the question of long haulage and
short haidage. You may have goods put on for many miles paying no more
than for short haulage. It is a constant source of trouble, not so much in
Canada as in the United States.

Mr. DEAKIN : Many of the Trust operations in America have been
conducted imder that cover.

Sir WILFRID LAURIER : That is one of their operations ; but their
operations are legion. It is the cause of trouble in the United States much
more llian in Canada.

Mr. LLOYD GEORGE : It is a much more glaring thing than that.
For instance, you would hardly charge practically the same rate for carrying
goods for 10 miles as for carrying them 500 miles, would you?

Sir WILFRID LAURIER : I understand that under the present system
they make through rate from the point inland to port of exportation botli for
the railway and shipping.

Sir JOSEPH WARD : At a low rate if going by their own shipping.

Mr. ASQUITH : To tlie ultimate ]X)int ofdestination.

Tkadk.

395

Sir JOSRPfl WARD : For instance, from Munich to Constantinople a Klevendi Dny.
German who is a nianul'actnrer and exporter of a siniihir line of .n'oods to a rtMavinoT.
manufacturer in England can, in some form or another, get a rate from — —

Muni(;h to Constantinople so as to give him the chance of obtaining the trade in 1'i!i:ikki;ntiai.
the Levant more fa voura I )ly than another manufacturer producing an article
in England of the same character can get to the sea-board and on to a steamer.

Mr. LLOYD CtEOI^GE: I know. Here is a case. "The mileage rate

" charged under this tariff " — this special through-rale tariff — " by the German

" State railways for the carriage of goods may be approximately estimated in

" in the following manner. Taking, for instance, the rati; per ton of

" 1,(K)U kilos for fO ton lots of the highest class of goods (such as india-

" rubber articles, hats, silks, electro-plate, shoes, &c.) from Munich to Alexan-

" dria, Braila, Constantinople, Galatz, &c., this Avould be 71s. Taking on the

" other hand the rate for the same goods to the same destination from lierge-

" dorf about 10 miles only from liandnirg, the same is only otis. Id. It wunld

" result therefrom that 14.s-. 11*^. is the mileage rate for the railway carriage

" between ^Munich and Bergedorf, and that the rate per ton per mile (as

" Munich is ■i[}3 miles from Bergedorf) is thus a fraction over one-third

" of L/." No railway in the world can carry those goods at that rate, it
therefore means (hat the cost falls upon the State system of railways.

Sir AMLFRID LAURIER : Do you mean the loss is borne bv the
State ?

Mr. LLOYD GEORGE : By the railways. The whole system belongs
to the State in Germany, and the State makes a great jirofit upon the system
as a whole. It pays them undoubtedly well. The Gennan traders I saw here
a short time ago, were very satisfied witb the whole system, and tsaid it was
worked in such a way as to assist the development of trade and industry
there.

Sir JOSEPH WARD : The whole thing is scientifically worked now.

Mr. LLOYD GEORGE : Y>s. I have put in the conclusions of this
Committee, so that the Mend)ers of the Conference can peruse them at tlieir
leisure. 1 would not think for my part of even considering a suggestion of
this character if it were intended in any way as a proposal for buttressing
up British shipping at the expense of the general tax-payer. I think it is
better to say so at once, in order to clear that idea out of the wa3^ It will
make it all the easier for us to discuss the proposal actually outlined from
other points of view. I gather that that is the opinion of Sir Joseph ^Vard
also. He has not put it on the ground of sidjsidising ships.

Sir JOSEPH WARD : Certainly not.

Mr. TjLOYD GEORGIA: I know his anxiely is -and that anxiety we
share with him — to bring the Colonics and the ^lother Country iiearei-
together in point of time, and to bring their ])roduce to the marivct, if
possible, at rates which would not unchdy handicap them in comjietitiou with
foreign countries. We realise that the Empire produces almost every
conceivable conunodity requir(>d by her inhabitants. One of the advantages
of an iMnpire so widely scatti'red is that it ]ioss(>sscs every character of
climate and soil ; but on the other hand the disadvanlagi' of such geographical
distribution is to be found in the dithcidty of bringing the commodities to
its consumers in the different parts of the Empire as required. This resolves

396

Eleventh Dav. itself into a questiou of facilities for transport : tlie provision of the means

6 May 1907. foi" rapid and inexpensive communication l^etween the constituent parts of the

Empire. 'I'he problem that has been suggested to ns by Sir Joseph Ward and

ritEi-EKEXTiAL gi^. Wilfrid Laurier and other speakers is to reduce, as far as possible, the
^^^^- natural disadvantage of distance under which we suffer. The prompt and

T 1 \^c a ^ ^^^^ cheap delivery of foods, perishal^le articles, and raw materials is a very
o}i leorge. ^^^ factor to the consumer and manufacturer, and it is these commodities
which are so largely produced in the Colonies and so largely required in this
country. The development and acceleration of inter-Imperial communication
for business pui'poses would imdoubtedly be a movement in which all parts
of the Emj^ire would share for their mutual benefit. It would result, not
only in increased facilities for the inarketing of goods and for stimulating the
development of trade, but in giving important opportunities to the movement
of individuals from one part of the Empire to another. By bringing the
distant parts of the Empire nearer to the centre it would make the Empire
more compact. All that is an essential element in trade. This is the proposal
which is put before us, and it is well worthy of our best, and, I would say, of
our most innnediate consideration. We have hail no schemes placed before
us up to the jiresent, and in a decision of such vital consequence, direct
and indirect, not merely to the trade, but to the general efficiency of the
Emjjire, the method of working is of the very essence of the scheme. I could con-
ceive plans which with the best intentions in the world would lead to dissension,
difficulty, perhaps disaster ; but it ought not to be beyond the resources of
British statesmansliip to devise some plan which will achieve an end in itself
so desirable. In my mind, it woukl have at least this one advantage over
preferential tariffs. I believe — and in this I slaare the conviction of millions
of my fellow-countrymen — that a preferential tariff, necessarily involving as it
does a duty on corn and raw materials, would increase the price of products
which it is necessary that our people should get at the lowest possible price.
In that I gather from Mr. Deakin, he does not quite agree with me ; and
Dr. Jameson certainly took excej^tion to that statement when I made it
before. On the other hand, the imi^rovement of our transport facilities would
have the effect of cheapening the price of the Colonial commodities which we
are so anxious to get into our markets to feed our manufacturers and our
men. Now, you may ask whether I have anything definite to propose. The
proj^osal was first made to us hy Sir Joseph Ward on Tuesday last. He, I
gather, is not j)repared to submit any definite, settled, and thought-out
scheme. He contented himself in his speech with giving a general indication
of the lines upon which a discussion of this topic might usefully proceed.
Would it not be well that schemes should be elaborated in detail after
thinking out all the rainifications of the problem with which we are con-
fronted V 1 have during the last few days seen a good many men who are
experts on such questions, and talked to them upon this subject, and whilst
they have convinced me that the difficulties to be overcome are enormous, I
am not satisfied that the project is a hopeless one. C)nce these schemes have
been prepared and presented with the full responsibility of the respective
Governments behind them, we might then each examine them and confer
further on the question.

There is one other matter to Avhicli I feel I ought to refer. It has been
imputed to the Government of which I am a member that it has cold-
shouldeix'd the Colonies.

Mr. I'EAKIN : Are you referring to a remark made by me?

' jMr. LLOYD GEORGE : I think it was made by you.

Mr. 1 )EAKIN : I have already pointed out several times that the very
.necessary habit of newspaper compression was responsible for that expression

307

being misintorpretetl. I was speaking to an audience of ladies — tlie Victoria Elevenih D«v.
League — where I met a deputation from the British Women's [^migration 6Alaviyo;".

League. Both in speaking to me complained as otliers did of not receiving ihe

encouragement which they thought they were entitled to from the Government P"efekential

of this country. Their com])laints related to matters extending over a certain rade.

number of years, and therefore refers not to any particular government but ^ ueakm.")

to yonr governments in general. Complaints of what we in the Colonies with

our habits of State action certainly consider an unsympathetic attitude in

your governments and departments generally are constantly made. I was

speaking on that platform in that relation, urging them not to cease their

admirable work of sending out Avomen of character and reputation and

assisting theni to become establislunl in the Colonies, nor to cease to use your

educational systems to familiarise them with our advantages. I iirged them

not to be discouraged by any cold-shouldering on the part of governments or

their departments. Some of my colleagues here were present. I was urging

them not to relax their efforts nor to permit themselves to be crushed, but to

appeal from the departmental neglect and to rely upon pidjlic support to

enal)le them to do what we in the Colonies think our (governments ought to

assist them in doing there. It Avas in that particular relation the word " cold

shoulder " was used. I had uot at the moment anything in my mind tliat

has transpired at this Conference.

Mr. LLOYD GEORGE : I aui sure 1 am delighted to hear that.

Mr. ASQUITH : And I, too.

j\[r. DEAKIN : If I had anything to say on that, topic that would not
hav^e been the meeting or the jjlace at wiiich i should have said it.

Mr. LLOYD GEORGE : That is what I thought. It would have been
better to say it here lace to face. I am not quarrelling -so much with what
you said as with the interpretation placed upon it by certain journals. I
am jiot sorry I have referred to it, because it has given Mv. Dcakin the
opportunity of clearing u]) that matter.

]\Ir. DEAKIN : I have corrected it in several places already.

Mr. LLOYD GEORGE : All I say is, that we have given to the Colonics
the answer which they Avould have given us if we had endeavoured lo induce
them for Imijerial or other reasons to change their iiscal sj-steni, a system
established, according to Mr. Deakin, purely in the interests of Australia.
That is the fiscal system you consider best in the interest of Australia.

]\fr. DEAKIN: Our iiscal system in the interest of Australia anil our
preference system in the interest of the I'-mpire.

Mr. LLOYD GEORGE: Wc couhl have given them no otlii-r reply to
any proposal which involved the taxing of the food of the people ; and the
Colonial representatives knew that befon* they started for tliis Conference.
I would ask them to consider what are the conditions of a thickly-popidated
country like ours, dependent for its supplies on other lands. If Australia
and New Zealand had the same population per square mile as Great Britain has,
then the Australian census would reveal the presence of more than a thousand
millions of men and women and children crowded on Australian soil,
dependent inevitably as we are for the very necessaries of life upon what
is brought to their harbours of the surplus of other lands. Let Australia
pray God, when that time comes, that she may have no slums on her soul.

398

Eleventh Day. Mr. DEAKIX : We will uot, if legislation can prevent it. •

G Mav 1907.

,. Mr. LLOYD GEORGE : I know. I was verv much impressed by Avhat

Tr vue. ^^^' Joseph Ward told me about the social position of the people of New

Zealand. He assured me that for years no beggar had accosted him in that

fortunate land. We, in these old countries, are not so happily circumstanced.

Neither Free Trade nor Protectionist countries can claim that they are inunune

from dire poverty and distress amongst large masses of their population.

We have in every old country of the world multitudes of poor people

who from the cradle to the grave, are never out of sight or hearing

distance of the wolves of hunger. Attempts have often been made to saddle

our fiscal system with resj)onsibility for the distress of our times ; there might

have been something to say for that had Protectionist countries been free

from the same condition, and also if it had not been for the fact that Britain

is, in spite of everything, the richest covmtry under the sun per head of her

population. Free Trade has been a great success as a Avealth-creating machine,

and all this wretchedness is not so much the sorrow as the shame of Great

Britain. Had our Colonial friends proposed resolutions calling upon xis to

use the gigantic resources of this country to put an end for ever to a condition

of things which is a blot on the fair fame of the Empire as a whole, then we

should have been happy to have assented to their resolution, and to do all in

our power to give it effect. But an alteration in our fiscal system is not

going to achieve this end ; the causes are deeper, as they are older, than any

existing fiscal system. The most rabid Free Trader would not have

contended that the abolition of the tarift's of the Continent would put' an

end to all the poverty that exists in Continental countries, and we feel

perfectly certain that a change from Free Trade to Protection would simply

aggravate the distress we wish altogether to avert. You seem in the New World

to be profiting l)y the bitter experience of the Old, and dealing thoroughly and

eftectively Avith the social and economic evils that afflict your people ere those

evils harden into malignity ; but when we seek to heal those sores in these

tradition-bound countries, Ave do so timidly and fearfully, as men would

attempt interfering with the dispensations of Providence. It Avill be a lung

time ere we can sununon the courage to apply remedies which you have

already boldly used for less aggravated evils. In the meantime there Avill be

much suft'ering and privation in this land of abundant plenty. We beseech

you, then, not to lend countenance to any schemes which, hoAvever much they

might profit you, Avould have the effect of increasing by one grain of sand

the Aveight of unendurable poverty noAv borne by many sous and daughters of

this affluent country.

I am exceedingly obliged to the Conference for having listened to me
so patiently.

Adjourned to tc-morroAv at half-past 10 o'clock.

^U)9

TWELFTH DAY. Twtini. Day.

7 Mav lUOT.

Held at the Colonial Office, Downing Street,
Tuesday, 7th :\rAV lt»(»7.

Present :

The Right llouourablo Thf. EARL OF ELGIN, K.G., Secretary of State

for the Colonies (President).

The Right Honourable Sir "Wilfrid Lai rii:r, G.C.M.G., Prime Minister
of Canada.

The Honoura])le Sir F. W. Borden, K.C.M.G., Minister of Militia and
Defence (Canada).

The Honourable L. P. Brodelr, ^Minister of ^Marine and Fisheries
(Canada).

The Honourable Alfred Deakin, Prime ^Minister of the Commonwealth
of Australia.

The Honourable Sir W. Lyne, K.C.M.G., Minister of Trade and Customs
(Australia).

The Honourable Sir JosErn Ward, K.C.]\I.G., Prime Minister of New
Zealand.

The Honoural)lc L. S. Jameson, C.B., Prime Minister of Cape Colonj-.

The Honourable Dr. Smartt, Commissioner of Public Works (Cape
Colony).

The Right Honourable Sir Robert Bond, K.C.M.G., Prime Minister oE
Newfoundland.

The Honourable F. R. Moor, Prime Minister of Natal.

General The Honourable Louis Botha, Prime I\riiiister of the Transvaal.

The Right Honourable Winston S. CiuRcniLL, ^I.P., Parliamentary
Under Secretary of State for the Colonies.

Sir Francis Hopwood, K.C.B., K.C.M.G., Permanent Under Secretary
of State for the Colonies.

Sir J. L. Mack-ay, G.C.i\I.G., K.C.LE., on behalf of the Lidia Office.

Mr. H. W. Just, C.B., C.M.G., ") t • , o ,
Mr. G. W. Johnson, C.M.G., ' j Joint Secrefcm

'tL'y.

^Ir. W. A. Robinson,

Assistant Secretary.

Also present:
The Right Honourable H. H. Asquith, M.P., Chancellor of the Exchequer.

The Right Honourable D. Lloyd George, M.P., President of the Board
of Trade.

Mr. W. RuNCiMAN, M.P., Financial Secretary to the Secretary.

400

Twelfth Day. Mr. IT. TiLEWELLYN S.MiTii, C.B., Permanent Secretaiy to the Board of

7 Mu' 1907. Trade.

Mr. A. Wilson Fox, G.B., Comptroller-General of tlie Commercial,
Statistical, and Labour Departments of the Board of Trade.

Mr. G. J. Staxi.ey, C.M.G., of the Board of Trade.

Mr. Algernon Law, of the Foreign Office.

Mr. TIIOALA.S W. HoLDERNESS, C.S.I., of the India Office.

PREPEREKTI.A.L CITAIR^IAN : I am not quite sure how the members of tlie Conference

Tkade. would wish to proceed at this particular point oL' our proceedings, but I tliink

we are all agreed that we must, iC possible, close the discussion on whicli we
have been engaged the last few days during this sitting. I only wish to say
Avith regard to myself, tliat I do not wish to detain the Conference by any
intervention in this debate, because the case for the Government has been
put liy the lieads of those departments of Plis Majestj^'s Government who are
specially responsible, and, as far as I am concerned, I am entirely in accord
with the principles and sentiments which they have expressed ; biit my
friend, and the representative of the Colonial Office in the House of Commons,
Mr ( !hurchill, would like to say a few words to the Conference on one
particular side of this question of which he is specially in charge, and I ask
the Conference to hear him now.

:\Ir. DEAKIN : We shall all be delighted.

Mr. WINSTON CHURCHILL : Lord Elgin and gentlemen, the economic
aspect, both from the point of view of trade and finance, of the question of
Imperial Preference has already been dealt with very fully liy the Chancellor
of the Exchequer and the President of the Board of Trade, and I desire in
the very few observations with Avhich I shall venture to trespass upon
the indulgence of the Conference to refer very little to the economic
aspect, luit rather to examine one or two points about this question
of a political, of a Parliamentary, and almost of a diplomatic character.
I want to consider for a moment what would be the ell'ect of a system
of preferences upon the course of Parliamentary biisiness. The course of
Colonial alfairs in the House of Commons is not always very smooth or
very simple to discover, and I am l)ound to say that, having for one-and-a-
half years been responsible for the statements on behalf of this Department
Avhich are made to the House of Commons, I think enormous difficulties would
be added to tlie discharge of Colonial Inxsiness in the House of Connnons if
we were to involve oiirselves in a system of reciprocal preferences. I think
everyone will agree, from whatever ])art of the King's dominions, or to what-
ever ])arty he belongs, that Colonial affairs suffer very much when brought
into the arena of British party politics. Sometimes it is one party and some-
tiiiu's it is another which is concerned to interfere in the course of purely
Colonial affairs, and I think such interferences are nearly always fraught with
vexation and inconvenience to the Dominions affected. Now, the system of
Iniperial preference inevitably brings Colonial affairs into the Parliamentary
and the party arena ; and, if I may say so, it brings them into the most
unpleasant part of Parliamentary and political work, that part which is
conceriKMl with raising the taxation for each year. It is very easy to talk about
prefen-nce in the abstract and in general terms, and verj' many j)leasant things
can be said aliuiit mutual profits and the good feeling which accrues from

401

commercial intercourse. But in regard to preference, as in regard to all other Twelfth Day.

tariff questions, the discussion cannot possibly be practical unless the proposi- 7 May 1907.

tions are examined in precise detail —in exact and substantial detail. Many "7~

people will avow themselves in favour of the principle of preference who '"^rKAPB.

would recoil when the schedule of taxes was presented to their insiiection. ,,, ^,. , , .,, ^.

TicT T ■ ^ r •ITll (Mr. L'hlllflllll.;

1, thereiore, leave generalities about preference on one side, i leave also
proposals which have been discussed that we should give a preference on
existing duties. I think it is quite clear that no preference given upon
existing duties could possibly be complete or satisfactory. It could at the very
best only be a beginning, and Dr. Jameson and Dr. Smartt when they urged
us with so much force to make a beginning by giving a preference on South
African tobacco have clearly recognised and frankly stated that that preference
would in itself be of small value, but that it would be welcomed by thern
as conceding the larger principle. Therefore, I think, we are entitled to say,
that before us at this Conference is not any question of making a small or
tentative beginning on this or that particidar chity, but we have to make up
our minds upon the general principle of the application of a reciprocal
preference to the trade relations of the British Empire. If that l)e so, I am
bound to say that I think that the representatives of the self-governing
Dominions who ask us to embark on such a system ought to state bluntly and
abruj)tly the duties which would be necessary to give effect to such a proposal.
I thought what IMr. Deakin said on this point was extremely correct. He said
that if the principle of preference were agreed upon between the Mother Country-
and the Colonies, it would be left to each partner to that general resolution to
select the duties by which they would give effect to the principle of
preference. That is a very correct attitude, and I am quite sure that
Mr. Deakiu was very glad to be able to assume it. I know, in the House
of Commons, mj'self, the satisfaction with which I have been able sometimes
to parry an awkward question with a highly correct answer. The question
Avhether raw material is to be taxed is absolutely vital to any consideration
of Imperial preference. Although I think it is a very good answer, when
the direct question is raised, to say that the Colonies would leave that to the
^Mother Country, those who urge upon us a system of reciprocal preference
are bound to face the conclusions of their own policy, and are bound to
recognise that that reqiiest, if it is to be given effect to in any symmetrical,
logical, complete, or satisfactory, or even fair and just manner, must involve
new taxes to us on seven or eight staple articles of consumption in this country.
I lay it down, without hesitation, that no fair system of preference can be
established in this couutiy which does not include taxes on bread, on meat, and
on that gi-oup of food stuffs classified under the head of dairy produce, and
which does not also include taxes on wool and leather and on other neces-
saries of industry. No uniform or fair system whicli did not include that
could possibly be established. If that be so, seven or eight new taxes
woidd have to be imposed to give effect to this principle you have brouglit
before us. Those taxes would have to figure every year in our annual
Budget. They Avould have to figure in the Budget resolutions of every
successive year in the House of Commons. There would be two opinions
about each of these taxes ; tliere will be those who like them and favcMir
the principle, and who will applaud the policy, and there wiU be those who
dislilve them. There will be the powerful interests which will be favoured
and the intei-ests which wiU be hurt by their ai)j)lication. So you
will have, as each of those taxes comes up for the year, a steady volume of
Parliumoutary criticism directed at the taxes. Now that criticism will, I
imagine, flow through every cliannel by which those taxes maj' l)e assailed. It
will seek to examine the value, necessarily in a canvassing spirit, of the
Colonial Preferences as a return for which these taxes are imposed. It will
seek to dwell upon the hardship to the consumers in this country of the taxes

e 48«fi8. C c

402

Twelfth Day.
7 May 1907.

Frefekential
Trade.

(Mr. Cbiircbili.)

themselves. It will stray further, I think, and it will examine the contributions
which the seK-governing Dominions make to the general cost of Imperial
defence ; and will contrast those contributions with a severe and an almost
harsh exactitude with the great charges borne by the Mother Coimtry.

Mr. DEAKIN : We have enjoyed that already for some time.

Mr. WINSTON CHURCHILL : It is perfectly true that there has been
a debate upon that subject in the House of Commons, but the manner in
which that question when raised was received by the whole House, ought, I
think, to give great satisfaction to the representatives of the self-governing-
Dominions. We then refused to embark upon a policy of casting-up balances
as between the Colonies and the Mother Country, and, speaking on behalf of
the Colonial Office, I said that the British Empire existed on the principles of
a family and not on those of a syndicate. But the introduction of those seven
or eight taxes into the Budget of every year will force a casting-up of
balances every year from a severe financial point of view. Now, I think it
has been said, and will be generally admitted, that there is no such a thing
in this country as an anti-Colonial party. It does not exist. Even parties
not reconciled to the British Government, who take no part in our public
ceremonial, are glad to take opportunities of showing the representatives
of the self-governing Dominions that they welcome them here, and desire to
receive them with warmth and with cordiality. But I camiot conceive any
process better calculated to create an anti-Colonial party, to manufacture
an anti-Colonial party than this process of subjecting to the scrutiny of the
House of Commons year by year, through the agency of taxation, the profit
and loss, so to speak, in its narrow financial aspect, of the relations of Great
Britain and her Dominions and dependencies.

Then, I think, that this system of reciprocal preference, at its very outset,
must involve conflict with the principle of self-government, which is at the
root of all our Colonial and Imperial policy. The Avhole procedure of oiir
Parliament arises primarily from the consideration of finance, and finance is
the peg on which nearly all our discussions are hung, and from which many
of them arise. That is the historic origin of a great portion of the House
of Commons procedure, and there is no more deeply-rooted maxim than the
maxim of " grievances before supply." Now, let me suppose a system of
preference in operation. When the taxes come up to be voted each year,
members would use those occasions for debating Colonial questions. I can
imagine that they would say : We refuse to vote the preference tax to this
or that self-governing Dominion unless our views, say, on native policy or
some other question of internal importance to the Dominion affected have
been met and have been accepted beforehand. At present, it is open to the
Colony affected to say : These matters are matters which concern us ; they are
within the scope of responsible self-governing functions, and you are not
called upon to interfere. It is open for the Dominion concerned to say
that. It is also open for the representative of the Colonial Office in
the House of Commons to say that, too, on their behalf. But it will
no longer be open, I think, for any such defence
when sums of money, or what would be regarded

be voted in the House of Commons
for the purpose of according preference

to be offered
as equivalent to

or
sums of money, have actually to
through tlie agency of these taxes

to the dift'erent Dominions of the Crown, and I think, members Avill
say, " If you complain of our interference, why do you force us to
" interfere ? You have forced us to consider now whether we will or will not
" grant a preference to this or that particular Dominion for this year.
" We say we are not prepared to do so unless or until our views upon this or

403

" tliat particular internal question have been met and agreed to." I confess Twelfth Day.
I see a fertile, frequent, and almost inexhaustible source of friction and 7 May l9o7.
vexation arising from such causes alone. „

l^REFEKKNTl AL

Then I should like to say that there is a more serious infringement, as it Trade.

seems to me, upon the principle of self-government. The preferences which (jjr. Clnncliill.)
have hitherto been accorded to the Mother Country by the self-governing
States of the British Empire are free preferences. They are preferences
wliich have been conceded by those States, in their own interests and also in
our interests too. They are freely given, and, if they gall them, can as freely
be withdrawn ; but the moment reciprocity is established and an agreement
has been entered into to which both sides are parties, the moment the
preferences become reciprocal, and there is a British preference against the
Australian or Canadian preferences, they become not free preferences,
but what I venture to call locked preferences, and they cannot be removed
except by agreement, which is not likely to be swiftly or easily attained.

Now, Lord Elgin, I must trench for one moment upon the economic
aspect. What does preference mean ? It can only mean one thing. It
can only mean better prices. It can only mean better prices for Colonial
goods.

Dr. JAMESON : Oh, no. It will make a much larger volmne of trade,
which is often better than better prices.

Mr. WINSTON CHURCHILL : I assert, without reserve, that
preference can only ojjerate through the agency of j^rice. All that we are
told about improving and developing the cultivation of tobacco in South
Africa, and calling great new areas for wheat cultivation into existence iji
Australia, depends upon the stimulation of the production of those com-
modities, through securing to the j^roducers larger opportunities for profit.
I say that unless preference means better prices it will be ineffective in
achieving the objects in favour of which it is urged.

Dr. JAMESON : Surely if I seU 100 lbs. of tobacco at ^d. per lb. profit
I do much better than selling 5 lbs. at fcZ. per lb. profit. Surelj'^ that is very
patent.

Mr. WINSTON CHURCHILL: But the operation of preference consists
in putting a penal tax upon foreign goods, and the object of putting that
penal tax on foreign goods is to enable tlie Colonial supply to rise to
the level of the foreign goods plus the tax, and by so conferring upon the
Colonial producer a greater advantage, to stimulate him more abimdantly
to cater for the supply of that particular market. I say, therefore, without
hesitation, that the only manner in which a trade preference can operate is
through the agency of price. I am bound to say that if preference does not
mean better prices it seems to me a great fraud on those who are asked to
make sacrifices to obtain it. It means higher prices — that is to say, higher
prices than the goods are worth if sold freely in the markets of the world.

Dr. JAjMESON : If you iise the words " more profit " instead of " better
prices," then that will explain the thing.

Mr. DEAKIN : Wholesale production is always cheaper than retail.
It would be a great advantage to our farmers if they could snnply increase
tlieir acreage at existing prices. On the whole transaction, without the

C c 2

404

Twelftli Day. alteration of a farthing in prices, they then would be much better off, because
7 May 1907. they would cultivate a larger crop more cheaply, transmit it more cheaply,
and get the shipping accommodation more cheaply in l^ulk. They would
PuEPEKENTiAL get all thc advantages of wholesale production instead of retail production.

-L xC A 1 1 Pj .

(Mr. Deakin.)

Mr. WINSTON CHURCHILL: If there is no enhancement of price
to be expected on the part of the Colonial producer, why does not he now
embark on all these developments which are promised ?

Mr. DEAKIN : Because with present supply to your open market that
might mean reducing the j)rice below the profitable limit. We are satisfied
with the prices of the last four or five years, but if we had produced inuch
more we might have brought it below that satisfactory limit, unless we had a
preference. It really amounts to what I tried to put as the wholesale and
retail argument without alteration of price.

Mr. WINSTON CHURCHILL : There is an advantage in wholesale
production. I am not disputing that.

Mr. F. R. MOOR : A more important point is this, it stimulates the
population of yovu" large Colonies where you have such an enormous
undeveloped area of country.

Mr. WINSTON CHURCHILL : That is quite true. I am quite ready
to admit that the fact that you make a particular branch of trade more
profitable, induces more people to engage in that branch of trade. That is
what I call stimulating Colonial production through the agency of price.
I am quite prepared to admit that a very small tax on staple articles
would affect jDrices in a very small manner. Reference has been made
to the imposition of a shilling duty on corn, and I think it was
Mr. Moor who said, yesterday, that wdien the Is. duty was imposed prices
fell, and when it was taken off prices rose. That may be quite true.
I do not know that it is true, bi;t it may be. The imposition of
such a small duty as Is. on a commodity produced in such vast
abundance as wheat, might quite easily be swamped or concealed by
the operation of other more powerful factors. A week of unusual sunshine,
or a night of late frost, or a ring in the freights, or violent speculation,
might easily swamp and cover the operation of such a small duty ; but it is
the opinion of those whose economic views I share — I cannot put it higher
than that — that whatever circumstances may apparently conceal the effect
of the duty on prices, the effect is there all the same, and that any duty
that is imposed upon a commodity becomes a factor in the price of that
commodity. 1 should have thought that was an almost incontestable
proposition.

Mr. DEAKIN : Most of your propositions seem incontestable to you, but
oar experience refutes many of them.

Mr. WINSTON CHURCHILL : In that respect, Mr. Deakin, I enjoy the
same advantage of conviction as you enjoy yourself.

Mr. DEAKIN : We do not say our opinions are incontestable. We say
they are open to argument and illustration by experience.

405

Mr. WINSTON CHURCHILL : Here yoii have the two different sides 'ij^elf'-l' ^")-
of the bargain, the sellers and the buyers, the sellers trying to get all they " Mii.v iy07.
can, and the buyers trying to give as little as they can. An elaborate process p , k.ntial
of what is called the higgling of the market goes on all over the world Tkadk.

between exchanges linked up by telegraph, whose prices vary to ^'jjtli and
•g^nd. We are invited to believe that with all that subtle process of calc;ulation
made from almost minute to minute throughout the year, the imposition of a
duty or demand for 1,000,000Z. or 2,000,000L for this or that Govermnent,
placed suddenly upon the commodity in question as a tax, makes no difference
whatever to the cost to the consumer ; that it is borne either by the buyer
or by the seller, or provided in some magical manner. As a matter of fact,
the seller endeavours to transmit the burden to the purchaser, and the pur-
chaser places it upon the consumer as opportunity may occur in relation to
the general market situation all over the world. That is by way of
digression only to show^ that we believe that a tax on a coimnodity is a
factor in its price, which I thought was a tolerably simple proposition.
AVhat a dangerous thing it will be, year after year, to associate the idea of
Empire, the idea of our brethren beyond the seas, the idea of these great
yoimg self-governing Dominions in which our people at present take so
much pride, with an enhancement however small in the price of the
necessary commodities of the life and the industry of Britain ! It seems
to me that, quite apart from the Parliamentary dilHculty to which I have
referred, which I think would tend to organise and create anti-Colonial
sentiment, you would, by the imposition of duties upon the necessities of
life and of industry, breed steadily year by year, and accumulate at the
end of a decade a deep feeling of sullen hatred of the Colonies, and of
Colonial affairs among those poorer people in this country to whom
Mr. Lloyd George referred so eloquently yesterday, and whose case when
stated appeals to the sympathy of everyone round this table. That, I think,
would be a great disaster.

But there is another point which occurs to me, and which I w^ould
submit respectfully to the Conference in this connection. Great fluctuations
occur in the price of all commodities which are subject to climatic
influences. We have seen enormous fluctuations in meat and cereals and
in food stuffs generally from time to time in the w^orld's markets. Although
we buy in the markets of the whole world, we observe how much
the price of one year varies from that of another year. These
fluctuations are due to causes beyond our control. We cannot control the
causes which make the earth refuse her fruits at a certain season, nor can
we, unfortunately, at present, control the speculation which always arises
when an imusual stringency is discovered. Compared to these forces, the
taxes which you suggest should be imposed upon food and raw materials
might, I admit, be small ; but they would be the only factor in price which
would be absolutely in our control. If, from circumstances which we may
easily imagine any of the great staple articles which were the subject of
preference should be driven up in price to an unusual height, there would
be a demand — and I tliink an irresistible demand — in this country that the
tax should be removed. The tax would bear all the uniaopidarity. People
would say : " This, at any rate, we can take off, and relieve the l)Tirden which
is pressing so heavily upon us." But now see the difficulty in which
we should then be involved. At present all our taxes are under our own
control. An unpopular tax can be removed ; if the Government will not
remove it they can be turned out and another Government can be got
from the people by election to remove the tax. It can be done at once.
The Chancellor of the Exchequer can come down to the House and the tax
can be repealed if there is a sufficient demand for it. But these food taxes
by which you seek to bind the Empire together — these curious links of

e 48Gfi8. C c 3

406

IVelfth Day.
7 May 1907.

Preferential
Trade.

(x\Ir. Churchill.)

Empire wliicli you are asking us to forge laboriously now, would be
irremovable, aud upon them would descend the whole weight and burden
of popular auger in time of suffering. They would be irremovable because
fixed by treaty with self-governing Dominions scattered about all over the
world, and in return for tliose duties Ave should have received concessions
in Colonial tariffs on the basis of Avhich their industries would have grown up
tier upon tier through a long period of time. Altliough, no doubt, another
Conference hastily assembled might be able to break the shackle which would
fasten us, to break that fiscal bond which would join us together and release
us from the obligation, that might take a great deal of time. Many
Parliaments and Govermnents would have to be consulted, and all the
difficulties of distance would intervene to prevent a speedy relief from that
deadlock. If the day comes when you have a stern demand, and an over-
whelming demand of a Parliament in this coimtry, backed by the democracy
of this country suffering acutely from high iood prices, that the taxes should
be removed, and on the other hand the Minister in charge has to get up and
say that he will bring the matter before the next Colonial Conference two
years hence, or that he will address the representatives of the Australian or
Canadian Govermnents through the agency of the Colonial Office, and that in
the meanwhile nothing can be done — when you have produced that situation,
then, indeed, you will have exposed the fabric of the British Empire to a
wrench and a shock which it has never before received, and which anyone
who cares about it cannot fail to hope that it may never sustain.-

Dr. JAMESON : Would not it be possible to mitigate this " awful shock "
by making some original reservation to provide for these awful possibihties —
these emergencies ?

Mr. F. R. MOOR : We have it already.

Dr. JAMESON : There are often reservations for emergencies in treaty

oltligations.

Mr. WINSTON CHURCfflLL : It is not a mere question of goodwill
on either side. When you begin to deflect the coarse of trade you deflect it
in all directions and for all time in both countries which are parties to the
bargain. Your industries in your respective colonies would have exposed
themselves to a more severe competition from British goods in their markets,
and would have adjusted themselves on a different basis, in consequence.
Some Colonial producers would have made sacrifices in that respect for the
sake of certain advantages which were to be gained by other producers in
their country by a favoured entry into our market. That one side of the
bargain could be suddenly removed without iDflicting injustice on the other
party to the bargain, appears to me an impossibility.

Those are practically all the observations with which I wish to trouble
the Conference, and I must say I am very much obliged to members of the
Conference for the patience Avitli which they have heard these views.

I submit that preferences, even if economically desirable, would prove
an element of strain and discord in the structure and system of the British
Empire. \Vhy, oven in this Conference, what has been the one subject on
which we have differed sharply? It has been this question of preference. It
has been the one apple of discord which has l)een thrown into the arena of our
discussions. It is quite true we meet here with a great fund of goodwill on
everybody's part, on the part of the Mother Country and on the part of the
representatives of the self-governing Dominions — a great fund of goodwill
which has been accumulated over a long period ol' time when each party to
this great confederation has been tree to pursue its own line of development

407

unchecked and untrammelled by interference from the other. We have that Twelfth Day.
to start upon, and consequently have been able to discuss in a very frank and 7 May 1907.
friendly manner all sorts of questions. We liave witnessed the spectacle of "

the British Minister in charge of the trade of this country defending at ' trvde. '^
length and in detail the iiscal system — the purely domestic, internal fiscal ,^^^ Chnrrbill.')
system of this country from very severe, though perfectly friendly and
courteous criticism on the part of the other self-governing communities.
If that fund of goodwill to w-hich I have referred had been lacking,
if ever a Conference had been called together when there was an
actual anti-colonial party in existence, when there was really a deep
hatred in the minds of a large portion of the people of this country against
the Colonics and against taxation which was imposed at the request or desire
of the Colonies, then I think it is quite possible that a Conference such as
this would not pass off in the smooth and friendly manner in which this has
passed off. You woidd hear recrimination and reproaches exchanged across
the table ; you would hear assertions made that the representatives of the
different States who were parties to the Conference were not really repre-
sentatives of the true opinion of their respective populations, that the trend of
opinion in the country Avhich they professed to represent was opposed to their
policy and would shortly effect a change in the views which they put forward.
You would find all these undemocratic assertions that representatives duly
elected do not really speak in the name of their people, and you would, of course,
find appeals made over the heads of the respective Governments to the party
organisations which supported them or opposed them in the respective
countries fi'om which they came. That appears to me to open up possibilities
of very gi'ave and serious dangers in the structure and fabric of the British
Empire, from which I think we ought to labour to shield it. My Right
Honourable friend, the Chancellor of the Exchequer, has told the Conference
with perfect truth — in fact it may have been even an imder-estimation — that
if he were to propose the principle of preference in the present House of
Commons it would be rejected by a majority of three to one. But even if the
present Government coiild command a majority upon the subject, they woxdd
have no intention whatever of proposing it. It is not l^ecause we are not ready
to run electoral risks that we decline to be parties to a system of preference ;
still less is it because the present Govermuent is unwilling to make sacrifices,
in money or otherwise, in order to weave the Empire more closely together.
I think a very hopeful deflection has been given to oiir discussion when it is
suggested that we may find a more convenient line of advance bj" improving
communications, rather than by erecting tariffs — by making roads, as it
were, across the Empire, rather than by building walls. It is because we
believe the principle of preference is positively injurious to the British
Empire, and would create, not imion, but discord, that we liaA'^e resisted the
proposal. It has been a source of regret, I think, that on this subject we
cannot come to an agreement. A fundamental difference of opinion on
economics, no dou])t, makes agreement inqjossible ; but although Ave regret
that, I do not doubt that in the future, when Lnperial unification has been
carried to a stage which it has not now reached, and Avill not, perhaps, in our
time attain, people in that more fortunate age will look back to the Conference
of 1907 as a date in the history of the British Empire when one grand Avrong
turn was successfully avoided.

Sir WILFRID LAURIE R : Lord Elgin and gentlemen, I think we have
spent nearly a week over this subject, and perhaps the time has come now
when we may reach a conclusion upon it. At the opening of this debate I
stated that, for my part, I intended at the proper time to move again the
resolution which Avas affirmed by the Conference of 1902. I have listened

C c 4

408

Twelfth Day.
7 May 1907.

Preferential
Trade.

(Sir Wilfrid
Laurier.)

with very great interest, as everybody has, and very great attention also, to
everything that has been said, and I see no reason at present to change the
opinion which I formed then.

Mr. Deakin, in the course of the verj- able presentment which he made of
the case as he conceived it on the part of the Dominions beyond the Seas,
referred us to the case of the German Zollverein. Sir William Lpie, who
followed, took the same line also. It is certainly a case in point, and the only
regi-et I have, for my part, is that I cannot see my way to accept the policy of
STich a Zollverein as was adopted in Germany towards the year 1830, if I
remember right. Nor do I see that any of the Dominions which are
here represented could be in a i)osition to accept that i^rinciple. In the
case of the German people, commercial unity preceded political unity. With
us. political unity exists. We are all subjects of the same Sovereign. The
question before us is whether or not commercial unity can also foUow. The
German peoples when the Zollverein was first introduced, were, if I may use the
expression, a mob of principalities. There was quite a number, some 30 or
more dependencies of all sizes, some big and some small, and each one had its
own Sovereign, with common language, common institutions, and practically
the same economic conditions. But they all had tariffs one against the other.
There was a customs house at every few miles. When the Zollverein was
adopted aU this was done away with, and they adopted a common commercial
union. They abolished the customs houses, established amongst themselves
a system of Free Trade, and established a customs cordon around their own
country. If it were possible for us to have a system of Free Trade over the
whole British Empire, and a customs cordon around the British Empire, for
my part I would accept this as the very ideal of what the British ICmpire ought
to be. I have expressed the opinion more than once, and I will express it again.
The Americans have a system of Free Trade amongst themselves covering 45
States now with a population of over 80,000,000 people. The Germans have a
system of Free Trade among themselves covering nearly 60,000,000 people. The
French have a system of Free Trade among themselves of some 40,000,000
people. If it were possible to have a system of Free Trade covering the whole
British Empire with its population of something about 400,000,000, it would
imdoubtedly be one of the greatest benefits that could be given to the British
Empire, and, perhaps, to the world. Unfortunately this cannot^ be done, and
for two reasons. First, the British people, as I understand at(-present their
political opinion, are not prepared to limit their system of Free Trade even to
the extent of the boundaries of the Empire. The other reason is, that the
self-governing dependencies which are here represented are^not prepared to
extend the system of Free Trade to the limits of the Briie "Jat :npire, nor even
to the extent of their own boundaries. These factors are here before us, and
we must accept them as they are.

Mr. DEAKIN : Is not the fact that the British Government raises so
large a proportion of its revenues by Customs duties, as do also the several
Dominions, a very serious consideration ?

Sir WILFRID LAURIER : No. 'I'he British Government at the present
time do not raise their revenue from Customs, except upon those articles
which are luxuries and a fit subject of taxation— spirits, tobacco, wine to a
certain extent— but I think wine can be discarded out of the discussion. A
large extent of the revenue raised by Customs by the British Parliament is
also the subject of Excise duties. It is strictly a subject held by all civilised
nations at the present time, as being eminently a source of revenue, and
which should be treated for revenue purpeses. We do this in Canada also. We
submit spirits and tobacco not only to Customs but to Excise duties, and m

409

our preference we have eliminated those articles from the preference. We Twelfth Day.
do uut give any preference upon British tobacco or upon British spirits. 7 May 1907.

I was at a point when I said that the Dependencies which are here

represented are not in a position to accept this system of universal Free 1'Refekential
Trade within the Empire. I speak for Canada, and I think I speak for u-^ •

Australia, though Mr. Deakin, Sir Joseph Ward, and all others present, Laurie, )"^
will be able to speak for themselves. In Canada, at present, we have
only two sources of revenue, customs and excise — no other. We have
no income tax and no direct taxation of any kind. Though I hold as
the ideal policy, a policy of Free Trade within the Empire, even if at this
moment the British Government were to tell us : " Yes, we are prepared to
" give you a preference ; that is to sa)-, we are prepared to give Free Trade
" all over the Empire," I would not be prepared, for my part, to accept it.
If we had Free Trade within the Emj)ire we would have thereby the
preference which we all seek for. Our goods woidd come free, the goods
from other countries would become subject to taxation or duty, if I may
use the term which ^Ir. Deakin prefers, and therefore we shoidd have fi'eedom
from taxation in the British market. But if the British Government were to
tell us in Canada : " We are prepared to adopt Free Trade if you are
" prepared to adopt Free Trade, and that will give you the preference you
" seek," I should have to say for Canada that we are not prepared to
do that because we must insist upon our system of customs duties in order
to raise our revenue. If we were to go and ask the Canadian Parliament or
people to abandon their present system of present customs' duties for
revenue purposes, the whole of the Canadian people would say : " No, we
" are not prei:)ared to do that. We jnust insist upon our present system.
What is true of Canada, I think, is also true of Australia ; I think is
also true of New Zealand ; I think is also true of Newfoundland, and also
of the Cape, Natal, the Transvaal, and of every Dependency which is
here represented. There is the situation. We knew it in 1897, when
we adopted the system of preference which we have given to Great
Britain. Why did we do it ? We did it because we were intensely
convinced in the country which I represent that a great advantage would
accrue fi'om preferential trade within the Empire. Wc could not do it in any
other way. We gave our preference to the British products in our countiy.
We did it deliberately, and have had no cause to regret it since. So little
cause havv we had to regret it that, whereas in the first instance the prefer-
ence was only 15 per cent., one or two years later we increased it to 25 per
cent., and, again, have increased it since to 33^ per cent. We have revised
the tariff during the present Session, or the last Session, which closed a few
days ago, and we have maintained our preference of 33^ })er cent, with one or
two exceptions only on limited articles. We have in some cases increased it,
and in some cases decreased it ; but, on the whole, we have maintained
the 33J per cent. This has been adopted without any serious challenge even
on the part of the Opposition. Then why have we done it? We did it
because we believed in the system of preferential trade, and beheved, and now
know that, by adopting this system, we would improve our trade, that is
to say, we believed that the British people would buy more from us ami we
would sell more to them, and that has certainly been the result of it.

Mr. Asquith in the course of the remarks which he offered the other day
I think did not give the Canadian preference the whole of the benefit to which
it was entitled. Discussing our tariff, as it has existed for the last 10 years,
he remarked that the incidence of protection so far as regards British
trade and American trade was 13 per cent, with regard to liritish trade,
and 19 per cent, with regard to American trade. I do not dispute those
figures, but those figures are not exactly leading to a proper appreciation of
the policy which we have elaborated. We have done everything that we

410

Twelfth Day.
7 May 1907.

PREFERENTIAr.

Trade.

(Sir Wilfrid

Laurier.)

could — that has been our policy — to throw the whole of our trade towards
Great Britain. We are side by side with a nation — one of the wealthiest and
most enterprising nations on earth to-day — the American people. They are of
the Anglo-Saxon race, the gi-eat commercial race of the world, and if anything
they are perhaps more enterprising than their progenitors, and put in perhaps
more energy and activity to push their trade than any other nation that I know
of. Therefore it is not surprising that in the case of Canada, with a popiilation
now of 6,000,000, by the side of a population of 80,000,000 of such enterprising-
business men as are the Americans, our trade with them should be larger
than our trade with Great Britain. First of all they are double in nim:iber,
being 80,000,000— Avhile you are only 40,000,000. Apart from that they are
neighbours. There is no boundary line except a purely conventional one
over the whole territory. Their habits are the same as ours, and therefore we
are induced to trade and cannot help it by the force of nature. But so far as
legislation can influence trade we have done everything possible to push our
trade towards the British people as against the American people.

Mr. ASQUITH : May I say 1 did not in the least dispute that ? My
object was not, as I think I made clear, in any sense to complain of the
Canadian preference ; on the contrary, I recognise both its intention and its
effect. My jjoint was that natural conditions were such that it was inevitable

that the Americans should get the best of it.

Sir WILFRID LAURIER : Exactly. I do not dispute your intention,
or the fact that yon wanted to give us the full benefit ; but I do not think
with all your goodwill you reached the point that we have helped British
trade in a very considerable degree. In 1897, when we introduced preference
to British trade, the British importations into Canada had fallen to 29,000,000?-.
Now they have reached the figure of 69,000,000L, a very considerable increase.
Of this there are 1G,000,000L uj)on the free list. ^Ve have a very large free
list which covers all possible raw materials — everything of the kind. You
in Britain are not in the position of selling much of what is on the free list
■ — only 16,000,0001. — whereas our imports from the United States of free
goods runs nearly to 80,000,000?.

Now as to the dutiable goods, you have increased those goods to the
figure of 52,000,000L, that is to say iipon 52,000,000L of importations from
Great Britain into Canada, we give joxi a preference of 33J per cent., which
is certainly a valualjle contribution on our part to British trade. Not only
have we done it by preference, by legislation, but we have forced our trade
against the laws of nature and geography. If we were to follow the laws of
nature and geography between Canada and the United States, the whole
trade would flow from south to north, and from north to south. We have done
everything possible bj^ building canals and subsidising railways to bring the
trade from Avest to east and east to west so as to bring trade into -British
channels. All this we have done xecognising the principle of the great
advantage of forcing trade within the British Empire. This principle we
recognise. We are bound to say that though the preference which we have
given has not done as much, perhaps, for British trade as the British merchant
or manufacturer would like, we have told the British people at the same time
that there is a way of doing more. There is the preference of mutual ti'ade,
and this is what we had in view when we adopted in 1902 the resolution
of that year.

Let me read out to the Conference the resolutions of 1902. The first
part is in these terms : " That this Conference recognises that the principle
" of preferential trade between the United Kingdom and His Majesty's

411

" Dominions beyond the Seas would stimulate and facilitate mutual com-
" raercial intercourse, and woidd, by promoting the development of the
" resources antl industries of the several points, strengthen the Empire." I
think we all can agree with that ; but there is a qualification in the next
statement : " That this Conference recognises that, in the present circum-
" stances of the Colonies, it is not practicable to adopt a general system of
" Free Trade as between the Mother Country and the British Dominions
" beyond the Seas." We acknowledged, at that time, it was not possible for
the Conference to do more than tliat up to that time-that it was not possible
to adopt a system of universal Free Trade amongst us. Then we assert :
" That with a view, however, to promoting the increase of trade within the
" Empire, it is desirable that those Colonics which have not adopted such a
" policy should, as far as their circumstances permit, give substantial
" preferential treatment to the products and manufactures of the United
" Kingdom." Upon the principles which are here enunciated in these
three resolutions I think aU those here assembled from the Dependencies
l)eyond the Seas are unanimous in agreeing. The next resolution is in these
words : " That the Prime Ministers of the Colonies respectfully urge on
" His Majesty's Government the expediency of gi-anting in the United
" Kingdom preferential treatment to the products and manufactures of the
" the Colonies, either by exemption from, or reduction of, duties now or
" hereafter imposed." My friend, Mr. Deakin, speaking on behalf of
Australia, has proposed to go one step bej^ond this and to adopt this
resolution : " That it is desirable that the Uiiited Kingdom grant preferential
'* treatment to the products and manufactures of the Colonies."

Perhaps, on consideration, Mr. Deakin would agree with us, that it would
be preferable not to force this, but to keep to the resolution of 1 902. We are all
agreed at this table — those who come from the Dependencies bej'^ond the Seas
— that we have no desire and no intention of forcing a policy which we believe
in, upon the British people, if they aie not prepared to receive it. 1 have
stated a moment ago that a statement had been made — we heard it in 1902,
and we hear it again in 1907 — that the Canadian preference has not done as
much for British trade as had been hoped for. I repeat, there is a way of
doing it ? It is by adopting a mutual system of preference. But again, I
suppose the British Government represented here may saj^ : " No, Ave are not
" prepared to do that. We might improve our trade with our self-governing
'' Dependencies ; but, whilst we might do this, we would disturb the whole
" system of trade and would lose perhaps more than we would gain other-
" wise by disturbing the whole sj'stem of trade that we have in this country."
This is a question which is not for us. I am not prepared to discuss it at this
moment or give it a passing word. This is a matter which is altogether
in the hands of the British pcoj)le, and they have to choose between one
thing and the other ; and if they think on the whole that their interests are
better served by adhering to their present system than liy yielding ever
so little, it is a matter for the British electorate. First of all, 1 exi)ressed my
own views, and I think I expressed the views of aU here assembled, that
nothing could be more detrimental to the existence of the British Em))ire than
to force upon any part of it, even for the general good, a system whicli would be
detrimental locally, or might be believed to be detrimental locally. For my part,
I would have no hesitation at all in resenting any attempt made to force upon
the CiUKuUan people anything wliicli the Canadian people would not believe in
even for the broad idea of doing good to the whole Empire. I think the best
way of serving the whole is, by allowing every part to serve and recognise
its own immediate iuter(>sts. So far as, and as long as, the interests of the
British Empire depend upon this and recognise this principle — that every one
of those communities which are allowed the privilege of administering their
own affairs ])y their own parliaments — the best way is to leave to each

Twelfth Day,
7 May 1907.

Prf.ferentiai.

Tkaije.

(!Sii- Wilfri.l

Laurier.)

412

Twelfth Day,
7 May 1907.

Preferential
Trade.

(Sir Wilfrid
Laurier.)

parliament to decide for itself, and for the people whom it represents
what is best for that conimnnity. That is a principle upon which we
ought to be all agreed. It is a question for his Majesty's Government. It
is a question for the political parties represented here — as we represent
the political parties of oiir respective communities — to determine whether
it is better in the interests of the United Kingdom that they should
continue this system which they have at present or that they should
go as far as, for my part, I would like them to go. Therefore, I have
no more to say upon this point. For this reason, I say it is better
to agree to stand by the Resolution of 1902, as it was.. I am free
to say that at that time when we passed this resolution, we were induced to
pass it to some extent — I will not say immediately, but certainly influenced
in our determination — by the fact that at that time, certain duties had been
put upon cereals in a moment of urgency during the war, and we thought
at that time that it would be good policy to give a preference upon these.
But the British Parliament thought differently, and removed the duties
instead of giving us a preference. They thought they owed it to their people
not only not to give a preference upon that, but to remove altogether that
Avhich they conceived did not perhaps at the time but might have put a
burden upon the great mass of the consuming people of the country. For
my part, I enter upon no discussion upon the moot point whether the
imposition of a duty wo^dd or would not increase the price of bread. This is
a matter which in some instances might do it, and in others perhaps might
not do it. This is a matter which would be altogether regulated by
circumstances, and I pass it over to those who have to deal with this question
within the United Kingdom.

Having said that much, 1 come now to the next resolution : " That the
" Prime Ministers present at the Conference undertake to submit to their
" respective Governments at the earliest opportunity the principle of the
" resolution, and to request them to take such measures as may be necessary
" to give effect to it." It may be, perhaps, not out of place to say a word as
to what has been done with regard to giving effect to this resolution. The
third resolution stated this : " That with a view, however, to promoting the
" increase of trade within the Empire, it is desirable that those Colonies
" which have not already adopted such a policy, should, as far as their
" circumstances permit, give substantial preferential treatment to the
" products and manufactures of the United Kingdom." What has been done
since 1902, during the five years which have intervened, to give effect to this
resolution ? It is a point which perhaj)s may be considered here. Canada
has done everything Avhich it could do in that respect. Before that time we
had adopted the system of preferential trade, and we have maintained it
unimpaired. I understand that the South African Dependencies here
represented, have also by their system of a commercial union amongst them-
selves, given a preference to the British products in their own markets.
They have given it in the line that Canada has given it, that is to say,
covering everything. Now Australia has done something. In 1906,
Aiistralia introduced a system of preference. I remark this, that it was not
until four years after the Conference of 1902 that Australia did this. Why ?
Probably because there were difficulties to adjiist in Australia.

Mr. DEAKIN
Government.

We '^vere then

our whole Commonwealth

Sir WILFRID LAURIER: You did it as soon as you could. Then
according to the figures which were put on the table the other day by

413

Mr. Asquith, the preference was not a universal preference, snch as we gave in
Canada for everything, but simply for 8 per cent, of the importations into
Australia from Great Britain.

Mr. xlSQUITH : It was what Mr. Deakin called a fore-runner.

Sir WILFRID I.AU11IER : That is to say the preference has been
given on some articles and not upon others. In Canada we did it
differently; we gave a preference upon everything except those 'articles
which are subject to excise duty. New Zealand, as I understand, has given a
preference also, not exacth' universal like ours, but covering, as Mr. Asquith
stated, 20 per cent, of the British importations. Why was this ? Why was not
a universal preference given ? The economic conditions in Great Britain are
not the same as in the different Dependencies beyond the Seas, which are all
young nations, and even their conditions are not all alike. They differ
in Canada from what they are in Australia, they differ in Australia from
what they are in jSTew Zealand, and they differ in New Zealand from what
they are in South Africa. That is to say, we are yoimg nations
with different local interests in every particular commmiity. In Great
Britain the conditions are these, that you have an old settled commimity,
the wealthiest in the world, largely developed, having nothing new to do, but
only to press on with what is being done ; whereas in our conunmiities we
have everything to create ; we have manufactures which are new and in a
different condition of development. We feel strong enough in Canada to
give a preference upon all our manufactured products, and if I understand
the theory rightly of the preferential treatment adopted in Australia, and also
in NeAv Zealand, they do not feel strong enough to give a preference even on
the lines of their own manufactures. I think that is the reason why New
Zealand and Aiistralia do not give to the Motherland the whole preference
which we give in Canada. I make these observations just to show that it is
essential to leave to each communitj' the extent and measure of the preference
which it wants to give.

Mr. Deakin has introduced another resolution, and one to which, I, for
my part, would subscribe with both hands, and I would like, Avith some
modification to make it the subject of a special resolution, and not an amend-
ment to the 1902 resolution. It is this : " That it is desirable that the
" preferential treatment accorded by the Colonies to the products and
" manufactures of the United Kingdom be also granted to the products
" and manufactures of other self-governing Colonies." I should sub-
scribe with both hands to this, and on behalf of the Government I
represent here, and the people of Canada, I would be prepared to enter into
an absolute arrangement. Any preference which we give to the Motherland
we will give you, expecting that any preference you give to the Motherland
you will also give us, and with Sir Joseph Ward's Government and the other
Governments we will do the same. That is, so far as it goes, an excellent
principle. The communities which you and I represent here have no free
trade tariffs. We all levy our tariff's in the same way, bj'^ Custom duties, ami
therefore it is easy for us to extend to all parts of the Dominions of the
British Empire, here represented, the treatment which we give to the JMothcr-
land. Speaking on behalf of Canada we have offered it to Australia, and
are prepared to offer it to New Zealand and to the others here represented.

I am coming to a point which was made the other day by Dr. Jameson
with regard to our intermediate tariff'. We have revised our tariff" this year
and have adopted a new principle. We had a two-column principle — a

Twelfth Day.
7 May 190".

Pbekerential
Trade.

(Sir Wilfrid
Laurier.)

414

Twelfth Day. tariff for general purposes and a preferential tariff. Between the preferential
7 May 1907. tariff and the general tariff" Ave have now an intermediate tariff. The object of

this intermediate tariff is to enter into negotiations with other communities to

RLtEREXTiAL }jave trade arrangements with them. It has been supposed that this was to
(S'-Wif'i hit our American neighbours. With our American neighbours we should be
LauiierT only too ghid to trade on a better footing than at the present time. We are
next door neighbours, and in many things we can be their best market, as in
many things they can be our best market. We should be glad to trade
with them ; but it never was intended, nor thought at the time, that this
intermediate tariff' could apply to the United States. There was at one time
wanted reciprocity with them, but our efforts and our offers were negatived and
put aside, and we have said good-bye to that trade, and we have put all our
hopes upon the British trade now. But there are other nations — France is one
and Italy another, with which we could have better trade than at the present
time. France has a minimum tariff and we are prepared to exchange our
intermediate tariff, if they will exchange their minimum tariff with us. But
while giving this intermediate preference, we maintain the system of lower
tariff' to the Mother Country, and to all our fellow British subjects all over
the world. Dr. -Jameson made the point that if we were to enter into such
an agreement with foreign nations, we would debar the possibility of giving
a preference to the Mother Country. Nothing of this kind. Our tariff is not
so constructed, and cannot be so held. If we were to make an agreement
with France, Avhich I doubt whether we could, France would understand the
position ; she would take our intermediate tariff knowing at the same time
there was a lower differential tariff under all circmnstances for the Mother
Country and the British Dominions.

Mr. F. R. MOOR : I am sorry to interrupt, but I would like the Premier
of Canada to assure us on this point. By that amount which you reduce it
to any other foreign power, you reduce your preference with the Home
Land.

Mr. DEAKIN : And with us.

Sir WILFRID LAURIER : I do not admit that we would reduce it, it
would remain as it is ; but the man who trades with us in Great Britain knows
that he may have a competitor not upon the same lines, but upon reduced
lines fi'om our general tariff'.

Mr. ASQUITH : He may have a competitor on the line of the inter-
mediate tariff, if, for instance, you came to an arrangement with France.

Sir WILFRID LAURIER : That is to say, instead of having a margin
of SSjj- per cent, he may have a margin of only 25 per cent. It makes that
difference, no doidjt.

j\Ir. ASQUITH : But it cannot alter the quantiun of preference.

Sir WILFRID LAURIER: No, it cannot alter the quantum of
preference.

Dr. SMARTT : Your tariff is now 33^ per cent. If you introduce an
intermediate tariff, the preference in favour of Great Britain or the other
British Colonies that might reciprocate with you would not be 33^, but
would be reduced.

415

Sir WILFRID LAURIER : It could be reduced by 3 and 4, but never Twelfth Day,

more than 5 per cent. ; that is to say, instead oi' having a preference in our 7 Uav 1907.

market of 33J, he woidd have a preference with regard to tiiat nation say of -^^ —

28 per cent. That woukl be the limit. 1'kekerential

Trade.

Having said that much, there is a point I wish to make here. I thought
of bringing it before the Conference by way of resohitiou, but as it is a question
which allects Canada and Canada alone, I will not do so, because the other
members of the Conference are not interested in it. I stated a moment ago
that we do not desire in any way to interfere with the opinion of the British
people so far as their fiscal policj' is concerned ; but, while I say this, and in
view of having the best relations possible maintained between the Motherland
and the Dominions beyond the Seas, there is one thing, however, which I
think we are entitled to, and that is, that we should be treated with absolute
fairness. Now we have a grievance, and, I think, a Avell-foundcd grievance,
in Canada, with regard to the question of the cattle embargo. For more than
20 years the British Government have pi-actically excluded our live cattle
from their market on the ground that they were tainted with disease. We
resent this in Canada ^I use the word "resent " in the hope that it is not too
strong — as being unfair, because the assertion is iin founded. Our cattle are
absolutely free from disease. Now our exporters of cattle are compelled as
soon as the cattle are landed in the port, say, of Liverpool, to have them
slaughtered immediately on the pretence that they may spread disease and
that they may taint the British cattle. As a matter of fact, everybody knows
at the present time wc arc free from cattle disease. Therefore, day by day,
Aveek after week, cattle come in and are slaughtered immediately, and the
fact that they are bound to be slaughtered immediately obliges the exporter
to take a lesser price for them because of the necessity to find a market
on arrival. If the thing were based upon fact, I could have no word of
complaint to make, but when as a matter of fact the Canadian cattle ought
not to be excluded on that ground, we think that it is a gi'eat injustice to us,
and one which we have serious reason tc complain of. If it were maintained
as a ground of policy ; if you were to say " We do not want the Canadian
cattle to come in in comj)etition Avith British cattle in the market," that
would be quite another matter. That would be a question of policy for the
British Government to which we would have nothing to say. But so long as
they maintain the position that our cattle are excluded for the reason of the
liealth of the British cattle, it is a position which we resent, and which I
bring to the serious attention of the British authorities. We complain that it
is imfair to us, that it is not oidy an injustice, but a slander upon our
position. We have a system of quarantine in Canada which is maintained
at a very great cost in a state of efficiency, and we maintain that our cattle
are just as free from disease as British cattle are to-day. In order to
maintain the good relations, now happily welded between the British Empire
and Canada and all parts of the Empire — but, I am speaking now of a
question which concerns only Canada — I bring this matter to the serious
attention of Flis Majesty's Government. It is a thing which ought not to be
allowed. It is a slander upon our good name. It is a thing which rankles
in our breast because we know it is not fair, and I go further and I say that
it is maintained not upon questions of sanitarj- jprecautions but ulterior
motives which a Free Trade Government should not aUow and uphold.

As I said in opening, I beg to move that the resolutions of 1902 be
reaffirmed.

jVIr. ASQUITII : Perhaps I may just say in reference to what Sir Wilfi-id
Ijiurier said at the end of his speech, tliat, as regards the Canadian cattle, I

416

Twelfth Uiiy. know this to be a very serious matter. I am speaking onlj- for myself and not

7 May 1907. in tlie least for the Government when I say that in my character of a Member

of Parliament, not as a Minister, I have over and over again urged the

Prefekential argument which Sir Wilfrid Laurier has been urging now, in the same
(direction and with the same object, concerning Canadian cattle. That was in

(ilr. Asqiiit i.j j_^_^y private capacity, when I was not in a position of responsibility. As he has
indicated, there are a number of conflicting views and conflicting interests
here, and I will undertake to bring everything he said to the attention of my
Right Honourable friend, the President of the Board of Agriculture, and I-sviU
assure him of its importance.

Mr. LLOYD GEORGE : We fought it very hard when we were in
Opj)osition.

Sir WILFRID LAURIER : Fight it hard, then, now you are in the
Government.

Mr. LLOYD GEORGE : It shows the difficulty of upsetting a thing when
once it is established.

Mr. ASQUITH : It is a very serious question. We do not at all minimise
the gravity oi: it.

Sir WILFRID LAURIER : It is serious ; and the discontent will grow
in intensity in Canada.

Mr. DEAKIN : Lord Elgin and gentlemen, there is a House of Com-
mons' paper which appears in the " Times " of this morning relating to
Imperial trade — No. 133 — which appears to be pertinent to the subjects
before us. Perhaps it might be included in our Proceedings. It shows the
values of the trade of the United Kingdom, Canada, Australia, New Zealand,
and British South Africa, in 1906.

Mr. ASQUITH : It was moved for by your fiiend, Mr. Harold Cox.

Mr. DEAKIN : The mover is immaterial, but the facts are of some
interest, and they might as well be added.

Mr. ASQUITH : Put it on the Minutes, certainly.-

Mr. DEAKIN : Yes, it shows the rather curious circumstance that
Australia must be an importer to the Mother Country of an exceptional
amount of dutiable goods, or, as you would call them, taxable goods.
Practically, Canada imports the same as we do. They send 28,000,000Z. to
our 29,000,000L

Mr. ASQUITH : Yours is wine and rum.

Mr. DEAKIN : Canada pays in duty 15,000L, and we pay in duty
106.()00f., as against South Africa, 16,000L So that ours is an exceptional
position, which I do not think is quite realised.

* For this Return, sec page 4il.

417

Mr. ASQUITH : The wine and rum accounts for it.
Sir WILFRro LAURIER : How is it explained ?

given the

ought to be
pushed even

Mr. DEAKIX : The Chancellor of the Exchequer has
explanation that our wines and spirits — rum particularly — are highly dutiablr
articles. Nevertheless, it brings out some differences in trade which are rather
interesting.

It seemed to me that it would be undesirable that the very striking
address of your colleague, the Under Secretary of State, should pass without
notice from our point of view, both because it merited criticism in itself, and
because it offers so much temptation. May I be permitted to say, first, that
among the subjects upon which we hesitate to enter are discussions of
the methods of business in the House of Commons, of which, I am sure,
Mr. Churchill is a master. It strikes me, as an outer barbarian, that it is
rather extraordinarj- even to suggest that the business of the Empire and
its transactions, instead of being dealt with on their merits, and sought for
their advantages, are to be limited in order that they may not clash with the
procedure maintained in the Mother of Parliaments. As I have said, what
that procedure may lack is not for us to discuss ; but one would suppose that
the efforts of members of that most distinguished of all Parliaments would
tend to shape their means of handling their business so as to meet the
demands of the Empire. Surely it ought not to be considered an impediment
of a serious character that, owing to the way in which budgets may be dealt
with in the House of Commons, the introduction of any further financial
issues is to be prohibited because they might involve delay and possible
friction. I merely mention this to suggest that the remedy
applied to the procedure, and not to the business of the countn*.

Passing from that, may I say that a similar argument was
fvirther in the direction of what appears to me, with all respect, an artificial
plea, that no preference is possible unless it is complete, uniform, and
scientifically perfect. All I can say is that I have never yet seen a tariff, and
never expect to, that I have never yet seen a budget, and never expect to, in
any countrj* of the world, which fulfils those conditions. Of course the ideal
is one towards which it is desirable to direct attention. Assuredly the
method we pursue in Australia, with which I do not profess to be enamoured,
is open to very serious comment if that high standard be maintained. T\'e
have a tariff which is very defective, and is about to be revised this year,
which wiU continue defective after its revision, and wiU never be absoluteh'
uniform, or by any means complete. It wiU be simply the best rule-of-
thimib arrangement we can devise. We have a parallel and related bounty
system, which I cite in this connection because it may be perhaps more
properly contrasted with our proposals for preferential trade. Our bounty
system at the present time is merely a rudimentar>- tentative proposal,
covering perhaps some dozen particular interests which the Parliament of
the Commonwealth believes it to be profitable to foster. The treatment
we are proposing of the cultures to be encouraged is not, and cannot be,
made uniform, and is not, and cannot be, made complete. I am not
arguing against completeness or against uniformitj'. We all realise that
those are ends to be kept in view, but if we are to delay action untQ those
are achieved we should wait for ever in each and aU of our business enter-
prises. In matters of trade, speaking for ourselves, with our limitations
of knowledge, we have no great faith in abstract or even in concrete doctrines,
because the fluctuations of commerce are continuous, and our knowledge of
them varies so much from date to date. There are hundreds of different
factors, to which ^Ir. Churchill himself graphically aUuded, that come mlo
play irregularly or unexpectedly, and we recognise that these require to be

Twelfth Uaj.
7 May 19CI7.

I'RErERESTIAJL

Trake.

e lt>66ti.

D.I

418

Twelfth Day.
7 Mav 1907.

Preferential
Trade.

(Mr. Deakin.)

met by fresh adaptations from time to time. Then, if I may be pardoned
for saying so, it did appear to me to be somewhat inconsistent, that
Mr. Churchill's argument against preference was based first of all upon an
assumption that the duties, or taxes as he prefers to call them, which may
be imposed are to come up for review, and are to be the subject of criticism
every year. Yet at a later period of his address he referred to any reciprocity
arrived at as being embodied in a treaty. This, I should have thought the
only practicable means of dealing with this subject. I cannot imagine a
reciprocity Avhich would be shifting on one side or the other or on both
year by year, and which would thus come up for yearly re-discussion.

': Mr. WINSTON CHURCHILL : It is not only a question of Parliamentary
procedure. The procedure in Parliament embodies the rights which the
Commons of England have won over a thousand years of constitutional
struggles, and they are rights which can be asserted, and there is no right
more fundamental or more jealously held than the right of criticism of
taxation, and I cannot believe that that right would ever be parted from by
the House of Commons in whole or in part. That was my point.

Mr. DEAKIN : That was one of the points, but if any reciprocity is to
be arranged at all, it must be arranged by a treaty, for three or five years,
as both parties might agree. The assent of the British Parliament once
given to such an arrangement it certainly could not come under direct review
in an effective way until the expiration of that period whatever it was.

Mr. WINSTON CHURCHILL:
would be irremovable.

It would be subject to criticism, but it

Mr. DEAKIN : Anything is subject to criticism ; but it would not be
terminable except by mutual consent or at a definite period, and certainly
it would not encourage criticism more than the Budget, as a whole, does.
There would be a tendency to pull the new plant up by the roots to see if it
was growing, but that occurs in regard to the thousand-and-one or rather
the ten thousand and many different things affected by or affecting the
finances of the country. Criticism we must always have, and I am sure the
Under Secretary of State W'Ould not be associated with any proposal to limit
that criticism. His argument that these proposals, because they are financial,
invite criticism, applies to the whole scale of the operations of the Empire.
While this Empire continues to grow, its figures and finances will continue to
grow. That gives a greater field for criticism or review, but I do not suppose
anybody wishes to check the growth of the Emj)ire in order to avoid that
criticism. Consequently, that mutual arrangements for mutual benefit are
to be deprecated, becavise they afford temptation to critics and possible
friction, is to apply an argument which no one wiU attempt to push to its
logical conclusion. It is a fair debating point to make — but I must relinquish
comments of a personal character, as Mr. Churchill has had to leave —
that it suggests the indulgence of a riotous imagination when we find
the Under Secretary pointing to the natural, the ordinary, the inevitable
proceedings in every Legislature as grounds for rejecting a new develop-
ment of policy, because it must involve a clashing of interests, and the
annual review of its incidence by Parliament. Is our party system to destroy
everything except itself ? Are we to put aside great projects because they
are debateable, or close the Empire to avoid friction in the House of
Commons ? We cannot move without friction, nor live without differences
of opinion. We cannot advance without the clash of opposing interests.
Every development of self-government, and every growth of our industrial

419

life, and every extension of the powers of the State, invite criticism and Twolftli Day.

require it. Free criticism is the breath of our constitution. To shrink from " May 1907.

great tasks or newer enterprises because of the greater burden tliey impose ., .""Z.

upon representatives, and representative institutions, means simply shrinking Tua.de.

from growth, and the responsibilities of growth. If we wish one we must /^j^. l^^.^^^^^^ ^

take the others. It is impossible for us to become more closely united,

indeed, it is impossible for us to develop our own local self-governments in

any direction without running more of those verj' risks which Mr. Churchill

has painted with great eloquence and with much force, but as it appears to

me, with a momentary oversight, of the fact that he is really condemning

our whole system of Government and its adaptability to modern needs. He

is criticising, by implication unfavourably, that Parliamentary system which

he is ostensibly at the same moment enthusiastically upholding or intending

to uphold.

Plis argument is also fatal to all possibilities of conunercial relations, not
only within the Empire but without the Empire. You can have no arrange-
ment with a foreign country' of any kind based on mutual concessions ; you
must not even go the length that Canada, South Africa, and New Zealand have
ventured to go. You must stop far short of that. You must hesitate before
you press for most-favoured-nation treatment anywhere, because that means
making discriminations ; you wiU be getting advantages ; you will be over-
coming disadvantages, but you are bringing yourselves and your relations
with them into the arena of conflict. If there are such dangers from friction
within the Empire there must be danger from the same commercial friction
without the Empire. If his argument is pushed, as it ought to be pushed, a
stage further, it means cutting off Great Britain from anj^ l)usiness negotia-
tions with her rivals involving possible causes of friction with them, or
possible causes of further discussion in the House of Commons. More than
that, I should have said in his presence that his argmnent appears to me to
go to the root of the Empire as an Empire. It would isolate Great Britain, not
only in trade, but in every other operation forbidding joint action ; it would
tell against every operation by agreement. It woidd enforce isolation. I
am sure that is not what the Under Secretary of State intended. I am
perfectly prepared to be told that he sees where he is going to draw the line,
but, I cannot see why, to use his own words, if he follows out the logical
deductions of his own argument, he can stop short of a complete isolation of
the Mother Country from all her Colonies in matters of trade and commerce,
and from all foreign countries. Finally, he has to count with the effect of
his disruptive and extreme doctrines of individualism when they come to be
applied to any state action whatever, even in this country itself.

CHAIRiVIAlSr : I think he spoke specially of food and raw material.

Mr. DEAKIN : He did speak specially of duties on food and raw
materials as affording special cause for complaint. This argument applies
in either a greater or lesser degree to everything else, although he properly
laid most peremptory stress just now upon them. To other duties ()r
agreements about duties as to other forms of political action it applies with
varying force. There are matters far from aU fiscal connection which might
become almost as vital, but it wouhl be idle to pursue this speculation
further. As his remarks were general and theoretical from first to last,
and as he admitted himself developed a doctrine, I meet them in the same
general and rapid way. The interjection of the Chairman is pertinent, since
it was upon the treatment of food and raw materials that Mr. Churchill dwelt,
but the whole of his thesis as to dangers of friction, delays in the House of
Commons, and the other various dilliculties he foresees applies of necessity to
the whole range of possible political bargains and activities.

Dd 2

420

Twelfth Day.
7 May 1907.

Preferential
Trade.

(Mr. Deakiu.)

As at another part of his address Mr. Churchill alluded to preference
as implying what ahnost amounted to a revoting of any reciprocity each year,
another allusion of his mentioned the discussion of reciprocity granted to
some particular Dominion. We have not got far on the road of preference
in this Conference for many reasons supplied by Ministers themselves, but if
we had reached any practical propositions, I do not think any member would
have been heard proposing and defending a special grant to each particular
Dominion. Sir Wilfrid Laiirier has ali-eady touched upon this point,
incidentally, Avhen he spoke of the scope of Canadian preference, and
contrasted it with the more discriminating preferences of Australia and
New Zealand. But no one, so far as I am aware, has had in A'iew a
particular negotiation Avith each particular Dominion. What we all had in
contemplation, if preference had approached the practical stage, Avas a general
agreement of a simple character at first, which might in time be supplemented
and extended. Its enlargement Avoidd be based on experience, but, so far as
I am aware, no one has projected a separate and independent agreement
to be improvised noAv between the Mother Country and each of the self-
governing Colonies.

If the ai-gument of the Under Secretary with reference to the grave
Parliamentary risks inherent in dealings with reciprocity or financial
proposals is sound it applies already Avith practically equal force wherever
preference has been given. I do not profess an intimate acquaintance with
the course of Canadian public affairs, but Sir Wilfrid Laurier will correct
me if I am wrong in stating, that so far as I am able to follow Parlia-
mentary proceedings in his coimtry, none of the disastrous consequences
which Mr. Churchill painted as inseparable fi'om all tariff adjustments have
yet ensued. I am not aware that Sir Wilfrid Laimer has found that every
year the preference granted to Great Britain, though it is still unrecip-
rocated, provoking the angry contention, occasioning the gTeat friction, and
involving the fierce animadversions upon those concerned in it, Avhich are
to accrue in this country if his theory Avere true.

a lot.

Sir WILFRID LAURIER : It was in the first year, but it has abated

Dr. SMARTT : As it would do here.

Mr. DEAKIN : As it Avould do, I take it, in every other country. Any
new course permits misapprehensions and invites challenge in the first place.
It has only been partly tried for a short time and is not fully appreciated.
Every first essay is likely to call for some amendment to Avhich criticism is
properly directed. But listening to the very forcible utterances of the
Under Secretary, one naturally looks to actual experience to discover the
long chain of very hazardous and serious consequences which he insists
must flow in this country Avhenever these are to be criticised, or upon
which comment is possible every year. What is our experience after the
granting of preferences ? In Canada, Ncav Zealand, and, Avith a shorter
experience. South Africa, Ave have budgets as controversial, legislators
just as sensitive to public opinion, oppositions just as hostile and eager to find
material, sections just as able to make use of any Aveapon in the armoury of
parliamentary procedure. We have seen all those forces in play in the
politics of Canada for a number of years and in the other Dominions for a
certain number of years, without their furnishing us Avith any single instance
of any exceptional aliuse or injuiy due to the existence of their preferences,
or indeed of their tariffs. Whence the sweeping conclusions can be draAvn
as to the effects upon Parliament of the existence of financial relations of this

421

kiutl which Mr. Churchill depictetl as not in these Dominions it is impossible Twelftl) Day.
to guess. Consequently, I venture to submit that his view of parHamentary 7 suiy 1907.

proceedings is as abstract as his view of the economic considerations which

he aftenvards urged. In that field, I do not propose to follow him, liecause I PREt;^EKENTiAL

have already indicated that our own experience teaches us that the field of kade.

abstract economics is as far from the actual practical considerations whicli ^ Ueakin.)

operate in the daily woi"king of our financial and legislative expedients as are

the principles of pure mathematics from the daily labours of a carpenter or

joiner. It is true tliat those principles are all implied in his handling if you

search for them far enough. Li all he does, and in every motion his body

makes, he obeys what we are pleased to call the laws of nature. But

doctrines collected into an abstract system, whether of political economy or

mathematics, really apply only outside this workl of limitations, of sense and

experience. Undoubtedly they have a certain application within it if you can

get your theory to exactly agree with all the conditions of a particular set of

circumstances ; as a matter of practice, to dwell upon them leads to confusion

and beating the air, while the study of the actual consequences of our own

acts, in our own surroundings, or for their action and re-action as discovered

in facts and experience, is, so far as we can jiidge, the only method which it

is safe for politicians with business, and practical men of every calling to

employ.

Really when the Under Secretary went on to speak of the possibility of
sullen hatred (a phrase he repeated on more occasions than one), being
aroused liy the existence of preferences if they were found to Ije burdensome,
and of darkly revolutionary proceedings which were to ensue, he again
entirely ignores our own experience. There were oscillations in the opinions
of the public of my country before they settled down finally to our accepted
policy, oscillations which we frequentlj' witnessed in Australia while we had
six States all pursuing much the same experiments — fiscally now in favour
of higher Protection and then iji favour of lower duties towards Free
Trade. I do not think that the temperature of politics is any lower in the
Commonwealth and its States than elsewhere. I might even be prepared to
maintain the contrary from my own personal experience. But in the bitterest
struggles that we have ever had upon exactly the matters on which
Mr. Churchill dwelt so strenuously, when we were charged with taxing the
food of the people and taxing the raw materials of manufacture, and
particidarly the implements of agriculturists, all these contentions though
fought out with the greatest bitterness politically at the moment, have
vanished and will leave not a trace behind. There was no time at which they
severed the ordinary relations that (il)tained between Members of Parliament
who held the most absolutely diverse views. At no time have our factions
shown more than the usual amount of resentment which accompanies
differences of opinion. We have been through the precise experience which
the Under Secretary of State has had to imagine for himself as occurring
in this country in the future under the application of preference. The
reality bears no resendjlance to his nightmare. Our tariff has been handled,
and it has been handled a great deal ; when we had six States, some State
or States were always "tinkering" with their tariffs. We have had
experience of pretty well every kind of fiscal experiment that can be devis(Hl,
and every kind of strife that can arise out of it, but we have founil nothing
whatever in our own actual experience to justify Mr. Churcliill's morbid
anticipations. I venture to say that in a country of this kind, witli its more
established institutions and greater population, with a power of more easily
resisting relatively small sections greater than we possess, although it seems
almost an offensive thing to say, I have absolute coniidence in the House of
Commons and of its capacity to sustain quite as much strain as we have so
long experienced, and proliably a very great deal more.

e itHKH. D (1 3

422

Twelfth Day. Those who followed Mr. Churchill closely will acquit me of, at all events,

7 May 1907. consciouslj' distorting or exaggerating his arguments, and have pursued them

veiy little further than he took them himself. Every one of his contentions

REFERENTIAL ^^^^^ followed up ouly to a certain point, and fell very far short of its
'. reasonable application. All his argiiments right through, that friction in

Parliament is tm desirable, that constant discussions on financial matters,
especially taxation, is relatively unprofitable and to be deprecated, that the
arrangement of financial relations which are to the loss of one party and to
the profit of the other are certain to aggravate the losing party — all those
things were true, but were magnified and exaggerated so beyond all measure
— that they temporarily hypnotised the Under Secretary, as he with his
eloquence was hypnotising us. It is as a protest that I venture to urge that
after all preference proposals do not differ materially fi-om the ordinary-
financial proposals of each year. They may not match those contained in the
recent Budget of i^rosperity which the Chancellor of the Exchequer has
delivered, but belong to a class of proposals Avhich this country will have to
face as every other covmtry has to face them when times of depression come,
when income is short and has to be sought by new modes, v\dien fresh
departures have to be taken as they have been taken in our country in
connection with land taxation, income taxes, and imposts generally of that
sort. In regard to these, feeling does become heated and very fierce for a
time, but it is only for a time. The same experience has to be gained in this
countrj^. There is nothing to differentiate essentially your dealing with
preference from your dealing with other financial questions. No preference
is proposed in perpetuity. Yet one argument of the Under Secretary seems
to suggest that he was thinking of a preference that could not be departed
from and to which no term was fixed, whereas other parts of his address
showed that he realised that they were only treaties for fixed times, and
bound to be reviewed, though during currency they were capable of being
reviewed only by consent. I do not know whether that consent would ever
be sought or given, but am perfectly certain that no self-governing community
would entertain the project of parting with its rights over its own taxation
for more than a very limited period. Each of the Dominions, having entered
into a treaty of reciprocity for a limited period, would hold to it without
iindue exacerbation on the part of its politicians or people. We have tried it
and therefore know. As a matter of fact, we haA^e faced precisely the same
kind of problems, precisely the same class of irritating questions, as
Mr. Churchill considers preference must be. It has its risks like everj*
proposal. It has all the risk of every movement forward. If you sit still you
are comparatively safe ; directly you advance you incur the chance of collision
with obstacles ; but every day we have to move individually. Every year let
us hope our commiinities will move, and move onwards. Unless we are going
to forego all advance we must take the consequences, the accompaniments of
advance, namely, increase of responsibility. For my own part I should be
very sorry to see any doctrine adopted which suggests that it is intended
to wrap the British Empire in a napkin in case it should catch cold. To
treat it as if it possessed so tender a cuticle that it could not be touched
without 2)'?i'iiiai^ent and fatal irritation, is to l)rand it as a poor organism
incapable of coping with the ordinary difficidties in its path, or the necessary
ailments which come from abuses or mistakes. I do not say that working out
a complete and imiform and perfect system of preference is an easy thing. I
only say that none of us believed or expected it can be done until after years
of experience, but what we would have been quite satisfied with now would
have been an experiment, no matter how small, so long as it was genuine,
something tentative, something modest, even if only made bj' means of reduc-
tions of existing duties. We wish for something that will enable us to test
experimentally, as for my part I think we ought to test these and other

423

similar siiggestions. Mr. Lloyd George generously acliiiitteil in his interesting
and able speech that mutual trade has its advantages, and that any proposition
for its extension requires to be kindly and sympathetically handled. So far
as his own position permitted him I think he did handle it sympathetically.
I regret that at the conclusion his substitutes for preference were not more
positively defined. We are still left in complete uncertainty in regard to liis
intentions except from a very general indication. But I quite recognise that
the tone of his remarks indicated an anxiety to find a means wlierever means
were possible to him. I regretted to notice, tlierefore, that the Under
Secretary of State for the Colonies, like the Chancellor of the Exchequer,
although repeating the same vieAV, did place another accent upon it. He
seemed to convey the idea that the way even for practical experiments,
for practical tests of the smallest, the simplest and most tentative kind, is
absolutely barred by reason of certain beliefs which they entertain in regard
to what they call the laws of political economy. That is unfortunate, because
it makes argument useless ; it brings you right up against a wall. When
a man is prepared to ai-gue on the facts and from figures, as the Chancellor
of the Exchequer did at great length and for the greater part of his address,
you have something which appeals to one's judgment, and to which you can
hope to make some kind of reply dealing with the same kind of material, in
the hope of convincing him ; but there is no hope of convincing a man who
starts out with an orthodox faith which tells him beforehand what can or
cannot be done and what can or cannot be believed, which makes every-
thing not included in that faith heterodox unbelief, neither to lie weighed
nor balanced, but to be banished to the nethermost pit. That kind of dogma
forbids argument, or even if argument is employed makes it absolutely
useless. I hope we bring an open mind to this question ourselves. We have
been asked what we will do if Free Trade is proposed to us. All I can say
is, we should argue the question out on its merits. For my part, if the
Imperial Government at any time said : " We are prepared to enter into
" complete fi'ee trade between ourselves and the Colonies, and to impose
" a tariif against the outside world," I should say that it is a proposal, if
put into practical shape, which would be worth the very best consideration
of all the Dominions. Everj^thing wovdd depend on the tariff which was
intended to be imposed against the outside world. That is the lirst point.
In the second place, ahnost everything would depend upon the capacity of
each part of the Empire to supply the void Avhich would be made in its
finances by the loss of the customs' taxation upon Avhich at present we all
rely. Apart, therefore, from our own industrial development, such a project
would mean a revolution in Colonial systems and methods of taxation.

Twelfth Buy.
7 Mav 1907.

i'uekekential
Tkade.

(Mr. Deukin.)

Mr. LLOYD GEORGE : Exactly, as preference means a revolution in
our fiscal methods — there is no doubt about that. It is perfectly clear if you
put a tax upon corn, you have to put a tax on every foreign commodity that
comes into this country. Our system would be revolutionised. Instead of
being a system of what we call Free Trade, it becomes a Protective system.

Dr. SMARTT : But you hatl a tax upon corn, and the argument shows it
had no effect in increasing prices.

Mr. LLOYD GEORGE : I know, but we had to take it ofP. Even a
Conservative Government had to take it off because they recognised the
impossibility of keeping up a tax of that sort without putting it on all
round.

1J<1 i

Preferential
Trade.

424

Twelfth Day. Mr. DEAKIN : Surely there must l^e some proportion kept between

7 May 1907. canse and effect ? Let me refer to one of your arguments, which is fair, but
cannot be applied either as immediatelj^ or as strongly as you applied it ; that
is the argmnent that you cannot give a little without being obliged to give a
great deal more. First, we cannot argue it, because that depends upon ^-our-
selves. Looking at the Connnonwealth, if you tell us if we do something, we
will have to do a great deal more, I say, my experience does not Avarrant that
conclusion. It is j)erfectly true a new start may establish a tendency, if it
is successful, eucom'aging you to go further, but if it is not successful it
establishes a tendency to go back. We have gone back when we have thought
we haA^e made a mistake, and gone forward when we have thought we have
made a success. When you start interfering with your industrial or economic
system, even to improve it, you encourage demands from other portions of
your community who wish to share the same advantages which they believe
others receive. That is quite true. But really that is a contention which
can be so universally applied against every legislative project and proposal,
no matter what it may be, that it has no particular force when associated
with this jDroposal ; at any rate, no more force than it has when associated
with every form of legislative proposal. In some cases it would have less,
and in others more force, but it is never more than a guess.

Mr. LLOYD GEORGE : May I just point out this — and one of
]\Ir. Chamberlain's friends, Mr. Bonar Law, said it recently — that Mr.
Chamberlain's idea when he started was not to go in for a general protective
system, but purely to set up a system of preferential trading with the Colonies
on the basis of a tax on corn ; but he fomid when he looked at the whole
problem that the demand for protection would be irresistible, and he tacked
on a general system of protection to the preferential proposals.

Dr. JAMESON : That is a general system of protection, and not a general
tariii with a view to giving preference to the Colonies. There is always this
horrid word " protection."

'Mv. LLOYD GEORGE : I said yesterday I do not want to quarrel
about words. I will use the word "tariff." I do not want to beg the
question by using words you do not accept. I only state the fact that Mr.
Chamberlain found the demand would be irresistible, and he had reallj- to
supplement his proposals by a proposal for a general tariff. That was really
the meaning of the Glasgow speech.

Mr. DEAKIN : May I come back to my argunrent in this way ? — the
proposal for a preferential tarilf will benefit the Colonies. The people of
Great Britain say it is a very admirable thing to benefit the Colonies, but
then begin to ask why should not we benefit ourselves at the same time and
in the same way.

Mr. LLOYD CiEORGE : They do not say so as a matter of fact.

Mr. DEAKIN : That was Mr. Chamberlain's line of advance.

Mr. LLOYD GEORGE : Yes, that was Mr. Chamberlain's proposal,
and I think he did it under pressure. I am sure he was keen about the
other.

425
Mr. DEAKIN : Then it was said : " If that is good for the Colonies it is Twelfth Day.

good for us." 7 May 1907.

Mr. LLOYD GEOKGE : It was said under pressure. ^"^ TuAu'r'^

Mr. DEAKIN : The people who influeucetl Mr. Chaiuberlaiu said,
" You are doing something for the Colonies by means of duties ; had not you
at the same time better do something for us ? "

Mr. LLOYD GEORGE : That was their view.

Mr. DEAKIX : That is a perfectly legitimate view, but if it applies to
him, as far as I understand j'our argument and that of your colleagues it
does not apply to you. You and those in agreement Avith you do not think
these duties are going to benefit the Colonies. If you give them at all it
would be a concession of a more or less sentimental character. Hence, if you
think they will not l^enefit the Colonies you will not think it will benefit your
own people.

Mr. LLOYD GEORGE : To put it frankly, no doubt a duty on corn and
meat would be unpopular. I do not suppose anybody in this country would
controvert that proposition for a moment on the other side.

^Ir. DEAKLST : That is if it was sufficient to raise prices.

Mr. LLOYD GEORGE : Well, the reluctance with which the Conserva-
tive party have taken up even the 2s. duty is the best proof of that. And
Mr. Chaiulierlain, he being the astutest politician we probably have seen in
my time in this country, saw at once he coidd not get the coimtry to take
that pill without gilding it with something else. That is what it means.
I am sure the people in this country would never look at the idea of a duty
on corn or meat imless they become Protectionists on general groimds, and
want to exclude foreign manufactures.

Sir WILFRID LAURIER : Do you think there is any use in protracting
this discussion ?

ilr. DEAKIN : Beyond the fact that it is very interesting, I do not know
that it would help the immediate purpose before us. But I do not want to
shrink from any question the Minister wishes to put, and to meet, as best mj''
poor resources will allow, any argiuuent he submits. Our difficulty, of course,
is, and I think the Minister most amply recognised it yesterday, that we each
start w'ith certain pre-suppositions, whether derived from experience or
education, and are always coming back to them. We have neither time here
nor the means to get at those and deal w'ith them finallj\ It is always an
engagen)ent of outposts which we are maintaining. We cannot get at the
heart of the question in a meeting under the pressure that exists here.

My excuse for having addressed the Conference again to day, is that I
was not willing that an address so forcible and so well put as that of the
Under-Secretary of State for the Colonies should pass without criticism from
oiir point of view. My general answer to his thesis is sununed up in the
proposition that he is like the medical man Avho confines his patient to an
invalid chair because, if he takes exercise or performs his natural duties, he
nms a risk of complications, of catching cold, of all kinds of diseases and
imaginable physical accidents. I admit his aim. If you can get the British

Twelfth Day.
7 May 1907.

Preferential
Trade.

(Mr. Deakin.)

426

Empire into an invalid chair, you may save it from a certain number of risks,
though I think those you invite by this treatment will be more seriotis, because
debility of body tlu'eatens more dangerous results than healthy natural occu-
pation or exercise. Especially will it be found more depressing than a real
effort to act in concert with its children. I do not say we would not make
mistakes, and would not have sometimes to retrace our steps because we had
temporarily overshot the mark, but we should be going on, and have the
satisfaction of correcting mistakes and counting our successes, which I believe
would far overbalance those mistakes. Ultimately we should arrive at
co-operative action by such means, among others, as the Board of Trade have
suggested. Every time I have touched tliis question I have from the first
included improved cable communication, mail communication, and the diffu-
sion of commercial intelligence, the niultij)lying of commercial agencies in
the country all as parts of one system. I have never severed them. Pre-
ferential trade, with me, means all those things, as weU as promoting our
dealing with each other's commodities. Speaking for the Conmionwealth, I
shall welcome all or any of them, not as substitutes but accompaniments,
necessary parts of the same scheme and the same doctrine, only accomplished
in a different way, which appears to you more acceptable than our first means.
We want to use all means, and in that regard I welcomed your speech as a
hopeful augur^r that we shall obtain fr'om you before we part the positive
proposals in a definite shape which are to further that Imperial unity which I
am sure you desire.

CHAIRMAN : May I remind the Conference that Sir Wilfrid Laurier, at
the beginning of his remarks, put a specific j)roposal before us. He said
that he wished to move that the Conference should re-affirm the principle of
the resolutions of 1902, and I think I am right in saying that he proceeded
to say that he thought he could say for all the Dominions beyond the Seas,
that they were agreed to the first three of those resolutions of 1902. If the
Conference desires, I shall follow the precedent of 1902, and ask for the
opinion of each Colony for and against. But assuming there was no dissent
at that moment —assuming that the proposition of Sir Wilfrid Laurier is
correct and that those representing the Dominions beyond the Seas are
agreed with the principles of the first three resolutions, I have to say that
as far as His Majesty's Government are concerned we have nothing to say in
regard to the second or third. With regard to the first we cannot give our
assent so far as the United Kingdom is concerned to a re-affirmation of the
first resolution in so far as it implies that it is necessary or expedient to alter
the fiscal system of the United Kingdom. That would be our position, and if
the other members of the Conference wish to re-affirm the resolution we
should have to state here that that is our opinion.

Then I understood that Sir Wilfrid Laurier proceeded to
following resolution proposed by Mr. Deakin, which stands
Australian list, was one which he would desire to support and
the Conference. I have to say on behalf of His Majesty's Government in
regard to that resohition, namely, " That it is desirable that the preferential
" treatment accorded by the Colonies to the products and manufactures of
" the United Kingdom be also granted to the products and manufactures of
" other self-governing Colonies " — that we have no objection, of course. We
recognise its advantages so far as the Colonies choose to adopt it, but it is a
matter essentially for their consideration. Sir Wilfrid Laurier then said
that he desired not to support the final resolution of Mr. Deakin.

urge that the
fourth on the
recommend to

Mr. DEAKIN : He preferred No. 4 of 1902.

Sir WILFRID LAURIER: Yes.

427

CHAIRMAN : We also cannot accept that resolution ; but the resolution Twelfth Day.
that we would desire to put before ihe Conference is in accord, I think, with 7 May 1907

the general tenour of Sir W'illi-id Laurier's remarks, and it is to this etlect :

That this Conference, recognising the importance of promoting greater "keff.kential
freedom and fuller development of conunercial intercourse within the
Empire, believes that tJiese objects may be best secured by leaving to each
part of the Empire liberty of action in selecting the most suitable means
of attaining them, haviiig regard to its own special con(b'tions and
" requirements." That is the resolution which His ^lajesty's Government
would desire to put as smnmiug up tliis discussion.

I do not know how I am to deal Avith the further resolutions l)efore the
Conference from New Zealand and the Cape ; but I suppose it would be, at
any rate, desirable for the Conference to settle these that are now submitted
by Sir "Wilfrid Laurier with the addition which I propose first, and if there is
anything else which has to be added the other Colonies will then mention it.

ilr. DEAKIN : Let me simplify matters by saying that in order to obtain
what, I hope, will be unanimity, I have no objection to accepting the proposal
No. 4 of the Conference of 1902, instead of the new proposition. We put it
in other wonls for the purpose of separating the fiscal relations between the
Dominions themselves and the relations with the United Kingdom more
distinctly. I accept that proposal, and if Sir Wilfrid Laurier moves the whole
of the resolution, shall be happy to support it.

Sir WILFIHD LAURIER : I move the resolution of 1002 and Mr.
Deakiu accepts the fourth resolution in preference to his own for the sake of
iinanimity. ^^'ith regard to the resolution moved by Australia : " That it is
desirable that the preferential treatment accorded by the Colonies to the
" products and manufactures of the United Kingdom be also granted to the
" products and manid'actures of other self-governing Colonies " ? I say that
I think the Chairman's idea an excellent one and I am ready to support it. I
think it might be the substance of another resolution, and not this one.
Therefore, so far as I am concerned, I propose to adhere to the resolution I
have moved. The point raised by Loi-d Klgin, I think, is well covered in the
last words of the fourth resolution : " That the Prime Ministers of the
" Colonies respectfully iirge on His Majesty's Government the expediencj' of
" granting in the United Kingdom preferential treatment to the products and
" manufactures of the Colonies, either by exemption from or reduction of
" duties now or hereafter imposed." We do not impose or wish to have the
appearance of dictating, but if preferential duties are imposed we shoidd have
a preference in respect of them. The point raised by Lord Elgin is well
covered l)}' that.

CHAHBIAN : No. 4 would he met by new resolution.

Sir WILFRID LAURIER : I say resolution No. 4 covers the idea that
you have in your mind, that is to say, each party should be left to determine
for itself what is best. We are unanimous so far in this, but the British
Government tell us. No, we are not prepared to admit the systeui of
preference. We say, We do not ask you to admit it now. It is for you to
decide, l)ut whatever duties you do impose we ask for a preference upon
them. That leaves you to determine hereafter whether you put new duties
or not. That is really the subject between us, and it seems to me the resolu-
tion of 1002 substantially meets the objection you have at the present time.
I re-alfirm, and all the Colonies atHrm here, that we have no intention ai; all
of dictating that the Government slujuld put new imposts which they do not
want to, but if they lIu put them, we should have preference upon them.

428

Twelfth Day. CHAIRilAX : I am afraid I should not be able to accept it for the

7 Mav 1907. resohition I propose.

^''™de!"''''' Sir WILFRID LAURIER : There is a line of cleavage.

Mr. DEAKIN : If we withdraw No. 4, and accept the resolution which
Ministers propose, it would mean an absolute retreat fi'om the position
of 1902.

Dr. JAMESON : Besides, Lord Elgin will not agree to No. 1 either.
I hope the Governments will vote. Lord Elgin has told us he cannot.

Mr. LLOYD GEORGE : How can we ? It is for the Prime Ministers of
the seK-governing Colonies.

Sir JOSEPH WARD : I agree with the latter portion of the resolution
moved by Mr. Deakin, that it is desirable that preferential tariffs should be
included.

Mr. DEAKIN : We will do that separately.

Sir JOSEPH WARD : When those are disposed of, does that mean the
disposal of the other resolutions entirely, without submitting them to the
Conference ?

Dr. JAMESON : No.

CHAIRMAN : No ; I said at the beginning I should ask everyone.

Sir JOSEPH WARD : Because I want to move my resolution with an
omission fi'om it, which I hope will give us unanimity upon it, irrespective of
the others.

CHAIRMAN: Very well. Had not Ave better dispose of the others
first ?

Sir JOSEPH Ward : Certainly. I shoidd like to support the resolu-
tion of Sir Wilfi'id Laurier and also the proposal of Mr. Deakin when it comes
up separately.

Dr. JAjMESON : On behalf of tlie Cape, the first resolution of the Cape
is exactly as proposed by Sir Wilfrid Laurier at present, and we will not press
that. With regard to the second resolution originally put by the Cape, I do
not want to press that at all. As I explained in the remarks I made, it Avas
more or less a warning, and I will not press it.

]Mr. DEAKIN : It was a very proper thing to call attention to.

Dr. JAMESON : That was the intention of it — to caU attention.

CHAIRMAN : With reganl to our position, I spoke of the three first
resolutions because I think Sir Wilfrid Laurier dealt with them in his speech
at first.

Sir Wn.FRID LAURIER : No ; I said I moved the whole of those
resolutions of 19U2, Ijut then I stated that, with regard to three of them, there

429

was no difference of opinion between us. With regard No. 4, Australia
moved something else which Australia has now withdrawn.

CHAIRJVIAN : Then I made my remarks based upon the remarks you
made on the first three. It does not seem to me to make much difference,
but the inclusion on your behalf of the whole four is subject to the same
reservation which I read on behalf of His Majesty's Government : " His
" Majesty's Government cannot give its assent so far as the United Kingdom
" is concerned to a re-affinnation of the resolutions of 1902, in so far as they
" imply that it is necessary or expedient to alter the Fiscal system of the
" United Kingdom." Of course No. 4 comes from you aU as Prime Ministers
of the Colonies. We do not make any representation, and you are quite at
liberty to make that representation, but we make this affirmation at the end.

I'welfth Day.
7 May 1907.

1'hekerentul
Trade.

(Sir Wilfrid
Liiurier.)

Sir WILFRID LAURIER: Certainly, we cannot take exception to that
You state your position and we state our position. It is carried with this
understanding.

CHAIR!^LA.N : Does anyone Avish it to be put ? Is tliat carried ?

Sir WILFRID LAURIER : It is carried.

(3HAIRMAN : Now, with regard to the resolution which I now
submit.

Rcsolation VI.,
p. vii.

Mr. DEAKIN : My second resolution is : " That it is desirable that the
" United Kingdom grant preferential treatment to the products and
" manufactures of the Colonies." That comes in because we are adopting
down to No. 4 which does not include that. What I move now, is : " That
" it is desirable that the preferential treatment accorded by the Colonies to the
" products and manufactures of the United Kingdom be also granted to the
"" products and manufactures of other self-governing Colonies."

Sir WILFRID LAURIER : In principle I am ready to dispose of that,
but I am willing to modify the language.

Mr. DEAKIN : What do you propose ?

Sir WILFRID LAURIER: I am not prepared to draft it to-day, but it
would he that we should have reciprocity. 11 a Colony does not give any
preferential treatment to the Mother Countrj'-, the resolution would not apply
perhaps.

Mr. DEAKIN : This was not intended to prevent that, it was only a
general affirmation of a desirable thing.

Sir WILFRID LAURIER : I think I agree with you, but I would like
it to stand for a day. The principle suits me altogether, I may say.

CHAIRMAN : There is some confusion I think. We must put this
resolution : " That this Conference recognising the importance of attaining
" greater freedom and fuller development of commercial intercourse within
" the Empire, believes that these objects maj' best be secured by leaving it
" to each part of the Empire, liberty of action in selecting the most suitable
" means for attaining them, having regard to its own special conditions and
■*' requirements."

Twelfth Day.
7 May 1907.

Preferential
Trade.

4;w

]\Ir. DEAKDJ : Personally, I do not object to that in principle, but I
do not know that it affirms anything.

Dr. JAMESON : You cannot either object or affirm.

Sir JOSEPH WARD : If you add to that " and that every effort should ,
■' be made to bring about co-operation," then I think we could all support it.

Mr. DEAKIN : Where would you put those words ? They are better.

Sir JOSEPH WARD : At the end.

Mr. DEAKIN : Anything after " co-operation "—do not you want
" between them," or something of that sort.

Dr. JAMESON : This puts us in a perfectly absurd position. It does
not really negative, but any one can read a negative into this, to the resolution
we have just passed of 1902.

Mr. DEAKIN : Do you think so ?

Mr. LLOYD GEORGE : I do not think so. You have expressed j-our
opinion that this is your way of co-operation, but we suggest other methods of
arriving at the same end. It is not a negative at all.

Sir JOSEPH WARD : I suggest that these words be put in : " and that
" every effort shoidd be made to bring about co-operation in matters of
" mutual interest."

Mr. LLOYD GEORGE: Yes.

Sir JOSEPH WARD : We are in co-operation on defence, emigration,,
and naturalisation.

Mr. LLOYD GEORGE : And for trade, too, we can co-operate.

Sir JOSEPH WARD : If you put that in I will support it.

Mr. LLOYD GEORGE : Certainly, by all means.

Sir JOSEPH WARD : " And that every effort should be made to bring
" about co-operation in matters of mutual interest."

Dr. JAMESON : May I be allowed to say a word about this. We, all
the self-governing Colonies here represented dui-ing the last six days, have
affirmed our belief in preference. His Majesty's Government during those
six days have affirmed their belief in no preference. We are each to have
liberty of action, and now we say we are both right.

Mr. LLOYD GEORGE: No.

Dr. JAMESON : That is the position.

Mr. LLOYD GEORGE : We are to co-operate within the limits we have
set down for ourselves. That is all, surely. Dr. Jameson does not say

431

co-operation is impossible because we do not take the same view about fiscal Twelfth Day.
matters. It would be a very sad thing for the Empire. 7 Mav 1907.

Dr. JAMESON : I shovild be delighted if Sir Joseph Ward's suggestion ''" ^0^'*''
of co-operation is put. I would vote for it with hoih hands without this ,^^ LlovJ
first part. George.)

Mr. DEAKIN : Dr. Jameson wants this without the preamble.

Sir JOSEPH WARD : I think the preamble is aU right.

Dr. JAMESON: This puts us in a ridiculous position. We have said
the members of this Conference outside FTis Majesty's Government arc in
favour of preference as a method of the unity or whatever you like to call it.
His Majesty's Government gives a direct negative, and we are both to vote
for liberty of action. It is quite true we have liberty of action, so it means
nothing. We all agree we are to have liberty of action, but what is implied
in this is that we are voting Yes is No, and No is Yes.

Sir JOSEPH WARD : I do not quite see that, for this reason. We, the
whole of us, affirm that we reserve the undoubted right for our self-
governing Colonies to do what we think right in our own borders, and we will,
none of us, give it up. The British Government say exactly the same thing.
It is evident they cannot vote for preference. It is equally evident that we all
voted for preference. Yoii cannot do more than to make a declaration as to what
you want. Unless we are unanimous and all agreeable to enter into preference
treaties and systems, you cannot get a preferential treaty. That is a certainty.
There is not much to he gained by saying we make a declaration in our
speeches — which we have all done,— and when it comes to a resolution we are
all going to vote one way and the British Government the other. It follows,
as a matter of procedure, that if they do not vote we cannot get preference
unless they assent to it. So I want to bring about the feeling of co-operation
at the end of the resolution, believing there is to be more dune in the future,
and that we cannot do everything to-day.

CHAIRMAN : I do not wish to raise unnecessary objections in the least-
Perhaps, with the prudence of a Scotsman, I rather wanted to see it in
writing. I have seen it in writing now, and we have no objection to adding
those words proposed by Sir Joseph Ward.

Dr. JAMESON : If Sir Joseph AVard will allow me to answer what you
have said, it seems to me tliis would have been an admirable resolution before
we started the question at all, whether there should he preference or not. We
■ought to start on that basis because we all believe it ; but having gone on
that and come to absolutely opposite positions, to now bring in the liberty
of action surely is absolutely useless, and the only reason it can be brought
forward is to emphasise the fact that all we have done is not Avorth anything.

Sir AVILFRID LAURIER : I think, on the contrary. His Majesty's
Government has come a good way down to meet us here. They say, " Very
" well, we accept the resolutions you have just affirmed, but we want each
"" party to be left to decide how to do it."

Mr. LLOYD GEORGE : Yes, but let us co-operate where we can.

Dr. JAMESON : Outside the preference question this would be
admirable.

432

Twelfth Day. CHAIR]\IAN : To make it clear, I wisli to say that we do make a

7 May 1907. reservation with regard to those resolutions.

Preferential gir WILFRID LAURIER : Exactly.

Trade.

Mr. LLOYD GEORGE : We each state our respective positions and end
ixp by saying : " Now let us co-operate within those limitations."

Dr. JALIESON : Why not a resolution of co-operation.

Mr. DEAKIN : Is it not possible for us to take Sir Joseph Ward's
suggestion as our starting point instead of our conclusion, and then adopt the
lang-uage or a good deal of it here, so that it will read this way : " That
" every effort should be made to bring about co-operation between the
" several parts of the Empire subject to the complete liberty of action of
" each in selecting the most suitable means for attaining it." That comes
to the point. Every effort should be made to bring about co-operation —
that is a positive proposal — between the different parts of the Empire
subject to the liberty of action of each in selecting the most suitable
means of attaining it.

-'o

Mr. LLOYD GEORGE : The only thing Mr. Deakin leaves out is,
" promoting greater treedom," and so on.

Mr. DEAKIN : We have that in our first resolution of 1902.

Mr. LLOYD GEORGE : But that refers to one method only.

Mr. DEAKIN : Yes, that was " stimulate and facilitate."

Mr. LLOYD GEORGE : That is by one method. We want other methods
as well. Your opinion is that this is the best. W^e made it quite clear what
our opinion is, and then we end up by saying, "Let us do our best to promote
" commercial intercotirse within the Empire, reserving to each party perfect
" freedom of action as to the best means of doing it."

Sir WILFRID LAURIER : I am satisfied to have the resolution as
amended by Sir Joseph Ward.

CHAIRMAN : We must adhere to that position.

Mr. LLOYD GEORGE : I think if we can get a unanimous vote it would
be all the better, because, I think, Mr. Deakin is not very far from this
resolution.

Mr. DEAKIN : How would this do : " That every effort should be made
" to stimulate and facilitate mutual commercial intercourse by co-operation
" between the several parts of the Empire, subject to the liberty of action of
" each in selecting the most suitable means for attaining it ? " It puts the
co-operation in the forefront. This other resolution oj^ens with a general
statement which does not appear to apply to anything, and then follows a
particular proposal.

CHAIRj\IAN : We have asked the Chancellor of the Exchequer if he
can come over. In the meantime, if there is a point you wanted to speak to
about your own resolutions we might take it.

433
CARRIAGE OF BRITISH GOODS IN BRITISH SPHPS.

Twelfth Day.

Sir JOSEPH WARD : I want to see if I can get my resolution 7 May 1907.
uiianinioiisly agreed to. I want to suggest an alteration in it. The afliruiing
ol' the resolution of 1902, as proposed by Sir Wilfrid Laurier, to which I jj^'j^i^f, Gof>»s
agree, as I think it is the !;est thing under all the circumstances to-day, ly British
removes the necessity for independent resolutions being moved by any of the Ships.

self-governing Colonies ; but I would like to (^lightly alter this resolution, in
the hope that it may meet with at least a good send-ott' from this Conference.
I want to suggest : " That it is essential to the %vell-being of both the United
■' Kingdom and His Majesty's Dominions bej'ond the Seas that in the
" transport of goods to the over-sea Dominions efforts in favour of British
" manufactured goods carried in British-owned ships shoidd be supported by
" this Conference." I want to affirm the desirability of carrying British
manufactured goods in British ships, if we can, and I should think the
Conference generally would be able to assist to that.

Sir WILFRID LAURIER : I would add " as far as practicable " after
the word supported — " That it is essential to the well-being of both the
" United Kingdom and His jMajesty's Dominions beyond the Seas that in the
" transport of goods to the over-sea Dominions efforts in favour of British
" manufactured goods carried in British-owned ships should be supported as
" far as practicable."

^Mr. F. R. MOOR : Are not we getting into confusion? We might deal
with one thing at a time.

CHAIRMAN : We were only taking this to till up time.

Sir WILFRID LAURIER : So far as Canada is concerned I am disposed
to agree to this. Perhaps Sir Joseph Ward will agree to my suggestion of
the word " desirable," instead of " essential." In Canada a resolution was
introduced to limit the benefit of the preference on British goods only to
those imported through Canadian ports. We accepted the resolution, but
with a modification which is to come into force shortly, when in the opinion
of the Governor in Council the trade has been sufficiently developed so as to
allow us to get importations into Canadian ports. At present many imjjorts
come by way of the United States. That is a relic of the practice of former
days, when Canada had to get its trade developed tlu-ough the means of the
southern ports, biit now we are getting our own ports equipped, we hope,
Ijy and by, to possibly dispense altogether with intermediate States. This is
on the same lines. To confine British trade to British bottoms there can be
no serious objection. I agree to it very willingly, especially as Sir Joseph
Ward has agreed to put into it " as far as practicable." It could not be done
at the present time so far as Canada is concerned. We have to use other
sliips, but we are getting to use more and more the British ships. So I
accept it with the qualification " so far as practicable," because it could not
be put into force immediately.

Mr. LLOYD GEORGE: "British manufactured goods in British
shipping," instead of " carried in."

Sir JOSEPH WARD: Yes, I will make the alteration. 1 only want to
affirm something in that direction.

Mr. DEAKIN : Are you moving that 't

Sir -lUSEPll WARD: Yes.

e 4S6liS. E ,;

'IVelfth Day.
7 Mav 1907.

Carriag^e of

British Goods

IN British

Ships.

434

Mr. DEAKIN : But you are not moving it in this altered form.

Sir JOSEPH WARD : Yes.

Mr. DEAKIN : WiU you read it ?

Sir WILFRID LAURIER : Will you aUow me to withdraw, as I have
an engagement in a few minutes. I stand by Sir Joseph's Ward's
resolution.

Mr. DEAKIN : But we are working out an alternative.

Resolution VIII.,
p. viii.

Preferential
Trade.

Sir WILFRID LAURIER : If Sir Joseph Ward accepts the alternative,
I am satisfied, and I follow it.

Sir JOSEPH WARD : The resolution will read in this way : " That it
" is desirable in the interest both of the United Kingdom and His Majesty's
" Dominions beyond the seas, that efforts in favour of British mauufactTired
" goods and their carriage in British-owned ships, should be supported as far
" as practicable."

Mr. DEAKIN : That is aU right.

Mr. LLOYD GEORGE : I would prefer to leave out the words " their
carriage in British-owned ships," and make it " efforts in favour of British
shipping " because we want to carry other goods. We are not depending
only upon the carriage of our own goods.

Sir JOSEPH WARD : It is the same thing : " That it is advisable in the
" interests both of the United Kingdom and His Majesty's dominions beyond
" the Seas, that efforts in favour of British manufactured goods and British
" shipping should be supported as far as practicable."

Mr. LLOYD GEORGE: Yes.

CHAIRMAN : I put this resolution : " That it is advisable in the interests
" both of the United Kingdom and His Majesty's Dominions beyond the Seas
" that efforts in favour of British manufactured goods and British shipping
" should be supported as far as is practicable." Is this agreed to ?

The resolution was carried unanimously.

PREFERENTIAL TRADE.

CHAIRMAN : I think I understood. Dr. Jameson, you did not wisli to
laise any point upon your resolution ?

Dr. JAMESON : Not the resolution on the paper, but I wish to put the
resolution I Ijrought forward yesterday.

Dr. SMARTT : That has been accepted in principle already. It is
merely an extension.

Dr. JAMESON : My real difficulty with regard to this is, as has been
emphasized, I am glad to say, by one of my political opponents since my
departure from South Africa, that unless preference is coupled with some form
of reciprocitj' it may be withdrawn. Therefore I am bound to bring this
resolution forward.

Tr-voe.

435

CHAIRMAN : As the Chancellor of the Exchequer has arrived we had Twelfth Uay.

better finish the first resolution. Mr. l)eakiu wishes to put it: " That every 7 May 1907.

" effort should be made to stimulate and I'acilitate mutual commercial inter- ■

" course between the several parts of the Kiupirc by the development of all "^.^^''^^7''*^''
" their means of inter-communication, su!)ject to the liberty of (jach sell-
" governing Dominion to select the most suitable methods for giving ell'ect
" to it."

Mr. ASQUITH : Is this a proposition as a substitute for the whole
resolution? I certainly prefer the resolution as it stands very much. I think
it is much wider in its scope and clearer in its language. I think the fresh
one rather limits it.

Mr. LLOYD GEORGE : The development of aU means of communication
is a most important limitation. Tliere are other means of practical commercial
intercourse in the Empire.

Mr. ASQUITH : I agree with the words as previously proposed.

Mr. LLOYD GEORGE : This other resolution of Mr, Deakin's does not
go so far as I am prepared to go.

Mr. DEAKIN : I will put in the word " especially."

Mr. ASQUITH: " Every effort should be made by co-operation."

Mr. DEAKIN : They are right, but it is the preliminary part I object to.
It seems too vague.

Dr. JAMESON : It seems to me emphasising a truism which we have
acknowledged to begin with, unless it means something difl'erent. If it only
means what is on the face of it this original resolution of the Government is a
mere truism which we all acknowledged before we began the Conference, and
all through the Conference. We have always emphasised it. Why do it
again unless there is some other reason for it ?

Mr. LLOYD GEORGE: Mr. Deakin's resolution affirms the resolution
as to liberty of action. He does not object to that.

Mr. DEAKIN : I put it in because you wished it, not that I think it
necessary.

Dr. JAMESON : This one of Mr. Deakin's is a separate subject. We
have done with Tarift" Reform or preference antl now deal with other methods
of commercial intercourse, whereas this other resolution implies a negative of
what we have been doing this week so far as the Colonies are concerned.

Mr. LLOYD GEORGE: You have affirmed your view of the best method.
We have affirmed ours. Now, upon the basis of that mutual understanding
of each others' positions we agree upon this.

Dr. JAMESON : Upon what — to have liberty which we have aU agreed
upon long ago ? Why put it in ?

Mr. LLOYD GEORGE : No. Sir Joseph Ward's resolution carries it a
good deal further than that. I think these are the important words : " That

E e 2

436

Twelfth Day. " every effort should be made to bring about co-operation in matters of

7 May 1907. " mutual interest." It carried it beyond what Dr. Jameson is afraid of — a

„ ■ mere barren affirmation of a thing we all agree to.

Preferential °

• Trade.

(Mr. Lloyd ^^- JAMESON : I cannot see the use of this at the beginning of

George") Sir Joseph Ward's resolution. I shall be delighted to pass the resolution on

everything — co-operation, connnunication, and everything else, but why

reiterate this truism which I am afraid various people will say after a week's

discussion is a kind of slur on the discussions of the week past.

Mr. ASQUITH : Not at all.

Mr. LLOYD GEORGE : You will not deny liberty of action even to
the Mother Country.

Sir JOSEPH WARD : Mr. Deakin in the course of the speech which he
delivered before the suggested words that I have added were put into the
proposition coming from Lord Elgin, stated that in giving any support to the
resolution moved by Sir Wilfrid Laurier re-afhrming the resolution of 1002 on
behalf of his Government he required a qualilication. He x^roposed to
support this resolution with a qi;alification, and this is the qualification.

CHAIRMAN : With the other words used.

Sir JOSEPH WARD : So we have the resolution of 1902 re-affirmed,
the British Government having put on record their desire to keep to their
position. With regard to that, from the point of view put liefore the
Conference, I see no harm in accepting that resolution.

Mr. ASQUITH : The Imperial Govermneut consider it essential that
those words should stand in the resolution.

Mr. DEAKIN : That each should have its liberty.

Mr. ASQUITH : Yes.

Mr. F. R. MOOR : Nobody has questioned that principle.

Mr. ASQUITH : We wish to have it put on record.

Mr. DEAKIN : Would this get rid of the difHculty : " That every effort
" should be made to stnnulate and facihtate co-operation in matters of
" mutual interest between the several parts of the Empire, especially by the
" development of all through means of inter-communication, subject to the
" liberty of each self-governing Dominion to select the most suitable methods
" for giving effect to it." That, I think, contains everything important —
affirmation, co-operation in matters of mutual interest, and further development
of inter-communication, and the other qualification on which you lay stress —
that It IS subject to the liberty of each self-governing Dominion to select the
most suitable methods.

•~, Mr. ASQUITH: No, I do not think there is any very substantial
difference between them ; but, to my mind, there is an important lUfi'erence
in the mode of expression and the order. I believe that is the real tUffer(!nce
between us — the order in which the two parts of the subject are dealt with —

437

and from our point ol' view, as we have given great consideration to this, we Twc-lfth l)ny.
think the ailirmation of freedom shonhl conic lirst and the other next. 7 May 1907.

1^ R I*' V P It F V T f A 1

CHAIRMAN : This is the resolution which His Majesty's Government Trade. "

puts before the Conference: "That this Conference, recognising the (Mr. Asqnith.)
" importance of promoting greater freedom and fuller development of
" commercial intercourse within the Empire, believes that these objects may
" be best secured by leaving to each part of the Empire liberty of action in
" selecting the most suitable means for attaining them, having regard to its
" own special conditions and requirements, and that every effort should be
" made to bring about co-operation in matters of mutual interest."

Dr. SMARTT : "Might I ask you as Chairman, whether tlie Conference,
having affirmed resolution No. 1, which states, " That this Conference, recog-
" nising that the principle of preferential trade between the United Kingdom
" and His Majesty's Dominions beyond the Seas, will stimulate and facilitate
" mutual commercial intercourse," it is competent for this Conference to
propose a resolution which does not affirm this resolution.

CHAIRMAN : I specially said we did not agree to that.

Dr. S^IARTT : I thoroughly understand that, and you have registered
your vote as President of this Conference, and a very important vote, as not
agreeing with it. Notwithstanding that, the Conference has maintained the
principle laid down in the first resolution, and I wish to say that this resolu-
tion following the other would mean that the Conference had departed from
its position that the best way of tleveloping this mutual co-operation would be
by preference.

CHAIRMAN : K you ask me as President, I do not think it is out of
order.

Dr. JAMESON : If this means anything to me it means this, that we
have decided to differ here on a question of preference ; the self-governing
Colonies against His Majesty's Government taking absolutely different views.
This resolution is to emphasise the fact that for commercial intercourse the
best thing is for the Colonies to give preference and for His Majesty's Govern-
ment not to give preference. If Ave vote for this it puts us in the position that
we agree to that, and stultifies everything we have said for the last week. I
say that because I personally could not support that on behalf of my colony
as it stands. I want to emphasise again that we all say w^e must have absolute
liberty of action on this and every other subject.

*

Mr. LLOYD GEORGE : Sir Wilfrid Laurier, who was the very first to
give preference to the Mother Country, does not think so.

Dr. JAMESON : I disagree with Sir Wilfrid Laurier.

Mr. LLOYD GEORGE : His was the first Colony to propose it- and a
very substantial preference he gave us — and he has improved upon it since.
Certainly, he does not take that view. He is the father of preference within
the Empire.

Dr. JAMESON : Sometimes you find children get a little more advanced
than the father or mother, as the case may be.
1S(>68. E e 3

Twelfth Day.
7 May 1907.

Preferential
Trade.

Resolution VII.,
p. vii.

438

I^Ii-. DEAKIN : This would be mj^ position. I do not specially object to
this resolution even as it stands, though I admit there is force in Dr. Jameson's
fear that it may be misinterpreted. There are words that would make it
acceptable to me, if not to the other members. I would propose that after the
word "that " we introduce the words : " without prejudice to the resolutions,
" already accepted, this Conference recognises the importance of promoting
" greater fi-eedom," and so on.

Dr. SMARTT : That will do.

Mr. ASQUITH : Let us see if we can meet Mr. Deakin. We are anxious
to if we can. You said the resolutions, but you must inchide the reservation
made by the Imperial Government.

Mr. DEAKIN : Certainly the resolutions or reservations.

Mr. ASQUITH : It had better be on the face of it to make it plain.

Mr. DEAKIN : To make it plain I have put : " That without prejudice
" to the resolution already accepted or the reservation of His Majesty's
" Government, this Conference, &c."

CHAIRMAN : I wiU read it again to make it quite plain.

Dr. JAMESON : I am quite content.

Mr. F. R. MOOR : I am satisfied.

General BOTHA : Yes.

Sir JOSEPH WARD : I am quite satisfied.

Mr. DEAKIN : We always get imanimous before we finish.

CHAIRMAN : This is the resolution of the Conference.

Dr. JAMESON : Then there is my further resolution.

Mr. DEAKIN : I do not know whether the President has a resolution
with reference to coastwise trade. I take it that is bound up with this, in a
sense.

Mr. LLOYD GEORGE : I will show you Sir Robert Finlay's opinion on
that, and then if, after that, you stiU think it right, you will press it.

Mr. DEAKIN : Thank you.

CHAIRMAN : The only arrangement I have made for to-morrow is that
the First Lord of the Admiralty will come.

Dr. JAMESON : May we first finish up this resolution, or it will
disappear altogether.

Mr. ASQUITH : I think we had better dispose of it now.

439

Dr. JAMESON : Very well, I will propose it. Twelfth Day.

7 May 1W7.

Mr. ASQUITH : This is as to preference on present dutiable articles. I

am not going to take up any time. You understand our position in the Preferential
matter. We think it would concede the principle without doing any raue.

substantial good to anybody.

Dr. JAMESON : Yes, I understand that, but the main reason is it will
help me to keep the preference going in South Africa if I put it here, even if
I only vote for it myself, but I hope General Botha will vote with me on it.

CHAIRMAN : The resolution moved by Dr. Jameson is : " That while
affirming the resolution of 1902 this Conference is of opinion that as the British
" Government through the South African Customs Union — which comprises
" Basutolaud and the Bechuanaland Protectorate — do at present allow a
" preference against foreign countries to the United Kindom, Canada,
" Australia, New Zealand, and all other British Possessions granting
" reciprocity. His IMajesty's Government sliould now take into consideration
" the posssibility of granting a like preference to all portions of the Empire
'' on the present dutiable articles in the British tarilf."

Mr. DEAKIN : It is only a request to consider. You do not dissent
from that ?

Dr. JAMESON : The consideration of possibly doing it.

Mr. DEAKIN : You are not asked to say you will do it or not.

Mr. ASQUITH: We have considered it.

Mr. DEAKIN : You can consider it again.

Mr. ASQUITH : If you please we will take the same attitude with
regard to this as with regard to the other- — an attitude of reservation. We do
not conceive we are free to do this.

Ml'. DEAKIN : You are always free to consider it if not free to grant it.
Dr. SMARTT : You are doing it at the present moment.

Mr. ASQUITH : I was not aware of the case of Bechuanaland and
Basutoland.

*

Dr. JAMESON : It has been very advantageous to those two
Protectorates.

Sir JOSEPH WARD : That means a reduction in your duties if it is
given effect to— not an imposition of duties.

Mr. DEAKIN : It means only a reduction if it is granted, but it does
not promise that any reduction wiU be granted.

Mr. ASQUITH : But it means that we are to consider the question
whether we shall treat the foreigners and the Colonies as it were differently,
and that we conceive we are not able to do.

Ee 4

Twelfrli Day.
7 May 1907.

Preferential
Tkaue.

Resolution TX.
p. viii.

440

Dr. JAMESON : That is the whole of it. I would like it put to the
Conference.

Sir JOSEPH WARD : I will support that.

Mr. F. R. MOOR : I support it.

CHAIRMAN : Do you support it, General Botha V

General BOTHA : No, I do not support it.

Sir ROBERT BOND : Yes, I support it.

CHAIRMAN : We do not ; we dissent from it.

Mr. ASQUITH : Sir Wilfrid Laurier is not here.

CHAIRMAN : That will be recorded. Those are all the resolutions.

Mr. DEAKIN ; There are the subsidiary motions. I do not know if
you would pass the others without discussion. Our resolution is : " That
" the Imperial Government be requested to prepare for the information of
" Colonial Governments, statements showing the privileges conferred, and
" the obligations imposed on the Colonies by existing commercial treaties,
" and that inquiries be instituted in connection with the revision proposed in
" Resolution No. 5, to ascertain how far it is possible to make those
" obligations and benefits uuifonn throught the Empire." It only asks for
information and inquiries as to all conmiercial treaties.

Mr. LLOYD GEORGE : We cannot answer you that on the spur of the
moment.

CHAIRMAN : We will do to-morrow such other business as I can

Adjourned to to-morrow at 10.30 o'clock.

•11

intp:r-i:\ipeuiai. thade

RI-yrURN sliowiug for the last year for wliicli figures are available :— •

(a) The value of all articles imported into the United Kingdom from

Canada, Australia, New Zealand, and Britisli South Africa,
respectively, (i) free of duty, (ii) subject to duty ;

(b) The value of all articles imported into Canada, Australia, New

Zealand, and British South Africa, repectively, from the United
Kingdom, (i) fi-ee of duty, (ii) subject to duty.

(A) Value of all Articles Imported into the United Kingdom which
were consigned from Canada, Australia, New Zealand, and
British South Africa, respectively, (i) free of duty, (ii) subject
to duty.

Colony whence Coiisi^'iicil.

Iinijorta (Consigiuncnts) of Meicliandise into the Unitml
Kingilom in 1901).

Kvee of Duly.

Subject to Duty.

Total.

From C'iiiiiiilu ....
„ Aiistraliii - -
„ New ZealiiiKl - - . .
„ Hiitisli Soiitli Africa*

£
28,019,668

29,178,609

15,618,850

(^,327,476

£
15,368

106,537

163

16,894

£
28,035,036

29,285,146

15,619,013

6,344.370

* Including Rhodesia, Oranire River Colony, and the Transvaal. The fieares given are exclusive of the value

of dianiondi from (he t'a|>c of Ciuod Hope, which aniiiniilrcl ti iK\7'■\'^'^'^/. according; to tijjiirc-j supplied Ijy tlie
Cape Government.

(B) Value of all Articles imported into Canada, Australia, New
Zealand, and British South Africa, respectively, from the United
Kingdom, (i) free of duty, (ii) subject to duty.

Imports of Merchandise from the United Kingdom.

Colonies.

Kree of Duty.

Subject to Duty.

Total.

Ciiiiad

I (year ended 30(ii June 1906) (ii) -

£

3,406.000

£

10,815,000

£
14,221,000

Aiistri

ilia (1905) (/.)

5,738,000

1 1,513,000

20,25 1 ,000

N(!W J

Cealund (1905) -

2,484,000 (»/)

5,300,000

7,784,000

liritisl

1 South Afrien (1904) (e)

6,506,000 {d)

14,335,000

20,841,000

(«) The figures represent imports for consomption.

(A) The iigures represent imports of gomis the prodii -e or maimfa -tare of the Uniteil King loai.

(cj .\ppid.\iinate figures, compiled from the returns o' the various South .\fric.1n colonies. Later di'talled

tigures are not yet available, but the tat il value of merchandise imported from the United King loni

in'o British Sduth .Vfrica amounted to 10,'.I38,II00/. (exclusive of Colonial Government stores) in 190fi.

this being the first year for whicii returns were compiled by the South .Uriean ."Statistical liiireau for

'* British Soutli Africa as a whnle."
((/) Inclusive of the value of certain goods which .'ire free of duty when the i>rodiicc of the United Kingdom

but suliject to duty wlien the produce of other 4'ountrii'S.

Note. — The figures in the above Statements are exclusive of the value of bullion and specie.

Board of Trade,

April 10(17.

A. \V I I.SOX V()\.

442

Thirteenth Day. THIRTEENTH DAY.

8 May 1907.

Held at the Colonial Office, Dowxing Street,
Wednesday, 8th May 1907.

Present :

The Right Honourable The EARL OF ELGIN, K.G., Secretary of State

for the Colonies (President).

The Right Honourable Sir Wilfrid Laurier, G.C.M.G., Prime Minister
of Canada.

The Honourable Sir F. W. Borden, K.C.M.G., Minister of Militia and
Defence (Canada).

The Honourable L. P. Brodeur, Minister of Marine and Fisheries
(Canada).

The Honourable Alfred Deakin, Prime Minister of the Commonwealth
of Australia.

The Honourable Sir W. Lyne, K.C.M.G., Minister of Trade and Customs
(Australia).

The Honoural:ile Sir Joseph Ward, K.C.M.G., Prime Minister of New
Zealand.

The Right Honourable Sir Robert Bond, K.C.M.G., Prime Minister of
Newfoundland.

The Honourable L. S. Jameson, G.B., Prime Minister of Cape Colony.

The Honourable Dr. Smartt, Commissioner of Public Works (Cape
Colony).

The Honourable F. R. Moor, Prime Minister of Natal.

General The Honourable Louis Botha, Prime Minister of the Transvaal.

The Right Honourable Winston S. Churchill, M.P., Parliamentary
Under Secretary of State for the Colonies.

Sir Francis Hopwood, K.C.B., K.C.M.G., Permanent Under Secretary
of State for the Colonies.

Sir J. L. Mackay, G.C.M.G., K.C.IE., on behalf of the India Office.

Mr. H. W. Just, C.B., C.M.G., ) r ■ , r, ,
Mr. G. W. Johnson, C.M.G., I'^omt Secretar,

Mr. W. A. Robinson,

Assistant Secretary.

ries.

443

Also present : thirteenth JJay

The Right Honourable D. Lloyd George, M.P., President of the Board « May I907.
of Trade.

JVlr. H. Llewellyn Smith, C.B., Permanent Secretary to the Board of
Trade.

Mr. A. Wilson Fox, C.B., Comptroller-General of the Commercial,
Statistical, and Labour Departments of the Board of Trade.

Mr. G. J. Stanley, C.M.G., of the Board of Trade.

Mr. Algernon Law, of the Foreign Office.

The Right Honourable The Lord Tweedmouth, First Lord of the
Admiralty.

The Right Honourable E. Robertson, M.P., Parliamentary Secretary to
the Admiralty.

Captain Ottley, M.V.O., R.N., Director of Naval Intelligence.

Mr. W. Graham Greene, C.B., Assistant Secretary to the Admiralty.

Sir W. S. RoBSON, K.C., Solicitor-General.

IMPERL^L SURTAX ON FOREIGN IMPORTS.
CHAIRMAN : We begin with the Treaty question.

Mr. DEAKIN : Lord Elgin and gentlemen, if I may, I woiJd like to
hand in a draft embodying the general proposal which I have twice suggested
for the consideration of the Conference. This I have now shaped, I think,
into a more intelligible form, so that before we leave trade questions we
might have an opportunity of seeing whether any co-operation is possible in
this direction. I wiU read it : " This Conference recommends that in order
" to provide fvmds for developing trade, commerce, the means of communica-
'' tion, and those of transport within the Empire, a duty of one per cent, upon
" aU foreign imports shall be levied, or an equivalent contribution be made
" by each of its Legislatures. After considtations between their representa-
" tives in conference, the common fimd shall be devoted to co-operative
" projects approved by the Legislatures affected, with the general purpose of
" fosteriue: the industrial affairs of the Empire so as to promote its growth
The one per cent, is fixed merely as a basis to start fi-om, and
of an equivalent contribution made by eacli of the Jjegis-
I hope, meet Sir Wilfrid Laurier's objection. The plain
provision that this fund is to be devoted to co-operative purposes approved
by the Legislatures affected, preserves in the amplest way their powers of
self-government and their control of this fund. If adopted, this would
provide a means of co-operation in respect of the expenditure of the fund
thus created. I will now circulate it.

" and unity."
the suggestion
latures would.

Imperial

Surtax on

Foreign

Imports.

CHAIRMAN : You do not propose to discuss it.

Mr. DEAKIN : Yes, I have asked for this twice before.

CHAIRMAN : We cannot possibly discuss it at this moment, because it
must go before the Chancellor of the Exchequer.

Mr. LLOYD GEORGE : It is a Treasury matter.

444

Tliirieenth Day. i\jj. DEAKIN : I do not mean to discuss it now.

S May 1907.

Dr. JAMESON : It must go before the Chancellor of the Excheqner if

Imperial ^j^g Imperial Government contributes.
Surtax on ^

Foreign

Lmport*. Mr. LLOYD GEORGIA : It is altogether u Treasury matter, whether

duty or equivalent contribution.

Mr. DEAKIN : Yes. But the questions of Ijetter means of counnunica-
tion and transport are matters to which you have specially referred more than
once, and this is the means of providing a joint fund out of which those
means could be financed.

Mr. LLOYD GEORGE : Have you worked out roughly what it would
come to.

Mr. DEAKIN : I have some figures here, but they are not material.
If preferential trade is ruled out, and the resolution we have passed practically
disposes of it as far as this ( 'onference is concerned, we are left in the void.
We have now to look for additional means towards the same end.

Mr. LLOYD GEORGE : By way of elucidating it, not by way of
debating it, what does " equivalent contribution " mean ? For instance, take
this case. Our imports from foreign countries are over 400,0(X),000L or
something of that sort. Does that mean that we are to contribute at the
rate of one per cent, on the merchandise imported into this Kingdom ?

Mr. DEAKIN : The proposal is that you should either levy a duty of one
per cent., or whatever percentage you agree upon ; or contribute the same
amount from any other source.

Mr. LLOYD GEORGE : Do you mean contribute on the 40U,000,UOOZ. ?

Mr. DEAKIN : How otherwise could you measure equality of
contribution?

Mr. LLOYD (tEORGE : It is hardly what I caU an equality of con-
triljution. Dr. Jameson Avould contriljute about 100,000L, and we 4,0U0,000L
That is not what I caU equality, quite.

Mr. DEAKIN : It is if you look to the fact that you decide how your
4,000,0U0L is to be spent.

Mr. LLOYD GEORGE : We get an equivalent for it ?

Mr. DEAKIN : Yes, you may offer its equivalent.

Mr. LLOYD GEORGE: But you will not give us 4U votes to Dr.
Jameson's one— I am not suggesting that.

Mr. DEAKIN : The proposal here is that you should practicallj^ control
the expenditure of your 4,00O,O00L, and Ave of our 400,000L, or whatever it is.

Mr. LLOYD GEORGE : It is premature to discuss it now. . I only want
to know what amount we are to contribute. Supposing we had a sort of

445

arnuigpiiieut uitli you wliirli would iuvolvo tlu' i^xpeuditui'e ol' 4UU,00UZ., TIiukhihIi Diiv.

and that you would contribute 2(.)U,UU0L and we 20(),(>()()L, tliat is one way of 8 Muy 1907.

interpreting " c!([uivalcnt contribution." The other is the way you have

explained now, that we should contribute forty times as luuch. Imi-kkiai,

Surtax on
FoKEir.v

Mr. F. U. MOOR : With about forty tunes as much at stake. Imim.kts.

(Mr. Lloyd

Mr. LLOYD GEORGE : No, it is uot we who have come first of aU to ^""'•gc.)
complain of present arrangements.

Mr. DEAKIN: First ol all, we are 5,0UU,0UU people anil I have yet to
learn that you number forty times that.

^Ir. LLOYD GEORGE : 'Die difference Avould Ijc nearly ten to one.

Mr. DEAKIN : You are a little more tlian eight to one.

Mr. LLOYD GEORGE : One per cent, would mean that vour share
would be OO.OOOL

Mr. DEAKIN: I will not toiich that now. I will go into the figures
later. The pi-inciple is that you put into this fund, for argument's sake,
SOO,O0OL and we 100,0()0L, as far as we two are concerned. Then for any
joint service you woiild consider how much of your 800,000Z. you would
devote towards it,, and Ave should consider how much of our 100,000L we
should devote towards it. We should not be the only partners. Any proposal
we were interested in, New Zealand might be and Canada might be, and
others might be. But the idea is to have a joint fund. Roughly the amoimt
contributed by each country to that fund should be within its own control
to the extent that it could not be applied to any purposes until its
Legislature has approved of the proposal, which would set out how miich the
United Kingdom, how much Canada, how much Australia, and how much
New Zealand contribute. The Legislatures do not let go of anything. They
deal with their own money imder this resolution as they do now, and unless
they are satisfied a fair distribution has been arranged they will not pass it.

Mr. LLOYD GEORGE: Still, if it is a bargain between us and the
Colonies that we should spend some four million pounds upon objects of
this kind, \ve have to spend them somehow or break the treaty.

Mr. DEAKIN : Yes, while the treaty lasts.

*

Mr. LLOYD GEORO^E : Before we enter into a bai-gain of that sort we
have to see what it means.

Sir WILFRID LAURIICR : You say it is to be a general fund, and il
you create a general fund, how arc you leaving it to the Legislatures to
distribute ?

Mr. DEAKIN : Y'ou have no choice between that and creating some
other body which would displace our Legislatures. I think that is impossible.

Sir WILFRID LAURIER : You can leave it to each Legislature to do as
much as it pleases without creating a fund.

Thirteenth D;iy.
8 May 1907.

IltPEKIAL

Surtax on
Foreign
Imports.

Coastwise
Trade.

446

Mr. DEAKIN : But if Ave can agree at once that there shall be such a
fund and fix its amoiuit that would be a first step to Imperial co-operation.
The existence of that fund would make it imperative that there should be
from time to time consultations of a business character as to how that fund
should be applied, and how the respective portions contributed by each shall
be arranged. It would have to be absolutely under the control of the
Legislatures, but there would be a fimd and full consideration fi-oni time
to time as to how it cotild be most fruitfully applied. The Legislatures
would have to be satisfied as to its application in each instance.

Sir WILFRID LAURIER : I understand you do not move it this
morning ?

Mr. DEAKIN : No.

Dr. JAMESON : I think this is an attempt on Mr. Deakin's part to found
a fimd for the schemes which the President of the Board of Trade
suggested.

Mr. LLOYD GEORGE : To found a fund at our expense.

Dr. JAMESON : Not all at your expense. Up to now, the indication has
been that it was to come entirely from Chancellor of the Exchequer.

Mr. LLOYD GEORGE : We should contribute at least ol. net for every
11. the Colonies in the aggregate would contribute. Perhax^s that is too high ;
but two or three to one at least.

Mr. DEAKIN : We are over 12,000,000 people and you 43,000,000 people
— between three and four times as much.

CHAIRMAN : May we proceed now to the other business ?

COASTWISE TRADE.

Mr. DEAKIN : With reference to this resolution, as to coastwise trade,
I had expected my colleague would be here in time to deal with this. The
matter which is embodied in this resolution was fully considered on a
number of occasions by the Conference of 1902. We have now before us its
resolution, which asks the attention of the Government to the state of the
navigation laAvs in the Empire and the advisability of revising the privileges
as to coastwise trade, including trade between the Mother Country and its
Colonies and Possessions, and between one Colony or Possession and another,
to countries in which the corresponding trade is confined to ships of their own
nationality. It was iipon the motion of the late Mr. Seddon, representing
New Zealand, that this question was given such prominence to. This same
resolution was passed in 1902.

Mr. LLOYD GEORGE : Do you recollect what the Imperial Government
did then ?

Mr. DEAKIN : They allowed the resolution to be passed without anj^
objection whatever. It was brought forward by Mr. Seddon, from whose
speech I take a quotation of an utterance of Senator West, in the United
States Congress, when he said : " We can exclude foreign ships from our
" coastwise trade, and no foreign nation can complain; and, of course, with

447

" the monopoly of building these ships, and repairing them, our shipowners TLirteeuth Da
" have a harvest each year which they could obtain nowhere else." The y -^^y 1907.

United States are amongst the countries who have emphatically reserved their

coastwise trade and given a very wide interpretation to that term. The Coastwise
Secretary of State at that time invited special attention to this part of Tuade.

Mr. Seddon's proposal, at page 72 ; and Sir Wilfrid Laurier, Avho had CMr. Deaki-i.)
evidently given this subject close attention, at page 73, pointed out that
50 years ago the Navigation Laws " were repealed, largely at the instance of
" the Colonies, and perhaps Canada was one of the chief motors in the new
" departure. The conditions have changed very much since that tune. The
" Americans have extended tlieir navigation laws, but not only to the coasting
" trade, but to a class which is not at all used for coasting trade ;
" for instance, they have applied their law on the Pacific Ocean
" not only to the coast of the American continent, not only to the
" coast of the United States from California up to British Columbia, but
" they include Honolulu as part of the United States. They have not
" allowed the privileges to other shipping. They reserve that exclusively
" to themselves." He explained the Canadian law, which offers
leciprocity in tlie coasting trade — an offer not then taken advantage of bj'
the United States, nor, I think, since. The representative of the Common-
wealth, Sir Edmimd Barton, at page 76, said : " Whether it would be
" possible with the concurrence of the whole of the self-governing portions
" of the Empire to make a general navigation law accepting and asserting
" the principle, and leaving the application of it to the autonomous action of
" the Governments concerned, is a question which may well be considered ;
" and I think this whole question of the navigation laws is one which may
" demand a larger and longer discussion than we have given to it yet." I
think tliat discussion has now been held under the presidency or chairmanship
of the President of the Board of Trade.

Mr. LLOYD GEORGE : That is so.

Mr. DEAKIN : Was it the law of Merchant Shipping only, or the
Navigation Laws which were under consideration ?

Mr. LLOYD GEORGE : I think we pretty well covered the whole
groimd.

Sir JOSEPH WARD : That is so.

Mr. DEAKIN : So I understand. This question now comes to us almost
by transfer from your Conference.

Mr. LLOYD GEORGE : Was this moved at all at our Conference ?

Sir JOSEPH WARD : My impression is that it was not.

Mr. IvLOYD GEORGE : The only question we proposed to refer to this
Conference was as to the islands of the Pacific, whether they should be
included as part of the coastwise trade of Australia.

Sir JOSEPH WARD : At the Navigation Conference we dealt with the
power, admitted by everybody, of the Colonies to govern shipping within
their own territories. We decideil that the inter-connnxmication between an
outside place and the Colonies we had no jurisdiction over beyond our own

V.

448

Thiiteenth TJny. waters. We decided to go for uniformity in legislation as far as possilile, to

8 May 1907. meet the different requirements of the Empire. The canse of this being

~ ; referred here, was a desire on our part to try and control ships and shipping

Trade!" ^^ ^^^® islands of the Pacific, making those islands part and parcel of the

(S'n territories of Australia and New Zealand, and we wanted to arrive at a decision

Joseph Ward.) upon it, and found we could not govern the trade on the oceans outside our

own territory, and we decided that aspect of it should be transferred to this

Conference.

Mr. DEAKIN : Does not that involve a consideration of this resolution
of 1902 which we had already set down for consideration by this Conference ?
That is to say, is not the main point so far as we are concerned, or rather,
is not our main object to learn the opinion of the Government of the United
Kingdom as to the possilnlity of dealing with the trade between the Mother
Country and its Colonies and Possessions as coastwise trade. The islands of
the Pacific have a particular interest for New Zealand and the Commonwealth ;
but, of course, they would come under any application of these general
principles to which by resolution attention was called in 1902. I presiune
the question has been considered since, and was just about to briefly point
out the steps by which the Government of the United Kingdom came to
agree to this resolution in 1902. The then President of the Board of Trade,
at page 134, pointed out that if there Avas to be a reciprocity arrangement in
regard to coastwise trade only three countries would be affected — Russia,
the United States, and France — because every otlier country did practically
leave its coastal trade open to British vessels. Russia and the United
States are exceptions, and France is a partial exception. Again he said
the qiiestion might be raised to Russia whether the trade between Great
Britain and her Colonies was not in her sense of the term coastal trade,
on the plea that she has made traffic between Odessa on the Black Sea and
Port Arthur coastal trade. Those were two ports in the same territory,
whereas the United States made Honolulu, Hawaii, and Porto Rico all islands
in the ocean subject to their coastal trade provisions. Sir Wilfrid Uaurier
then pointed out that all the resolution did was to call attention to this
subject. The resolution was approved. At page 139 it will be found as it
appears on the agenda paper for this Conference. There will be found as
Appendix No. 18 at page 453 — a memorandum liy the Board of Trade —
which sets out the practice of the different countries there mentioned in
regard to their coastwise commerce. I wiU only call attention to the general
principle adopted by Portugal, which first reserved the whole of its trade
absohitely as coastwise trade, and then opened its ports to foreign vessels as
appeared advisable or in consideration for reciprocal concessions. They
started with reserving the whole of the coastal trade, and then commenced
to throw open to everybody certain portions of it which they did not wish to
reserve, and to make reciprocal arrangements with countries that did reserve
their coastwise trade. That seems to be a course which has something to l)e
said in its favour. At page 456, paragraph 20, of this report, there is a state-
ment in Annex No. 8, showing the position of coastal trade, which says :
" It will be seen that there is no treaty under which the right to share in the
" coasting trade of all our Colonies and Possessions is granted to any foreign
" country, but a few treaties (mostly with unimportant countries from a
" maritime point of view) concede tliis right with respect to our Crown
" Colonies and certain self-governing Colonies which have adhered to those
" treaties." It mentions Greece, Paraguay, and the Argentine. The Board
of Trade Memorandum raises the question as to whether there is a distinction
between what might be called a foreign shipping trade and coasting trade
proper, and then proceeds: "Assuming fliat any difficulty of this kiud is
" snrinninited, the r.n.'aty position as regards inter-Empire tratle would appear

449

" to be identical with that as regavtls coasting trade. THtis, our treaties Thirteenth Day.
" with Austria-! 1 11 ngary, (Ireece, and certain other countries would have 8 Muy 1907.

" to be ' denounced ' before steps could be taken bj'^ legislation in the United

" Kingdom to reserve the trade lietwecn the Unitt^d Kingdoiu and any Coastwise

" of the Colonies. The carrying trade between Canada, India, and New

" South Wales could apparently be ' reserved,' if desired, without breach of ^ ""' •^"''"•)

" any treaty, and, generally speaking, the treaty restrictions on the

" reservation of the inter-Colonial trade would seem to be less formidable

" than those applying to the Colonial trade with the United Kingdom, always

" assuming that inter-Colonial trade could, without breach of treaty or

" fear of retaliation, be assimilated to Colonial coasting trade. The

" restriction of the trade between particular Colonies to British vessels

" would nattu-ally he a matter for Colonial rather than Luperial legislation,"

and the question is raised whether it woidd not be possible even

under all existing treaties to restrict the trade between the United

Kingdom and any particidar Colony to British vessels " by means of a

" colonial law, in cases in which the Colony passing such a law is not

" bound by treaty to admit foreign vessels to its coasting trade." That

suggestion may have rather an important bearing upon a subsequent question

we may he called upon to discuss.

Speaking for the Commonwealth, it appears to us that attention having
been invited to this question in 1902, it is possible that in the future the
exercise of some of the powers referred to in that memorandum, or the
occasion for their exercise, may arise suddenlj*. It would be well therefore
to ascertain from the British Government what has been the result of any
further inquiries which have been made in this direction either as to local
powers or practical advantages or disadvantages of such reservations. If
that be not a complete statement we can again re-afSrm this resolution, so
that further attention will be called to it in the hope of our obtaining some
clear and precise understanding of what our powers are in this connection.
We require knowledge which would guide us in forming an opinion as to
what extent it would be judicious for us to exercise those powers. For the
purpose of bringing this matter to a head, equipping ourselves for practical
solutions when these may be necessary, and for In-inging iip to date the
very interesting and valuable information contained in the additions to the
Conference of 1902, the resolution before you is submitted for re-affirmation.

Sir WILFRID LAURIER : I quite approve for my part.

Sir JOSEPH WARD : This resolution, as Mr. Deakin has said, is a
similar one to that moved by ]\lr. Seddon at the last Conference. I want to
say what Kew Zealand did after his return. We introduced legislation
affecting the whole coastwise administration, so as to insure that British ships
had to a very large extent the advantage in our country. We did it by the
altering, among other things, of our law as to the pajnnent of wages and the
general control of the ships. We do not allow outside ships to come down to
our country and engage in coastwise trade at all. We have stopped that.
We have done as America did.

Mr. DRAKIN : Do you allow them if they comply with the conditions ?

Sir JOSEPH WARD : We do not allow an outside ship to trade on our
coast. Since the resolution moved by Mr. Seddon in 1902, referred to by
Mr. Deakin, we in Xew Zealand have gone in the direction of it to a very
large extent. We have done it for a reason referred to by Mr. Deakin,
because we felt keenly in our countiy the extraordinary position of

c 4S0t)8. F f

Thirteenth Day
8 May 1907.

Coastwise
Trade.

(Sir Joseph
Ward.)

450

being broiiglit i^p when our shijis get to Honolnln, and then not allowed to
go on to trade with America. We had to withdraw a steamer for which
we were paying a subsidy for carriage of passsengers and mails between
New Zealand and England via America. After 1902 the effect of this
resolution was put into a statute in our country, and we are carrying it out.

Mr. DEAKIN : Part of it.

Sir JOSEPH WARD : A part of it.

Mr. DEAKIN : This is general, and relates to the United Kingdom and
the Colonies.

Sir JOSEPH WARD : We had a considerable amount of discussion at
the Navigation Conference upon the very wide and difficult subject of
controlling ships after leaving England, and before coming into our waters.
We came to the conclusion that we coidd not interfere in any way whatever.
We Avent on to suggest in the resolution there, which will come up for
consideration of the various Governments later, and I think we all supported
it, that such portions of the resolution passed there which either required
legislation in our countries or elsewhere for bringing them into effect the
respective Governments should take into consideration, with a view of giving
effect to them. I am in most cordial agreement with Mr. Deakin in this, and
support it very heartily upon the principle that we do not want to see
injustice done to British shipping \ipon our coast when we have at least one
gi-eat competitor, which has put into operation a very extended interpretation
of coastwise law, which does not allow our ships to engage in trade on
the Pacific Ocean fi'om Honolulu to San Francisco. We are all the more
anxious to see the system, so far as it can be put into operation, generally
applied to any other portions of the Empire.

Mr. LLOYD GEORGE : The only part of the resolution which really
comes within the pui-view of the Lnperial Conference is that which deals
with the trade between the Mother Country and its Colonies and Possessions
and between one Colonj' and Possession and another. The question of our
coasting trade is a matter entirely for the British Parliament. Now I will
just put the two or three considerations which occur to us which tend to
make it miadvisal^le in my judgment that we should accept this resolution.
It looks at first sight very simple and clear, with nothing Imt advantage to
us, but on detailed consideration it will be seen to be otherwise.

Mr. DEAKIN : The resolution only says that it is desirable that the
attention of the British Government and the Colonies should be called to
the matter.

Mr. LLOYD GEORGE: "And to the advisability of refusing the
privileges of coastwise trade."

Mr. DEAKIN : Yes, to call attention to the advisability.

j\lr. LLOYD GEORGE: It really means a recommendation, if it means
anything at all, because, I take it, our attention has been called to it by the
Impcn-ial Conference in 1902. The suggestion contained in the resolution
would certainly not meet with approval on our part — namely, that we

451

should close our inter-Imperial trade to the vessels of foreign countries Thirtecntli Day.
which deny similar privileges to us. I wiU give the reasons why I do s Mny 1907.

not think it is advisable that we should, at any rate at the present

moment, challenge these countries on this particular point. It will be Coastwisi!
found on detailed consideration that the matter is not quite so simple as Trade.

it looks, and that, in fact, these proposals, framed undoid)t('dly in the (if"",

interest of British ships and British trade, involve a great complication of ^'"^'^ George.)
difficulties, which may well make us pause before we give our assent to
them. It is convenient, in the first place, to discuss this proposal on its
merits, quite apart from any complication introduced by treaty engagements
or the limits of legislative powtn-. The ol)ject is either to exclude foreign
ships from our coasting or iuter-lmperial trade, or l)y the threat tliereof to put
pressure on foreign govermnents to admit British ships to the corresponding
trade in their dominions. In either case ihe object is to benefit British
shipping. It could have no other beneficial result. On the contrary, the
exclusion of foreign ships or any class of them from the right to carry goods
between the United Kingdom and a British Colony, or between the
Colonies themselves, must, if effective, tend pro tanto to handicap the
buyers and sellers of those goods, by restricting their choice of transport
facilities and probably raising the cost of carriage. The Australian
exporter of wool and meat would hardly wish to be restricted to British
ships to carry his goods to the United Kingdom in competition with
the Argentine exporter of wool and meat, who coidd select British or foreign
ships as best suited his purpose. Moreover, if goods can only travel direct
between different parts of the Empire in British ships, while goods from
foreign countries may travel either ])y British or foreign ships, a positive
advantage is given to trade between the Empire and foreign countries as
compared with trade within the Empire. If merchandise can be sent from
Hamburg to Austraha in ships of any nationality, l^ut from London only in
Britisli ships, the result would hardly tend to benefit the port of London in its
competition with Hambiu-g, or to maintain the entrepot trade of the United
Kingdom. Unless these disadvantages to the trader are compensated for in
some way, the proposed reservation woidd operate as a discrimination adverse
to direct trade within the Empire. If, nevertheless, the proposal is
advantageous, it can only be because of the l)enefit to be conferred on British
shii^ping. But is this l^cnefit certain? If confined, as proposed in the
resolution, to the exclusion of vessels of countries which do not give reciprocity,
it will produce but little practical result. The great bulk of the foreign
shipping wliirh actually engages in our inter- Imperial trade is Norwegian or
German, and neither of these countries exclude us from their coasting or inter-
Imperial trade. The only countries whose vessels would be excluded under
the resolution are those of Russia and the I'nited States, whose participation
in our inter-Imperial trade is at present negligible.

Mr. DEAKIN : Do not the Germans give some special advantages to the
trade with their Colonies ?

Mr. LLOYD GEORGE : No.

Mr. DEAKIN : Not as regards shipping V

Mr. LLOYD GEORGE : No, none.

Mr. DEAKIN : They tried to in the Marshall, Islands. They shut us
out and a vessel of ours had to so back twice because thev were not allowed
to trade m the Marshall Islands. The question of compensation for tbat is
now under consideration.

F f 2

452
Thirteenth Day. Sir WILFRID LAURIER : Surely it was iUegal ?

8 May 1907.

Mr. LLOYD GEORGE : That was a question of duties I understand.

Coastwise
Trade.

Mr. DEAKIN : A question of payment for the privilege of trading at
all, a question of heavy duties, and also restrictions as to the cargo they
could obtain. It was a deliberate attempt to throttle trade, which succeeded
to the extent that a vessel was driven back twice at the cost of many thousand
pounds of trade. The Captain offered to pay the exceptional fee in order
to be permitted to trade, and then was blocked again. It is a very strong
case indeed.

Mr. LLOYD GEORGE : I know the coasting trade of Germany is
open to us.

Mr. DEAKIN : They have not any coasting trade, to begin with, worth
speaking of.

Mr. LLOYD GEORGE : I am only dealing with your resolution which
does not propose to hit a country which extends the same opportunities to us
for what they are worth. The trade between Germany and her colonies is
just as open to us as to German vessels. About the Marshall Islands I do not
know. I am told that thej^ have admitted thej' were wrong in that case and
have set it right.

Mr. DEAKIN : But have paid no compensation yet.

Mr. F. R. MOOR : What is the position with regard to French
regulations ?

Mr. LLOYD GEORGE : France reserves its trade to Algeria, which is
not, properly speaking, a colony, because, I believe, it has representation in
the French' Parliament. It is treated ahnost as if it were a French
Department.

Mr. DEAKIN : They treat all their Colonies nominally as Departments.

]\Ir. LLOYD GEORGE : Not their oversea possessions, such as
]\Iadagascar, Senegal, and Tonquin. There we can trade without any
restriction at all.

Sir JAMES MACKAY : And Pondicherry.

Mr. LLOYD GEORGE: Yes.

Mr. DEAKIN : They give tariff advantages to their goods in their own
Colonies, and also subsidies.

Mr. LLOYD GEORGE: That is another point. It has hit French
shipping much more than it has hit us. The whole system has been a
ghastly failure, and the result is, that even Germany is now beating French
shipping, although Germany has hardly any coast and consequently few
sailors. France has native sailors, especially in some parts of her coast, and
there is n6 reason why she should not be second to us, except for her very
protective policy.

453

Mr. DEAKIN : I do not think tliat policy has anything to do with it. Tliirteemli Day,

8 May 1907.

Mr. LLOYD GEORGE: Of the total tonnage entered and cleared with castwise
cargoes at United Kingdom ports in trade with our Colonies and Possessions Tkade.

in 1900, only one-third per cent, was Russian, and none American. So it
would hartUy hit America.

Mr. DEAKIN : Do you say we have no trade in American ships ?

Ih: LLOYD GEORGl-:: None. 0£ the total tonnage entered and
cleared with cargoes in the United Kingdom in trade with our Colonies and
Possessions in 1906, none were American.

Mr. DEx\KIN : We have American boats plying on our coast.

]\Ir. LLOY'D GEORGE : I suppose they buy something from you. You
woidd not like to turn them out.

Mr. DEAKIN : Y'ou said we had none.

Mr. LLOYD GEORGE : None at the United Kingdom ports.

Mr. DEAKIN : There are some with us.

Mr. LLOYD GEORGE : Limited in this way, the proposal couhl confer
little practical benefit. If the principle be extended further, it is likely to
expose our shipping to reprisals. This is what I want to impress npon the
Conference more especially. We have nearly half the merchant shipping of
the world, and it is to onr advantage to keep open every trade to that
shipping so far as possible. If we reserve certain valuable trades to our flag,
other countries will probably follow suit. But they will probably do more
than this, and will look aliout to find other means of combating or coimter-
acting our action either by increased subsidies to their own shipping or by
some other steps. Moreover, it is to be remembered that the foreign ships
which we should exclude from this particular trade will not be destroyed ;
they will continue to trade, and will probably compete for freight more
keenly than ever in the foreign trade which is still open to them. This
foreign trade largely exceeds the Colonial trade in magnitude, and it is quite
possible, therefore, that we might lose at least as much as we gained by
excluding these vessels from our Colonial trade. That is exactly what
happens in France. They exclude us from their coasting trade, with the
result that we enter more keenly into the international trade and beat
French ships in French oversea trade. This argument refers chiefly
to inter-Imperial Trade. 'I'he reservation or opening of the coasting
trade proper of each part of the Empire is (subject to treaty provisions)
a matter for local concern, as I have already pointed out. The matter
may be illustrated by one or two figures. I find that the total entrances
and clearances of British shipping throughout the world do not fall
far short of 250,000,000 tons per annum. The total tonnage of foreign
ships entered and cleared in British inter-Imperial trade is less than five
million tons. This represents the maximum extension of our shipping trade
that might conceivaldy be brought about by a scheme of reserving trade to
British ships. Owing to the vastness of our Mercantile JMarine in every part
of the Avorld the tonnage exposed to possible reprisals or to increased

486fiS. F f 3

454

Thirteenth Day.
8 May 1907.

Coastwise
Trade.

(Mr.
Lloyd George.)

competition fthi'ough subsidies and in other ways would he many times as
gi-eat. It is evident that a country so situated must necessarily look upon
proposals such as that made by Australia in a very diiferent light from that
in wliich they may appear to the point of view of Australia, whose foreign-
going shipping is relatively very small. As I have already stated, we have
half the merchant shipping of the world. Looking at the entrances and
clearances of ships of various nationalities in British and foreign ports, I take,
first of all, the United States of America, which is one of the countries which
would be hit by this resolution, and I note that over 25,000,000 tons of British
shipping entered and cleared in 1905 in the United States ports, while less
than one and a half million tons of American vessels entered and cleared in
our ports. There were 15,500,000 tons of British shipping in French ports
compared with 3,000,000 tons of French shipping in United Kingdom ports.
Take Russia. The British ships in Russian ports came to 8^ million tons ;
the Russian ships in British ports came to 1^ million tons. There were
nearly 12,000,000 tons of British shipping in Italian ports compared with less
than 950,000 tons of Italian shipping in the United Kingdom ports. Even
in the case of Germany, the British shipping at Clerman ports is in excess of
German shipping at British ports — 10 i million tons as against 8| million
tons — but of this 8J miUion tons of German shipping, 4 million tons were
simply in baUast, while of the lOl- million tons of British shipping, .3 million
tons were in ballast ; so that, as far as cargoes were concerned, we were in
the proportion of five to three. These figures have only to be mentioned, for
us to see at once how vulnerable our merchant shipping is. This is not said
to disparage the value of the suggestions for the encouragement of British
shipping, but to illustrate the special difficulties of our position as compared
with that of the Colonies. There are methods by which the Colonies, or some
of them, could give a very direct impetus to British shipping if they desired
to do so — if, for instance, they were to relax some of their restrictions upon
British ships which desire to enter into the coasting business in Australia,
more especially. As a matter of fact, in the last few years those conditions
have been made very onerous ; so onerous that they will drive British ships
out of the Australian trade altogether.

Mr. DEAKIN : Yoix are not speaking about what has been done in
Australia, because we have no law yet.

Mr. LLOYD GEORGE : I beg your pardon ; I mean what is proposed
to be done, because Sir WiUiam Lyne, at the Navigation Conference, said he
proposed some extraordinarily stringent regulations. He read them out, and
I am sure the effect will be to drive British shipping almost entirely otit
of the Australian trade.

Mr. DEAKIN : They were to provide for equality in wages and con-
ditions of employment.

Mr. LLOYD GEORGE : Yes, but not merely that ; they involved struc-
tural alterations of British ships. They would be prohibitive.

Mr. DEAKIN : Better accommodation for the men ?

Mr. LLOYD GEORGE: Well, we have done that ourselves, andare in
advance of every country in the world in that respect. If you superimpose
absolutely fresh conditions in Australia, the result will be that our own
conditions will be quite nugatory, and ships which can enter and do
trade in every other part of the world, except Russia and the United States of

455

America, will not be allowed to enter the Australian coastwise trade. In Thinoentli Day.

fact, Australia will hit us harder than even France in that respect. If 8 May 1907.

Australia wants to help British shipping, far and away the most effective way

would be to treat us a little more generously in the matter of merchant Coastwise

shipping legislation. I am bound to say that, because the resolution comes Ibade.

from Australia. , , (^'■•

Lioyd George.)

Mr. DEAKIN : Quite right, and I think there will l)e every desire to do
it. The only question is how far can we do that consistently wtli maintaining
the standard, as we propose it, for our own shipping owned in Australia,
or at all events running entirely in Australian waters. We shall fix a
certain standard wdiich will be, or believed to be, fair and just, and
require them to live up to it. Having done that, how can we destroy their
whole trade to others by omitting those others from the same obligations ?

Mr. LLOYD GEORGE : I am not complaining so much about the vessels
which trade exclusively along your coast. I agree there is a good deal of
reason in what you say now, that if you impose these very heavy regulations
upon your own ships, you have a right to demand that British ships should
also conform, otherwise they would enter into your coastwise trade under
conditions which wovdd handicap your own shipping. But take a case of this
sort, take a great liner proceeding from this country to Australia. She calls,
say at Fremantle ; she picks up a couple of passengers who find out that that
particular liner is much more convenient and perhaps more comfortable than
the boats that may be trading between Fj-emantle and Sydney, and they say :
" We Avill go on from Fremantle to Sydney in that British ship, which
happens to sail at the veiy time we want to proceed." According to your
new proposals, as interpreted by Sir William Lyne, the moment a ship picks
up even a couple of passengei'S, every regulation of your coasting trade will
apply. She will have to put on the same number of stewards, the same
number of hands, as your ships must in your coasting trade. Not merely
that, but supposing that there is not the same kiml of accommodation which
you demand on your o-mi ships, the whole structure of this big liner has to
be altered, because a couple of passengers are picked up at Fremantle and
dropped at Sydney, for the convenience of the Australian people. That, I
consider, is a far worse sort of regulation that yon impose upon us, than
anything we have to contend with in any foreign part of the world.

Mr. DEAKIN : As a matter of fact, the recommendations of our own
Commission exempt the voyage from Fremantle to Adelaide.

Mr. LLOYD GEORGE : Perhaps I have taken the wrong port. 1 hear
there is something about a railway from Fremantle, and ships are to be exempt
until the railway is made. But take any other port. If a liner calls at any
Australian port and picks up a couple of passengers and drops them at
another Australian port — I need not necessarily take Fremantle — the whole
of those obligations which are most onerous and ruinous to British ships,
will apply, and the residt will be that they will be driven altogether out of
the Australian trade.

Mr. DKAKIN: The coastwise trade.

Mr. LLOYD GEORGE : The only thing we got passed at the Conference
after some difficulty, was that the same obligation shoultl be imposed upon

f i 4

Thirteenth Day.
8 May 1907.

Coastwise
Trade.

(Mr.
Lloyd George.)

456

foreign ships. Before you give us preference, you liad better start by giving
us equality.

Mr. DEAKIN : But do you understand that the Report of the Com-
mission was to that effect ? My recollection is that a distinction was to be
drawn between British and foreigTi ships.

Mr. LLOYD GEORGE : I am very doubtful how jon can impose this
restriction upon foreign ships. International obligations may prevent you
imposing it on foreign ships ; and at any rate, you should give us the
advantage of international amenities for our own ships. We ask you to treat
us as a foreign nation, at any rate.

Mr. DEAKIN : I think you will find your ships much better treated
than foreign ships.

Mr. LLOYD GEORGE : Do not drive us out because we are British.
That is all we ask.

Mr. DEAKIN : You are entitled to ask anything you like, whether
relevant to the actual facts or not. So far as I am aware, the Reports of
the Commission have recommended a distinction between British and foreign
ships. So your suggestions do not fit in with the facts.

Mr. LLOYD GEORGE : We were at the Navigation Conference. We
had all the lug steamship lines represented. They Avere exceedingly alarmed
by this interpretation which was placed upon the proposals, and I do not
think it was challenged. We had the labour people there Avho are dominant
in the sitiiation, and they said, " If we cannot impose these regidations on
foreig-n ships, we can do it on British ships at any rate."

Mr. DEAKIN : We had a Commission which sat and reported — not
the Government but only a Commission — and its proposal Avas, I think, to give
British ships an advantage. It Avill be oiirs.

Mr. LLOYD GEORGE : I am very glad to hear this, and I am glad
of this discussion if it has onlj' elicited that, Avhich we failed to elicit at the
Shipping Conference.

Mr. DEAKIN : When you are referring to Australia and ships being-
excluded, you mean in every instance from the coastwise trade and that
alone ?

Mr. LLOYD GEORGE : No, the instance I gave aa^is that of a big liner
proceeding Avith a cargo.

Mr. DEAKIN : That is Australian coastAvise trade. You piclc it up
at one port and drop it at another. The liner also carries goods from outside
Australia and your Avords might Ije read to cover that trade as Avell.

Mr. LLOYD GEORGE: No, I still press that, because it is very
important. Our shipoAvners asked you, if yoii Avanted to insist uj^on these
coastwise obligations Ijeing imposed on British ships, that you should confine
them at any rate to the cargo that Avas picked up. Take, for instance, a couple

457

of passengers picked up ; if you want to impose yoiir own regulations in Thirteenth Day.

respect of those two passengers, l)y all means do it ; hut if you insist that the 8 May 1907.
Avhole ship should be altered and hiindrctls of other passengers affected by

your laws so that they suddenly find themselves within the coastal regulations Coastwise

because of picking up a minimum cargo of this sort, I nuist say that such rade.

a requirement is perfectly oppressive. I am glad to have the opiwrtmiity of C^''-

saying so in the presence of Mr. Deakin who wiU have a dominant voice, no ''• ^^'■g®-^
doubt, in treating us fairly, or otherwise, when this Bill comes before the
Australian Parliament.

Mr. DEAKIN : May I point out again, that even if your statement were
true, it does not in the least meet the point I was taking. Your complaint
only relates to coastwise trade, in this case the carriage of the two suppo-
sititious passengers Avho are to be picked up in the Commonwealth and
afterwards landed within its borders. That is the only trade affected.
Therefore that is coastwise trade. The qualification that needs to go in,
with all your statement as to "Australian" trade, must be "Australian
coastwise trade." The restrictions if imposed Avould not affect in the least
your trade from any part of the world to Australia or from Australia to any
other part of the world.

Mr. LLOYD GEORGE : It is not a verbal qualification.

Sir WILFRID LAURIER : Is coastwise trade a necessary corollary to
British Trade with Aiistralia ?

Mr. DEAKIN : No, that is quite separate.

Mr. LLOYD GEORGE : I should have thought it was. I am told by
these great liners that it will make a difference of scores of thousands of
pounds, and they have to rmi things very near in competition with German}'-
and other countries now. It is a hard struggle. It will make a difference of
scores of thousands of pounds to them if they are driven out of this trade.

Mr. DEAKIN : This coastwise trade ?

Mr. LLOYD GEORGE : I do not think it is a purely verbal matter.

Mr. DEAKIN : But you have used the words " Australian trade " a
number of times, and when you come to look at the report presented, you will
see, that to make your meaning quite clear, it is necessary to put in the word
"coastwise."

Mr. LLOYD GEORGE : No, I still say, what I o])ject to, in so far as I
have any right at all — or rather, what I criticise, is not that you should impose
any obligation you like upon British or any other ships that are exclusively
engaged in your coasting trade, but that purely because these great oversea
liners pick up, maj"^ be, a ton of cargo or one or two passengers at one of your
ports, and deposit them at the next, all these very onerous obligations should
1)6 imposed on the whole ship.

Mr. DEAKIN : Whatever those obligations are, even accepting your
statement, they are only imposed if you engage in coastwise trade. That is
my point — the beginning and end of it. They are not imposed at all if
you do not engage in coastwise trade.

Mr. LLOYD GEORGP] : I agree — if you do not carry these passengers,
very well, you can go on. But that trade is precisely what enables the British

Thirteenth Day.
8 May 1907.

Coastwise
Trade.

(Mr.
Lloyd George.)

458

liner to deal with Australia at all upon the terms upon which it is dealing.
It could not do it if it were not that it gets a little trade like that on
the coast — an occasional passenger, or it may he a ton or two of cargo.
Naturally passengers in Australia prefer going in a big liner of that sort to
going in a small vessel engaged between one port and another. As the result of
the Bill as it stands, which it is proposed to introduce into the Commonwealth
Parliament, the British liner will be driven out of that trade, and will have to
reconsider the whole of its position. When we are discussing the question,
of increased facilities and subsidies in order to improve transport, I would
say that a far more effective thing than sid^sidies would be to treat these ships-
fairly in this matter. The proposed conditions are quite prohibitive.

Mr. DEAKIN : They might be, if w^e adopt such conditions. It is, of
course, possible to push those conditiqus to a j)rohibitive point, but tl^e
Govennneut Bill has not yet been drafted. The only Bill you have seeji is a
pill prepared by a Conmjission, two of whose members were associated wit):?.
my colleague. Sir William I^yne, at your C!onference. The Government has
yet tp coijsider its gvvu proposals in that regard. I _ani at a (lisadvantage in
the unexpected aljsence of my colleag-ue who would hg,ve taken up t}ie w1?x)Jjq
of this question.

Mr. LLOYD GEORGE : I wish he had been here.

Mr. DEAKIN : He has the whole subject at his fingers' ends, not only
because it is his department and not mine, but because he has been a member
of the Imperial Commission here last month at which this question has been
exhaustively discussed, while I have to go back to our local commission
and what it j)roposed some time ago. Our Government has proposed nothing.

Mr. LLOYD GEORGE : Sir William Lyne's attitude was rather militant
against our ships.

Mr. DEAKIN : No doubt Sir William Lyne would make the best case he
could .

Dr. JAMESON : I do not like it used as an argument against the whole
question of preference, but I do hope Australia, in the person of Mr. Deakin,
will consider what Mr. Lloyd George has said, because it is very interesting
for the first time to have a preference asked for by the Imperial Government
fi-om a Colony on those lines.

Mr. DEJAKIN : It is very hard tq resist that.

Mr. LLOYD GEORGE : As I put it, before you proceed with preference,
1 think you had better start with equality — and we have not had that yet.

Mr. DEAKIN : We first start with equality and hope for something
better — preference.

Mr. LLOYD GEORGE : We will found preference on equality.

Mr. DEAKIN : When I have the opportunity of putting the case to
the Commonwealth Parhament in favour of a distinct discrimination on
behalf of British shipping, I shall be able to mention how you, with tears in
yovir voice, pleaded for preference.

459

Mr. LLOYD GEORGE: 1 thfuidit I would take advantage of this Thirteenth Dajl

opportunity ol' putting this to you.

8 May 1907.

Coastwise
xVIr. DEAKIN : Certainly. I wish I had at hand more detailed knowledge. Trade.

Mr. LLOYi') GEORGE : As regards the United Kingdom, the interests
of British shipping are not thought to be prejudiced by the very small amoimt
of foreign shipping which enters into our coasting trade. The tonnage of
foreign vessels with cargoes in the United Kingdom coasting trade is less than
1 per cent, of the total^ialf a million tons out of a total of Or),U()0,UOO.
Still less are our interests menaced by the few tons of shipping of the
countries which exclude our ships from their own coasting trade (only one-
eighth per cent, of the total). Apart, altogether from the question of
reservation, it is clear that the assimilation of our world-wide " inter-Imperial
trade " to mere coasting trade, could not be effected without a considerable
departure, not only from our own long-estal)lished practice, but also from the
practice of other nations except, perhaps, Russia and the United. States. The
term "coasting " voyage, used in its natural sense, implies a voyage from one
port to another in the same country without the vessel touching for purposes
of trade at any intermediate port not belonging to that country, and if this
definition be accepted as acciirate, there would seem to be grave difficulties
in the way of the extension of regulations affecting such voyages to long
oversea voyages, involving, in many cases, calls at intermediate foreign
ports.

ilr. DEAKIX : That would apply to the request about the Pacific Islands
being treated as coastwise trade in Australia.

Mr. LLOYD GEORGE: Are you going to bring that before the
Conference ?

to us.

Mr. DEAKIN : I understand that was referred from your Conference

Mr. LLOYD GEORGE : I had to rule that out at the Shipping Confe-
rence. Surely, the question of the Pacific is one for the whole Empire to
discuss, because Canada would be just as much interested as Australia w'ould
be in the Pacific. I felt that we could not, especially in the absence of the
Canadian representative, discuss the question of the Pacific.

Passing from general considerations to methods of action, it is clear that
the only method of closing the inter-Imperial trade to foreign vessels, or any
class of them, is by Imperial legislation or Order in Council. It is needless
to say that such a measure would attract great attention, and probably
would be regarded as a sign of decadence and of fear on our part. Countries
which reserve their trade are influenced by the fact that they caimot
compete on equal terms with British shipping. Every country trying to
overtake us in the race will be proportitJuately encouraged to greater
exertions by a step suggesting that we cannot hokl our own against them on
equal terms.

Lastly, the purely treaty difficulty is not to be lightly set aside. The
magnitude and nature of this difficulty differs much according to whether the

460

Thirteantli Day.
b May 1907.

Coastwise

Trade.

(Mr.

Lloyd George.)

proposed reservation is intended to apply to the inter-Imperial carrying trade
in both directions, or only to the ontward trade from the United Kingdom to
the Colonies, and to trade between the Colonies. If extended to inAvard trade
from the Colonies to the United Kingdom — as I understand it is — the
exclusion of foreign ships generally would raise questions in connection with
a niunber of important treaties, some of which it is in the highest degree to
our interest to maintain. If confined to outward trade to particiilar Colonies,
the question depends upon the treaties which happen to bind the particular
Colonies in question. Of course, if the exclusion be confined to the countries
(United States and Russia) which excliide us, there is no treaty obstacle to the
reservation of inter-Imperial trade, but neither does there s.eem to be any
material advantage in such a course. I am going to put in a memorandum — ■
I need not trouble the Conference by reading it — as to (i) the participation of
foreign vessels in our inter-Imi^erial and coasting trades ; (ii) the practice of
foreign countries with respect to reserving or opening their inter-Lnperial or
coasting trades ; and (iii) the treaty position. It has been circulated.
That is all I have to say.

Sir WILFRID LAURIER : This shows the great difficulty there is in
having a uniform policy for the Empire so far as questions have been brought
up at the Conference. As I tmderstand your remark, Mr. Lloyd George, the
resolution as drafted and submitted by Mr. Deakin to be re-aihrmed, which
was passed in 1902, affects only two nations — Russia and the United
States.

Mr. LLOYD GEORGE : That is so.

Sir WILFRID LAURIER : You say you have no competition with the
United States in that branch of business.

Mr. LLOYD GEORGE : None.

Sir WILFRID LAURIER : And very little with Russia. Therefore it
does not affect you at all.

Mr. LLOYD GEORGE: No.

Sir WILFRID LAURIER : But it affects us tremendously on the Pacific
Ocean. Mr. Deakin, rej)resentiug Australia, and Sir Joseph ^Vard representing
New Zealand, and I representing Canada, are very much hit by it. You
have not competition Avitli America but Ave have. The competition is very
unfair. If the Americans choose to exclude its from their coasting trade,
Avhich is supposed to be generally a matter j)ertaining to the shipping of any
nation, I do not think Ave should have much to say, but the Americans have
extended their coasting law in a manner Avhich seems to be al)solutely
unprecedented, if not trespassing upon international laAV, by extending
coasting laAV to Honolulu. It places us at a tremendous disadvantage that
shipping from Australia to San Francisco cannot call at Honolulu. A ship
leaving \'ancoi\ver for Australia or Ncav Zealand cannot call at Honolulu. It
is a very serious impediment to our shipping. We have had to submit to it.
We could not avoid it.

Mr. LLOYD GEORGE : Why ?

Sir WILFRID LAURIER : Becaiise Ave have had ships Aviiich traded
between Australia and the United Kingdom Avhich Avant to call at Honolulu,
and thev cannot do it now. There is the difficulty.

461

Mr. LLOYD GEORGI*] : Have you attempted to legislate at all ? Thirteenth Day.

8 May 1907.

Sir WILFRID LAI'RIER : What legislation can we do ? We can only

^o

Sir WILFRID LAURIER : We intend to, if we can. We ask you not
to bind yourself to the resolution, but simply to inquire into the question.
The question has never been, properly looked into, but only superficially. It
rests on international as well as other law, and I simply ask that the
resolution be re-affirmed for further inquiry and nothing else. I would not
ask the Conference to pledge itself to any definite action, but I think we are
right in asking for the resolution to be re-affirmed for the purpose of going
deeper into the subject. The conflict of interests between the British
interest and that of the Dependencies on the Pacific Ocean is one which
ought to be looked into, and I think under such circumstances the resolution
ought to be re-affirmed.

Sir JOSEPH WARD: It would be just as reasonable if the British
Government were to lay it down as a principle that Mauritius was to be
looked upon as part of the coast of England, as what America has been doing
to us and to England as well in the matter of Honolulu. We cannot trade
between New Zealand and San Francisco with our steamers for the reason
that the American law extending to Honolulu is, tliat not a passenger on that
islantl can be shipped by one of our steamers, and not a ton of cargo. Yet

Tbade.

say : " We will do the same thing to you." We have offered again and again ^^r^^^^,

to reciprocate with the United States in the exchange of coastwise trade.

We have a large coasting trade between Canada and the United States on the

lakes. It would be to their advantage and our advantage to have coasting

trade, becaiise there is so much shipping on these lakes, and it is getting

more and more voliniiinous every year, as everyone knows. It is a serious

impediment on our shipping, but the United States have absolutely refused.

So far as that goes they are within their rights, but when they go beyond

their natural rights, and apply those to a country like ITonohdu and to the

Philippines also as part of the coast of the United States, although 1,U0U miles

away, that is most unfair treatment. At all events, it seems to me an abuse

of the powers of legislation, and therefore the question is one of great interest

to UP. I can see the force of what you now tell us. It would expose us to

retaliation and hurt our shipping, so the question is one that requires

very serious consideration.

Mr. LLOYD GEORGE : But we cannot hit them. That is our trouble.

Sir WILFRID LAURIER : But we can, and we do not want to, or we
woidd and perhaps we cannot. That is the difference. This resolution does
not go very far. It does not bind you to anything. It simply asks for further
consideration on the subject, and I think it worth consideration.

Mr. LLOYD GEORGE : As far as the Mother Country is concerned, we
cannot possibly object to what Sir Wilfrid Laurier suggests now, if tho
resolution is to relate only to the Colonies.

Sir WILFRID LAURIER : I see the force of your objection, and you
see the force of ours.

Mr. LLOYD GEORGE : I agree ; if I were a Canadian I would hit
them if I could.

LSE

462

Thirteenth Day.
8 May 1907.

Coastwise
Trade.

(Sir
Joseph VV^aril.)

that place is some four days' steatn from San Francisco ont in the Pacific
Ocean. When we submitted a resolution at the Conference over which
i\Ir. lioyd Geoi'ge presided to discuss the propriety of dealing with our New
Zealand shipping to a nunil)er of islands in the Pacilic, we are told that we
cannot control them a;nd that foreigners and everybody else can do as they
like there. As a general principle, we do not take exception to that. We
want the right to govern our own ships as to pay and everything ; but when
we go to a place on the road to England, under the laws of America, extending
thousands of miles from the coast of the mainland, we are obliged to travel in
an American ship only, and not have one of our ships under contract with
them. This resolution, to my mind, is most important. That whole aspect
of it comes under the scope of it and is deserving of great consideration at
the hands of the British Government.

Mr. LLOYD GEORGE : You want us to consider the question of refusing
to foreign ships the privilege of trading between British Possessions. It is
of no use our considering it. We have considered it over and over again.
We could not hit Russia or the United States.

Sir JOSEPH WARD : I will put a question, but I do not suppose you
can answer it ; it gives the clearest illustration of what has been done to
us. If a law were submitted from our country about it, it would necessarily
require to be held over before the King's consent could be given. If we
were to suggest the imposing of a law in New Zealand to say that American
shipping trade to New Zealand passing on to Australian ports was to be con-
sidered, between Auckland and Sydney, as working in a coastwise trade and
not allowed to ship a passenger or a t(Mi of cargo from Auckland to Sydney —
1,200 miles — and that trade was confined to British ships, you would have to
hold that law over because it would be in contravention of what has hitherto
prevailed. Yet what we complain of and made rej)resen_tations aljout time
and again are in somewhat the same position. A British ship, a P. and 0., an
Orient, Union New Zealand line. New Zealand Shipping Company or Australian
vessel, cannot trade from America, and call at Honolulu, en route to New
Zealand and take a passenger or a ton of cargo for the reason that it is controlled
under the American coastwise law. There must be some way of reciprocity to
prevent it. It is grossly unjust. It seems to me it is a straining of the idea
of what coastwise trade is to such an extent as almost to make its believe we
are living in the Dark Ages. It has never been done in the world before, antl
now, it is extended to the Philippines and we all feel it very keenly.

Sir WILLIAM LYNE : Did not they seize one vessel on one occasion ?

Mr. LLOYD GEORGE : You might require Imperial legislation for
that. I shovdd not like to express an opinion.

Sir WILFRID LAURIER : All this is new to yBu; I am sure.
Mr. LLOYD GEORGE : Yes.

. ,, Sir WILFRID LAURIER : It shows the necessity of giving it more
attention and more stiidy. I am not prepared myself to say what should be
done, but it is a new condition df things which has developed, and which
ougkt to be looked into, because it is interfering with us very seriously ; and
with all due respect to the AmericdtiS, for whoin we have a great admiration
and with whom we are very friendly, they are intensely selfish in their

463

application of their law. \^'e uaiit to afiinii tliis resohition lor hirther

investigation.

Tliirteeutli Day.
S Mav 1907.

Mr. LLOYD GEORGE : I agree with you on the question of trade
between Canada and New Zealand. I confess the facts which you have
given me now, and the facts which Sir Joseph Ward has given, deserve close
attention. I could not pretend that this question of coasting trade is new to
me, and certainh- it is not new to the department over which I preside, as
they have gone into it over and over again. So far as the Mother Countrj' is
concerned, -we haA'^e gone into it very carefully. I think it would be
misleading if we said we would consider that question further, as if we had
not considered it. Sir Wilfrid Laurier wants to consider the question of the
trade between one Colonv and another..

Coastwise
Tkade.

(Sir
Wilfrid Laurier).

Sir WILFRID LAURIER : Between British countries.

Mr. LLOYD GEORGE : If you leave out trade between the ]\[other
Country and the Colonies, and simply say coastwise trade between one
Colony or British possession and another, that is where you seem to be hit.
We here are not hit at all. The balance of advantage is enormously on our
side. To pretend to look into a transaction which is so enormously in our
o^vn favour as if it were a grievance would be misleading. I agree that you
are very hard hit as between Canada and New Zealand and Australia.

Mr. DEAKIN : Is it only when you have an immediate grievance that
inquiry is justified or necessary? Ought there not to be a certain amount
of protective preparation? Is not the fact that you are considering the
various devices by which various nations endeavour to foster their own
trade at your expense, a useful thing to be known ? Should we not show
that at all events you are following these things with close attention. You
are not of opinion at present that they do you any substantial injury, but a
proposition may be launched within the next month or two which would do
substantial injury. Are you prejudiced in any way by inquiry? Are you
not justified in letting it be known tliat your attention has been directed to
this danger by the representatives of the Dominions beyond the Seas ?

Mr. LLOYD GEORGE : But I do not want to alarm the shipping
industry here. The balance is enormously in their favour. They do not want
to call too much attention to it.

Mr. DEAKIN
any alarm.

This resolution has stood since 1902 without occasioning

Mr. LLOYD GEORGE : I agi-ee, as between one British possession and
another there is a case ; but there is no case to look into so far as our shipping
trade with America is concerned. The advantage is overwhelmingly on one
side. The same thing applies to Russia.

Sir ^yILFRlD LAURIER : If this is an Imperial Conference, as we
believe it is, questions have to be looked into, not onlj^ from the point of view
of the LTnitcd Kingdom, but all its Possessions. It does not affect you so far
as the United Kingdom is concerned, but it affects us. We are part of tho
British Empire, and it seems to me, therefore, the question brought up
justifies more inquiries, without at all alarming anybody. We say simply that
it is desired to call attention to it.

Thirteenth Day.
8 May 1907.

Coastwise
Trade.

Resolution X.
J), viii.

466

Dr. JAMESON : It is an inquiry with a view to action being taken
between the Colonies.

Mr. LLOYD GEORGE : The Lnperial Government are to take action.
It would be on the initiative of the Colonies. A Bill in Australia or New
Zealand dealing with trade between the two countries would not have effect,
and it woiild have to be done through the Imperial Parliament. This does
pledge us to go into the matter.

CHAIRMAN : Can we come to a point of agreement ? because the First
Lord of the Admiralty is waiting.

Mr. F. R. MOOR : I think it rests with Mr. Lloyd George.

CHAIRMAN : The resolution was circulated, and it is proposed to omit
the words " between the Mother Country and its Colonies and possessions
and ..."

Mr. LLOYD GEORGE : Yes.

Dr. JAMESON : Is it worth while to cat out this ? You say it has been
inquired into, and the Imperial Government will not do anything. The
Imperial Government can never know what circumstances may arise and what
inquiry may be worth while. It does not commit the Government to anything.
Why- not leave it as it is ?

Mr. LLOYD GEORGE : The word " advisability " makes all the differ-
ence. On the other hand, if you take that out, it would weaken the
resolution so far as the inter-Colonial trade is concerned.

Sir WILFRID LAURIER : As far as we are concerned, I would have
the resolution as it is or not at aU. If the British Government cannot accept
it, there is an end of it.

Sir JOSEPH WARD : That is my opinion also.

Mr. LLOYD GEORGE : I do not think we can possibly accept it.

CHAIRMAN : Is that your opinion. Sir Robert ?

Sir ROBERT BOND : Yes.

Mr. DEAKIN : I vote for the resolution as it is.

Dr. JAMESON: Yes.

Mr. F. R. MOOR : I am guided by my colleagues. We are not directly
interested, but I think those other Colonies know their minds, and I vote
Avith them.

CHAIRMAN : Have you any opinion to offer, General Botha ?

General BOTHA : No.

Mr. LLOYD GEORGE : There is no coast trade for the Transvaal. We
cannot accept the resolution.

467

Mr. DEAKIN : We affinn it, and you dissent.
CHAIRMAN : Yes, we dissent.

REVISION OF COMMERCIAL TREATIES.

'Sir. D1'L\KIX : I presume tliere is no objection to the next : " That the
" Imperial liovernment be requested to prepare for the information of
" Colonial ( Jovernments, statements showing the privileges conferred, and the
" obligations imposed, on the Colonies by existing commercial treaties, and
" that inquiries be instituted in connection with the revision proposed in
" resolution No. V." You have presented most of this information.

Mr. LLOYD GEORGE : Yes.

Mr. DEAKIN : I presume that will be carried.

Sir WILFRID LAURIER : That is a very proper thing.

]Mr. LLOY'D GEORGE : Would you mind explaining the last sentence
of it ? — " to ascertain how far it is possible to make those obligations and
" benefits uniform throughout the Empire." ?

Mr. DEAKIN : We quite recognise that in many cases there must be
special treaties which will only affect parts of the Empire and not the whole
ot it. But surely it is desirable that these differences shoidd be reduced to a
minimum, and that, wherever possible, treaties should have sway if possible
over the whole extent. In many cases they are relatively immaterial. Minor
treaties are proposed to us, and we say no to them because we have no
interest one way or the other ; but if it was represented to us that the
Conunonwealth was the only place in the Empire which was not agreeing,
no doubt for the sake of uniformity we should say : "Verj- well, we will
faU in with it." It does not mean very much, but it clears the way by
encouraging general action instead of partial action. It is not intended to
go further.

Mr. LLOY'D GEORGE : I do not see any objection to that.

Sir JOSEPH WARD : Nor I.

Sir WILFRID LAURIER : What is the meaning of resolution No. V.

Mr. DEAKIN : It is at the end of the one we have just had : " That the
" Imperial Govermnent be requested to take the necessary steps for the
" revision of any commercial treaties which prevent preferential treatment
" being accorded to British goods carried in British ships." I did not move
that at this stage, l)ecause I proposed to refer to it very briefly in connection
with the question of the treaties raised by the resolution of the Government
of New Zealand.

Sir Wn^FRID LAURIER : Will yon read it, and move it ?

Mr. DEAKIN : I have only moved the resolution lower down : " That the
" Imperial Government be requested to prepare for the infonnation of
" Colonial Governments, statements showing the privileges conferred, and

Gg 2

Thirteenth Day.
8 May 1907.

Coastwise
Tkade.

Rkvision' ok

CoMMEKClAL

Tkeaties.

Tbirteeuth Day.
8 May 1907.

Coastwise
Trade.

464

Mr. IJ^OYD GEORGE : No, not finite.

Sir WILFRID LAURIER : It is desirable that the attention of the
Government of the United Kingdom and the Colonies should he called to the
present state and to the advisability of refusing

Mr. LLOYD GEORGE : No, really, it would be very misleading. I am
sure you will take it that, on the whole, we are the best judges of what the
effect would be upon people here, how they would read it to-morrow morning,
and would say : " They are going to consider the question of reserving the
coasting trades to themselves." We know the danger of that from the
American point of view, where ihe balance of advantage is so enormously in
our favour at present. The same thing with regard to Russia. But I do not
mind you saying that you are going to look into the question of the way
America is treating New Zealand or Australian shipping, because there you
have a distinct grievance, and I think you ought to look into it. If I may
say so, and I think the Chairman agrees, it could only be dealt ^^'ith by
Imperial legislation. Therefore it is for you to look into it.

Sir JAMES MACKAY : The same apphes to the trade from Japan
across to San Francisco, which is carried on by British ships. They are not
allowed to take a passenger from Honolulu to San Francisco, or a ton of
cargo — that is the case with the White Star Ijine, and other vessels.

Mr. LLOYD GEORGE : We cannot
They are not in our coasting trade at all.

hit the Americans in our trade.

Sir JOSEPH WARD : If you brought down a proposition to-morrow
(which would be a little startling, I admit) to say that the trade between
Ireland and England was coastwise trade, and that no American ship could
take a passenger or a ton of cargo to or from Ireland either going or coming,
you would be putting American ships in the same position as New Zealand
and Australian ships are in now with regard to trading between them and
ilmerica via Honolulu or any of the Hawaiian Islands.

Mr. LLOYD GEORGE : It would be incredible that we should conmiit
the folly of doing so. We are practicaUy carrying more than half the whole
international trade of the United States of America. For us to do a thing of
that sort would simply mean reprisals. I do not know how long it would
take to carry a Bill through the House of Representatives and the Senate —
I do not think so long as here, even under the guillotine-— but there would be
a Bill through in three weeks, a subsidies Bill, and we should have the trades
of the Atlantic contested in competition which would be just as formidable
as the American competition we had to meet in the fifties.

Sir JOSEPH WARD : I say at once it would be a very improper thing
to do, I should be very sorry to see it done ; but that is exactly ^\ hat goes
on so far as we are concerned in regard to Honolulu.

Mr. LLOYD GEORGE : I think Sir Joseph Ward, Sir William Laurier,
and ]\lr. Deakin have made a great case alwTit that, but seeing that all the object
you have in view is met by confining the resolution to an inquiry as to the trade
between one British Colony and another, I think it would be misleading for
us to subscribe to a resolution which looks really as if we w^ere in favour of
the principle of refusing the privileges of the coasting trade to foreign ships.

465

Sir WILFRID LAURIER : You aro the best judge of that. This Thirteenth Day.
resolution, as Mr. Deakin says, has beau in existence for live years, and it has ^ May 1907.
not disturbed anybody.

COA.STWISE

Sir JOSEPH WARD : It woulil have a very undesiral)le effect, which I
assume you would be the last one in the world to l)ring about, of practically
revei-sing a proposal carried by a former Conference, whether generaUj'
adhered to or not, is another question. One colony, New Zealand, having
introduced legislation to conform to it, to a large extent, if you refixse to
re-affirm it now it looks like going back upon the 1902 resolution.

Mr. LLOYD GEORGE: The resolution was passed in 1902 and the
Imperial (lovermnent have inquired and made up their minds. To say at the
end of five years that they are going to inquire again, is rather puerile. You
have tlealt with the question as the result of the resolution, and Australia
means to deal with it next year. For us it would l)e purely childish. We tlo
not mean to deal with it. We mean to leave it alone. But here is a perfectly
new point raised by Sir Wilfrid Laurier, and there I think we ought to inquire,
but so far as the trade between the Mother Country and the Possessions is
concerned, it would be quite misleading for us to say Ave had the slightest
intention of dealing with it in the sense of reprisals against the United States
and Russia, who are the only two countries involved. But you are raising a
different point, and it would strengthen the resolution and show we mean
business to confine it to that. We have inqiiired into the subject and come
to the conclusion that we cannot do anything ; ])ut in our judgment something
may be done with regard to inter-Colonial trade.

Sir WILLIAM LYNE : Woidd you suggest anything being flone with
regard to inter-Colonial trade ?

Mr. LLOY'D GEORGE : We are quite -vviUing to look into that matter.
It seems to me that there is a case. Of course it will have to be done at
the I'eqixest of the Colonial legislatures ; but I believe there would have to be
an Imperial Act to take power by Order in Council to exclude countries not
giving fair treatment to Colonial shipping. It woiild have to be an Imperial
measure. I suggest leaving out " between the Mother Country and its Colonies
and Possessions," so that the sentence would read " including trade between
" one Colony or Possession and another to coimtries in which the corre-
" spending trade is confined to ships of their own nationality." That is the
real case you have to look into as far as I am aware.

Mr. DEAKIN : I stand by the resolution as it is.

Sir JOSEPH WARD : I do not think the alteration would be any use,
with all deference to Mr. Lloyd George ; because if you look at the resobition
as altered, it means we have to look into the question as affecting shipping
belonging to our own country.

Mr. LLOYD GEORGE : No.

Sir JOSEPH WARD : Pardon me, we are confined to our own waters,
and we can do that now. We do not want a resolution of the Conference to
do that.

Mr. LLOYD GEORGE : No, this pledges us ; it is not a pledge by you
merely. I am not trying to get out of the pledge for the Imperial
Govermnent.

c 18668. G g

468

Thirteenth Day.
8 May 1907.

Revision of

Commercial

Treaties.

(Mr. Deakin.)

" the obligations imposed, on the Colonies by existing commercial treaties,
" and that inquiries be instituted in connection with the revision proposed
" in resolution No. V., to ascertain how far it is possible to make those
" obligations and benefits imiform throughout the Empire."

Sir WILFRID LAURIER : You refer in that to resolution No. V. What
is resolution No. V. ?

Mr. DEAKIN : That would not stand yet.

Sir WILFRID LAURIER : We had better have that in blank.

Mr. LLOYD GEORGE : Yes, that goes out.

Resolution XI., ]\ij.. DEAKIN : Take out the words " with the revision proposed in

^' ^'"' " Resolution No. V." When that is done I think Ave should either bring up

the part of resolution No. V. alluded to under the resolution of the Govern-
ment of New Zealand, or if Sir Joseph AVard prefers, I will move it now
independently.

After further discussion in private, on resimiing :

CHAIRMAN : Lord Tweedmouth is waiting to deal with Naval Defence,
and this present discussion may last some time.

Sir JOSEPH WARD : I think it would be better to postpone thib, and
hear Lord Tweedmoiith now.

Mr. DEAKIN: Certainly.

Naval Dkkexce.

469

NAVAI. DKFKNCE. Thirt...>M,tl. Day

CHAIRMAN : I mulerstaiid that different members of the Couference » ^'"V i-*""-
have had interviews with the Admiralty, and tlie First Lord is now prepared
to state to the Conference tlie result of those interviews and try to get your
decision on the whole sid:)ject.

Lord TWEiCD:\IOl'Tll : Lord Elgin and gentlemen, since we last met I
have had the o^jport unity of having conversations with various of the Prime
Ministers, and also with their colleagues, and they have had some conferences
with some of my colleagues at the Admiralty also. I do not know that I
have any very definite ]ilan to propose to you, I can only repeat what I said
before, that at the Admiralty we are most anxious to meet the wishes of the
various Colonies. But, of course, the real difficulty is that the position varies
in the different Colonies and they have very dift'ei'ent wants.

The l)asis that I think we want to go upon is in the first place to
acknowledge that it is perfectly impossilile in modern Avarfare to improvise
defence ; we must have it ready. That is the case with the army, no doubt ;
but it is still more so in any naval operations, l^ecanse yon require to have
the ships, and you require to liavc tlie men and officers, who have to undergo
a long and severe training.

Xow the situation, it seems to me, is this. I will take a colony separately,
or I will take Australia and New Zealand together, because the agreement
with New Zealand and with Australia is a tripartite one — New Zealand,
Australia and ourselves. We all hang together in the existing agreement,
and all are mutually bound. Australia now gives a sum to the Admiralty
of 200,000L under certain conditions, and New Zealand gives 4O,0UUi. The
Cape Colony gives 50,000?., Natal 35,000L, and Newfoundland 3,000L

As I imderstand, Australia puts forward a proposal that the agreement
of 1902 should be ended, and that Australia should start something in the
way of a local defence force. I do not know how far New Zealand concurs in
that suggestion. Sir Joseph Ward asked for some information on the
subject, and he had some talk at the Admiralty about it. He asked that
some information might be given to him with regard to the cost of such a
local defence, which in effect was to be founded on the establishment of a
force of submarines. I do not know what is Sir Joseph's view, but
I think it is rather important I should know the exact position he takes up
if he adopts the idea of the possible establishment of a submarine service. I
think, shortly, it may be stated that each submarine would probably cost about
5(),000L capital expenditure for building, and probably each submarine might
cost about 8,OO0L to keep going every year — I mean, to pay the men and
keep it in repair, maintain the necessary appliances, and so forth. Then
comes a question as to the manning of a submarine, because that is a very
important matter. The submarine men nmst be veiy highly trained. I think
there would l^e two ways of meeting that. One would be by sending the men
over to this country and getting them trained here, and probably the training
might be done in a year. I tliink it would certainly take a year before the men
would be competent to do the duties required of them in a submarine. Cr it
might be done in another way. Provided the flotilla were large enough, we
could send a crew, or more than a crew, out to the Colony which would be able
to train men belonging to the particular Colony in the work they had to do.

Then conies the question of South Africa. There, again, I believe the
idea of suljmarines is not altogether opposed to the ojnnion of the South
African representatives, and I believe that the establishment of a flotilla of
submarines by degrees would be favourably consideretl, at any rate in Cape
Colony ; I do not know what ^Ir. Moor would say with regard to Natal. As
I understand, the South xM'rican Colonies as a whole would like to have some

Thirteenth Day
8 May 1907.

Naval Defence^

(Lord Tweed-
mouth.)

470

detinite force of their own, either a submarine flotilla, or help with regard to
their naval volunteers at Gape Town, Port Elizabeth and in Natal. Again
we should be very glad to give some help with regard to that.

I ought to have said first, that so far as concerns the flag under which the
submarines would sail, probably they would fly the white ensign but with
a special mark on the flag — say the Southern Cross for Aiastralia.

Mr.
besides.

DEAKIN : We have the Union Jack with the Southern Cross

Lord TVVEEDMOUTH : That is the sort of proposal to which we should
be prepared to agree supposing that particular plan were adopted.

I do not think I need say anything with regard to Newfoundland. I
imderstand that the Newfoundland A^ew is that the present system should be
maintained. The Government of Newfoundland would be very glad if a
greater nmnber of men were added to the Naval Reserve in Newfoundland, and
they would be ready to give some further help in addition to the present
3,000Z. which is paid by Newfoundland.

Sir ROBERT BOND : Upon precisely the same basis — yes.

Lord TWEEDMOUTH: Yes, upon the same basis. With regard to
Canada, I think I may say there has perhaps Ijeen some exaggeration in the
idea that Canada does not do anything for the Empire in this matter. I
think not sufficient account has been taken of the work they have done in
taking up the protection of fisheries. They are very anxious to extend that
work, and they have now taken over the dockyards at Halifax and
Esquimalt, which I hope the Dominion will keep up and improve. I think
that is really a very considerable contrilnition towards the general upkeep
of our naval interests. There is at present no proposition from Canada to
make any change at all, but I think it is proposed that matters sliall go on
very much as they have gone on, except that the Canadian representatives
announce that they are anxious to do all that they can to expand the interest
in the Navy throughout the Dominion, and in that way think that they will
be really giving a great help to the Empire as a whole.

I think the important point we have to consider is the present situation
in the various Colonies which already pay subsidies.

Then there is the question of manning. Of course Australia has already
a considerable number of Naval Reserve men and men who are in the Navy. '
There are going to arrive here next week, on the 20th, 30 Australians and
10 New Zealanders, who are going to join British ships in this country for
training. We shall welcome them very heartily, and I hope that they will
gain great good by their visit and by the training they will receive.

Mr. DEAKIN : The training they are coming for is the higher training
which' could not be obtained on the squadron.

Lord TWEEDMOUTH : Yes. You have now in Australia, I think, nearly
1,000 men of one sort or another who have been connected with the NaA^ or
who are in the Reserve and so forth. If Australia prefers to tenninate
the arrangement with regard to the suljsidy, the burden of those men would
naturally fall upon Australia. That would be one of the things that would
have to be provided for if the subsidy were dropped.

Mr. DEAKIN: Yes.

471

Lord TWEKDMOUTH : I thiuk I ought to say with regard to this Tliirtceiuh Day
question of nmiiniug that the number of men necessary for the British Xavy a May 1907.

must necessarily l)e hmited. We cannot take in an unlimited number. At

this moment 1 should think we have at least six times as many applications >,'aval Eiekence.
from men to enter the Xavy as we can take in. Therefore, whatever,
arrangement may be come to with regard to manning throughout the Empire,
it would have to be understood that it must be limited, because beyond a
certain limit we should not have any use for the men.

Dr. JAMESON: The rank and fde— able-bodied seamen— six times as
many as you want ?

Lord TWEEDMOUTH : I think I am putting it untler the mark rather
than over it in saying that.

Then I ought to say a word about the question of cadets. I think that
in the Agreement of 1!)U2 an arrangement was made by which there
should be a certain number of cadets from each Colony. There were, I think,
eight from Australia.

Mr. DEAKIN : You mean cadets coming into the Royal Navy to become
officers.

Lord TWEEDMOUTH : Yes. There were eight for Austraha ; two for
New Zealand, two for the Cape ; one for Natal ; and two for other Colonies ; a
total of 15. I think the arrangement with regard to that has not been
altogether imderstood. It has been imagined that the cadets were to be
taken in anyhow. Really it only comes to this, that there are nominations
given to that number of cadets, and then some of them are examined in
Australia. Some come toschools in England and are examined here. So far
as the Colonial cadets are concerned, I think it is only right for me to say that
those who have been examined out in Australia are found not to be up to the
staudartl of education which is prevalent amongst tlie same Itoys in England,
and a good many have been rejected. I think the idea is that this number
is given ^vithout consideration of the qualities of the boys, whereas in fact
a good many lioys have been rejected on examination.

Mr. DEAKIX : All this is news to me.

Lord TWEEDMOUTH: Take 1903, for instance. In that year there
Avere six Australian nominations — three passed and went in. In U)0-1 there
were again six l)oys examined, and three passed into Osborne. Li 1905
Australia sent eight, of whom two passed in. In 190G five Australian
cadets came up, of Avhom four passed in, and in this year I think four have
come up, and one has passed in and one has not yet been examined.
I do not think the system has been thoroughly understood. I think the
idea has l)een that the nominations given were supposed to be absolute
eadetsliips ; whereas, they were only nominations to camlidates in order to
to go tlu'ough the examinations, and so enter in the same way as the cadets
■who enter here.

Mr. DEAKIN : No complaints have reached me.

Sir JOSEPH WARD : You have had nominations from New Zealand
also.

Lord TWEEDMOUTH: Yes, fiom New Zealand in 1903; one entered
and one passed ; in 1904 two entered, of whom none passed ; in 1905 two

G " 4

472

Thirteenth Day. entered and none passed ; in 1906 one entered and one passed ; and this year
8 Mav 1907. one entered and one passed.

Naval Defence. Sir JOSEPH WARD : I understand there is a limit to the number

(Lord Tweed- which you are allowed to nominate in any case ?

mouth.)

Lord TWEEDMOUTH : Yes ; two from New Zealand in a year, and
they are examined. A special examiner is appointed to examine them out
there ; or else they come here, and they are examined in the ordinary way.

Sir JOSEPH WARD : How many do you allow from each of the other
countries that are allowed to nominate in one year ?

Lord TWEEDMOUTH : Eight for Australia, two for New Zealand, two
for Caj)e Colony, and one for Natal ; and the other Colonies two. Canada
was not included in the original agreement, and those two were left for the
Dominion and the other Colonies.

Dr. JAMESON : When does that wholesale ploughing take place — at
the original entry or at any other time ?

Lord TWEEDMOUTH : Before they go in at all.

Dr. JAMESON : Simply on general knowledge examination ?

Lord TWEEDMOUTH: Yes.

Mr. F. R. MOOR : Are the examinations here, or in the Colonies ?

Lord TWEEDMOUTH : The examinations are held cither in the Colony
itself, or some boys come over here and go to school here, and then afterwards
are examined. I ought to say that, as a rule, we have about three times as
many candidates for these examinations as we can take ; that is, about f?00
come up, and 7U are taken. I think an idea has got about that the Colonial
Cadets are entitled to come in They are only entitled to come in jjrovided
they pass tests similar to those imposed on boys from this coimtry.

Dr. JAMESON : I think it is always acknowledged it is merely a
nomination, and they have to pass. Is the South African black list as bad as
you have just read ?

Sir JOSEPH WARD : That idea is not prevalent in New Zealand.
There is no misconception as to the conditions.

Lord TWEEDMOUTH: I am glad to hear that, and that is why I
mentioned it to-day. From the Cape, one entered in 1903, and one passed ; in
1904, there were two entered, and they were both unsnccessful ; in 1905,
two went in, and two passed ; and in 1906, one entered, but he appeared
be ore the Interview Committee here and was not rated sufiiciently high to
beftaken.

Dr. JAMESON : That is physically ?

Lord TWEEDMOUTH : No. In 1907, one has entered Ijut he has not
yet been interviewed.

473

I do not Is'iiow that I liavf very innch more to add, except to say that wo Thirtpcnth Day.
are anxious to meet j'oti if we possibly can. li' Australia makes up its mind 8 Ma v 1907.

to start something in the way of a local defence force, wc are quite ready to

give all the assistance we can to it. If New Zealand wishes to go on with the Navai, Okfente.

subsidy, again Ave are quite ready to arrange for that, or equally willing, if (Lord Twoed-

they prefer to go in for a submarine flotilla, to help in that. The same with momli.)

regard to the Cape ; we are quite r(\idy to meet their wishes. If they in

South Afri(^a wish to try a sul)marine flotilla, we are quite ready to help.

Also, in the meantime, I think we should be quite ready to try to arrange for

a training ship for the naval volunteers, and so forth. But with regard to

that, one particular point is that your volunteers are very desirous in South

Africa to become a division of the Royal Naval Volunteer Reserve, and

thereby obtain the Tiame of " Royal." That depends, in the first place, on

your passing an Act in your local legislature.

I do not think I could make a definite promise with regard to leaving a
ship continually there. Iliat is a matter for future consideration. Indeed,
if this is to become part of the charge made on the subsidy, then I think as
time goes on the expenses for a ship ought to be borne by the Colony
as well.

Dr. JAMESON : As time goes on they will do very well for us, because
we all say we ought to give more. In the meantime it wiU help Avith what
Ave do.

Lord TWEEDMOUTH : We shall endeavour to cai-ry on the arrangement
Avith regard to a ship at present ; but I would not like to pledge myself that
for all time Ave should have a ship there. On the contrary, I think the proper
thing Avould be that the training ship for your volunteers should be part of
the Colonial force.

Dr. JAMESON : Out of the contril)ution ?

Lord TWEEDMOUTil: Yes; I think that is all I can say. If any of
the Prime Ministers Avould now say Avhat they think, if I can meet them in
any Avay, I shall be very glad.

Mr. DEAKIN : Lord Elgin and gentlemen, as Lord Tweedmouth
mentioned Australia lirst, perhaps I may be permitted to say that the
ConmionAvealth Avill recognise the extreme fairness, and generosity, Avith
AA'hich he has met us. In conceding perfect freedom, notAvithstanding the
existence of an obligation AA'hich has yet several years to run, you liave
shoAvn that in every possible manner yoxi desire to keep in close accord
Avith the feelings of the outer Dominions. In Australia, for reasons Avhich
have already been put on record in the despatch Avhich I had the honour
of addressing to the Admiralty about tA\'o years ago, the existing contri])u-
tion has not proved generally popular. It A\-as passed because it Avas
felt that some distinct recognition of our responsibility for the defence of
oiir own country and of the Empire of Avhich it is a part, Avas necessaiy,
and though it did not take the form Avhicli commended itself most to the very
large minority, possibly even a majority, of tlie electors A\'e accepted that
mode of co-operation xmtil some better presented itself. Further consideration
has convinced the public that the present agreement is not satisfactory
either to the Admiralty, the political or professional Lords of the Admiralty, or
to the Parliament of the CommouAvealth. In your case you find yourselves to
a certain degree shackled even by the very general restriction as to the station

474

Thiiteeuth Day. of the fleet which is imposed by the present agreement. Originally, imder the
8 May 1907. Agreement of 1887, the Australian fleet was limited to Australian waters.

When that agreement expired, another agreement was entered into by which a

Naval Defence, fleet or squadron of increased strength was provided, and its sphere of action
(Mr. Deakin.) enlarged to the China and Indian seas. As a consequence, it appeared to many
in Australia that the local protection which was its primary condition was so
far- departed from that it had practically ceased to exist. Nor could this new-
development of policy be challenged because all expert opinion agrees that
the proper place for a defensive force is where it can deliver the best blows
at anj^ offensive force directed against it. It was quite probable that this
would not be immediately on the coast of Australia, but rather in the Indian
Ocean, or to the eastward towards the China seas. It is as much in the
interest of the ' Common vs^ealth as of the Navy that whatever power it can
bring to bear should be available wherever the enemy is to be found in
force, but this meant the withdrawal from our coast of ships to which we
have been accustomed to look for localised protection, and also for the
world-wide operations of the British Navy. Their withdrawal brought more
home to the public particularly of our great States on the seaboard the
nature of the risks to which they must be exposed in the absence of the
squadron. Practically every capital, with perhaps the single exception of
Perth, is upon the sea ; Sydney, Adelaide, and Hobart, are all easily approach-
aljle from the sea. In the case of Melbourne, Port PhiUip heads, and the
forts there could, if effective, keep an attacking force at a distance.
Yet, supposing the heads to be passed, Melbourne, too, would lie directly
open to any attacks. Brisbane runs a somewhat similar risk. The Com-
mittee of Imperial Defence, after giving this question full consideration, have
decided that a regular attacking force is not to be anticipated in our
Antipodean situation, under any circumstances that it is necessary to directly
provide for in advance. They look forward to the possibilities of a raid,
consisting in all likelihood of some four fast half-armonre(^l or partly armoured
cruisers, carrying forces of from 500 to, at the outside, 1,000 men. Even an
expedition of those small dimensions, calling for a verj^ considerable provision
in the way of fuel and other arrangements, would make only a transitory dash
for our ports and shipping rather than a series of prolonged attacks. But,
whatever the nature of the assault is to be, its possibility leaA^es the large
population of our seaboard States with a sense of insecurity, emphasised bj^
the probability of the withdrawal of the squadron some thousands of miles
away to deal with the expected enemy there. Consequent^, the demand for
some harbour and coast defence has been pressed iipon the minds of the
people in general, and has been lately several times considered by Parliament.
It is thought that while it maybe the liest possible naval strategy to withdraw
the squa(b-on to remote portions of the seas surrounding Australia, the contin-
gency of our being raided, even by a few cruisers, and of our commerce being
driven into the harbours or destroyed, or enclosed in the harbours, is not one
that a community ought to contemplate inmioved. Hence our desire for the
local in'otection to which you have already alluded. Our proposal to replace
the existing agreement Ijy the establishment of a force in Australian waters
is not due to motives of economy. On the contrary though it will involve a
greater expenditure upon maritime tlefence than we have ever undertaken
I believe that those proposals will be wiUingly accepted by Parliament. Of
course we shall require to proceed by degrees, but even then the expenditure
proposed will exceed the payment now made to the Admiralty, plus the
payments that have been made for several years past upon such naval defences
as w^e have retained. At all events, the present temper of the electors
encourages me to believe that in the course of a few years we shall see, in
proportion to our population, a fairly effective harbour defencCj which may

475 .

be extended, if our means permit, to some approach towards coast patrol. Thirtoentli Dhj.
I do not say coast defence, because that would imply a size and character of. 8 Mav 1907.

ship which our finances, I fear, will hardly be abl^^ to afford for a long time

to come. Naval Defence.

In regard to the very judicious remarks you have made with reference to (Mr. Deakin.)
the question of manning, for my own part, I quite realise the wisdom of
associating any local force which we may develop in the closest possible
manner with the Navy. Of the efficiency of the Navy and the quality of its
officers and men we have, from personal experience, in times of peace it is
true, liut still from prolonged experience, the highest possible opinion. Every
confidence is felt in Australia both in l^ritish ships and British sailors, anil
no doid)t is entertainetl of their capacity to give the best possible account of
themselves when the time of trial actually arrives. But we also recognise
that the Navy as a fighting machine is only kept in its condition of efficiency
by the constant maintenance, even in the lowest ranks of the Service, of the
highest state of training. We appreciate the discipline and training which
our men have received in the squadron, and anticipate in the future that, by
similar means, by association with the Navy, we shall be assisted to keep
our local vessels, whatever they may lje, up to its high standard. We shall
not be willing in any way to accept for ourselves any less degree of
proficiency than that which His Majesty's Navy enjoys, and by which its
reputation has been established. A force, small as ours must be, would
enjoy few, if any, opportunities of advancement for officers and men if it were a
completely isolated service. On the contrary, it has everything to gain by
being kept in the closest possible touch with the Navj-, and with all advances
as they are being made in Naval tactics or training. If, therefore, our
partner, Ncav Zealand, is able to devise what would be to them a satisfactory
scheme of local defence, or make some amended agreement with yourselves,
I believe the Parliament of the Commonwealth would desix-e to terminate
the present agreement, to set free the ships of the squadron from any
obligations at present imposed, and to devote our funds to the provision of
a local force. . 'J'he agreement, as you properly observed, is tripartite, and
requires the consent of New Zealand as well as that which you have given. I
quite recognise that. I have made no appeal to my friend, Sir Joseph
Ward, either in public or in private on this head, because I felt it was a
matter which he required to consider independently. As he knows, I have
made him no suggestion on this topic of any kind whatever. But I say
it will be a source of gratification to us if his Parliament terminates
this agreement in order to follow, so far as New Zealand is concerned,
whatever course it may think l)est. For our part. Lord Tweedmouth, your
overture will be made known in the Commonwealtli. Your words of coimsel
and approval will be very highly esteemed. We recognise this as a further
step in the exercise of our self-governing powers with which are properly
attached the responsibilities which can never be dissociated- from them.
Those responsibilities we have no desire to avoid ; on the contrary we shall
assume them with confidence in ourselves and in our cause, providing, so
far as our means and population permit, a defence of the harbours of
Aixstralia, which will be an Luperial defence ; it will not be the shipping
owned in Australia alone that will enjoy the protection of oiu* ships and
forts ; it will not be commerce especially Australian that will be protect(>d
by this harbour defence ; but of course the same protection will be secured by
these means for all British shipping and cargoes. The necessary supplies,
the necessary coal, either for the mercantile marine or for your vessels of
war, will there be under safe shelter and always at hand. All the stores
required to maintain the Naval force while it is in our waters would be safe
in time of war. These, I take it, are no mean steps towards the protection

476

Thirteenih Day. of that portion of the Empire not merely for its own needs, Init affording a

8 May 1907. Naval liase for all operations which may need to be condncted in those seas.

That ought not to he nnder-valned. Every development of Naval force in

Naval Defence. Anstraha is a development of the Naval forces of the Empire. It will lie
(Mr. Deakin.) capable of being ntihsed for defence and also in connection at any time with
yonr squadron in onr waters for offence also. Of conrse, even if the agree-
ment be terminated, the A'isits of the squadron to onr seas will not cease.
They will be paid in ordinary course. I also understand that as at present
the Navy will, for its own sake and in recognition of onr common interests,
obtain the largest portion of its supplies from Australia and New Zealand ;
that is to say, whatever supplies can be obtained on the spot ; that we
shall have the opportunity of seeing in our ports the ships of this powerful
united fleet that will Ije composed of the three squadrons of Australia, India,
and China. That is very necessary as maintaining a link of Empire of a veiy
real character, which makes an extremely strong appeal to the patriotism
of our people. The Navj^ is immensely popular. The British Army we
do not see except in our own militia. The Lnperial Navy represents the
great guarantee of its existence as well as a guarantee of our liberties and
constitutional privileges. The Navy is an extremely j)opidar Service, and,
realising that, we are s\u-e the Admiralty will not fail to allow us the
opportunit}' from time to time of seeing the splendidly manned and
equipped vessels which have made the British flag paramount in all seas.

, I could not pass by a speech so extremely gratifying to Australian

sentiments as your own without this notice. I do not for one moment
pretend to have adequately dealt with it.

Let me say in concbision, that, of course, we look upon any vessels
for local defence not only as Imperial in the sense of protecting Australia,
but because they Avill be capable of co-operating with any squadron, or any
part of yonr squadron, Avhich you may think fit to send into our Avaters to
meet any direct attack in proximity to our coasts. In that Avay, Ave ought
to be able, with the type of A^essel we shall haA-e, when associated Avith your
larger ships, to render extremely effective assistance. And so far from the
termination of this agTeement in any Avay concluding our close and intimate
relationship with the Imperial NaAy in NaA^al Defence, I hope it will l)e the
means of enabling ns to extend Naval dcA-elopment, in very efficient fonns,
in our OAvn seas, making it of such a character as to be of material assistance
if ever a foe to the flag should find his way into onr Avaters.

Sir JOSEPH WARD : Lord Elgin and gentlemen, I Avould like to tiy
and make the position, as far as New Zealand is concerned, quite clear in
connection with this matter. The remarks I made on a former occasion —
Avhich I do not propose to refer to at any length again — I adhere to in CA-ery
respect. That is, in brief, that in a developing country of the size of New
Zealand, about the size of Great Britain and Ireland, and a comparatively
young conntiy, we cannot xmdertake the possible future obligations entailed
in the making for the provision of anything in the shape of a local naA-y.
AVe believe it is of great consequence to the future deA'elopment of NeAV
Zealand Avith its enormous potentialities for the settlement of people, that
the necessity of maintaining that development must, in A'iew of the financial
obligations iuA-oh-ed in providing a local naA-y, take precedence Avith the
Government of that countiy in the interests of the people of that conntiy. I
adhere absolutely to Avhat I stated before in that respect. New Zealand has
made no request of any kind for an alteration of the existing agreement,
and I readily acquiesce in the suggestion made by the First Lord of the
Admiralty that NeAV Zealand in relation to the Mother Coimtry Avill of

477

necessity require to continue by direct subsidy or an increased subsidy Thirteenth Day.
which we are quite willing to give for a continued attachment to the Navy 8 May 1907.
proper which we cousidt'r is s(j iiii])ortiint to us.

I have had the opportiniity, owing to the courtesy of the First Lord of ^'-^v*'- Defence.
the Adniiralty of discussing matters with hiiu siuce we last met, and I asked ^^".

for some information to be furnished to me regarding submarines. Tliis I '^°*''I''' ^^""^O
received late last night, and only had an opportunity of looking at it since
I arrived at the C(jufernnce this morning. I have read the statement this
morning with considerable interest It goes without saying that I am not
prepared — in fact I mentioned it to Lord Tweedmouth when speaking to
him — to commit the Colony of New Zealand to any departure in the way
of a suggested submarine service without having had the opportimity of
conferring with my colleagues and in turn, any great departure if we contem-
plated making it, we w^ould require to submit to our Parliament and have
the ratification of our Parliament upon before assent by me at this Conference
could be by any means directly or indirectly implied. I should be only too
glad, however, to have the aspect of it placed before me, and when I "have
had an opportunity of tliscussing, placed before my colleagues with a view
to our considering whether the suggestion of a submarine service, pure and
simple, without th(> attendant surroundings of a local navy, as an alternative
to an increased subsidy, could then be taken up by New Zealand as a part
of the great organisation of the defence of the Empire as a whole, and that
portion of which is New Zealand especially.

I want to make the position clear so that the Admiralty, who are no
doubt better posted upon these matters than I am, may laiow. We have
14 towns on the sea coast. The majority of them are very important
towns. There is not one of them that is more than U miles at the outside
from the ocean or to the port imless it be the city of Dunedin, which
to the ocean itself, irrespective of the means of ingress and egress that ships
have to take, is only 5 or 6 miles away from the Pacihc. Though Lord
Tweedmouth has not to me personally, or at the Conference, given any lead
or indication as to what the Admiralty favours whether it is the organisation
of a local submarine service, and the responsibility being taken upon the
shoulders of Australia and New Zealand — I have had no indication personally
whether that method of dealing with the Colonies is more acceptable to the
Admiralty than the continuation from the New Zealand point of view of a
subsidy. I wish to add that from my point of view it would be of considerable
importance for us to know what the Admiralty itself favours. If the
Admiralty were to say to New Zealand that they believed as a matter of
defence of that portion of the Empire that the system we have been party to
for so many j'ears has, as the result of changes in the scientific development
of these submarines, become to some extent obsolete, or not so valuable, and
make the suggestion of a submarine force that would weigh considerably
with the Government and the people in arriving at a decision as to the best
course to follow in future, I think myself that the opinion of the Admiralty
would be valuable. 1 recognise Lord Tweedmouth has taken a completely
impartial stand, ami allowed it to be at the vt)luntary action of the Colonies
themselves to elect whether they go in for the subsidy or the submarine
defence. In that respect, if I may be allowed to say so, it is particularly
fair to the Colonies, and will Ije appreciated by New Zealand to be allowed
from the standard of self-govermncJit to do as we think proper. We would
like to have the opportunity of ascertaining what is the preference of the
Admiralty in this suggested system of local defence for Australia as against
the one for New Zealand for the continuation of a subsidy.

Mr. Deakin has abeady, for his coimtry, said Lord Tweedmouth has acted
with a generous consideration for the views put forth by Australia, having

478

Thirteenth Day.
8 May 1907.

(Sir
Joseph Ward.)

assented to tlieir proposal by stating lie was prepared to agree to whichever
course they desired. That brings up the question of the position of New

Zealand as one of the contributors to the agreement, whether we are going

Naval Defence, to hold Great Britain and Australia to that agreement, or set them free to do
at an early date what they think is essential and proper for them. I can only
say at once I am perfectly certain both my colleagues and the Parliament of
my country, if the First Lord of the Admiralty, who is responsible for the
general government of the sea defences of the Empire itself, is willing to
meet Australia in that respect, we would not adopt a dog-in-the-manger
pohcy, but I think would favourably consider the cancelment of the agree-
ment, with a view to allowing Australia to have a free hand with the
Admiralty, and New Zealand also, on its own line, to have a free hand to
carry out what it considers is best for our particular circumstances, in order
to make the position easy of settlement, as between the Admiralty and the
Commonwealth of Australia, I shall be only too glad to reconmiend it to my
colleagues, and to recoimnend it to my Parliament. In any case it would
take some little time to give effect to the change that Australia wants from
that point of view, and long before any inconvenience could arise no doubt
the Parliament of our country would give expression
voicing here as its representative. New Zealand as

desirous of giving iipon the basis of the contribution of Australia its fair
proportion. The six States of Australia gave an average of a little over
33,000L each, and originally as fixed the contribution of a colony like New
Zealand was fairly proportionate to the individual contributions of the States
of the great Commonwealth of Australia, and we paid our 40,000L a year.
I am quite certain New Zealand, if required to, under altered proposals that
may be suggested, with a view to cementing the defence of the Empire as
a whole, would be willing to increase its contribution.

I thank Lord Tweedmouth for the information he has furnished to me.
I am exceedingly obliged to the Admiralty. The whole matter will receive
the fullest consideration of my colleagues and myself at the earliest possible
date.

arise no
to what I am now
a country has been

Dr. SMARTT : Lord Elgin, and gentlemen, I am extremely obliged to
Lord Tweedmouth for the statement he has made (a statement which I think
Avill be welcomed by the people in Cape Colony, and certainly by the Naval
Volunteers) that he has kindly consented to agree to meet the request that on
the passage of the Bill submitted to the Admiralty the title "Royal " should
be attached to them.

I think, on the first meeting we had with the First Lord of the Admiralty,
he stated it was the intention of the Admiralty, as far as possible, to deal with
each Colony on the lines of the particular circumstances appertaining to that
Colony. I think the statement that he has made to-day shows the earnest
intention of the Admiralty to try and move forward in that direction.

So far as the Cape is concerned, I take it Lord Tweedmouth's statement
for the Admiralty is first, that on the passage of the Bill which has been
submitted to the Admiralty, the Naval Volunteers will be able to style
themselves Royal Naval Volunteers ; secondly, the Admiralty wiU, pending-
further arrangements, place at the disposal of the Naval Volunteers a ship,
most probably the " Odin," with her guns, on which our volunteers, as well
as those of the sister Colony of Natal, can get as thorough a sea-going
training as possible. In the meantime, the cost of the nucleus crew for
that ship, whatever crew the Admiralty considers necessary to enable her
to go to sea, would be defrayed out of the joint contribution now given by
the Cape and Natal to the Admiralty. I presume I would be in order, after

479

your statement, in allowing the volunteers in Cape Colony to know that on TLiriecDth Dav.
the passing oi' this Bill, this will come into elTect ? 8 M,iv 1907.

Lord TWEEDMOUTH : Quite so.

Dr. SMARTT : I can assure you that that will be most satisfactory and
will give a great fillip to the Naval Volunteer movement in the Cape.

Lord TWEEDMOUTH : We think in the end that the vessel ought to
be a Colonial one.

Dr. SMARTT: Yes. Further, I take it that the proposition the
Admiralty make is that they would encourage the spirit of local defence and
local assistance for naval purposes, and that the best direction in which that
could take elTect would be either in the direction of sidjmarines, or I suppose
the Admiralty would also be prepared to consider the question of destroyers.

Lord TWEEDMOUTH: Certainly.

Dr. S^IARTT : I shoidd take it that the submarine is a ship that only
employs a small number of the most highly trained experts ?

Lord TWEEDMOUTH : That is so.

Dr. SMARTT : She is not a vessel that will go far out to sea, Avhereas,
iu the establishment of the destroyer class, you would at once imbue your
people with the spirit of seamanship and the idea that they were rendering
greater service, because they could go some little distance out to sea, and
that would be a gi-eat incentive to developing a naval spirit amongst our
people.

Lord TWEEDMOUTH: I think the development of submarines is
going to be such in the future as almost to supersede the destroyer ; that it
will have a much larger sea range, and it Avill be not merely a defensive
vessel, but a very distinctly offensive one.

Dr. SMARTT : But, in the meantime, the Admiralty would be quite
prepared to consider, if the Cape desires to accept further obligations,
whether it should take the shape of submarines or destroyers ?

Lord TWEEDMOUTH : Yes, either or both.

Dr. SMARTT : Should that position be taken up, the grant which is now
paid to the NaA-y, and any further amount that might be necessary, would be
devoted to this purpose instead of lieing paid to the Admiralty as at the
present moment. That is a point I want to be very clear upon. The Cape and
Natal are giving 8-5,000?. A small portion of that will be used to provide a
nucleus crew to the " Odin," so as always to be able to go to sea for the
purpose of training our Naval Volunteers along the coast. Then, if we
establish submarines or destroyers, I understand that it is the intention of

Naval Defence.
(Dr. Smartt.)

480

Thirteenth Day
8 May 1907.

Kaval Defence.
(Dr. Smartt.)

the Admiralty that the balance of the 85,000L should be devoted to that
purpose, plus any extra amount of money that may be voted by the Colony in
order to establish a service of that sort. I at once acknowledge that the
contribution on behalf of the Cape is not at all adequate to the services which
the Navy renders to our defences, and I have no doubt that when the federation
General Botha spoke of the other day takes place, as the ports of Cape Colony
and Natal wiU be equally the ports of the Transvaal, both the Transvaal and
the Orange River Colony will also recogTiise their obligations to contribute
towards a defence scheme of that sort. Therefore, I do not see any difficulty
in the future, with the assistance of the Admiralty, in working up a consider-
able defence of this character. I presume then the Admiralty would place at
our disposal before we return to the Cape — or if not before, as soon after as
possible — the necessary information, as to the cost of establishing a submarine
or destroyer force, i.e., the cost of the ship, whether it be a submarine or
destroyer, and the cost and number of the crew necessary for iipkeep, so that
we could see in what direction we would have to work.

I do not wish to take up the time of the Conference, but I would like to
ask Lord Tweedmouth whether he has inquired into a statement I made some
few days ago with regard to the Naval docks at Simonstown, in which I stated
I had been informed that as the docks are now being constructed under
heavy south-east gales, it would be impossible or dangerous for a ship to
to enter those docks until the gale abated. Yoii were good enough to say
you would inquire whether that was correct or not, with a view, if my
information is correct, of having something done to expend the necessary
extra 60,000Z., or 70,000Z. to rectify it.

There were some other matters relating to shore defence, but I do not
know whether they ought to be discussed here or privately with the Admiralty
or with the War Office. There is the matter of the manning of our defences.

Lord TWEEDMOUTH : That is a War Office matter.

Dr. SMARTT : It would be better discussed with the War Office or
Admiralty privately, there being a mutual arrangement between the Cape
and the War Office in connection therewith.

Mr. F. R. MOOR : Lord Elgin and gentlemen, I follow on the lines of
the Cape. Our proposal now — and I think the two Governments are in
accord — is that we should work together as regards tliis training ship which
shall be available for our common cause, and to give our men the necessary
training at sea. The expense of this is to come out of our mutual contribu-
tions ; and then the c[uestion of the submarines is to be taken up hereafter as
to the cost and as to any increased expenditure in regard to maintaining these
craft at our diiferent harbours.

I am prepared to join with my colleague from the Cape in furthering the
objects we mutually have in view, and I trust before we leave, the Admiralty
will be able to give us a definite answer to what we are placing before them,
so that we shall be able to go back to South Africa and explain lo our people
what the terms of the provisional agreement are. We are going to meet our
Parliaments in a month or two, and I think it would be very advantageous
both to my Parliament and the Cape Parliament that we should have the
proposals definitely settled before we leave England.

I have nothing more to say, and I trust the lines suggested will be
beneficial to our Colony and the Navy generally.

Mr. BRODEUR: Lord Elgin and gentlomen, T have nothing to say
except to thank heartily Lord Tweedmouth for having been good enough to

481

recognise what Canada has beiui clcjini,^ iu regard to its defence. As I Thiiteentli Day.
mentioned the last time we discussed this question at the Conference, I think « May 1907.

the situation of Canada has not been properly represented. I am very glad

to see Lord Tweedmouth has actually acknowledged and recognised that we .Saval Deke.vce.
have been doing a great ileal, and are still doing a great deal, by taking over (Mr. Hrodeur.)
the Naval Stations at Esquiniault and Halifax.

There was a discussion in previous years to the effect that we should
contribute something directly to the British Navj'. I may say with regard
to that, there is only one mind in Canada on that question, and if it was
necessary I should ])e able to quote the remarks made lately in an article
published by Sir Charles Tupper, who is certainly one of the men best
qualilied to speak in Canada, upon the question. I ihiidv, j^crhaps, I might
mention what he said in regard to that. He said : " It is known that from
" the outset I have felt the interests of Canada and the true interests of
" the Empire to be opposed to the demand for Colonial contributions to
" the Imperial Navy," and "I maintain that Canada has discharged that
" duty in the manner most conducive to Imperial interests." So it shows
that both sides of politics in Canada agree with the policy which has been
going on for some years there. He adds, also, in that article, that " Canada
" protects her fisheries by her own cruisers, and when the Imperial
" Government expressed a wish to be relieved of the expense of maintaining
" the strategic points at the harljours of Halifax and Esquimalt the Canadian
" Government at once relieved them of that large expenditure, amounting
" to 185,000?. per annum." Negotiations are now going on for taking over
the Naval stations there. I do not know exactly what will be the amount
by which the Admiralty will be relieved, but I think it is a somewhat large
amount.

Since the matter has been brought before this Conference I may say that
Parliament has voted a large sum of money for the purpose of purchasing
another cruiser and putting that cruiser on the Pacific coast for the protection
of our fisheries.

We are very glad to see that Lord Tweedmouth has recognised that in this
matter it should be left almost entirely to the Colonies. I may say, in conclusion, '
that we will be veiy glad to work in co-operatiou with the Imperial autho-
rities, and under the advice of an Lnperial officer, so far as it is consistent
with self-government.

Sir ROBERT BOND : I have nothing to add to what I have already said
in the matter.

Sir WILLIAM LYNE : I would like to ask Lord Tweedmouth a question
in connection with the Australian proposals. It is not intended, I presume,
to remove the present squadron, or any large j)roportion ol: that squadron,
until, if we can make a new arrangement, our coastal defence is fairly
complete.

Lord TWEEDMOUTH : There is no intention of moving the squadron
as it at present exists until a new arrangement is arrived at. I think the
discussion that has taken place here to-day shows very clearly what was said
by Mr. Moor, that it is impossil)le to come to any final decision with regard to
these i^roposals we have been talking al)out, and on which, I think, we are
very largely agreed, until reference is actually made to the Parliaments of
the various Colonies, liecause they must decide in the first instance as to
whether they will take the line of going on with the subsidy, or supplement
the suljsidy by certain local defence arrangements, or adopt a system of local
defence instead of the subsidy altogether.

c 18008. U ^

48g

Thirteenth Day.
8 May 1907.

Naval Defence.

(Lord
Tweedmouth.)

Sir Joseph Ward asked what is the opinion of the Admiralty with regard
to the comparative merits of submarine local defence, and subsidy. That,
I think, is a question upon which we at the Admiralty cannot i)retend to
adjudicate. We say, if the Colonies decide on a system of local defence, we
think submarines would be themost useful way of beginning it, and that Colonies
woidd find that a submarine flotilla would lie the best way from their point
of view and from a strategical point of view of defending the coast, to begin
with, at any rate. They might 'afterwards develop the destroyer, and so forth ;
but to begin with the suljmarine would be the best plan that could be adopted
in everybody's interests.

We do not refuse the subsidy plan, and I do not think it would come
well from us to say that we insist that the subsidies shoidd be dropped.
That, I think, is a matter for the Colonies themselves. So far as we are
concerned, the subsidy is a very convenient way of receiving help from the
Colonies ; but we quite recognise that it is a question for the Colouies
themselves as to how far it is to be subsidy and how far it is to be local
defence. What we really desire is that we should have the cordial help of
the Colonies, and that in the most effective way in the first place, and in the
second place, in a way most acceptable to the Colonies.

Dr. SMARTT : So that if the Colonies were prepared to accept a scheme
which met with the approval of the Admiralty, to improve their local defence
in such manner as not alone would it assist them but also the British Navy
in time of emergency, they would have the approval of the Admiralty to
devoting the subsidies that they now pay to the general fund, to this purpose^
and still more have the approval of the Admiralty if they increased the
amount of money to be devoted to those services. So long as we feel assured
that that is the desire of the Admiralty, I am extremely anxious, so far as
South Africa is concerned, to move forward in that direction.

Lord TWEEDMOUTH : We shall be willing to take in kind what has
been paid in the past in hard cash.

Dr. SMARTT : And as times improve, we should lie prepared to increase
the amount devoted to these services. That is why I was anxious to know
whether, so far as the Cape and Natal are concerned, the Admiralty would
give us some suggestions as to the cost of building up either the submarines
or destroyers — that is, the cost of the ship on the one hand, and the cost of
the men on the other. We understand, in the case of a submarine, that we
coidd not supplement her crew liy the volunteers, because in that case you
want really trained experts.

Lord TWEEDMOUTH : I have here a statement which I had made out
for Sir Joseph Ward with regard to the cost of a sidjmarine. Will you take
that copy and share it with Mr. Moor ? I gave a copy to Mr. Deakin. That
gives, I think, a very good and short summary of wdiat the cost of a submarine
would be. You also would lil<e something on the same lines as to a
destroyer ?

Dr. SMARTT: Yes. I would like even further than that some small
scheme prepared by the Admiralty to put before the Cape and say : This is a
scheme you can work up to whenever you can ihid the money. I Avant it as
an incentive to the people to s(>e what they are going to work up to, and to
allow them to know what it will cost them.

483

Lord TWICF^DMOU'J'II : That we shall l^e glad to give. Dr. Sinartt spoke Thirteenth Day.
about the Naval dock at Siinoiistowii the other day, and the matter was referred b May 1907.
to the Ilydrographer. I have not got his report yet, but I will get it.

-n. OArii^rMrn o i t , ii -i • i NavAL DEFENCE.

Dr. feiMAii i i : fc>o long as i know you are really cousidermg the matter
I am satisfied, because it is a matter of considerable importance to the Cape,

and to the Empire.

Lord TWEEDMOUTH : Yes, it has been referred to the Ilydrographer
for report already. I do not think I have anything else to add. I do not
think we can pass a resolution now. We m«st have the answers from the
■various Parliaments before we can come to a definite conclusion.

CTL\IR]\IA]S! : I find that at the last Conference there was no definite
resolution on the subject, but oidy discussions on proposals put forward, which
were taken for consideration, and that is our position now.

Dr. SMARTT : I should think perhaps, if you would not mind letting
that wait over until the Conference is again np to its full strength, the Con-
ference may be able to affirm the advisal:)ility of the various Dependencies of
the Empire recognisingtheir oldigations, and insisting on doing anything they
can to assist the Xa^•y^ If we do not close it now it can be put in some form
before the Conference. The Admiralty might draft a resolution of that
character.

Mr. F. R. MOOR : Apart from what the Conference say to-day. Natal and
the Cape will be C£iiito satisfied to have that short Memorandum from the
Admiralty, so that we can lay these views of the Admiralty before our
Parliaments.

CHAIRMAN: Yes.

After an adjourmnent :

COMMERCIAL TREATY QUESTION. Commercial

Treaty

After further discussion in private, on resuming :

Mr. LLOYD GEORGE : I suppose you have the confidential
memorandum prepared by the Board of Trade and circulated Avith reganl to
the best means of consulting the Colonies in commercial negotiations ?

Mr. DEAKIN : I have been looking at it this morning for a littl^
while.

Mr. LLOYD GEORGE : If there are any suggestions which any
Colonial ]\Tinistcr would care to make about this either now or later on, I
will be obliged.

Mr. DEAKIN : I am not in a position to make any practical
suggestion. We have really no time either to reatl or consider these papers.

Sir WILFRID LAURIER : I have looked at it, and it seems to me
very satisfactory that no Treaty should apply to any of the Dependencies
unless they adhere to it, and then provision is maile in the Treaty that they
can put an end to it. That is pretty satisfactory.

H h 2

Question.

484

Thii-toeiith Di\y.
8 May 1907.

Commercial
Treaty

QuEi^TlOX.

Resolution XII.,
p. viii.

Sir JOSEPH WARD : Lord Elgin, I would like the resolution I have
given notice of motion of to l)e formally placed before the Conference and
assented to unless there is any material objection to it. " That all doubts
" should be removed as to the right of the self-governing Dependencies to
" make reciprocal and preferential fiscal agreements with each other and
" with the United Kingdom, and further, that such right should not be
" fettered by Liiperial Treaties or Conventions Avithout their concurrence."
I presume you will put this resolution, and it may be agreed to ?

Mr. LLOYD GEORGE : Yes.

UnIFOKMITV (IF

Patent Laws.

UNIFORMITY OF PATENT LAWS.

Mr. LLOYD GEORGE: With regard to patents, the Resolution is:
" That it is desirable in the interests of inventors and the public that patents
" granted in Great Britain or in any Colony possessing a Patent Office of
" a standard to be specified should be valid throughout the Empire." That
is New Zealand, is it not ?

Mr. DEAKIN : No, it is ours. Cape Colony comes next.

Mr. LLOYD GEORGE: Yes.

Sir WILFRID LAURIER : That is a very broad resolution, Mr. Deakin.

Mr. DEAKIN : Veiy broad indeed. I have not looked at it recently, but
I am quite aware that as it stands it sets up a practically impossible standard.
How far it is either possible or desirable to secure uniformity in this direction
is still a matter of argmnent with us. Our Chief Patents Officer, the
Commissioner of Patents, while admitting that the end in view is most
desirable, points out that the enormous distances which separate us, the great
importance as we all know in patent matters of prior registration, and the
varying conditions imder which protection is granted — all these circumstances
together make the expectation of anything like real uniformity in connection
with the granting of patents still a far ofi; end. So that, speaking from
memory, and without my material here, which I have not looked at for
some months, I know that this resolution, although allowed to stand in these
general terms, was intended merely to introduce the subject with a view
to a discussion as to the particular points and methods of simplifying
patent processes, assimilating them to each other, so that we might at all
events make some approach towards imiformity. Any idea of absolute
amiformity to he obtained Ijy means of an Imperial Statute, if it be ever
feasible, does not appear feasible now. AU that can be attempted so far as I
recall the difficulties to mind is, as I have said, that there should bo
such an assimilation of methods, times, and modes as would facilitate the
understanding in each part of the Empire of the patent laws of the other
portions, so that the steps taken and information supphed may be of the
same nature, thus saving the inventor the expense of facing half-a-dozen or a
dozen sorts of procedure in order to register his patents in dift'erent parts of
the Empire. We quite recognise that it is only in that practical direction,
step by step, and not by any overriding legislation requirements, that we
can attain the object of this resolution. It resolves itself into the practical
question how far our patent systems can he assimilated as' to be easily
mutually comprehensible and available.

485

Ml-. IJ.UYD (il'".()IM!E : Tliat is rcnilly llic point. Thineentli Dav.

H May 1907.

Mr. DExMvIN : I have not auj^ material at hand here to explain tlie

details in wliic-h I thondit that Avas possible. Uxiformitv ok

Patent Laws.

Mr. LLOYD GEORGE : What I find is that there are legal dithculties,
and I think they are set forth here in the memorandum which I will put in ;
T w ill not trouble the Conference by reading it.

'Sir. DEAKIX : AVe have not seen that, have we ?

Mr. LLOYD GEORGE : No. You will find the difticulties are all set
out there. AVe do not mind incpiiring into the whole question if you can put
it into the form rather of an in([niry as to whether something can ho done to
assimilate the laws.

Mr. DEAKIN : I will do that.

Mr. LLOYD GEORGE : Would j'ou mind piitting your resolution in
that form ?

CILMR^IAN : And then it can be taken up at a subsidiary Conference.

Mr. LLOYD GEORGE: Would something of this sort suit you?
" That greater uniformity of the patent laws throughout the Empire is
" desirable so far as local circumstances permit."

Mr. DEAKIN : Certainly, but would not you go fnrtlier ? That is a
general alKrmation that greater unity is desirable so far as local circumstances
]H^rmit, but could not some action be taken, perhaps preferably on your
initiative, if Ave were to furnish you, if you do not possess a complete
statement of our patent laws and methods to be collated by you. Then you
might be prepared to suggest to each of iis any amendments you would
commend if we should see our way to make them. This would be a means
of bringing us into line in whatever directions it is possible to obtain
uniformity. If you added to your general assertion something of that sort it
would be a most useful thing.

Sir WILLIAM ROBSON : There can be no harm in any expression as
to what is desirable, but I think before any constituent member of thi^
Conference commits himself to this resolution or anylliiug like it they would
require a very great deal of further consideration.

Mr. DEAKIN : Are yon speaking of the resolution that the President of
the Board of Trade has just read?

Sir WILLIAM ROBSON: No, but the addendum that you are suggesting
should be made to it — " That patents granted in Great Britain or in any
•' Colony possessing a patent office of a standard to be specified should be
" valid throughout the Empire." 1 ihiidv that is Mr. Deakin's aim, ratlier.

e 4SiiGS. II h :?

486

Thirteenth Day. Mr. DEAKIN : That is an unattainable ideal at present. It can be

8 Mav 1907. approached, but not reached, and it can only be approached by steps.

Uniformity of

Patent Laws. Mr. LLOYD GEORGE : This is the first step, I think, to greater

uniformity.

Mr. DEAKIN : I quite agree with that.

Sir WILLIAM ROBSON : That a uniformity of law is desirable is a
very safe expression.

Mr. DEAKIN : It goes without saying.

Sir AVILLIAM ROBSON : But that you should pledge yourselves to
bringing about uniformity of law involves difficiilties

Mr. DEAKIN : I do not suggest that. I adopted Mr. Lloyd George's
words and was suggesting that you might go on to invite us first of all to
furnish to you at the centre of the Empire, if you do not possess them,
schedules of particulars setting forth our Patent Laws. Then liaving
obtained those from each of the self-governing Dominions, you could compare
them and see in what particidar modes it would be an advantage to bring
them into line. You would inform each one what would be necessary to
bring its law into a general harmony. Probably all would accept it with
minor amendments. The consequence would be that you would have taken
the longest stride that is now possible toAvards uniformity.

Sir WILLIAM ROBSON : Uniformity of law, any resolution expressing
the desirability of obtaining imiformity of law, might have very beneficial
results, but I do not think beyond that we should proceed at present. We
are now in the middle of a discussion on a Patents Bill in the House of
Commons which is of a somewhat elaborate character, and we have also to
consider there, as we have in nearly every case, the international conventions.
We should want a good deal of time to think over the effect before altering
our Imperial patent law.

Mr. LLOYD GEORGE : Take the Bill which is before the House now ;
we are introducing for the first time the principle of compulsory working of
foreign patents. I should very much like to see that extended throughout
the Empire, and that is why I think a resolution of this kind might be
exceedingly useful.

Mr. DEAKIN : I quite agree with the resolution as you read it, and as I
followed it.

Mr. LLOYD GEORGE : And it would be a very good work for the new
Secretariat to take up.

Mr. DEAKIN : An excellent Avork.

Mr. LLOYD GEORGE : To try and collate these laws?

487

Mr. DEAKIN : Yes. Thirteenth Day.

8 May 1907.

Sir WILFRID LAURIER : Will you read your resolution ?

Mr. LLOYD GEORGE : " That greater imiformity of patent laws
throughout the Empire is desirable so far as local circumstances permit."

Sir WILFRID LAURIER : With this qualification I have no objection.
The subject is very complicated, and perhaps in no place more than
Canada, where the patent laws are perhaps more developed than anjn^here
else.

Mr. LLOYD GEORGE : You have compulsory working.

Sir WILFRID LAURIER : I do not profess to understand it myself.

Sir JOSEPH WARD: In New Zealand we are submitting fresh
legislation to the next Session of Parliament on this veiy important matter,
and wliat we want to reserve the right to our people to do is, that while you
may be suggesting uniformity of legislation, we will put legislation through
on this basis. I think our Parliament will do it, and it will ])e supported by
the Government. We absolutely object to the system that has up to now
prevailed of an American, French or German patentee asking for the regis-
tration of his patent in our country, reserving to himself the right to manu-
facture the article in America and keep our people in the position for the
fidl limit of years, and a renewal at the end of the time, of paying the piper
for the convenience of the people in America or Germany or France, or
wherever else you like to name, and the product itself is never manidiactured
in our country at aD. We pay for a typewriter, for a motor-car, or for
something connected with a plough, an exorbitant price to enable a person
who has sold his patent to somebody else at an exorbitant price, to bleed our
people to death. We are not going to allow it.

Mr. DEAKIN : We have a provision aimed at that.

Mr. LLOYD GEORGE : I have a provision with the same ol)jcct in a
Bill I am promoting now.

Sir JOSEPH WARD : We want to insist on the registration of a patent
within a reasonal)lc time, and indess it is brought into practical working in
our country, and the man himself may erect a factory in our country ami do
so, our people will do it for him. If that is provided for in your Pill it will
be endorsed by the people in our country.

Sir WILLIAM ROBSON : To obtain uniformity of law would involve
extraordinary difricnlty. Take Canada, Canada has a search for novelty, and
so has the United States, and the United States lays great stress on the value
of that provision, Init that provision does not exist everywhere, and Canadians
might very well object that patents granted with less severity of investigation
shoidd nevertheless run current throughout Canada, as if they were granted
to Canadians. Each Colony will want to think a great deal about this
subject.

II li 4

Uniformitt of
Patent Laws.

488

Thirteonth Day. Sir WILFRID LAURIER : It is a most complicated subject, Sir Joseph

8 May 1907. Ward. There Avill he no oljjection to our meeting our local circumstances ;
that is quite consistent with the desire to obtain imiformity of legislation.
Uniformity of

Mr. DEAKIN : We want a general policy and a resolution in that
direction.

Sir WILFRID LAURIER : The resolution of Mr. Lloyd George, with
the qualification at the end, is not objectionable.

Mr. LLOYD GEORGE: That is substantially the Cape' resolution, it is
pointed out to me. I had not seen the Cape resolution at all, Ijut with
reference to the Avord "Imperial legislation," that would he impossiljle, as we
could not legislate for Canada, Australia, and New Zealand. It might lie put
in this way : " That it is desirable that His Majesty's Government, after full
" consultation with the Colonies, should endeavour to provide such uniformity
" as may be j)racticable."

Dr. SMARTT : "Uniformity of laws as far as possible."

Mr. LLOYD GEORGE: That is substantially the Cape resolution,
except the first part of it.

Dr. SMARTT : I see your difficulty as to the first part, liut we can easily
meet it. What we had in view in framing this resolution was that we
wanted, as far as possible, as another example of imity, to have our patent
laws and our trade statistics, and our company laws, and everything of
that sort, formed upon the same basis, and we look to the Imperial Govern-
ment in their Act to advise us as to the best mode of procedure to bring about
that as far as possible.

Mr. LLOYD GEORGE : I think your resolution admirably meets it.

Dr. SM.'VRTT : I think Mr. Lloyd George will specially agree Avith me
that it is most inadvisable, even in regard to our company laws, that you should
have one law in England and a different law in all the various British Colonies,
who are anxious to have them all on the same basis.

Mr. LLOYD GEORGE : I think it is trade marks and not merchandise
marks you have in your mind.

Dr. SMARTT: Yes, "trade marks" it ought to be instead of "mer-
chandise marks."

]\Ir. LLOYD GEORGE : I think that might be carried.

Rcsoliiiioii XIIL, CHAIRMAN : "That it is desirable that His Majesty's Government, after

P- is- full consultation with the Colonies, should endeavour to provide such miiformity

as may be practicable in the laws for the granting and protection of trade

marks and patents."

Sir WILFRID LAURIER : Very good, but replace the word " Colonies."

489

i\Ir. DEAKIN : " Duiniuions " is the word wc have used. Thirteenth Day

« May 1907.

Mr. LLOYD GEORGE : AU right.

Dr. SMARTT : Would you add also, Mr. Lloyd George, the imiformity
of Company Law ?

UXIKOKMITV or
I'aTEXT LaW!:.

COPYRIGHT. Copyright.

]\Ir. LLOYD GEORGE : Wc have a new resolution about that. What
about copyright, which is imich more important V What have you say to
copyright, Sir ^\'il^rid ?

Sir WILFRID LAURIER : I do not thiuk I would touch copyright,
ilr. LLOYD GEORGE : It seems a little more difficult.
Sir WILFRID LAURIER : It is far more difficult.

Mr. LLOYD GEORGE : I wish we could get uniformity in copyright.

Dr. SMARTT : It is rather unfair that any portion of the Empire should
rely purely on the copyright of the other parts of the Empire.

Mr. LLOYD GEORGE : We are great sufferers here.

Dr. SMARTT : I am in favour of a copyright resohition.

Mr. LLOYD GEORGE : 1 wish you could include copyright, because it
is very unfair that our authors should l)o treated in a British Dominion exactly
as they would be treated in a foreign country.

Sir WILIJAM LYXE : Copyright goes a long way past that.

Sir WILFRID LAURIER : I suppose in Australia where you have a
large paper element copyright is a very troublesome question.

Sir WILLIAM LYNE : Very trouljlesome.

Mr. LLOYD GEORGE : You mean about designs.

Mr. DEAKIN : Our law as to designs is passed.

Sir WIIjLIAM LYNl"] : Wc want it to go furtlicr than it has?

Mr. LLOYD GEORGE : Does your law protect the poor British author?

Mr. DEAKIN : I would not like to say without looking at it how
far he is protected or not protected. Copyright is a technical subject.

Mr. LLOYD GEORGE: Copyright seem? to be too difficult.

Mr. F. R. ■MOOR: Are you leaving out copyright altogether ? Could
you not introduce it in looser terms : " and copyright as far as practicable."

Thirteenth Day.
8 May 1907.

Copyright.

490

Mr. LLOYD GEORGE : I wish you could, I must say ; it does not bind
yovi to uniformity, beyond what is practicable, and it is left to you to
legislate.

Mr, DEAKIN : I have no objection.

Dr. SMARTT : Your contention, Mr. Lloyd George, is that if an author
takes out a copyright in England, he should be protected in all British
Colonies.

laws.

Mr. LLOYD GEORGE : He could only be protected by your own

Dr. SMARTT : Our laws should protect him, and you would mutually
protect our authors.

Mr. LLOYD GEORGE : Certainly.

Dr. SMARTT : I am altogether in favour of it.

Mr. F. R. MOOR : So am I.

Dr. SMARTT : That is what we are pleading for.

Mr. LLOYD GEORGE : Aud you have a growing interest in it because
your literature grows. Would Sir Wilfrid object to the resolution?

Sir WILFRID LAURIER : At present I woidd. If the Minister of
Agriculture, who, strange to say, has the matter in his hands, were here he
perhaps would have a different opinion, but in his absence I would not like to
deal with it. It has been a contentious subject with us for years, and certain
sections of the Labour Party with us have taken a very strong position with
regard to it.

Dr. SMARTT : Could you not let it stand over ?

Sir WILFRID LAURIER : We cannot attempt to reform everything at
this Conference ; leave something for the next Conference.

Trade

Statistics.

Resolution XIV.,
p. ix.

TRADE STATISTICS.
CHAIRMAN : Trade statistics.

Mr. LLOYD GEORGE : I move here : " That it is desirable, so far as
" circiunstances permit, to secure greater uniformity in the trade statistics of
" the Empire, and that the Note prepared on tliis subject by the Luperial
■' Government be commended to the consideration of the various Governments
" represented at this Conference." I am not going to take up time over that ;
the memorandum has been circidated and I think we have all agreed that
it is very desirable that there should be uniformity of trade statistics.

Mr. F. R. MOOR : That is some work for your secretariat.

491

UNIFORMITY OF COMPANY LAW. Thirteeuth Day.

Mr. LLOYD C1E0R( IE : Yes, all this is work for the secretariat. I also ^ Maj^907.
move the rpsoliit ion "That it is desirable so far aii circumstaaces permit, to
" secure greater uniforinity in Company Laws of the Empire and that tlie Co'^/ff^^y'j. a w*"
" memoi'andum and analysis prepared ou this subject by the Imperial
" Government be commended to the consideration of the various (lovernments
" represented at this Conference." That has been circulated 1 think.

Sir WILFRID LAURIE R : That might be expected.

CHAIRMAN: Agreed?

Mr. DEAKIN : Agreed. p.'S"'"" ^^ ""

Dr. SMARTT : Can you not meet ns in copyright ?

Mr. DEAKIN : I do not see anything objectionable in recommending
the copyright proposed, but Sir Wilfrid is not prepared to deal with it.

Sir WILFRID LAUPvIER : Both Sir William Lyne and 1 have some
objection to it.

RECIPROCITY AS TO BARRISTERS. Reciprocity as

CHAIRMAN : There are two small things from New Zealand on the
agenda about reciprocity.

Sir JOSEPH WARD: I want to deal with this question of reciprocity
as to barristers and surveyors. I will state the position briefly, Lord I'^lgin.
I want to ask the Conference seriously to consider the fairness of giving
effect to what I propose and I will give my rea&ous for it briefly. Full
provision for reciprocity with the United Kingdom exists under the Imperial
Act, but it is practically inoperative in the case of New Zealand owing to
objections raised by the English Law Society on the ground that in New-
Zealand the two branches of the profession, barristers and solicitors, are
combined and owing to this objection the Order in Council necessary to bring
the Act into operation has not Ijcen issued. 1 submit that this objection has
no substance. It is not suggested, nor does the Act provide, that in the case
of a New Zealand barrister Avho is admitted in the United Kingdom under
the Act he shall be entitled to practise here as a solicitor. I woidd like to
point out that if the Act were brought into operation the balance of advantage
would be with the United Kingdom. The nimiber of New Zealand practi-
tioners who would seek admission in England would Ije very few, and the
UTimber Avho would actually practise in England woidd l)e intinitesimal. On
the other hand the nundier of English barristers who would avail themselves
of the Act for the purpose of a(huissiou in New Zealand where they would
have the right to practise both as l)arristers and solicitors would presumably
l)e great.

It is w<>ll known that although the ]u-izes at the English Bar are splendid
for those who can win them, the number who succeed is very small compared
with the very large numl)er who are barristers only in name. The Colonies
would afford an excellent field for these gentlemen, and in such cases the
direct advantage would he to them although 1 freely admit that the Colonies
would inevitably gain by obtaining people who would not only be a very
estimable addition to the popidation, l)ut woidd strengthen and raise the
status of the profession in the Colony and keep it in closer touch with the
English Bar.

Since I have been in England I have noticed that a further objection
has been i-aised, namely, that in New Zealand women are eligible for

492

Thirteenth Day. admission to the bar. I adinit the force of that in the inatter of reciprocit.y,

8 May 1907. that if you want reciprocity you should haA'e it in the same sexes, and where

the desirability exists in England of women not being admitted to the Bar,

Recu'rocitt as g^jj^ j^ j^Jqpj, j^q^ exist in New Zealand, you could not have reciprocity in that
respect. I think it is unreasonable under the reciprocity provisions of the

J s oil Ward ) •"'^'-'^ *^-^^* women should be allowed to practice Avhen they are not eligible.
Otherwise I should like to say, however, that the difficulty can be effectively
removed if the Order in Council provides that it shall apply only to persons
who woiild otherwise be eligible for admission. That would exclude women
from the benefits of the Act in the United Kingdom and elsewhere where
they are not eligible.

I have dealt only with the United Kingdom and New Zealand, but the
same observations would, of course, apply to other portions of the dependencies
in cases where the same objections have been urged. Now, I want to say on
this matter that I do personally feel that it is greatly to he regretted that a
matter of sentiment which can ))e provided for in the teiins of the Order in
Council, should prejudice or stand in the way of what would be regarded by
the profession, certainly in New Zealand, and I presiime elsewhere, too, the
inestimal^le advantage for them to have the right of reciprocity with their pro-
fessional brethren in England. To my mind it appears to l^e purely sentimental,
this objection to the admission of women to the Bar in New Zealand where
comparatively few women, only two or three at the most, have passed, and
who have certainly been very far from a discredit to the profession ; the
women I know who have passed for the Bar in New Zealand have obtained
it as the result of hard work, and every examination that a male requires
to pass through they imdergo, so that they have attained to the position
after every ordeal which it is possilile to put in their way to enable them
to attain to a very high and honouralile position, and the few who have
passed have carried out their work in a most capable way and stand
to-day very high in the esteem of the male members of the profession in
New Zealand. I do hope that at this Conference, wliere we are trying to
bring about mutuality and agreement, where we are trying to bring about
the interchange of officers in the Defence Department, where Ave are trying
to bring about the interchange of units in the Defence Organisation, we are
not going to allow a question of pure sentiment which could be provided for
by the most ordinary clause in the Order in Council, and the Imperial Act as I
say provides already for reciprocity excepting for the fact that barristers and
solicitors in New Zealand are combined Avhile that is not so in England,
should stand in the way so far as to prevent the carrying out of what was
originally intended under the Imperial Act, the interchange Ijetween members
of the professions.

i would personally look iipon it as almost an insult to the members of the
profession in England if they were to say they could not j)rovide for an
interchange by declaring it to be really on sentimental grounds which could
be obviated in the Order in Council in the ordinary way. I can say with
some experience of our coimtry, that the profession in New Zealand, some of
the leading members of the profession, regard the matter as of the deepest
possible interest to their profession, and I am persuaded in my own mind that
nine-tenths of the advantages would accrue to the men in England in the
profession who want to have the opportiniity of practising as barristers and
solicitors, which they could do in New Zealand and which the leading-
barristers and solicitors in New Zealand themselves cotdd not do if they came
to England.

For the reasons I have urged as briefly as I can my views, I hope
that the Conference may see its way to alTirm the Resolution. The conditions
required to meet the sentimental side of it can and would be provided for
by Order in Council. I move the Resolution, my Lord.

493

Sir WITJJAM ROBSON : T do not know wliothnr Sir Joscpli c-ould tell TliiriuontI, Dav.
us what are the qualifications iu New Zealand for admission to the New s May 1907.

Zealand Bar.

Recu'Rocity .\s

Sir JOSEPH \A ARD : I cannot tell you with complete accuracy, but I ""^^ BAnui.^TER.s
laiow that it involves a number of years being articled to a barrister and
solicitor's office, and passing an examination before a Judge of the Supreme
Court.

Sir WILLIAM ROBSON : This is not merely a question of general
reciprocity, but any advantage of this kind given to those who live, say in
New^ Zealand, or Australia, or Canada, or anywhere else, might, if the
qualification in New Zealand were not as severe as that in England, be made
the means of securing admission to the English Bar by what one might call
a Colonial avenue.

Sir JOSEPH WARD: Very well, make it a condition that the
reciprocity should be contingent on their complying with the same conditions
as exist for admission to the Bar in England.

Sir WILLIAM ROBSON : The same conditions woidd not be quite as
easily applied. AVe have very special and rather strict qualifications for
admission to the Bar. Admission to the roll as solicitors is a different
matter ; there you have a five years' apprenticeship (I do not know whether in
New Zealand the apprenticeship is so long), followed by a somewhat strict
examination, and we have many men in England who would be very glaii
indeed to avail themselves of any avenue by which that strict condition could
be evaded.

Sir ,10SEPH Vv'ARD : I think it is five years in New Zcalaiul.

Sir WILLIAM ROBSON : Then with regard to the Bar, we have
somewhat dift'erent c[ualifications, jicrhaps not apparently C[uitc so severe as
those which hedge roiuid the profession of solicitors, but still we have
qualifications of residence in England, which are generally accompanied,
I thiid<, although not necessarily part of the condition, by study in a
barrister's chambers. These C|ualifications I am afraid the English Bar
would not be content to surrender. It is not an easy matter for us to maintain
an even balance between barristers and solicitors with respect to qualifications
but we have given special facilities to solicitors to procure admission to the
Bar, and I am sure the English Inns of Court, who govern the Bar, would
very favourably consider anj^ proposal to give to solicitors from New Zealanel
or Canada, or the other Colonies, the same kind of special facilities as it
already gives to solicitors here. They let in English solicitors upon slightly
more favouralJe terms than they apply to one who is coming to the Bar merely
as a student without having become a solicitor, and 1 have no doubt that the
Inns of Court would favourably consider proposals to give that kind of
facility to Colonial ])arristers ; Ijut I would urge the Conference not to adopt
a resolution which it might be afterwards fouuci difficult for us to give effect
to, because we certainly would not be likely to force this upon the Inns of
Court without carefidly considering the views of those especially concerned.
We should have to consider the views of the Inns of Court, and 1 am bound
to sav that I am not able to speak with authority as to their opinion, because
I have taken no means of finding out what their opinion would be.

Mr. DEAKIN : They are expressed in the document before us.

494

Thirteenth Day. Sir WILLIAM ROBSON : I do not think the English Bar would be

S May 1907. willing to relax all the regulations and restrictions.

Reciprocity as gi^. WILFRID LAURIER : There are other difficulties in my country.

TO Bareibters.

The Bars, with us, are not under the jurisdiction of the Dominion Parliament.
We have a Bar for each Province.

Mr. DEAKIN : Our position is the same as yours.

Sir WILFRID LAURIER : There is a Bar for the Province of Quebec
and one for the Province of Ontario ; and a man cannot be admitted fi-om one
Bar to the other except under very special circumstances. For instance, if a
man becomes Attorney-General, he can be admitted from the Bar of one
Province to that of the other, or if he has obtained some very high post ; biit
I do not know more than two or thi-ee instances when a member of the Bar of
one Province has been admitted to the other except by qualifying himself,
and taking residence, and passing the examinations ; so that we should not
do it.

Sir WILLIAM ROBSON : It would be very difficult for us to let in a
New Zealand solicitor upon better terms than an English solicitor, and that
is really what this resolution would amount to.

Sir JOSEPH WARD : The extraordinary thing about this matter,
Lord Elgin, is, that £rom the New Zealand point of view we are regarding it
from the A^erj' opposite standpoint. I quite concede at once that the profession
are naturally jealous of their rights in England, and unless the terms of
admission were the same, it would be proper to exclude anybody from getting
in either as a barrister or solicitor in England ; but this is urged from the
very opposite standpoint. Of my own knowledge, I am not aware of many
fi'om our Colony trying to get admission to the Bar ; but I understand that
English solicitors have often come out and tried to get admission to the Bar
in New Zealand.

Sir WILLIAM ROBSON : I am sure it would lie a great rehef to English
solicitors going out to New Zealand, but one is looking at it from the point of
view of the English Bar, and, I am afraid, from their point of view — I do not
speak from any personal feehng of my own — the proposal would be resisted.
As it is, it is not altogether easj' to procure special treatment for the admission
of sohcitors. That we have done, and that, I believe, the Bar would be
willing to extend to the case of New Zealand or for Colonial barristers or
solicitors, but I do not think we could induce the English Bar to go further
in respect to Colonies than they go with respect to EngHshmen.

Sir JOSEPH WARD : I will qualify my resolution by taking the
suggestion made by the sub-treasurer, who writes on behalf of the British
Law Society, I suppose.

Mr. DEAKIN : The four Inns of Court.

Sir JOSEPH WARD : I will move as a preface to my resolution, " That
" provided it is satisfactorily established that the qualifications as a barrister
" in any Colony are equivalent to those in this country, any proposal for
" facilitating the call to the Englisli Bar of Barristers in any Colony or
" Dependency upon terms analogous to those upon which English solicitors

495

" may for tho time l)oing he entitled to ho called to the Bar should ])e Thirteenth Day.

" favoiirahly considered."' I think, if 1 take their own words that should be ^ ^"7 ^^'••

aceeptal)le.

Reciprocity as

TO Barristers.

Sir Wn.LLVM ROBSOX : We have uot that resolution before us.

Sir JOSEPH WARD : I move that.

Sir WIIiLIA^M ROBSOX : I do not think you are following this proposal.
This suggestion of Sir Henry Lawrence is that : " any proposal for facilitating
" the call to the English Bar of Barristers, in any Colony or Dependency,
" upon terms analogous to those u])on which English solicitors may for the
" time being be entitled to be called to the Bar should l)e favourably
" considered." That is putting the Colonial upon the same footing as an
English solicitor, but I rather understood your suggestion, Sir Joseph, to be
that if you make provisions in the Colony, of the same kintl as those which
are applicable to English solicitors, then the Colonial solicitor, without
submitting to the terms imposed upon an English solicitor here, by virtue of
liis atlmission in Xew Zealand Avould thereupon become entitled to admission
of the Bar of England. That is rather a different proposal to Sir Henry
Lawrence's.

Sir JOSEPH WARD : The wording of Sir Hemy Lawrence's second
paragraph does not quite bear that out, if 1 may be allowed to say so ; he
says : " The Committee recommend that provided it is satisfactorily
" established that the qualifications for admission as a barrister in any
" Colony are equivalent to tbose in this country, any proposal for facilitating
" the call to English Bar of Barristers in any Colony or Dependency upon
" terms analogous to those iipon which English solicitors may for the time
" lieing be entitled to be called to the Bar should he favourably considered."
It tloes not say, as you suggest now, that if they have established the fact that
their qualifications for admission as a Ijarrister in any Colony are beyond
all question, they sliould come home again and undergo a further examina-
tion. He says : " provided it is established." There would be somebody
on their behalf who would ascertain beyond all question that they Avere
entitled to admission. It woidd not give a general right to anybody to come
home and be entitled to atlmission here. I think, with that preface, to my
resolution it might be, without any difficulties, accepted.

Mr. DEAKIN : My position is precisely that of the Prime Minister of
Canada ; the Commonwealth, as such, has no jurisdiction over anj' portion of
the Bar, except that portion which ]u-actiscs in the Connnonwealth Court. But
in the various States of Australia the qualiiications for the Bar dill'er a good
deal. In most of the States it is possible for a practitioner to he at the same
time a barrister and a solicitor, although in practice in certain states, even
where that exists, the two are divided except in country towns ; I)ut in Xew
South Wales the Ihiglish practice still exists, and the two branches of the
profession are se])arate. The standards, so far as I am acquainted with the
English, are very fairly high ; in fact, owing to a rather curious conj miction of
circumstances, when the professions were amalgamated in Victoria, the
standard adopted was that previously in force in respect to the Bar. I believe
that every practitioner in Victoria now qualifies himself for what is
very nearly the degree of LL.B. before he is admitted as a barrister.
The standard of a year or two ago, and 1 am not aware of any change^ since,
was very high. I do not think Sir \\'iiliani Robson objects to any of the
proposals for reciprocity, providing that the authorities here are satisfied —
that the training, the p)robation, and the tests are fairly eipial.

(Sir
Joseph Ward.)

496

Thirteenth Day. Sir WILLIAM ROBSON : The difficulty would be to settle which

8 May 1907. authorities are to be satisfied.

Recii'rocity as i\£r_ DEAKIN : You are the authorities to be satisfied as to your Bar.

TO Bai'.risters.

Sir WILLIAM ROBSON : If the Conference pass a resolution, that is a
matter which no doubt Avould have great weight ; but, after all, the decision
as to what qualifications are necessary is at present left to the Inns of Court
for the English Bar and the Incorporated Law Society for solicitors. The
English Bar has expressed its wiUiugness in the docinnent which is before
me to consider favourably any proposal of which it would, of course, be itself
the judge as to what the qualifications should be here and in the Colonies,
and it would have itself to be the jiidge as to what conditions it should
impose here.

These are matters really for the English Bar, and I think an assurance
of that kind from the Inns of Court should really be sufficient, but it would
look very much like a quasi-legislative step aft'ecting the Inns of Court if they
were told by this Conference that, according to a decision to which great
weight shoidd be attached, provision should be made throughout the Empire
for recii)rocal admission of barristers to practice. They would say : " What
about our authority ? It is we who decide."

Mr. DEAKIN : I thought Sir Joseph had put that aside.

Sir WILLIAM ROBSON : I should like to see Sir Joseph's amended
resolution in some form in which it can Ijc carefully' considered, because I am
sure his addendum

Mr. DEAKIN : As I understand it is not an addendum ; he takes the
second paragraph of the report from the Sub-Treasurer to the four Inns of
Court.

Sir WILLIAM ROBSON : Not in substitution for his resolution.

Sir JOSEPH WARD : I have no objection to substitute that formally.
If I take the recommendation of the four Inns of Court I do not know that
I can have any better authority.

Sir WILLIAM ROBSON : I should like to see the exact form of the
resolution. What the report says is that it should be favourably considered
and I do not think there would be any objection to that in sid)stitution iov
the original proposal.

Mr. DEAKIN : Am I not right, Sir Joseph, that you move sidj-section 2
of this report possibly omitting the word " that " — "Provided it is satis-
" factorily established " right down to the last Avord.

Sir JOSEPH WARD : I move that.

Mr. DEAKIN : Thereis no objection to that.

Sir JOSEPH WARD: " Provided it is satisfactory established that the
qiialifications for athuission as a barrister in any colony are equivalent to those
in this country any proposal for facilitating the call to the English Bar of
barristers in any colony or dependency upon terms analogous to those upon
whicli English solicitors may for the time being be entitled to be called to the
Bar slioidd be favourably considered."

497

Sir WILIJAM ROBSON: That only l)in(ls tlio Kuglisli Bar, that Tl,i,itenil. Day.
resolution does not bind the Colonial Bar, and it does not deal with the 8 May I907.

difficulty raised by Sir Wilfrid Laurier.

Kkcii'kdcity as

Sir JOSEPH WARD : I will put in the words " English or Colonial." ■"" iJAuuKSTEUb.

Sir WILLIAM ROBSOX : It is much better before one adopts a
resolution which may conflict with so many professional interests that one
should see it iu some form in which it can be considered. As Mr. Deakin
suggests, you cannot take paragraph 2 and make it a resolution at this
Conference without reference to the reciprocal oi)ligations. I agree that if
you take the spirit of this resolution and you make it applical)le to all the
Colonies one might then get some resolution which is capable of being
accepted, but as it stands now it is unilateral.

Sir JOSEPH WxVRD : What I am trying to bring about, and I know
there is a strong opinion in our country with regard to it, is a position which
would hvlng the Colonies and the Old Country closer together and in the
matter of the professions it is as important as in any other respect. If the
conditions required by the Inns of Coiu-t in England are fully complied with
by a man who has passed through our Courts in our Colony and those
responsible for the govermuent of the Inns of Cburt on behalf of the
profession in England are satisfied that he can pass an examination
near to their own and it is for them to say finally whether that
examination has been such that they can agree to if that be
their imprimatur upon that professional man who comes to England, and
we interchange by conferring the privilege upon Englishmen coming to our
country, surely it is an advantageous thing for us to help one another. That
is what I am asking for. I take the proposal made by the Inns of Court
themselves ; I give way upon my own as it is considered too wide and is
capable of an interpretation that is opposed l)y those who represent the Inns
of Court, and in the aspect of it I take their own words, and I ask that that
should be given effect to as evidence of the goodwill of the profession in
Lngland to their l)rethren of the same flesh and blood in a British country,
New Zealand, or Canada, or Australia, as the case may be, I think one may
hope for this being generotisly considered even by those Avho are anxious to
conserve, and rightly so, the great interest of the profession in England. I do
not want to derogate from their status ; I do not want anyone from our Colony
who is inferior in any way to the Ijest men who can pass the most severe
examinations in England to come here, but if he passes with the approval of
tlie representatives of the Inns of Court an examination to what is recxuired
here that Avould Ijc a matter of reciprocity between the two countries.

Sir WILLIAM ROBSON: Do you not think you had better draft a
resolution which shall incorporate the reciprocity ? As matter of draughts-
manship it is scarcely quite convenient to adopt this paragraph which relates
only to what Iilngland is willing to do and not to incorporate in that what the
(Jolony is to do.

Sir JOSEPH WARD: Let us add at tlie ond of this: "should be
" favourably considered and provided that the sanie conditions as exist in
" relation to admission to the Bar in the Colonies should apply to English
" barristers or solicitors visiting those Colonies."

Mr. F. li. MOOR : How does that apply to the Colonies ? Sir Wilfrid
Laurier has pointed out the difficulty in their country, and we have it in ours
too ; I do not think there is reciprocity amongst ourselves over there yet.

c 4S(iOS. 1 i

498

Thirteen til Day.
8 May 1907.

Dr. SMARTT: No.

— Sir WILLIAM ROBSON : That is very important. That shows the

Reciprocity as necessity of considering the matter in all its bearings.
TO Barristers.

Dr. SMARTT : The difficulty with us is very strong owing to the fact
that the Cape law is founded on Roman Dutch law.

Mr. DEAKIN : I do not suppose it would be possible for the Inns of
Court to lay down provisions that would apply to every province and state in
the Empire ; they would require to deal with the examination or qualifications
now required in each and make the necessary provision for siipplementing each.

Sir WILLIAM ROBSON : Yes, we are here to consider whether these
siiggestions shoiold be put into a form susceptible for being dealt with by
the Conference as a resolution applicable to all Colonies.

Sir Wn^FRID LAURIER : There is great difficulty as to that, but the
point which Sir Joseph Ward has in mind he has partly reached, because he
has shown that the British Government here by legislation or otherwise could
admit barristers from the Colonies provided they qualified in a certain
standard, but to put it conversely, as you say, that is to say a barrister from
one countiy being admitted in another coiintry, for instance in Canada and
in Australia, is a thing that is beyond our power.

Sir WILLIA]\I ROBSON : I may say that it would be scarcely right for
the Conference to pass a resolution which should be binding upon the
Enghsh profession compelhng it or inviting it to give advantages to the
Colonies which were not accompanied by reciprocal advantages on the part
of the Colonies.

Dr. SjVLVRTT : I take it the Colonies to which Sir Joseph made reference
would give reciprocal advantages to the English barrister.

Sir JOSEPH WARD : I have just written this to try to meet it.

Sir WILLIAM ROBSON : I should hke to see the resolution and to
consider it. I should not like hastily to adopt, especially as representing the
EngUsh Bar for the moment, any resolution that might by my professional
brethren be considered prejudicial to their interests without consulting them.

Sir JOSEPH WARD : That is only fair. I wiU complete the resohition,
and in the meantime I would suggest that as we have had a discussion upon
it, it should be deferred imtil we meet again, because I think it is too
important to drop. There may be a certain amoimt of doubt as to how the
profession woxdd accept this resolution of their own

Sir WILLIAM ROBSON : You must not assume that this paragraph,
Avhich is stating what England is prepared to do, or what the four Inns of
Court are prepared to do, would be treated by them as adequate if it were
passed as a resolution by the Conference, operative against themselves only,
and not accompanied by any reciprocal advantages.

Sir JOSEPH WARD : I have that at the end, and I shall read it ; after
the word " considered " add the words " and that similar terms and conditions

499

" should apply for admission of English barristers and solicitors to the Tliirtper.th Day.
" Colonial IJar." My desire is to make it fair to both sides and equally •'^ Mav 19()7.
applicable.

RF.CIPHOriTY AS

Sir WILLIAM ROBSON : Sir Wilfrid Laurier thinks Canada may not ^" ^y'«'"^'''«^-
be wiUing to agree. jcseph Lnl.)

Sir WILFRID LAURIER: I say Canada ought to have no jurisdiction
in the matter.

Sir WILLIAM ROBSON : That is a very important block, and so again
with Australia there is an important block.

Mr. DEAKIN : You could not make it conditional, of course ?

Sir WILLIAM ROBSON : You may depend upon it that although the
English Parliament has, perhaps, a higher and moi'e absolute power over
Englishmen than ajiy governing body has over any State, still there are
unseen but unmistakable limitations to which Parliament is subject and when
it comes up against a profession like the English Bar, it is very apt to
discover that its limitations are somewhat substantial.

Dr. SMARTT : Especially as the profession has a considerable number
of votes.

:\rr. LLOYD GEORGE: Their influence is far-reaching.

Sir WEJJAM ROBSON: The English Bar is extraordinarily well-
represented.

Sir JOSEPH WARD : I can only say that in our country there is no
profession that stands higher in our estimation than the English Bar ; we
look upon them as the great representatives of a noble jirofession in every
way, and I do not want to do anything that would in any way either weaken
or interfere with any of the rights of ihe profession in England, very far from
it. I would not be presumptuous enough to do anything of the kind, and we
are anxious to bring about reciprocity lietween them upon fair terms only.
What I woidd suggest is, that with the addition of the words I have proposed
here, perhaps the resolution miglit be printed. I do not know whether I have
amplified it sufhciently to meet what I have tried to convey, and in the mean-
time, after it is printed, we might defer it until there is an opportunity of
considering it. In any case, I have sufficient common-sense to know that if
we proposed anything which was regarded by the English profession as
adverse to their interests, we could not expect them to conform to it ; we
certainly do not want to make any change unless it is an act of goodwill on
both sides. The matter has been brought forward in New Zealand by some of
the very best men in our country, and I am anxious before we go away from
this Conference that we should have an opportunity of considering whether we
cannot show a little genuine and practical feeling of reciprocity between our
countries on both sides of the water.

CHAIRMAN : Can you not put it in such a form as we have had a good
many resolutions as would invite that consideration? You speak of getting
at the feeling of the Bar, but we certainly cannot get the feeling of the Bar
before we separate, as we should probably separate, to-morrow. I do not see
how it is possible to get very much of an outside opinion, and if you could

I i 2

500

Thirteenth Day. liave worded yonr resolution so as to meet Sir William Robson's A'iew it
8 May 1907. would have been convenient.

Reciprocity as gjj. JOSEPH WARD : I would be very happy to do so and to put it in

TO ^ ARRi^TER.-. g^^^j^ ^ ^^^ g^g ^^ invlte a suggestion from them. I do not desire to huriy it.
(Chairman.) Perhaps it may stand until to-morrow and then in a few minutes we might
be able to deal with it.

Sir WILLIAM ROBSON : Yes, I am quite sure that the English Bar
would be desirous of doing what they can. I think I may say for the Bar that
we have not behaved ungenerously to those who have sought admission tC'
our ranks. Of course the privilege is a very valuable one and we have
accorded it very freely to Scotch and Irish barristers. The limitations stand
against them as much as against our brethren across the seas. There is no
differentiation between one who lives in these Islands and one who lives
beyond them under the same flag as far as we are concerned, but we have
been obliged in order to maintain the peculiar status of the English Bar to be
very strict indeed about our regulations as to admission, because it is a very
singidar status. It means that we have to give up many classes of work that
solicitors enjoy ; we are restricted in many somewhat singidar and pecidiar
ways and in return we have very exceptional privileges. The Bar is very
jealous both of its privileges and of its limitations. It is as keen about its
limitations as about its privileges and it would not be in any sectional or purely
national spirit that the thing would be considered ; it would be considered
on very broad grounds. That is why, as far as I am concerned, I would like
to see precisely what it is we were invited to do before we took any definite
step. I would certainly ask the Conference not to pass a resolution which
might bring the govermnent into conflict with the Bar upon a matter of this
kind.

Mr. DEAKIN : I suppose you speak now as a member of the government.

Sir WILLIAM ROBSON : As a Member of the Government and as a
barrister. I desire to see the Bar and the Government in continual accord.

Mr. DEAKIN: May I suggest as pertinent to this subject a matter
which on one of its sides at all events may appeal even to the English Bar.
It is rather anomalous that English barristers who have gone to the Outer
Dominions, and while there have reached a position which has qualified
them to receive silk, some of them receiving it in consequence of having
held for some years the highest position obtainable in their States, that of
Attorney-General, and adviser to the Governor. They advise him not only
as Attorney-General but in an independent capacity in times when he does
not desire ministerial but professional advice on matters of serious import
to himself. It seems anomalous that those who have been honoured liy being
made King's Coimsel, who are English barristers on their return to this
country should find that there is one King in Great Britain and another
King in the Commonwealth, and that they have ceased to be His Majesty's
C'ounsel or entitled to that recognition here.

Of course the circumstances are so various that I must not be understood
as endeavouring to lay down the doctrine that everyone who is made a K.C.
in any part of the Dominions shoidd be qualified here, but would venture to
put it as far as this, that unless some disability could be shown, some want
of qualification or standing or some particular cause which should deprive a
|u-ol'pssional man of standing of the honour he has enjoyed in one of the great
(oniniunities beyond the seas, he should retain his professional rank. I take

501

linst of all the case of the English l)arnster, because it seems to me strange Tliiitc<>iiili Dav.

and might naturally appeal to the English Bar. The Colonial barrister has 8 May 1907.

claims also depending on his qualifications.

REcn-uoi'iTY A.^

Sir WILLIAM ROBSON : The same thing is applicable to the Irish and ^^' AuiiisTtKb.

Scotch K.C. ^ ^^ (M>-. Dunk,,..)

Air. DEAKIX : But there is always a distinction ; 1 do not know that
the Irish or Scotch K.C. has been called to your Bar, or that after that he
lias occupied the position (I take the strongest case 1 can tind) of .\ttorney-
General and of Chief Legal Adviser to the (^rown.

Sir Wir.LLUI UOBSON : Yes. Take my Riglit I fonourable and learned
friend, the Lord Advocate ; the Lord Advocate would have to sulmiit to
the ordinary j^rofessional conditions before he practised at the English
Bar.

Mr. DEAKIN : Is he not an English barrister ?

Sir WILLIAM ROBSON : No.

Mr. DEAKIN : The case I am taking is of an English barrister,
a man with the right to practise at the T^nglish Bar ; I put my strongest
case first — the case of a man fully qualified lo practise at the English Bar
and who has the riglit to appear in all the Courts. He goes out to one of the
dependencies beyond the seas and receives silk either before or after his
elevation to the office of Attorney-General, and in one or two cases I have in
mind held the office for some years. They come liack to England, and
although they are English barristers, practising at the English Bar, who have
been His Majesty's advisers over the sea

Sir WILLIAJM ROBSON: That is really a matter for the personal
disci-etion of the Lord Chancellor, and if the case of a Colonial K.C. who had
been Attorney-General and desired to practise at the English Bar were laid
before the Lord Chancellor, it would be a case that would appeal strongly to
his discretion.

Mr. DEAKIN : But even so, the resolutitm does not bear that out.
Whether anj'- cases have been before the present Lord Chancellor or his
predecessor I cannot say. Going a step furthei-. let me ;isk your con-
sideration for the barrister who has not been achn^tted to the l!lnglish Bar,
but is qualified in the Dominions, as we now call them, provided his
qualification is, speaking broadly, as good as that required by the Imis of
Court, who becomes l\ing's Counsel and comes to Great Britain. Should
he not l)e entitled to have his claims heard ? Although I quite admit this
is a matter for the personal discretion of the Lord Chancellor, it is one of
those cases in which there appears to be a distinction of status drawn
between the Colonial and the British professional man. Now ludess that
is based upon some real dilYerence in qualification or ujion some definable
distinction, it surely ought not to arise, as I have heard that it has arisen,
simply because a man who would imdoubtedly have received silk if he had
been an Englishman, has not received it

Sir WILTJAM ROBSON : There is no distinction as between Englishmen
and Colonists, none. You may accept my assurance on that point, because
tscdh. I i 'A

5t}2

Thirteenth Day. eveiy observatioji you are making applies equally to the Scotch and Irish
8 Maj- 1907. Bar. The Scotch and Irish Bar maintain their regulation against us, and we

maintain ours against them. We have certain restrictive regulations amongst

Reciprocity as ourselves even ; we do not allow the member of one circuit to practise in

Tu Barristers, another circuit, and we have all these restrictive regulations, which are

(Sir something quite outside any question between Englishmen and anyone

\\ ilham Rob.sou.) gQjj^jjjg fj-gm the Dominions beyond the Seas. It has nothing to do with that,

because whatever we did with regard to Colonists we should equally have to

do with regard to the Scotch and Irish Bar.

Mr. DEAKIN : Under similar conditions, most certainly.

Sir WILLIAM ROBSON : It is the generality of the resolution which
makes me a little apprehensive about it.

Mr. DEAKIN : However, if I have enlisted your sympathies in this
matter it is sufficient for the present.

Sir WILLIAM ROBSON : It will be very favourably considered by the
English Bar and the Lord Chancellor, and the ol)servations you have made,
which have apparently some personal reference, I should be very glad to put
before the Lord Chancellor.

Mr. DEAKIN : I have done it not for personal reasons, but because, as
you know, professional men all the world over are rather jealous of the status
they acquire, and if one of their niunber

Sir WILLIAM ROBSON: Without perhaps any definite resolution,
I will communicate with the Bar Council. 1 woidd ask the Conference not
to pass any general or sweeping resolution without much greater consideration
than we have been able to give to it.

CHAIRMAN : There is one more suggestion. We will put the
resolution Sir Joseph Ward has made on record as having been submitted,
and then reserve the whole thing. I do not think we shall get further.

Sir JOSEPH WARD : Under the circmnstances I am quite agi-eeable
to that course. The resolution will go on record as a suggestion.

Reciprocity as RECIPROCITY AS TO SURVEYORS.

TO Surveyors.

CHAIRMAN : And the subject can be reserved for further consideration.
As to the other case you, mention, the surveyors, there is really no difference
of opinion about it. In the paper you have from us we quite accept your
resolution.

Sir JOSEPH WARD : That is all right.

Mr. BRODEUR : The same objection will apply as far as Canada is
concerned to this proposal about the surveyors.

Mr. DEAKIN : That does not disqualify Sir Joseph Ward from moving
his resolution, or from its being carried. It only means that we representa-
tives of Federal Governments cannot take any official part in that.

Sir JOSEPH WARD : I will give you my reason in one sentence, but
there are many others I could give why I think this resolution should be put

503

on record. Wo liave cases in New Zealand of English surveyors who have Thirteenih Day.

come to our country for the purposes of healtli ; they have all the qualilica- 8 Mbv 1907.

tions necessary, hut they are not allowed to practice in our country as

Surveyors. I have reatl the UKMnoranduin from those responsilde for Recu-ko.-ity as

circuhiting it in reference to the matter of reciprocity for the protection of ''" SmvEvoRf!.

laud surveyors and architects, and all I can say in connection with this is that ^^ (®'^.

the principal surveyors in New Zealand all belong to the Surveyors' Institute, ""'^I" »'« ■)

which is not a mere gathering together of men controlled as explained by the

Act of Parliament, b\it they are most jealous of the privileges of the surveying

profession.

Mr. F. R. MOOR : I do not like to interrupt, Lord Elgin, but there
are only one or two delegates here now, and I would lik(^ to know what
has been done wdth respect to that previous resokitiou. It has not Ijeeu
put in any shape or form.

CHAIRMAN : The last one ? It Avas decided that it should be
recorded, and the only resolution upon it was that it should be reserved
for further consideration.

Sir JOSEPH WARD : What the New Zealand surveyors are anxious to
do is this. They want to prevent a man having to commence again, and go
over the wdiole gamut of the ordinary examinations, but they want him to
comply, by examination, with all the local conditions, local requirements, and
local regulations in the case of a man fi-om England.

CHAIRMAN : Is there any objection to accepting it ?

Dr. SMARTT: Before that is accepted, I should like to have the
opportunity of seeing some papers we have on the sul)ject, and I have not
got a copy here. I imderstand that what Sir Joseph Ward suggests is that
any surveyor who is qualified in New Zealand shoidd, under the reciprocal
arrangement to be authorised, if he has satisfied the aiithoritios that he has
the necessary knowledge of the local Acts or regulations which may be in
force relating to the survey of land, &c., be entitled to practise. As far as
I am informed, in the Cape Colony the surveyors' examination is an examina-
tion of a very high standard indeed, and deals with many matters besides the
mere surveying of land, and I would like to have an opportunity, befoi'e the
Conference came to a resolution upon this, to look at these papers.

CHAIRMAN : It is dealt with in the report from the Surveyor's
Institution.

Dr. SMARTT : I have not had an opportimity of reading that.

CHAIRMAN : I think you will see that there they propose to establish
an examination which would satisfy those conditions.

Dr. SMARTT : Sir Joseph Ward's resolution does not propose that. He
proposes that if a man is qualified as a surveyor in New Zealand, on showing
he has a knowledge of the Acts in force in the other portions of the Empire
in which he desired to practise he should have the opportunity of being
allowed to practise the profession of surveyor irrespective of whether there
was a ditt'erence in the standariis of the examination in the various parts of

I i 4

504

Thirteenth Dav. the Empire. That is a very important thin^ ; it is veiy much on the lines on

s Miiv iyj7. which the Solicitor-(leneral has been referring to, the reciprocity among

barristers.

Hecipuuoiti as

^'Dr.SnnmT' ^'^ JOSEPH WARD : I wonld only like to say that in New Zealand

land surveying is recognised as a profession as much as law, medicine,
engineering, or anything else, and it is not (which appears to be passing in
your mind) the possibility of a New Zealand siirveyor coming to, say. South
Africa, that I was contemplating. We can take hundreds of them in New
Zealand when we get them, but if they come from England they must
go through all the formal examinations that the\' go through here, and they
must conform with all the conditions of the Surveyors' Institute.

Dr. SMARTT : Would it mean thai thej- would have to xJi^^s ^^^
examination ?

Sir JOSEPH WARD : In local regulations.

Dr. SMARTT : If I am rightlj- infonned, our surveyors have to pass
an examination in other subjects besides the survey of land. You would
then have a surveyor coming in saying that he was acquainted with the local
conditions, and allowed to practise on much easier terms than those upon
which local men would be allowed to practise.

Sir JOSEPH WARD : That is not so.

Dr. SMARTT : I will look it up, if you do not mind allowing it to stand
■ till the next meeting of the Conference,
deals with more than mere land survevine;.

over till the next meeting of the Conference. I understand our examination

Sir JOSEPH WARD : This is only to affirm that reciprocity should be
established ; you cannot give effect to it without legislation.

Dr. SMARTT : Will you put it in the form of the other resolution, that
it should be favourably considered? The difficulty is the question of
examination. I am all in favour of having the examinations on the same
basis, so that they coidd go wherever they liked, but it is a very serious thing
to have one standard of examination for one Colony, and another man passing
with another standard in another.

Sir JOSEPH WARD : Have you read my resolution ?

Dr. SMARTT : Yes. " That reciprocity should be established between
" the respective Governments and examining authorities throughout the
" Empire with regard to the examination and authorisation of land
" surveyors."

Sir JOSEPH WARD: Read the last part "subject only."

(.TJAIRMAN : '■ Subject only " seems to me to be the difficulty, and
surel}^ what the Surveyor's Institution propose is that there should be an
examination or some means of examining a Surveyor in every part of the
world up to the pi-oper standard.

Mr. BRODEUR : The last part (jf the resolution simply deak uiili the
one part of the regulations which have to be passed in each province. In

505

our foimtry each |)rovim-e lias the right to (hnil with tlie noniination or Thirteenth Day.

appointment of certain surveyors, and they liave got different regidations 8 May 1907.

according to the province in wliich they are, and I snhniit that it would be

ini])ossil)le for us to pass any resohition which wouhl affect that. It is not Rech-kocity as

a matter whicli couhl be deah with by the I'Vileral Atithorites ; it can only '■'" Sukveyors.

be dealt with by the Provincial Authorities. C^""- Brodeur.)

Mr. J)]'2AKIX : Some of us are Federal and some are State.

Mr. iiUODEUR: Some are Federal, which deal with the lands which
are under Feileral control.

Mr. T)EzVKIN : Sir Joseph Ward is not a Federal representative but
what we woidd call a State representative, and so are Mr. ^loor, Dr. Smartt,
and General Botha. They are qualified to speak on these subjects, where
you and I are not.

Mr. BRODEUR : That is the difficulty in which we hnil ourselves.

Sir JOSEPH WARD : I understand, but as long as you put ^'•our
position on record you need not give effect to it except by legislation. They
have to eomjJy with the Local Acts.

Mr. BRODEUR : You would have to put your resolution a little broader
than it is at the end there " subject only to his satisfying the Ooverument or
existing examining authority of the Province or State."

Sir JOSEPH WARD : Very well -of the Province or Country or State.

CHAIRMAN : May I suggest that you would be satisfied with this
resolution: "That it is desirable that reciprocity shoidd be establisheil
" between the resjiective (loveruments and examining authoi'ities throtighout
" the Empire with regard to the examination and authorisation of land
" surveyors, and that the Memorandum of the Surveyor's Institution on this
" subject be recommended to the favourable consideration of the several
" Governments."

Dr. SMARTT : That meets it.

Sir JOSEPH WARD : Tliat may mean it coidd not be done at all.

CHAIRMAN : On the contrary, I iliink it is very practical.

Sir JOSEPH WARD: Very well.

CHAIRMAN : That has been circulated to the members.

Sir JOSEPH WARD : You leave out everything after what ?

CHAIR.MAN : After the word "Surveyors" and insert "and that the
" !Xremorandum of the Surveyors Institution on this subject be reconunended
" to the favourable consideration of the several Governments." That seems
to me a A-ery practical way of carrying out what you wish.

506.

Thirteenth Day. Dr. SMARTT : I sliould think that meets it. Our difficulty is the same

8 Mav 1907. as the difficulty of the Surveyor's Listitution of England. We are one of the

===■-=- few Colonies with a severe examination in connection with land surveying,

Reciprocity as not alone in reference to the mere survejdng of land, but in connection with

TO Surveyors, the Other matters referred to by the Surveyors' Institution, and it would not

do to allow the ordinary qualified laud surveyor who had not studied the

other subjects to come in and compete on even more favourable terms

than our people who had studied these subjects. It is not our desire to

prevent anybody fi-om any part of the Empire coming in so long as we can

ari'ive at a fair test.

Sir JOSEPH WARD : I am quite agreeable to accept that.

CHAIRMAN : AVill that do, Mr. Brodeur ?

Mr. BRODEUR : I do not think it would be possible for us to agree,
because it would be asserting a right which we have not got at all. The
Provinces have more rights than we have got ourselves.

CHAIRMAN : We are not saying that you have at any rate ; we only say
that it is desirable and we send up the paper for consideration.

Mr. BRODEl'R : Then we might add a clause by wliich this matter
be reserved for consideration.

CHAIRMAN: Yes.

Mr. DEAKIN : I quite agree with Mr. Brodeur that this is not a question
we are entitled to speak upon with authority. I spoke on the previous
question as a member of the legal profession.

CHAIRMAN : Shall we adopt it in that form ?
Mr. BRODEUR : Will you please read it again ?

Resuhitiou XVI. CHAIRMAN : " That it is desira])le that reciprocity should be established

p. ix. between the respective Govenmients and examijiing authorities throughout

the Empire with regard to the examination and authorisation of land
surveyors, and that the Memorandum of the Surveyor's Institution on tliis
subject be commended to the favourable consideration of the several
Governments." That sends it to everybody.

Mr. BRODEUR: Would that include both the Federal and the
Provincial Governments ?

CHAIRMAN : Yes, they are the examining authority.

Sir WILFRID LAURIER : That is a pious wish and nothing else.

CHAIRMAN : The subjects for to-morrow are Naturalization, the
Extension of 13ritish Literests in the Pacific, Imperial Cables, and there is
the Notice which Mr. Deakin handed in this morning ; he also wishes to refer
again to the organization of the Colonial Office, and I would like to get the
final decision of the Conference witli regard to the publication of the
proceedings. That as far as I know is everything except two tilings, one, a

507

Universal Penny Postage, on which I wish to know what Sir Joseph Ward Thirteonth Day.
wishes to do, and the two subjects which have been discussed at the Treasury a Mav 1907.

— Double Income Tax and the profit on silver coinage.

(Chairuiau.)

Sir WILFRID LAURIER : Then certainly we will not go through all
that programme to-morrow.

CHAIRMAN : A good many of them are quite short.

Sir Wn^FRID LAURIER : But a good many of them woidd be long.

CHAIRMAN : I do not know how we are to go through them any
other day.

Adjourned to to-morrow at half-past 10 o'clock.

508

Fo,„tee„th Day. FOURTEENTH DAY.

9 May 1907. —

Held at the Colonial Office, Downing Street,
Thursday, 9th May 1907.

Present :

The Right Houourable The EARL OF ELGIN, K.G., Secretary of State

for the Colonies (President).

The Right Honouralile Sir Wilfrid Laurier, G.C.M.G., Prime Minister
of Canada.

The Honourable Sir F. W. Borden, K.C.M.G., Minister of Militia and
Defence (Canada).

The Honourable Ij. P. Brodeur, Minister of Marine and Fisheries
(Canada).

The Honourable Alfred Deakin, Prime Minister of the Commonwealth
of Australia.

The tlonourable Sir W. Lyne, K.C.M.G., Minister of Trade and Customs
(Australia).

The Honourable Sir Joseph Ward, K.C.M.G., Prime Minister of New
Zealand.

The Honourable L. S. Jameson, C.B., Prime Minister of Cape Colony.

The Honourable Dr. S^rARTT, Commissioner of Public Works (Cape
Colony).

The Right Honourable Sir Robert Bond, K.C.AI.G., Prime Minister of
Newfoundland .

The Honouralile F. R. Moor, Prime Minister of Natal.

General The HuuouralJe l/)Uis Botha, Prime Minister of the Transvaal.

The Right Honourable Winston S. Churchill, M.P., Parhamentary
Under Secretary of State for the Colonies.

Sir Francis Hopwood, K.C.B., K.C.M.G., Permanent Under Secretary
of State for the Colonies.

Sir J. L. Mackay, G.C.M.G., K.C.I.E., on behalf of the India Office.

Mr. H. W. Just, C.B., C.M.G., \ r ■ , q , ■
i\i /i .T7- 1 ri M n > Joint oecrctaries.

Mr. G. W. Johnson, C.M.G., j

Mr. W. A. Robinson,

Assistant Secretary.

509

Also Puksknt : Fouriccmli Day.

The liight Honourable D. I.loyd Cteougk, M.P., President ol' the Board J .'

ol; Trade.

Mr. H. Llewellyn Smith, C.B., Permanent Secretary to the Board of
Trade.

Mr. A. WiLSox Fox, C.B., Comptroller-General of th(> Connnercial,

Statistical, and I^abour Dei^artnient ol' the Board of Trade.
i\lr. G. J. Sta.\li:y, C.M.G., of the Board of Trade.

The Right Honourable Sydney Buxton, M.P., Postmaster-General.

^Ir. 11. HvRiNQTON Smith, C.B., C.S.I., Permanent Secretarj' to the Post
Ullice.

Thn Right Hononral)le Herrkrt Gladstone, M.P., Secretaiy of State for
the Home Department.

Sir Mackenzie D. Chalmers, K.C.B., C.S.T., Permanent Secretary to the
Home Office.

Mr. J. Peddei;, of the Home Office.

The Right Houonrable H. Id. Asquitii, M.P., Chancellor of the
Exchequer.

Mr. W. Blain, C.B., of the Treasury.

IMPERIAL SURTAX ON FOREIGN BIPORTS. Imi-euial

SlU'l'AX <>\

CHAIRMAN: Gentlemen, the first resolution on the Agenda is one that Fokf.k-.x

was submitted yesterday hj Mr. Deakin. Mr. Lloyd George has ])een gooil lMi-<)itr<.

enough to attend at some inconvenience, as he is due in the House of
Commons at half-past eleven, so perhaps it wiU be possible to expedite the
proceedings as much as possible in order that he may leave.

Mr. DEAKIN .• Lord Elgin and gentlemen : In order to permit us to
enjoy the inestimable advantage of hearing the President of the Board
of Trade without any loss of the time at his disposal in listening to me, I will
confine myself in submitting this resolution, to a very few general remarks.
I think his cross-examination yesterday helped to elucidate the matter very
well. If I understand the position, what we have arrived at is this. Hi's
Majesty's Government for various reasons says that any consideration of trade
preference is impossible, that nothing is to be done in that direction. That
disposes of one of the Ijrauches of the means which we favour as tending to
promote Imperial unity — the same imity in times of peace and in industrial
matters as are necessarily required for self-preservation in times of war. From
the same motives, thei-efore, we now proceed to some allied propositions
which make for preference of British citizens by British citizens, of British
purchasers by British sellers, and of British consumers by British producers.
We gather generally that on this question, at all events. His [Majesty's Ministers
in this country have an open mind. Indeed, there were sympathetic references
made both by the Chancellor of the Exchequer and the President of the
Board of Trade to these other means of facilitating intercoiirse, increasing
iiiter-Inq)erial trade, and ol^taining tlu^ advantages which ilow from those verj-
desirable developments.

510

Fourteeuth Da
9 May 1907.

Imperial
Surtax on

FuREIGN
iMPOHTi?.

(Mr. Deakiii

We seem to "be agreed that something has to be done to provide
increased facilities for coimnunication by mail steamers, with their attendant
increased facihties of commixnication for travellers ; improved cable com-
munication which means cheaper cable communication and more of it ;
the lowering of such charges as those levied in the Suez Canal, with
which Sir Joseph Ward has exhaustively dealt, and kindred propositions,
•) which, raising no fiscal question, imply the extension and enhancement of
our present means of conuuunication and trade. The great advantage of this
development, especially of communication, is that it benefits both ends and
any intermediate dominions. It cannot be said that the Mother Country is
not herself most deeply interested in this question, even if for the moment
we looked upon the Mother Comitiy as severed in her special interests fi'om
her Dominions over the Sea. Here is the centre of all communication ; every
mode of communication has shares of its benefits and confers the gi'eater
share in this country. Consequently, the money expended on improving
means of communication, whether by ship or by cable, are directly to the
advantage of the industries and the people of this comitry. They are also
advantageous at the other end to our interests. Now, I think, in matters
of commixnication our differences in population are measured by the propor-
tionate gain which accompanies them, or, in other words, that the expenditure
of the Mother Country in such matters, if in proportion to its population,
would at least be met by proportionate benefits fi'om this means. So also
in the case of cables and of the general charges imposed on British
commerce, not only those levied at the Suez Canal, but any others which tend
to diminish the full use of present ox^portunities. They may be assessed
either by population or trade. Having got to that stage, the next question
is : How shall such propositions be given effect to ? How shall they be
realised ? What concrete shape shall they assume ? It has always been
possible for individual Dominions, or several together, to approach the
British Government or each other in regard to postal contracts, or in
relation to cables, by going the length even of State ownership to provide
for conjoint action. I think that on the whole, speaking generally, the postal
contracts which have been made have been well worth the money expended
upon them — exceptions excepted — and that they still continue to be well
worth the money spent upon them, although the mere postal interest is, if
anything, less than it ever was before. It is always tending to become less,
so great are the other advantages associated with the use of swift and
up-to-date steamers with their atlvantages for the travelling of persons and
for the carriage of goods which can afford to pay rather liigher freights.
These count really for very much in modern postal contracts. We have come
to that stage when I understand His Majesty's Government are j)repared to
consider propositions of this sort, but if they are considered only in an
individual fashion with the particular Dominions concerned, we shall have
made no advance on the methods which have been employed for many years
past. Surely the opportunity has come when we can make a real advance
on those methods. Without this Conference, and without more than a
general discussion, something may be done now to help us all after this
Conference. Is not our duty to seize the opportunity while we are here
to consider the means by which the consideration of inter-Imperial business
questions may be made more pressing and immediate as well as practical ?
This resolution suggests one means to that end — the means originally
proposed by Mr. Hofmeyr, afterwards further developed by Sir George
Sydenham Clarke, and I think further simplified in the proposal which I now
lay before this Conference. This implies first of all some fmid out of which
we can finance any useful general agencies. Next, after creating a fund,
although that inverts the usual order of proceedings to some extent — while
obtaining it you draw your representatives together for the special purpose of

511

dealing in a simple business fashion with a series of business propositions Founei-ntli Day.
which may refer to any one of the things I have mentioned, or to any 9 May 1907.

other projects of the same character which are regarded as of Imperial '

importance, and to which two or more governments, counting the United v, .'!''"".'^''

Kingdom and the parts of the Empire represented, may be al)le and may desire ' i,',,Kri,i^;

to coiuliine for the common good. The representatives will meet for tliat 1mi-uui>.

practical purpose, sift these business proposals from a business standpuinl, (^^ir. Duakiu.)

closely examine their cost, carefully consider the returns to be obtained,

and look at all the associated consequences, and then prepare schemes,

some of which will interest only the United Kingdom and a particular

dominion, others the United Kingdom and two or more, others can perhaps

be devised which woiJd interest them all. Then those propositions require

to be submitteil to the Legislatures affected before they can be endorsed. So

that what we get is, tirst of all, a fund ; next the expert consideration on a

business basis of the means of employing that funtl. So when the several

Parliaments came to deal with it they would be fuUy equipped to judge

these propositions, to accept or reject them as they please, or perhaps

modify them by referring them back, the proportionate contributions of each

being scrutinised by each party. It is not necessary to work that out now in

detail. At all events, we should be face to face with the certainty of having

money to spend for Imperial purposes, and practical proposals how to spend

it after thorough examination had satisfied the different Legislatures. 1 can

see no interference with self-government, or with fiscal policy. First of all,

the amount suggested by Sir G. Sydenham Clarke is only one per cent., and

that amount need not be levied on the goods, but provided by contriljution.

Mr. WINSTON CHURCHILL : By subvention.

Mr. DEAKIN : Yes, so that the fiscal question cannot possibly arise.
I see the President's estimate yesterday was quite correct. It is reckoned,
roughly speaking, on a recent year at 4,G00,U0U?. — it would be higher this
year when every return is higher — but, taking it roughly, four and a half
millions one year with the other, as a rule, wovdd be likely to be made
available on that scale. You are not obliged to spend that each year, but
could carry it on, if necessary, and accimiulate it for a particular purpose,
either for a series of expenditures year by year for the one purpose, or by
a capital outlay. I need not go into details. I think I have made the general
sense quite plain. It is to bring us to a point, if possible, and to give a
positive character if we can and a direct impulse to these means of action
alreadj' approved by the Government. I think there is a great deal to
commend this, or I shoidtl not lay it befoi-e the Conference. Allow me to saj
that not only have I no proprietary rights in the proposition, but if I hat
I should recognise that this was not a developed plan to stand upon at all.
Any amendment which will make it more effective, and any reshaping of
it which would accomplish the same end, Avould commend itself to me. It
would only then become a qiiestion of degree, which was the speediest and
most practicable form to give it. I am not wedded to it. But we do want,
as it seems to me, some means of concentrating the consideration of all the
legislatures upon these Imperial problems.

Mr. LLOYD GEORGE : I should like to know something about your
idea of the administration of the fund.

Mr. DEAKIN : If the contribution of a particular Dominion were so
many hundreds of thousands of pounds, shillings and pence, the arrangement
would not 1)0 that that amount should be spent merely wpon the Dominion
in question, but the principle observed would be that practic-ally to all intents
and purposes each community woidd control and see expended the amount uf
its contribution with its own consent.

J

512

Fourteenth Duy.
9 May 1907.

iMPEKrAL

Surtax ux

FoRElftX

Imports.

Mr. WINSTON CHURCHILL :
among " Imperial purposes " ?

Do you include Imperial defence

Mr. DEAKIN : Not these Imperial purposes, though that was the
original proposal. Mr. Hofmeyr put Imperial defence first. That was after-
wards deflected to industrial proposals of this sort, because defence was found
to raise a great many difficult questions ; even so ardent an enthusiast for
Imperial defence as Sir George Sydenham Clarke abandoned that side of the
proposal and devoted himself to this kind of proposal. My idea, therefore,
is that practically the whole sum contributed by the United Kingdoni should
be disposed of by the Parliament of the United Kingdom as it approved
schemes, speaking roughly, to that extent. Certainly none of its money could
be expended on anything else without its consent. Without requiring the
fund to be kept to a shiUiug or a penny, each Parliament would control its
own contribution and require to give its own consent to its use.

any

Mr. WINSTON CHURCHILL: Supposing the contributions of
particular parties to this agreement were not expended in a g
year.

Mr. DEAKIN : Carry them forward.

Mr. WINSTON CHURCHILL : Or supposing a proposal was made that
they were to be expended in a particular way, and the Parliaments refused to
ratify it, the sum would be carried over and roll on.

Mr. DEAKIN : Accxunulated until some project was arrived at which
met with the approval of that particular legislature or until the agreement to
make such a levy expired. This is very far fi'om being an Imperial federa-
tion, very far from creating a body having authority either to raise money or
spend monej' after it is raised. It is quite apart from any proposition to
interfere with self-government. I admit that at once, and also admit that any
endeavour to bring about co-operation in this way, when a number of legisla-
tures are concerned, is open to aU the criticism suggested by onr knowledge
of the difhcidty of getting them to act together. But we give them at least a
means and motive to act together ; we bring proposals before them and put
the responsibility on the proper shoulders. We enable their electorates to
say Avhether they will refuse to combine for Imperial purposes or not. We
cannot do more than appeal to the people and the legislatures, and put the
responsibility on those who decline to co-operate. As it seems to me, the
great value of this proposition or any similar proposition is first, that it
points to action, and next, to practical action. It favours immediate action,
and if that action is not taken and that co-operation is not brought about,
it puts the responsibility on the right shoulders. Let us know which are the
peoples who refuse to act and why they refuse to act with their kindred.
These are business propositious, and will have no party character. To
cheapen a cable or make a new cable, establish or not establish a new line
of steaniers, are business propositions which do not involve any party quarrel
between the legislatures or parties concerned. They can only say, " this is not
" sufficiently remunerative ; that is not sufficiently practical ; we are paying
" too much for it ; here is a better scheme." The whole consideration would
turn upon questions of pounds, shilliugs, and pence. Such px'ojects would
not involve fiscal policy or impair self-government, but provide a means for
common action, and in that way bring pressure to bear in favour of action. I
do not discuss who pays the tax, how proportions are to be established, or

51

o

anything about all those questions of detail. But, in order to i'ldlil my Fourteenth buy.
uutlertakiug, I conclude with this brief exposition, and will answer questions 9 May iyo7.
as weU as I can, if asked to make it complete.

Imi'ekial

Mr. LLOYD GEORGE: Lord Elgin, antl gentlemen, I am exceedingly Fokei.;.\

obliged to Mr. Deakin and the Confei-ence, for allowing me to take this iMfonri-.
matter first, because I have my Patents Bill in the House of Commons, and (Mr. Deakin.)
have to attend to the piloting of it through Committee.

The Chancellor of the Exchequer, in his speech last week, stated yery
clearly that the Government were quite prepared to consider, and to consider
favourably, with a view to action, any workable sclieme for improving
Imperial inter-commimications, and I understand that this proposal of
Mr. Deakin's is a response to the appeal Mr. Asquith made for a workable
scheme. As Mr. Deakin has put it, it is a business proposition.

The first thing I point out — as he has already pointed out in reply to
Mr. Churchill's question — is that this is not exactly Mr. Ilofmej'r's proposal,
and 1 do not think it is Sir George Sydenham Clarke's proposal.

Mr. DEAKIN : No ; both of them had in mind an Imperial Council.

Mr. LLOYD GEORGE : Yes, but from another very important point of
view Sir George Sydenham Clarke's proposal, and Mr. Hofmeyr's, were, I
thought, more or less on the same lines. I understand that they proposed
that a fund should be raised for Imperial purposes, hut iirst amongst the
Imperial purposes they placed the question of Imperial defence.

Mr. DEAKIN : Sir George Sydenham Clarke, in the latest development
I have seen of his proposal in one of your reviews,-'- withdrew the proposal for
defence altogether.

:\lr. WINSTON CHURCHILL : Do you know what reasons he gave ?

i\Ir. DEAKIN : The note I have of what he said was " that the
" difficulty of dealing with naval defence on an Imperial l)asis is very great.
" The Na\y alone stands in the position of being a ubiquitous guardian and
" a proof of Empire, but its functions are inadequately understood at home,
" and far from being realised in greater Britain and tlae idea of an Imperial
" Navy to which all contribute, nuist, for the present, be abandoned." That
was said in a speech when he was Governor of Victoria, at Melbourne.

Mr. LLOY'D GEORGE : I only point out that Imperial defence was an
essential part of the scheme put forward by Mr. Hofmeyr, and I thought by
Sir George Clarke when he proposed a levy of this kind. Otherwise they
would not have dreamt of raising a sun-i of 5,000,000/. merely for the purpose
of cables and matters of that sort.

Mr. DEAKIN : I merely suggest 1 per cent, as he did.

Mr. LLOYD GEORGE : But that is a rather important element for us.
If Imperial defence were part of the scheme, it would be an admirable
business proposition for us, because the contribution of the Colonies in

• See "Nincicentli Century," Mi»y 1904, p. 70".
E 4iiGt>iJ. K k

514

Fourteenth Day.
9 Mav 1907.

ImI'EKIAL

Surtax ox
Foreign
Imports.

(Mr.
Lloyd George.)

proportion to popnlation is something like one third of onrs. We, at the
present moment, are contributing about 33,000,000L to the Imperial Navy.
I forget what the Colonies are subscribing ; it is something like half a million.
So, as a business proposition it would be a very admirable one for lis
because, if the money is to be brought into a general fund, and we are to
divide it in these proportions, we should get about seven or eight millions of
money out of it towards Imperial defence. But that I do not gather to be
Mr. Deakiu's idea, which is that this money should be spent purely for the
purpose of improving transport communication and cables and matters of that
kind. That is a very desirable object in itself, as I have already stated, but I
do not want to enter upon that again ; I adhere to everything I said
before. Mr. Churchill points out, too, that the establishment in the Colonies
of a service corresponding to our consular service in foreign countries
is another scheme which has for its object the development of the trade of
the Empire as a whole. But what does this proposal of Mr. Deakin's reaUy
mean? It means that the United Kingdom would contribute 4,500,00(,)L
My figure was correct yesterday, but I over-estimated the contribution of
the self-governing Colonies, and I find that the Australian Commonwealth
would contribute 100,000?., New Zealaiid 20,000/., Caua.la 400,000?.—
although the population of Canada is only about 1,500,000 above that of the
Commonwealth, they would contribute four times as much — Newfoundland
would contril)ute 6,000L ; Cape Colony would contribute 40,000?. ; Natal
would contribute 26,000?. Now, it is obvious that is not merely an unfair,
but a grossly unfair, contribution as between the Mother Country and the
Colonies.

Mr. DEAKIN : But each spends its own money.

Mr. LLOYD GEORGE : And it is also an imfair distribution of burdens
as between one Colony and the other.

Mr. DEAKIN : Each spends its own money.

Mr. LLOYD GEORGE : We do that now, and are doing it now. We
are spending .33,000,000?. upon Naval defence. As I said Ijefore, we are
willing, if thei'e is a working scheme put forward, to assist in developing
communications. Bi;t this seems to me to be an unfair, unjust, and unbusiness-
like response to the appeal made by the Chancellor of the Exchequer.

Mr. DEAKIN : Although you vote your own money for your own
purposes ?

Mr. LLOYD GEORGE : But then I do not see the object. Either this
means what it says, or it does not. We are to pay 4,500,000?. and the Cape
40,000?.

Dr. SMARTT : The foreigner pays, and we do not.

Mr. LLOYD GEORGE: If we really drag the fiscal question into it, I
do not think we shall come to an end. You are to find 40,000?., and Canada
is to find 400,000?. You may depend upon it, if you or Canada thought you
could get an extra 40,000?. or 400,000?. out of the foreigner, surely you would
try to get it. I do not doubt that at all. But no doidit you have, already gone
to the limit — tlic highest point at which you thiuk that revenue is consistent

515

witli imposing burdens on somebody else. However, I do not want to enter
into that.

Now, take the benefits to be derived out of it. I am c-crtain there would
be a very considerable beueiit to the Empire as a whole ; we would l)enefit,
the Colonies would benefit, each individually, and the Empire, as a whole,
would be the richer for it. T am coulidont of that. But the experience of
Canada has proved that, while preference has undoubtedly stimulated trade
between the ^fother Country and the Dominion, the relative effect on
Canadian export trade, as a whole, has been much greater than that on the
export trade of the United Iviugelom. The only ailvantage of this proposal,
if I may say so, is this : I think that it is useful as furnishing almost with
mathematical precision Mr. Deakin's ideas as to the proportion of the burden
of Imperial jireference which shoukl l)e borne by the Mother Countiy and
by the self-governing Colonies respectively.

Fourtoontb Day.
9 Mav 1907.

Ihpekial
Slrta.k ox

FoKEIIi.N
l-MI'OKT.S.

(Mr.
Lloyd George.)

Mr. DEAKIN : Pardon me, 1 do not think it has the slightest relation

to it.

Mr. LLOYD GEORGE: This is how it works. We are to contribute
4,500,000/. ; the self-governing Colonies are to contribute all of them put
together under 600,000/. I said yesterday we should have to put down 5/. for
every 1/. the Colonies put down. I was -wrong. We should have to put down
71. 10s. for every 1/. provided by the Colonies.

Mr. DEAKIN : On this year's returns or what year ?

Mr. LLOYD GEORGE: On the returns of 1905. That I think is a
very unfair and improper proportion for the Mother Country to be asked to
bear. 1 mean that we should get half the benefit Avith sevenfold the burden.

Mr. DEAKIN : Who said haK the benefit ?

Mr. LLOYD GEORGE : Preference invariably means that. It is a
greater development for the trade of the Colonies than for ours. It would
be an advantage to us, but not the same advantage to us as to the Colonies.

Mr. DE^AKIN : Surely you are applying your reading of one particular
preference l)y means of reduced duties in your favour, to cable services, mail
services, and services of that kinel imdertakcn each on its own merits. There
is no propoi'tion and no connection one with the other.

Mr. LLOYD GEORGE : I am perfectly certain of this : it would mean a
good deal more for the trade of the Colonies than for us. I am not putting it
as an argument against you, but on the contrary as an argument in favour
of it.

Mr. DEAKIN : A cheap cable service cannot mean jus
value to a small dominion as to this country.

as luuci

in

Mr. LLOYD GEORGE : No, it means that we should shift our trade
very largely, and I think that would be an advantage from the Imperial point

K k 2

516

Fourteenth Daj.
9 May 1907.

Imperial

Surtax on

Foreign

Imports.

(Mr.
Lloyd George.)

of view. Instead of trading to a certain extent with, for instance, the
Argentine, we shoukl trade with you. The benefit from the Imperial point
of view would be great. You would develop your trade enormously. All I
say in a proposition of that sort is that you ought to contribiTte at any rate
equally — I am not putting it higher than that.

Dr. JAMESON : You are going to take the trade by this proposition
from the Argentine to the British Colonies. By so much as you transfer it,
the less will be the money you will pay to this fund, the fund will be smaller.

jMr. DEAKIN : That is another point.

Mr. LLOYD GEORGE: But to what extent ?

Dr. JAMESON : Exactly to the extent you say.

Mr. LLOYD GEORGE : To the extent of one per cent. Our imports
of manufactures would be practically unaffected.

Dr. JAMESON : It is on the manufactures you introduced into this
country.

Mr. LLOYD GEORGE : Yes, practically unaffected by a proposal of this
kind.

Dr. JAMESON : That brings in the point that you will probably make
them yourselves.

Mr. LLOYD GEORGE : That is quite a different question.

Dr. JAMESON : Not different, merely a bigger part of the same
question.

Mr. LLOYD GEORGE : But the proposition as it stands at the present
moment, is that we shoi;ld, if we prefer it, make an eqiiivalent contribution
instead of levying one per cent, on our imports from foreign countries.
That means upon the present basis of our fiscal policy a contribution of
4,500,n00L as against 600,000?. by the self-governing Colonies. I do not
think the thing is workable for a moment.

Mr. DEAKIN : May I say that I am not altogether surprised at the
nature of the reply, but entirely surprised at the line of argument which
has l^een pursued. I have never heard more fallacious and transparently
inapplicable comparisons applied from one set of circumstaiices to a
different set of circumstances than I have just listened to. I must
say that to attempt to take the consequences of alterations in our several
schedules of duties as a measure of what you are to gain by some
amknown and yet undefined mail service or cable service improvement, a
reduction in canal dues, or anything of that sort, is perfectly futile. If
such reasoning carries conviction to anyone, it certainly does not to me.
I laid no stress upon the particular amount of 1 per cent. I took that
from Sir G. Sydenham Clarke for the purposes of launching the proposition,
as I thought I carefully explained. But the worst fallacy of all is, that
because each country is to dedicate a certain amomit towards Imperial
purposes, therefore, of course, there must be some proportion either of
population or other proportion between those amounts. There is no necessity
for any proportion whatever in the amoimt paid by each to its fund while
that fund remains, as I said, under the controlof the people who raise it and

517

who spend it only as thov think lit tor their own interest. IT llioy do not Fouiteemh Dav.
tliink a project is in their own interest, they do not spend it ; il' they ilo thiidc 9 May 1!»07.
it is lor their own interest, they spend what may he necessary upon it. 'i'hey ~

di) that only when they Iielieve the benefits to be gained will reward them lor Sukta.v o.v
their own investment of their own I'nnd. FuuEUix

Imi'out>.

Mr. WIXSTOX CHURCHirJ. : But meanwhih> they wonld have to raise (Mr. Deakiu.)
the snin of money everj- year b}' the taxation of the year, and if they did not
spend it, it would accunudate steadily in a fund.

Mr. F. li. MOOH : Why accumulate it? You could earmark it.

Mr. Dl'LVKIX : I have only put forward this method of arriving at an
Iniix'rial fund in a tentative and experimental way. As I thought I took care
to say, I am not wedded to this particidar form of contribution. What I want
to see are fniperial contributions for Imperial ]Mirposes, to be approved In-
each Legislature, and I tak(> it that the fact thai each Legislature had to give
its api)roval to the (>xpenditure of its own money is quite a sufHcient
guarantee that it will be expended fairly according to the judgment of those
composing that Legislature. Jn fact, that is the way we spend all our money
now.

Mr. WINSTON CHURCHILL : Then, under your proposal, there would
1)6 no obligation for any of the parties to the union to make any payments in
pursuance of the agreements into which tliev have entered.

Mr. DEAKIX : The obligation on each party Avould be to set apart
whatever sum was mutually agreed upon for Imperial purposes for a given
period, or luitil the arrangement was altered by consent. That wouhl be
l)inding for the period named, but whether any or all of that fund shall be
applif^l, to what purpose it shall be applied, and in what proportion as com-
pared to the other contrilnitors it shall be applied, would rest wholly under
the control of the Legislature concerned. So that this proposition would
do nothing more, if adopted, than indicate one means by which revenue
might be raised for Imperial x>in"poses by all the Dominions, unless they
chose to substitute equal subventions ; I do not put it any higher than that.
I said this or some similar ])roposal would give you an Imperial fund for
business purposes that would lie ileait with in a ])usiness-like way. When I
have said that, it seems to me I have disposed of the whole of the argument
of the President of the Board of Trade. He persists in assuming that I
propose that these Legislatures shouhl in some mysterious manner be moved
to vote their own money for unbusiness-likc^ proposals and in unfair propor-
tions. We are to get all the benefit and the United Kingdom is to l)ear all
the loss of all our agreements whatever they may be. 1 had no such pro-
position in my mind, and would not support a proposition which would
work out in that fashion. It is left to each Legislature to decide how
they should spend their money, and how much money they should spend.
What better security can there be ? Again, even if the argument had
discovered a defect in the particular system of raising the money, il does
not point to a defect in the principle I am concerned to maintain. This
is, that if we remain as we are, dependent upon iiulividual negotiations
])etween one or two governments concerned in oci-asional arrangements, we
shall be in no better position after this Conference than we were liefore it.

I have sidjuiitted this in order to see if we can discover some means by

which an Imperial fund may be raised for Imperial purposes, without

diminishing in any way the self-governing powers of the diilereut dominions.

Thej-- are to remain just as free and independent in their financial control

48f;Gs. K l< ;?

518

Fourteenth Day.
9 May 1907.

Imperial

SfJRTAX ox

Foreign

Imports.

(Mr. Deakin.)

of tlieir portions of this fund as they are now. These portions would lie
earmarked as the total fund would be earmarked. No one else could poach
upon it. But they would have the impulse of a common Imperial movement
and the control individually of a collective Imperial fund, if such can be
raised, and then the responsibility tirst of sending their representatives to
consider business propositions in a business-like way, and then of adopting,
rejecting, or amending these propositions. What is there unfair or uncon-
stitutional in that ? j\lay I once more say that the whole criticism of the
President of the Board of Trade assmnes the most unljusiness-like propositions
to be considered in the most unbusiness-like way, and voted for by the several
legislatures affected to their own undoing and for their own loss ?

Sir WILFRID LAURIliR : Lord Elgin and gentlemen, this proposition
to me is not new at all. It is quite familiar. It is the old Hofmeyr proposal
with a new suit of clothes on, and the modification which has been intro-
duced by Mr. Deakin does not alter at all the fact that this proposition has
been now for some 15 years before the British Empire and has not commended
itself, so far as I know, to any one of the component parts of it.

If I understand the meaning of this resolution aright, it would simply
mean this — Mr. Deakin will correct me if I am Avrong— and this seems to be
the logical consequence of it, that it would imply that the British Govern-
ment woidd have to pay a diity of 1 per cent, upon their imports, and that
it would be left to the other legislatures to supply the same amount if they
please.

Mr. DEAKIN : No, the intention is that any member,
Kingdom, or any other, could make an equivalent contribution.

the United

Sir WILFRID LAURIER : Exactly, but what is to determine the
eqnivalent contribution if it be not the contrilmtiou of the United Kingdom ?

each.

Mr. DEAKIN : A calculation of 1 per cent, upon

the foreign trade of

Sir WILFRID LAURIER : Exactly, but it is not a calculation. This
resolution is : " This Conference recommends that in order to provide funds
" for developing trade, commerce, the means of commtmication, and those of
" transport within the Empire, a duty of 1 per cent, upon all foreign
" imports shall be levied or an equivalent contribution made by each of its
" Legislatures. After consultation between their representatives in Conference
" the common fund shall be devoted to co-operative projects approved by the
" Legislatures affected with the general purpose of fostering the industrial
" forces of the Empire so as to promote its growth and nnity." What is to
determine this equivalent to be contributed by the different Legislatures, if it
be not implied by the contril)ution of the 1 per cent, levied by the United
Kingdom. The United Kingdom would levy 1 per cent, upon its imports
which would produce so many ndllious— 10,000,000?., 12,000,000?., or
20,000,000?. — and then the Legislatures would contribute an equivalent to
that. That seems to me a very serious objection to this scheme.

I pass from this consideration and say that in its shape I do not think it
could be acceptable to anybody here. But I look now to the purpose which
Mr. Deakin has in view of creating a general fund. I objected the other day
when the matter was brought to our attention that in Canada we woidd not
touch our tariff at all. \\'e have just spent consideral)le labour upon it, and
would leave it as it is. But Mr. Deakin says : " Then contribute as you
please." There is objection to it, as I pointed out. I do not see what
amount we are to contribute to tliis matter ludess we take the contribution of
1 per cent, by the British Treasury by means of this imposition.

519

I como now to tho second part. You want to create an Liiperial fund.
If Mr. Deakin permits me with all deference to say so this is a very liazy
proposition to create a general fund for certain purposes, indefinite, undeter-
mined, and as to which we shall have to cudgel our brains as to how to
employ the money thus raised. I prefer to come directly to the i^oint. There
are Imperial projects of magnitude which we can consider. Cables are one ;
improvement in navigation is another. If we agree on this particular point
before we sei)anite that it woidd l)e an advantage to create more cables and
add to the cables we have already or extend the Imperial cable we have. For
my part, I am quite ready to consider the proposition that each of those
interested at all events — perhaps South Africa or other parts would not be
— should agree to contribute a certain amount. Or if you have a scheme,
for instance, for improving navigation and communication between all parts of
the British Empire, a scheme which seems tome most worthy of consideration,
it Avould be a stronger bond of union at the present time than anything we
could devise. If we had a rapid up-to-date line of communication l)y which
we combined the whole of the British Empire here represented, it woidd do
more towards unity than anj'thing you can devise. I'or anything of that sort
I am prepared to say — and iho, people of Canada will be ready I am sure to say
so too —that we will put our hands into our pockets for the promotion of such
an object, as would Aiistralia also, and New Zealand I l)elieve. Therefore I
say it is better to come directly to an issue, and take the cable issue, say, this
year, another issue next year, and so on. But I cannot agree with the
proposal of Mr. Deakin, and I give my view in all frankness on this
matter.

Sir JOSEPH WARD : Lord Elgin, and gentlemen, mj' sjnnpathies are
entirely in the direction Mr. Deakin is urging, and I want, with him, to do
everything in my ])ower to assist in the bringing about of preferential trade
within the Empire, because — and I do not want to go over the same ground
again — I think it is in the best interests of the Empire. The more I think of
it, the more I do not like the idea of a surtax, for more than one reason.
Why ? Under this proposition, if 1 per cent, surtax were levied, it would
bring from New Zealand 20,000?. a year. From the point of view of
assisting in l)ringing New Zealantl into closer union with the Old Coimtiy, in
my view, 20,000/. a year is a mere drop in the bucket, and quite inadequate,
so instead of 1 per cent, as our contribution we would probably have to have
5 per cent, or 2.V per cent, to produce something greater, whether that be
50,00OZ., 60,0()OL' 70,000L, or perhaps 100,000i. a'year, to do what we require
to do in connection with the important matter of shipping connect it)n alone
in order to bring our country closer to the Old World. Once I, as repre-
senting New Zealand, commit myself to this proposition of Mr. llofmcyr's,
or rather Mr. Deakin's altered one, lam going to embark in an unknown
future undertaking as far as New Zealand goes, with the undoubted sequence
to this proposal of a higher rate than 1 per cent, being imposed upon our
country. I am not prepared at present to do that. In New Zealand, we
have had some experience of surtaxes. I recall right back in my own
early history in Parliament in our own country the fact that the Ciovernment
of that time imposed a 21 per cent, overriding duty npon all articles imported
into the countrj', dutiable and fre(% for the pui'pose of assisting the revenue

most disliked tax. Thony;h there was not univ(>rsal

Fourteenth Dav.
9 May 1907.

uid no departure from the i^rinciple of those who held
was looked upon probaiily as an expedient and at the

)een in operation twelve months

generally. It was a
approval given to it,
Free Traile views, it

time necessary thing to do, but- it liad not

when all sides were very strongly opposed to it, and the Government of the
day had to take the tax oif. It was one of the first things the Government
of which I was a member then, and am now, had to remove. Having
supported the putting into operation of that surtax in New Zealand, it was

K k I

Imperial

SUKTAX ox
FoKEIGN

Imi'urts.

(Sir
Wilfrid Laurier.)

520

Fouiteenth Day.
9 May 1907.

Imperial

Surtax on

Foreign

iMI'OnT^.

(Sir
Joseph W ard.)

found to be exceedingly nnpopular amongst the mercantile and farming world
and amongst all classes in our country, and we had to take it off. I take
these figures given by Mr. Lloyd George for the i^urpose of my argument.
No doubt they are perfectly correct ; 20,000L a year for a contribution to a
fast mail service from New Zealand to London would be quite inadequate, and
instead of 1 per cent. I am perfectly certain our Colony would have to
make provision for a very much larger charge. I am not discussing the
principle, but the working of it out from the point of view of what I can
foresee would arise in New Zealand. Another thing why I do not like it—
and this is the point which, since it was mentioned yesterday, has been
passing through my mind from time to time. We have already in New
Zealand imposed a higher duty against foreign importations than against
British on certain articles, ranging from 20 per cent., and some articles are
admitted fi-ee from England with a duty put against things from foreign
countries on our free list independent of that. We are anxious to turn the
current of foreign trade to Great Britain and the Colonies. In this next
session of Parliament, to Avhich I am going back, we are submitting the
revision of our customs tariff, and this policy will underlie our tariff to
some extent. If avb succeed in stopping the importation of goods from
foreign countries wdio give us nothing in return for Avhat we do now^ in
the way of remission of duties, by treaties, or anything else, upon whom
are we going to levj' our 1 per cent, or whatever we decide to put on in the
way of a siu-tax ? We are going to put it every time against the Britisher.
The object Mr. Deakin has in view I am in sympathy with, and would
sincerely like to be able to support him in this proposal, but it would, as it
occurs to me, have an injurious effect, and as it struck me Avhen first I heard
the proposal here I really do think it would tell against us in the advocacy
of preferential trade with different portions of the British possessions in the
future.

I think we ought to have something definite if possible before we
leave this Conference upon the important matters of inter-communication
and other subjects I referred to, and I should like to hear the British
Government say they are prepared to provide, say half a million of money
as a contribution towards these matters, the Colonies in turn coming in
with a fair proportion, the whole amount not to l^e put wp unless we gave
our fair proportion toAvards bringing about an Imi^erial and Colonial mail
service, improved cable service, and so on. With all deference to those
responsible for the outAvard traffic from England through the Suez Canal to
the Colonies, I suggest it woidd be a good thing to have a bounty system or
something of the kind, or a percentage of contribution to the steamers
carrying cargoes. I am not suggesting anything in the matter of passengers
because I think the practical side of getting our products through the Suez
Canal is altogether of greater importance than anything else Ave can suggest.
If Ave could give a tomiage contribution of some kind so as to make it
possil^le for these tramp steamers to work Avith Australia and Ncav Zealand
through that canal — a contribution by Avay of liounty if you like — I think
Avould be a very fine thing to do. If the British Government Avould say
that in order to ensure a material reduction in the cost of cabling to
Australia and Ncav Zealand they Avould divert all their traflfic to the Pacific
cable for a period, provided it AA'as done at a certain rate, and if the other
companies Avould come down to the same rate, a division of the biisiness
could be given from the Avhole of us, and if a giiarantee against loss to the
shareholders in the Eastern Cable Company were given by the respective
Governments, and of course to the Pacific Cable Company, Avho have
giTaranteed the money for the Pacific calile, you Avould be in a position to
get low rates and be able to do an incalculable amount of good.

I knoAv l\Ir. Deakin's sincerity and earnestness in trying to bring about
ImperiJil unity in the way he has advocated, and I am anxious to see

521

something done; but I sec difficulties from the point of view of New Pouneeuth Daj.

Zealand, and I would suggest to Mr. Deakin, as we have had unanimity 9 ^^y 1907.

from the Colonies so far, that having elicted a discussion on this matter it — —

would be better not to take a vote. I do not want to vote against him ; but Imperial

from my knowledge of the way a surtax has operated in New Zealand and the '^fokekjn^

imcertainty of my colleagues' views upon the matter as well as of the New Imi-okt-.

Zealand ParlianuMit I am not prepared to act in regard to a proposal which /^j^

has a great underlying principle in it, that is this overriding system of Joseph Ward.)
taxation, I would not myself feel justified in supporting it. I am sorry I
have to dissent from Mr. Deakin in this matter, but it is inevitable.

Dr. JA^IESON : Lord Elgin and gentlemen, I am not going to dissent
from Mr. Deakin. I am fully in sympathy with everything he has said here
on the subject ; but at the same time it is quite true, as Sir Wilfi'id Laurier
said, this is too hazy and too complicated. I take it what Mr. Deakin had in
his mintl was to try to take some practical step forward.

Mr. DEAKIN : Yes. If not this, what is the alternative ?

Dr. JAMESON : We listened with the greatest pleasure to the extremely
sympathetic speech from Mr. Lloyd George Avhen he had to emphasise what
the Chancellor of the Exchequer had already told us, that our pet idea must
be al^andoned, luit that there were all kinds of subsidiary matters that would
help in the same direction. What I was waiting for was some practicable
scheme about the subsidiary matters, and still more for some practical
suggestion as to the amount of money which was going to be put up to carry
oiit the practical schemes, and no doul)t Mr. Deakin having running in his
mind these two practical propositions, brought this forward as a possible
scheme for getting the money to do some of these subsidiary things which are
proposed, and which we do not believe, but know, will help towards
our ideas.

Mr. LLOYD OEOIIGE : You must have a scheme ])efore you consider
the money part of it.

Dr. JAMESON : It is a very useful thing to have a fund to draw upon
for any scheme.

Mr. WINSTON CHURCHITJ. : Having a fund and then looking for
objects to spend it on was pithily described the other day as finding a biscuit
in the street and then buying a dog to give it to.

Dr. JA^IESON : As a matter of fact, there is a general scheme which
will cost money, and I believe I heard IMr. Lloyd Cieorge say that, with a view
to fostering trade within the Empire, he had already been to the Chancellor
of the Exchequer to get money for the appointment of commercial experts.

:\Ir. LLOYD GEORGE : I have been promised it since.

Dr. JAMESON : It requires money, but you said we will not stop there;
we will do other things which will require money.

^Ir. LLOYD GEORGE : I had my scheme first, and then I got my
money.

522

Fourteenth Day.
9 May 1907.

Imperial
Surtax on

FOREION

Imports.

Dr. JAIMESON : I hope you have your scheme now. Mr. Deakin is now
going to suggest a way to you to get tlie mone3^ I liope it was not a mere
general statement. We expect to get something more on the lines suggested
by Sir Joseph Ward — sulisidies to freights on tramp steamers, and so on.
This is merely a suggestion from Mr. Deakin — not fixing himself to 1 per
cent, or to 10 per cent, or a decimal percentage at all, but a suggestion by
which the fighting forces might be provided.

I am really quite in accord with the general principle ; but it is possible,
if Sir Joseph Ward's suggestion is adopted by the Government, and that half a
milUon is going to be put up for this purpose by the Government, and we all
round the table piit our proportion, it might be rmnecessary to pass this,
and I daresay Mr. Deakin would not then put it to the vote at all.

Mr. F. R. MOOR : Lord Elgin and gentlemen, we have been considerably
edified by the sympathy that has been extended to us by the Imperial Govern-
ment, and the promise of what we may expect in the furtherance of our
Imperial ideas. But I think it would be greatly to our advantage in bringing
about something in the shape of some fruit as regards this Conference, if the
Imperial Govermnent would l)e a little more candid and let us know, in some
practical way, the steps they would take to bring about the object we all
have in view. I am loth to A^ote against a proposition of this sort, which has
at any rate a practical ring about it Avith respect to providing a common
frmd ; but when the Government meets us and tells us they have a great deal
of sympathy for Avhat we are trying to do, and do not tell us they have
anything behind Avhich they may suggest before we break up, I think it
woidd be in the interest of all if they would give us some indication, in a
practical way, of Avhat they do propose or would be prepared to consider. AVe
have tried in various ways, l^ut we have been met by refusal, certainly, again
I repeat, in a very sympathetic Avay. But that does not help us. We are here
for business and to promote our common interests, and AA'e do Avant something
tangible, if possible, to take back to our Colonies. I do hope before this
resolution is put that Mr. Lloyd George will indicate some way.

Mr. LLOYD GEORGE : What have you proposed, except something that

would involve a change in our fiscal system ?
you made that Ave have refused ?

What practical proposals have

Mr. F. R. MOOR : I am not arguing that point, but Ave have lirought
forAvard proposals that have not been acceptable to the Home Government,
and the Go\¥rnment have, at the same time, told us they are very kindly
disposed toAvards us, and that in some way they would be only too glad to
meet us if it fell in with the vieAvs of the Imperial Government. Will the
Imperial Government tell us hoAv, in some practical Avay, Ave can decide on
some conunou resolution ?

Mr. LLOYD GEORGE

I thought Ave had done so.

Sir ROBERT BOND : Lord Elgin, and gentlemen, 1 am sorry I cannot
support the resolution proposed by Mr. Deakin. The position of the Colony
I represent in respect to imports and exports is entirely different from that of
any other Colony in the Empire. For instance, our exports to the United
Kingdom only amount to 13 per cent, of our total ; Avhereas these of Cape
Colony amount to 95 per cent.. New Zealand 78, Australia 70, Natal 52,
British Guiana 52, and Canada 52. Our principal trade is with foreign
countries. About 70 per cent, of our exports go to the Mediterranean, and
to South America. I might say, further, that our aA-erage tariff taxa*^'"^

523

to-day is about 35 per cent., and I could not recommend to my Parliament
an increase of that tariff by even 1 per cent. Further, the importations
into the Colony are principally from foreign count "ies. One of our largest
impoitations is salt for fishery purposes and is obtained from Cadiz. This
at tlie present time passes in duty free, and the imposition, even of 1 per
cent., might not cmly lead to retaliation on the part of our Spanish and
Portuguese customers, but the tax woidd fall heavily upon the very poorest
of the popidation, namely, the fishennen. There is another large foreign
importation, namely, flour. Part of our importation comes from Canada, but
a considerable portion of it, highest grades, comes from the United States of
America. That now passes in duty free, and the imposition of even 1 per
cent, upon the principal food of the poorest people of the Colony, would
naturally be resented and be regarded as oppressive. The other articles
of foreign importation, upon which the proposed tax would fall, woidd
be meats, pork, bacon, butter, sugar. Forty-five per cent, of the total
imports of the Colony consist of food, and these are derived to a large extent
from the United States of America. The policy of my Government is to
reduce the tax on articles of food. The fact then that a V3ry large pi'oportion
of our food supplies has to be imported from the United States, and our fishery
supply of salt from Cadiz, renders the position of my Colony, as I have
previously remarked, totally different from that of any other Colony. Under
these circumstances I regret that I cannot support the proposal that is made.

Fourteenth Day.
9 Mu}- 1907.

Impeuial
Surtax ux

FoKElGN

Impokts.

(Sir
Robert Bond.)

Mr. DEAKIN : If I had taken fuller advantage of my opportunities
when opening this debate instead of curtailing my remarks to spare time for
the Minister I should have avoided some of the criticisms, even of my friend
Sir Joseph Ward. If he looks at this proposition, he Avill see I have
suggested the 1 per cent, only as a measure, so that it woidd be quite
possible for New Zealand or any State in a similar position not to impose
the 1 per cent, at all or impose any surtax. Under the second clause of
the first paragraph " or an equivalent contrilMition made by each of the
legislatures," it would only l)e necessary for New Zealand to find her
20,000?., or whatever the sum is, fi-om her own revenue, without a surtax at
all. I am sui'e that misappi-ehensiou was due to my omission to explain
the details of the proposition at length. 1 only submitted it, of course, to
assert or suggest a principle and not as a final proposition which c-ould
not be amended. I admit, however, that Sir Joseph's criticism and the
criticism to which it has been sul)jected by others show that this percentage
upon foreign goods is open to serious criticism. It is needless to
pretend that it is not. But again it was the same misreading of the
resolution which led Sir Joseph to speak of the possibility of the 1 per
cent, duty falling upon British goods instead of upon foreign. That would
not be possible under the terms of this resolution at all. First of all, you
need not have your surtax on foreign goods unless- you like ; but you cannot
have it on anything else. You can take it out of general revenue. You
cannot impose 1 per cent, on anything except on foreign goods, and need not
impose that if you prefer some other means of finding the money.

Sir JOSEPH WARD : Yes, I see that is so.

Mr. DEAKIN : Sir Joseph's criticism was entirely spnpathetic, as
was that of most other Colonial members of the Conference. Having regard
to the general character of this resolution and the nature of the subject, I
had not even worked out the figures as to what a 1 per cent. contri])iUion
mas. I stated yesterday, and stated again to-day, on several occasions that

524

Fourteenth Day.
9 May 1907.

Imperial

SfliTAX ON
FoKEKiX

Impokts.
Deakin.)

(Mr

I put in the 1 per cent, instead of leaving a blank, simply in order that the
principle of co-operation might he discussed. I mentioned that one-half per
cent, might do if this measure were thought proper. I do not waste the time
of the Conference on merely abstract resolutions. But it does appear to me,
as Mr. Moor veiy well put it, that we are likely to separate without ha^dug
come to practical conclusions. I thought it was wise, and have not altered
my opinion that it was necessary to submit some broad j)roposition in order
that we might learn from the members of the Government of the United
Kingdom, whether they had in their minds any scheme for Imperial action at
all, or for an Imperial fund other than the separate schemes which may be
proposed from time to time for a steamship service, or a cable service, or any-
thing of that character. I have not been able to elicit even that. On the
contrary, I have been met with the usual opposition criticism which we hear
so often in Parliament upon a proposition of this sort, when the object is to
hurry it conveniently out of the way. I do not object to that. I am
sufficiently accustomed to it. But I also appreciate its motives. If the
representatives of the Government here had really in their minds any scheme
at all, this would have Ijeeu the time when they coidd have triTunphantly
produced it and explained it. I do not mean that they woidd have brought
down details — but they ought to have suljmitted a plan showing us some
possibility of an advance upon our present casual disunited methods of
cond;)ining for particular purposes here and thei'e. That imperfect method
exists and will exist. We do not lose it because we consider Avhether it
cannot be improved upon. My object was to insist upon the need for
improvement and only to suggest one means for its improvement. I was not
taking a course foreign to the purpose of this Conference, but strictly in line
with it. We have not succeeded in getting consideration for preferential
trade. I wanted to know if we could not get consideration for something
else which did not involve the fiscal principle at aU — some method of imion
for united action. This proposition may be as faulty as you please. I drew
it in terms sufficiently loose on purpose. It has at least made our position
here quite plain.

Sir JOSEPH WARD : May I suggest altering the last part and leaving
the first part out, in order to try to get a decision in only a general wa}' to the
effect that this Conference recommend the Legislatures aft'ected with the
general purpose of fostering the industrial forces of the Empire so as to
promote its growth and unity to provide contribxitions with that ol)ject. If
you move something like that, and leave it to us to put amomits on our
respective Estimates for the consideration of our Parliaments, we are all
right.

Mr.

propose

Sir

DEAKIN : I think there is a good deal to be said for what yoii

JOSEPH WARD : I do not want to propose it.

Mr. DEAKIN : I quite understand. But I am not complaining in the
least degi-ee of any criticism that applies. I only say the attitude of Ministers
shows they have not made up their minds on this question at all. They
simply say : "Bring forward a particular proposal and we will look at it."
We knew that before. That is a very admirable attitude, the purely negative
attitude they always have taken and always will take, and the attitude other
ministers in the same quandary always will take — I am not finding fault
with that. I have asked, " Can we do anything more?" The answer is,
" We cannot do anything more."

Mr. LLOYD GEORGE : I never said anything of the sort. 'I'o briag
forward a proposal which will involve our contribution of 4|- millions' as
against your 1()0,000L, \vith no scheme, no plan of spending, not a glin^imer

525

of au itle.i what the money is to go to but simply saying, " We arc to pool it, Fonrtoemli Day.
" and until we can find something to spend it on, let it roll up " — if that is a 9 May 1907.
scheme for a great commercial Empire, I think it is a scheme pour rirc, if I ~

may say so. It is not as if there was a definite plan, which is exactly what SlrtIx^on
Mr. Asquith has asked for and very properly asked for. He said he was Fohei«;x

prepared to recommend the Treasury to find money. I go beyond that and Imi><>kt>.

say I am perfectly willing for my part, after consultation with the Chairman (Mr.

and my colleagues, to subscrilje to the suggestion made l)y Sir Joseph ^^'ard, I^loyd George.)
and I go further than that and say we shall be in favour of some systematic
considtation between the repi'esentatives of the Empire as to the liest means
for promoting the objects you have in view. We must have a plan before
we spend money. We are spending enormous sums of money in the Empire
now, and we really want to know upon what we are going to spend these
further sums. We nmst not, first of all, resolve to spend, and then go
fishing for a scheme somewhere from here to Australia. Let us, first of
all, find our plan. I Avould not mind altering j\Ir. Deakin's resolution in
some way just to show our bona fides.

Mr. DEAKIN : You are now saying more than you did before.

:\rr. LLOYD GEORGE : Really, it was very difficult in language that
would pass the chair to express mv view of this 4,500,000L against the
GUO.OOOL

Mr. DEAKIN : It was, if I may so, because you coidd not have listened
to my proposal. I did not dwell on the 4,o0(),000?. I said over and over
again that we can substitute anything — half per cent, or anything else. Jt
Avas insistetl from the first that the amount named was adopted as a mere
convenience.

Mr. LLOYD GEORGE : It is the very thing we have to dwell upon.

Mr. DEAKIN: Certainly, when it is actually proposed, but at this stage
it is a proper thing to notice and pass by, until the principle has been settled,
and detail is taken in hand.

Mr. LLOYD GEORGE : Imperial defence is costing us something like
G0,OO0,(H)0L at the present moment.

^Ir. DEAKIN : In moving this motion, I said over and over again :
'■ As regards this particular amount, I have taken it because I find it suggested
" in a scheme submitted by Sir Cieorge Sydenham Clarke." I said expressly
I do not attach any special importance to that particidar proportion. You
are perfectly justified in saying all you did, to the effect that this particular
amount will not do, and thus dismissing it ; I am not in any way concerned
because that is not the cardinal point.

Mr. LLOYD GEORGE : The cardinal point is not to raise the revenue
first and find a plan afterwards.

]\rr. DEAKIN : That is quite another issue ; you are giving us help now.
You are beginning to meet my proposal. Now you state you are prepared to
accept a regular and systematic discussion of business proposals.

Mr. LLOYD GEORGE : Systematic consultation— stronger still.

Mr. DEAKIN: In saying that, j'ou are coming to a positive proposal,
which is just what I want. You may tear my resolution to rags and do what
you please with its proportions and details if you accept the principle of
united action in some definite shape.

Mr. LLOYD GEORGE: I would suggest the following resolution:
" This Conference recommends that in order to develop trade, commerce,

Fourteenth Day.
9 May 1907.

Imperial

Surtax, on
Foreign
Imports.

(Mr.
Lloyd George.)

526

" the means of communication, and those of transport within the Empire,
" it is desirable that some means should be devised for systematic consultation
" between the members of various parts of the Empire for the purpose of
" considering co-operative projects for the general purpose of fostering the
" industrial forces of the Empire, so as to promote its growth and imity."
These ends have to be considered by expert business men, and afterwards
we shall come in to find the means.

Mr. DEAKIN : That is a most distinct advance. It may not come
immediately to anything because it is only a general provision, but I quite
feel that it is not fair to press the President of the Board of Trade for
anything expressed in poimds, shillings, and pence until definite schemes are
propounded.

Mr. LLOYD GEORGE : You have no schemes. Schemes would have
to be considered very carefully. So far as I am concerned, I have been seeing
a good many shipowners, and I have realised what great practical difficulties
there are which must be overcome, and you could not formiilate a scheme in
the course of the few days that are at our disposal now. It would take a
consideraljle time for consultation with all classes of people interested in our
oversea trade.

Mr. DEAKIN : I entirely agree. Be sure that there will be no sparsity
of projects ; we are full of them. People are continually making proposals
for improvement of conununications, and one thing and another.

Mr. LLOYD GEORGE : One thing you have to do is to persuade Australia
to make a harbour where ships of a certain size can go in. Yoiir depth of
water is only 28 feet draught. These huge ships will not enter. That is one
point a large shipo^vner has put to me, and I said, " That is not for us ; it is
for Australia."

Mr. DEAKIN : You are quite right. It is for us. Speaking from
memory he is a little out of date. They are blasting in Port Phillip, and
have been for the last 12 months, rocks to a depth of 30 feet — I think 32 to
35 feet in the entrance to Melbourne. In Sydney harbour, as I xmderstand,
the entrance is deep enough already.

Mr. LLOYD GEORGE : But you cannot get alongside with a ship over
28 feet.

CHAIRMAN : We need not have particulars.

Mr. LLOYD GEORGE : I only give it as an illustration.

Mr. DEAKIN : I have no possible objection to any detailed criticism
of any possibilities, except to say that I did not put any proposal forward
of this vague character. But my suggestions are now being met in the light
I think they ought to have been met at first. It is excellent to provide
for expert consultation periodically. The only thing is, cannot we go further
before we part ? I do not know whether a question of this sort will come
before the new secretariat or whatever it is, or go to the Board of Trade.
Are matters of practical business, propositions which are made from either
one part or the other of the Empire, to go through the secretariat or to the
Board of Trade or to whom ?

(3HA1RMAN : May I say that I imdertook at the Ijegintiing of this
Confei'euce to endeavour to organise a secretariat ? I have not had time
since the Conference met, and I think you must really leave me some scope.

527

^fr. DEAKTN : This is not a question of organisation.

CHAIRMAN : It is really a question of organisation as to what part of
the business is to come through this secroturiat in this olfiee, or what part
may go through the Board of Trade. I have undertaken the organisation of
the secretariat.

Mr. 1)EAKIN : I do not think that is an answer.

Mr. WINSTON CHURCIin.L : Has not this Resolution now proposed
already been passed by the Conference on the day we discussed the
organisation of thf Uoid'erence — to have conferences on matters of common
interest every four years, and subsidiary' conferences held as often as necessary
between anj* parties interested in iuter-Iniporial or inter-Colonial questions ?
In what way does this Resolution advance upon any proposal which the
Conference has already decided ?

Sir WILFRID LAURIEK : I would not press your motion to-day, but
have something more concrete than that. With regard to the motion made
bj' Mr. Deakin with all due respect to the earnestness with which he has
pressed it, it seems to me an absolute departure from constitutional
goveriunent. If there is anything which is true in constitutional British
Government it is this that you do not provide money in advance for
anything. Your proposal is to create a general fund and then you find how
you are to apply it afterwards. If there is an object to be served, or work to
be done, or something of the kind which requires money, then we find the
money ; but your scheme proposes that we should find the money in advance.
That seems to me an absolute departure from constitutional government.
Where can you find a precedent for it 'f Where is it consistent ? Call it a
duty or a tax, after all it is money taken out of the people's pocket, and you
do it for a vague indefinite object. That is absolutely contrary to consti-
tutional government. If there is anything true, it is that you do not take
money from the people except for a special object, and I object to yovir motion
on this ground. I lun jiot qxiite satisfied with the motion of Mr. Lloyd George
as it is very indeterminate, and coimuits us to nothing. I hope before we
separate we can find an actual scheme on which we can ask the contribution
of the British Government, and all or some of the Governments here
represented — some big scheme of communication amongst ourselves. This is
what you have in mind, yourself, Mr. Deakin. Therefore, I think you should
not propose the motion to-day.

My. deakin : I take the proposed resolution of the President of the
Board of Trade as being drafteti with the idea that instead of allowing this
matter to drop we should pass something and show that something progi-es-
sive is really intended. I quite agree that was the motive, and appreciate it ;
but at the same time it is open to the criticism which I myself was leading
up to, that such a plan involves consideration of the secretariat ami the nature
of the secretariat, and of subsidiary Conferences. Consequently I dt) not press
for passing a resolution at aU. What I want to get if I can before we leave,
is a decision of this Conference on the question : Is it not possible to do
sometliiug more iu the future than we have ever done, in the way of providing
for practical business-like i^roposals making for Imperial co-operation and
unity of action being dealt with in a luisiness-like way ? Mr. Lloyd George
says very ])ropei-ly that, according to his revision of my resolution, what may
be termed a special meeting or subsidiary Conference of experts wnll enable
us to deal with them. That is quite true and helpfid. Is that the furthest
limit to which we can go? So far from thinking myself the person speciallj'
endowed with ideas on this subject, I broached it in order to obtain the
assistance of others, in the expectation that they would provide out of their

Fourteenth Day.
9 May 1907.

Imperial

SuiiTAX OX
FlIREIGX
I.MPORTK.

528

Fourteenth Day.
9 May 1907.

Imperial
Surtax on

P"OREIGX

Imports.

(Mr. Deakin.)

greater experience more than I am able to suggest at tlio present time. I am
tied to nothing. Let ns do sometking definite so that when we leave the
Conference, Ave can say with some confidence : " We have not done the things
" we wanted, hut we have at least made the way easier in future for any
" of those practical projects to he dealt with immediately without the delay
" which now invariably accompanies the correspondence in making even
" an approach to joint action bj'' our governments."

Mr. WINSTON CHURCHILL : How is not that met by the fourth
clause of the instrument governing the Imperial Conference, which provides
that upon subjects which cannot be conveniently postponed a new Conference
of representatives shall be held l)etween Governments concerned. Does not
that cover it ?

Mr. DEAKIN : It could cover it, Init has not been expressly held to apply
before.

CHAIRMAN : That is the intention of it.

Mr. DEAKIN : That is the intention. It leaves them irregular, and not
as I wished regular and constantly in operation. Your statement shows you
are prepared to adopt something.

Mr. LLOYD GEORGE: And there is the readiness of the Imperial
Government to put it into black and white. Is it not advantageous to have
Avhat Mr. Churchill has just said applied to this i^articular subject ? That is
the use of the particular resolution which I proposed.

Mr. AVINSTON CHURCHILL : That is putting it in black and white
twice over.

Mr. DEAKIN : No, the first is a general resolution.

Mr. LLOYD GEORGE : Yes, about the organisation of this subsidiaiy
Conference. This is simply a suggestion that this would be a proper suljject
to be dealt with at the subsidiary Conference.

Mr. DEAKIN : The President of the Board of Trade pointed out what he
was doing in reference to conmiercial intelligence within the Empire, and
the new efforts he is going to make to extend the system. That seems on
right lines, and admirable. Now we have attention called to the fact that the
machinery of subsidiary Conferences is to be applied in the same direction ;
that is exceUent, too. But I Avant this thing not to be talked out here, but
defined and understood. When we return and are asked what Ave haA-e done
Avith regard to practical co-operation among our governments in the future,
Ave can only point to the Consular SerAdce Avithin the Empire as Avell as
Avithout it, Avith a provision for subsidiary Conferences. I thought subsidiary
Conferences on these practical matters Avas ahvays possible. I Avant to add
to that. Let us make our collection of scalps as numerous as Ave can, showing
Ave have met these diflficulties, and disposed of them.

Mr. LLOYD GEORGE : I understand that Sir Wilfrid Laurier proposes
before the Conference separates to propose a practical scheme.

Sir WILFRID LAURIER : I hope so.

Mr. LLOYD GEORGE : I hope j-ou will let us have it in time to give it
proper consideration.

Dr. JAMESON : That is no reason why we should not pass this general
resolvition.

Sir WILFRID LAURIER : I desire to let it stand over until Ave have
something more.

529

CH.MHMaX : For the ]\liiiutes of to-day we record that Mv. Deakiu iMmiiocutli Day.
submitted this resolution, and Mr. Llnyd George sulmiitted his. 9 May 1907.

Mr. DEAKIX : PU'asc understand that it this resohitiun ol' mine were Imi-kkiai.
rejected by every individual niendjer ol the Conference, I shoidd deplore our "'^i,\,Vm( '.'^
divergencies, but it would not in any way depress me. I shoidd take the Imi-okts.
IxMiefit of all the criticism, not regretting that I had brought the matter
forward. My faith is that it is better to make a mistake attempting to frame
a practical proposal than to do nothing at all. If this was a mistake, and I
am satisfied it was not, 1 liave at least succeeded in bringing the question
right home. We are not here to score verbal victories by carrying resolutions,
or to feel defeated if we do not carry them, but we are here to make some
advance by the frank discussion of these Imperial possibilities. I am obliged
to tlie j\liuister for getting beyond the accidents of my j)roposal to its essence
at the close.

UNIVERSAL PENNY POSTAGE. Universal

I'liNNV t'oSTAUE.

CIIAIUjMAN : Mr. Puxtoii also has business which calls liini away, and
as this Post Office subject will not take very long, I think we might take
the subject of imiversal penny postage before we take Imperial cal.)le
connnunication.

Sir JOSEPH WAlvD : Lord Elgin and gentlemen. In the motion as it
stands upon the Agenda, I propose, after consultation with the Postmast(>r-
General, to make a variation which he has agreed to accept, and it will fully
meet what I want to place before the Conference to have a resolution upon,
and I think it will bring about unanimity. I propose to substitute this : " That
" in view of the social and political advantages, and the material connnercial
" advantages to accrue from a system of international penny postage,
" this Conference reconunends to His Majesty's Govermnent the advisability,
" if and when a suitable opportimity occurs, of approaching the (Jovernments
" of other States, members of the Universal Postal Union, in order to obtain
" further reductions of postage rates, with a view to a more general and, if
" possilile, a imiversal adoption of the penny rate." "What animates me, in
asking this Conference to give effect to a proposition of this kind, is a liesire
to see penny postage universally established as soon as possiljle, and to get
over the incongruity of being able to send a letter from England to New
Zealand, or from New Zealand to England for a penny, and having to pay 2), J.
to send that letter some 20 miles across the English Channel. Anything
assisting to ripen public judgment on an important matter of this character,
world-wide in its operation, in that respect is a good thing. As the Post-
master-General has agreed to it in this altered foj-m, I hope it may connncnd
itself to the Conference. I move the resolution.

Mr. BUXTON : Lord l^lgin ami gentlemen, I have, on behalf of the
Government, to accept the resolution, in the words Sir Joseph Ward has been
good enough to adopt. Only I feel l)0und to say in regard to it that this
resolution must be taken as an indication of policy, and that it leaves the
fullest possible freedom to the British Government to judge as to the time
anil the opportunity and especially as to the question of the fimds at thcnr
disposal, with regard to how far, and at what moment, and to what extent
they can carry out the policy of further Postal reforms with reference to
foreign countries or the Colonies, and in the matter of the adoption ol'
■universal penny postage. I am afraid I can give no promise of any likelihood
that we shall l)c al)le to consider \ho matter at a very early date, because the
Post Office revenue from which this wouhl have to come, is not in a very

E l.sc.iis. L I

530

l"'ourteeiitli Diiy.
9 Mav 1907.

Universal
Penny Postage.

(Mr. Buxtou.)

more than auy promise to carry
matter is really one of finance,
moment we may have the funds ;
Joseph Ward and the Conference

elastic condition at the present moment, and the various claims upon our
finances are considerable just now. I am afi'aid it must he understood
in our accepting this resolution that we do it as an indication of policy

it out at any early date. The whole
We should desire to do this at any
but I should like to point out to Sir
that the adoption of this proposal woidd
mean a very considerable charge on Imperial funds. We have made certain
postal improvements, as Sir Joseph knows, under the Postal Union — -changes
which come into force on 1st October next and which will cost us about
190,000?.. a year. The adoption of universal penny postage would mean an
addition to that of about 450,0001., so that this resolution in its entirety would
involve a charge of something like 650,0007. a year, which is, of coui-se, a
very serious siun. I am afraid we could not look with any hope, within, at
all events, a number of years, of making up that loss by increased facilities
leading to increased commerce, because in reducing it to a penny post, the
margin of profit is almost infinitesimal on each item. I am glad to think that
at the Conference of the Postal Union, at which Sir Joseph Ward was a
representative, a very considerable step was made in advance in regard to
foreign postage, at the instigation of the British delegates, supported by the
Colonial delegates, under which, after the 1st October next, the charge for
foreign postage will remain, rmfortimately, still at 2^d., but that will frank a
letter not of half an ounce as previously, but of a fvdl ounce, and the second
charge for two ounces will be only 4|^d. So that the upshot of the matter
wiU be this, that under the new regulations which have cost this country about
200,000?. a year, in future a letter weighing an ounce, which before was bd.,
will go for 2|d. ; a two-ounce letter, which before would have cost lOd. will
now go for 4|-fZ. I think the Conference will admit that is a considerable step
in advance in improving postal regulations with foreign countries. I do not know
Avhether Sir Joseph has quite enough taken this point into accoiint. As he will
know as a delegate at that Postal Union the other great countries interested
were by no means anxious to adopt penny jDOstage ; indeed, it Avas with great
difficulty they were induced to adopt these changes which I have mentioned.
Therefore, I am afraid even if we Avere om-selves prepared, and had the funds
at disposal at the present moment, to suggest a penny postage to the other
countries it wordd not at present be received with much favour. But I will
aay it is a matter with Avhich the Chancellor of the Exchequer, as well as myself,
have expressed sympathy, which, if and Avhen the fimds permit we shall
certainly desire to adopt, taking into account this fact that in regard to all
postal reforms they unfortunately cost money, and we have to look romid
Avhen Post Office funds are available to see Avhat, on the whole is the best
investment for that service. This would, therefore, have to take its
opj)ortimity Avith other matters in competition, many of which are pressed upon
us from time to time. I entirely agree with Sir Joseph Ward that it is a
matter of great importance and one \A^hich I, for one, would like to see
adopted at some early date.

There is just one point in connection Avith it Avhich I might mention
Avith regard to Imperial Penny Post, and that is that that also is benefited by
the Postal Union Convention, to AA^hich I haA^e referred. Up to now, under
the Imperial Penny Postage, a letter of half-an-ounce Avent for a penny, but
after the 1st October next a letter of a AA-hole ounce Avill go for a penny ; so
practically Avhat used to cost 2d. under the Imperial Penny Postage will only
in future cost a penny.

I venture to suggest to Mr. Deakin Avhen Ave are talking of inter-
communication betAveen A^arious parts of the Empire, and subsidies, and so on,
whether the time has not come that Australia also should fall completely into
accord Avith the rest of the Empire in regard to this matter.

531

Mr. DEAKIX : We hroiight in a Rill last year. Fomreeiith Day.

9 May 1907.

Mr. BTTXTON : But I understood it was withdrawn.

Universal

Mr. DEAKIN : Ir was defeated and withdrawn.

Mr. BUXTON : Then I suggest to Mr. Deakiu that he should endeavour
to educate Australia. As we are all agreed, the penny postage is of the
greatest possible advantage, and Australia should no longer stand out from
the agreement and the arrangement which was come to all over the rest of
the Empire.

One point, perhaps Sir Joseph will allow me to make in regard to this
matter. The chief object, as I understand, or the chief results, at all events,
of this Conference is that there is a general desire, on both sides, on the -part
of the Home Government, and on the part of the various Colonial Governments
to meet one another in regard to improved inter-commuuicatiou from ihc
point of view of Empire, and from the point of view of coumierce. Ai't(;r all,
this Imperial I'enny Postage which exists at present is a very considerable
link between the various parts of the Empire. I am not altogether sure,
seeing that has only l^een in effective force for a few years, whether on the
whole — looking at it from an Imperial and Colonial point of view — it is not a
littlc! premature to press for the other step. Would it not be l)(>tter to see
lirst if it is likely to facilitate the communication between the various parts of
the Empire before we extend its benefits at considerable expense to ourselves
— between oiu'selves and other countries. I throw that out not as hostile to^
the spirit of this resolution, but as a point which under the pecidiar
circinnstances of the discussions which have occurred here might well be
borne in mind.

May I add, in connection with questions of postal facilities and
conununication that we are now introducing, and are going to suggest to the
various Colonies the introduction of the cash on delivery system as ])etween
the Colonies and Great Britain. The Imperial Postal Order has now, I am
glad to say, been adopted by every Colony with the exception of Canada and
of Australia at the present moment ; but I am in commmiication with the v
Postmaster-General of both the Dominion and of the Conimonwealth, and 1
hope they may be able to fall in with a system, which, as regards other parts
of the Empire, is found to be of the greatest possilile advantage in enabling
small purchases between the Coloni(>s themselves and between the Colonies
and Great Britain.

I thought I had better, perhaps, make these general observations, and
again express my sympathy with th(> views of Sir Joseph Ward, and say
that when, and if opportuuitj^ occurs, it is a matter which we certaiidy have
at heart, and hope at some time oi- other to be able to accomplish.

Mr. DEAEIN : It is part of the policy of the Govermnent to introduce
penny post, but the circmnstances in Aiistralia, like the circumstances in some
of the other great Dominions, are not taken into accoimt when the refusal
of a majority of its Legislature to make that concession is considered.
Owing to the sparsely settlcMl nature of our interior, there are places in which
it costs us several shillings for the delivery of every letter. We provide
what I think, having regard to the different distances to be covered, are remark-
able instances of Post Office enterprise. Wherever there are a fp-w tents Ave
manage to make an-angemeuts for a postal service. Many of ihese are
maintained at great cost. The consequence is that while if we were confined
to an area such as that of the United Kingdom universal penny postage would
be voted immediatelj' — and in fact there is penny postage within several
States — we have neA'er been able to get the assent of the Legislature yet to

L I 2

532

FoiirtfiL-iitli Dav. an Imperial proiiositioii. Thej" fear tliat it would mean if not a curtailment
9 Miiv 1907. of any of the existing services which I have referred to, a greater hesitancy

in granting them to fresh settlements. They look with some jealousy on any

UxivEusAL proposal for diminishing the Post Office funds since our constant onward
EN.N\ (.:>rAGE. ^lovemeut means a constant opening of new offices and the making of fresh
(Mr. Deakiij.) arrangements at considerable expense. However, that is part of our policy.
We are endeavouring to carry our measure, and another effort Avill be made
in that regard. At the same time it is only fair that the Postmaster-General
should recognise the very exceptional circumstances under which our work is
carried on. Under these circumstances when we have not yet arrived at
penny postage within the Empire itself, it does look a little previous, as the
Americans would say, to be asking it from other comitries.

Sir JOSEPH WARD : One Avord upon this matter from the point of
view so fully represented, which I appreciate to the greatest possible extent,
by the British Postmaster-General. In submitting this resolution, it is not
with the object of pressing at any undue period iipon any portion of the
Empire, Great Britain or elsewhere, the bringing into operation of this
system, but it is if possible to impress upon, not the distinctlj^ advanced
British Post Office, who have done all in their jjower up-to-date, and done
most valuable work, but upon other countries as well as Great Britain, the
importance of having universal penny postage through the world. I am
glad to have submitted this resolution, if only for the purpose of hearing
the statements made l)y Mr. Buxton as to what has been done by
the British Post Office already, and I take the opportunity of saying,
as the New Zealand delegate at the Postal Conference, that the repre-
sentatives of Great Britain there, not only did most valualjle work, but
were a distinct credit, not only to the postal service of Great Britain, but to
the Empire as a whole. I want to place on record my testimony to the
splendid way in which the President of that Postal Union, Mr. Babington
Smith, carried out most difficult and imj^ortant work there. I may say that
the British delegates remained neutral when this Universal l*enny Postage
proposition was put before that Conference. We have done all in New Zealand
that the Postal Union required to be done. We have the penny rate for
4 ounces throughout our country on letters ; we have cheapness and efficiency
in both our postal and telegraph services in every way possilile. I want to
take the advantage of saying how important it is to have within the Empire
uniformity both as to charges and sj^stem. Australia is a case in point.
There against Mr. Deakin's own representations and those of his capable
Postmaster-General, Mr. Austin Chapman, Parliament decided on the grounds
of loss of revenue, not to go for universal penny postage. Our experience
in New Zealand — and it was the experience of Canada, I know also ; the then
Postmaster-General told me so himself — is that the effect of our coming right
down to a penny rate was we recovered our revenue in a very limited period,
very much less than the permanent officials contemplated, namely, mider
three years. The aspect put by Mr. Deakin as one of the reasons Australia
has voted against it Avas to avoid increased mail services. In New Zealand
the adoption of it was the cause of our very nearly douhling the facilities foi'
carrying mails to the different portions of our country owing to the increased
business that accrued. I sincerely hope that the time will arrive when Mr.
P)UXton, who is not only sympathetic towards this resolution, but, I am sure,
anxious, will be able to do it. Some morning we will lind that America and
Germany have entered into a subsidiary agreement for a penny postage
between theniselves, or America and France, or some other great comitries.
When that is done the whole world must soon follow. My opinion is Britain
ought to be ahead, as it always has been ahead. We should not look upon
ll\(' Post Ollice as a great taxing machine for general revenue, l)ut regard

533

it as it is, as a great uieaiis I'ur the (iistrihiitioii of the writt(?n opinions ami Foi.h.m-iiiIi Dnv.
conunnnications of people to one another in all j)arts of the world, and that 5) jiuy 1907.

hy the cheapeninff oL the postal rates wc are helpino- them to promote business _

and to bring into every-day life a bettor and closer knowledge of all parts of ,, ,^ .^'.'\f"^^'' .
the world.

I can oidy thank Mr. ]3uxton for giving my proposal his support. I Joseph "var.l.)
thoroughly understand the reservations he has made, which from his point of
view are quite essential.

CHAIRMAN : Then this resolution may be declared adopted.

The resolution was carried. llesolmidii XVII.,

p. ix.

BrrEilL\L CABLE COMMUNICATION. Impouai, Cable

CoMMUXlCATIOV.

CllAlUMAN : This is a resolution of Cape Colony. I understand there
has been an agreement iix^on this point.

Mr. BUXTON : We are willing to accept the motion.

Dr. S]\1ARTT : That is what I umlerstand. Therefore iIk^ only thing to
do is to formally move it : "In the opinion of this Conference the provision
" of alternative routes of cable commuuicatiou is desirable ; but in deciding
" upon such roiites, the question of the strategic advantage should receive
" the fullest consideration ; (2) That landing licences should not operate for
" a longer period than 20 years, and that when subsidies are agreed to be
" paid they should be arranged on the ' standard revenue ' principle, i.e., half
" the receipts after a fixed gross revenue has lieen earned to be utilised for
" the extinguishment of the subsidy, and, by a agreement, for the reduction
" of rates." I believe that was done in the last agreement Cape Colony
made.

Mr. BUXTON : Yes. 1 do nut think I need say anything upon it. This
is the general ]iolicy which we have carried out here in the Post OlKce here
and we arc entirely in accojil Avith the resolutions, both No. 1 and 2.

CHAIRMAN : Then this resolution will be adopted ?

Sir JOSEPH WARD : Yes, I most I'ordially support it.

Sir WILFRID LAURIER : I have no objection at ali.

The resohdion was carried. Uc-solniion XVIII.

p. i.\.

NATURALIZATION. XATuuAM/.Ai.nN.

CHAIRMAN : We next have the question of naturalization, on which wc
have already heard the Home Secretary. Sir Wilfrid Laurier asked that this
should be adjourned to express your views upon the subject.

Mr. GLADSTONE : I have prepared a draft resolution.

Sir WILFRID LAURIER : 1 think there is no objection to that. As far
as I am concerned, I quite agi-ee to that.

534

Foiiiteeutli IjiH'.
9 May 1907.

Naturalization'.

CHAIRMAN : Perhaps I liad better remind the Ooiiference that the
draft resolution submitted was : " That with a view to attain uniformity, so
far as practicable, an inquiry should be held to consider further the
question of natui-alization, and in particular to consider how far, and under
what conditions, natiu'alization in one part of His Majesty's Dominions
should be effective in other parts of those Dominions, a subsidiarj'^ Conference
to be held, if necessary, under the terms of the resolution adopted by this
Conference on the 20th of April last."

General BOTHA : I have a memorandum on naturalization which I
should like to read and hand in, though I quite agree with that
resolution.

Dr. SMARTT : If that is read, I think that will allow us to come to
some conclusion now.

CHAIRMAN: Would you hand it in ?

Dr. SMARTT : It affects the discussion considerably, I think.

Sir WILFRID LAURIER : My colleague, Mr. Brodeur, has something to
say on this subject. It will perhaps lit in at this moment.

Mr. BRODEUR : Lord Elgin and gentlemen, I have only one or 1\vo
observations to make with regard to this resolution moved on the question of
naturalization. I may say we have passed in Canada this year a Bill on the
question of naturalization to this effect. I may perhaps read the most
important part of the Bill, which provides : "Any person resident in Canada,
or in the service of the Govermnent of Canada, or of any province of
Canada, who has obtained a certificate or letters of naturalization in the
United Kingdom, or in any part thereof, or in any British Colony or
Possession, Avhich certificate or letters remain or remains in fidl force and
effect, and who desires to be naturalized in Canada may, if he intends when
naturalized either to reside in Canada or to serve imder the Government of
Canada or the Government of any such province, apply for a certificate of
naturalization in manner hereinafter prescribed, without having complied
with the condition as to residence required imder section 13 of the
" Natxiralization Act, chapter 77 of the revised statutes, 1906." Our Act
really provides that a person who has resided in Canada for three years may
obtain letters of naturalization, giving certificates as to his character, and as
to his residence. He has to apply to the Courts, and the Courts decide
whether under the statute he is entitled to be natiu-alized. We passed in the
session which has just closed the clause which I have just read, by which in
the future a man to be naturalized who has got already a letter of naturaliza-
tion fi-om any British Colonies, will be entitled to come before the Courts and
to have his certificate of natui'alization in Canada, so to a general extent we
are accepting the certificate of naturalization which has been given by the
other British Colonies.

I do not know whether it is advisable or not that we should discuss the
BiU which is proijosed to be introduced into the House of Commons here,
but I think that Section 7 is going a little further than I, for my part, would
be willing it should go, because there it is declared that when a certificate of
naturalization has been given here it is to be accepted by the Colonies them-
selves. I think it would be just as well to leave this question entirely in the
hands of the Colonies. It will be advisable perhaps to have a general law, as
Canada, but at the same time civintj to the Colonies the

we are having in

535

right to legislate and do what they like. I am afraid this clause will have Fourteenth Day.

the elfect of preventing the Colonies from legislating on the question. That y May I907.

is the only objection I see to the Bill which is going to be introduced.

Natcralizatio.v.

Mr. DEAKIN : Generally the Bill appears to us to be a good one,
and woiild certainly be of assistance in clearing up ambiguities which at
present exist in the law. One point I may mention without entering into
detail is that if clause 12 were assimilated to clause 8, so that it might be
acted upon without assigning anj^ reason, that would be of advantage.

The naturalization question has few difficulties in Australia, except in
regard to the admission of coloured races, and particularly coloured aliens.
It is due to that apprehension that we have been and shall continue to be
vigilant in guarding a possible use of this Bill. As, however, it does not
appear in any way to impair the scope of our Immigi-ation Acts, under
which the education test is applied at discretion, this particular measure
is not open to the objection that it weakens the force of those statutes.
Under these circumstances we look forward with some expectancy to the
passing of the Bill as likely to be of value to ourselves as well as to other
Colonies

Geiii'ial 1-501TIA : T will ask for my memoraudnm to he read now.

The memorandum was read as follows :—

" (1.) It is desired that an alien naturalized in any portion of His

Majesty's Dominions should have to all intents and purposes, as from the

date of his naturalization, the status of a natural born British subject not

only within the ambit of the law mider which letters of naturalization are
issued to him, but everywhere, except when the naturalized person is

actually within the coimtry of which, at the time of naturalization Ik^ was,
and of which he still remains a subject.

" (2.) In order to carry out this object a BiU has been drafted under the
instructions of the Secretary of State for the Colonies consolidating and
amending tht^ enactments of the Lnperial Parliament relating to aliens
antl naturahzation. A copy of this BiU is included among the papers on
the subject of naturalization sent to each of the Colonial Premiers.

" (3.) The proceedure laid down in section 26 of that BiU for conferring
on an alien naturalized in a British possession outside the United Kingdom
the status of a Britisli subject everywhere, is not satisfactory.

" (4.) It has been suggested that the Imperial Act relating to the
naturalization of aliens should be so amended as to apply to every portion
of His Majesty's Boniinions. The objection to this suggestion is that it is
not desirable that legislation should be imposed on a self-governing Colony
except by the Parliament of such Colony.

" (5.) The difficulty can be overcome by providing in the Imperial Act
that so much of it as relates to the naturalization of aliens, their status when
naturalized, as also the status of their wives and children may be put in force
mutatis mutandis in any portion of His Majesty's Dominions, by a proclama-
tion of the Governor thereof. In a self-governing Colony such proclamation
would only be issued by the Governor on the advice of the responsible
Ministers of such Colony. The clauses of the draft BiU which woidd be put
in force under the proclamation Avould be sections 7 to 17 inclusive, section 18
(with the exception of subsections (2), (3), and (8)) and sections 20, 2] , 24,
and 25.

L I 1

53G

Foniteeurh D:iy. " (6.) The Liiperial Act nuist provide that the proclamation aforementioned

9 May 1907. shall name the authority to whom application shall be made for certificates of

naturalization, and by Avhom they shall be issued, and that the powers aud

Natukalizatiux. ^i^^^jgg conferred under the Act on'the Secretary of State shall be exercised by
( eneia o i.i.j ^-^^ ^^-^1 authority. It should also provide that a certificate of naturalization
issued by such authority shall have effect, to all intents and purposes, as if it
were a certificate granted by the Secretary of State, under the Imperial Act.

■' (7.) The following provisions in the draft Bill shou.ld, however, be
amended before it can be accepted by some of the self-governing Colonies : —

" (a.) The Bill, as drafted, applies to aliens of non-European descent
equally with those of European birth or descent. In some of the
self-governing Colonies (Natal for example) local naturalization
is granted only to Europeans, and it is unlikely, therefore that any
such Colony will agree to recognise as a British subject any coloured
person coming to reside therein, who has been naturalized in some
other portion of His Majesty's Dominions where no colcnir
distinction is made. On the other hand, the Lnperial Parliament
may strongly object to making any such distinction in any
naturalization law submitted to it, especially seeing that no such
distinction is made in the present Imperial Act of 1870, under
which it may be urged that a person naturalized within the United
Kingdom is a British subject in Avhatever part of His Majesty's
Dominions he may take up his residence. This difficulty may
be overcome by providing that a certificate of naturalization
granted in any Colony in which the Lnperial Act has been put
in force in manner prescribed in the last preceding subsection
shall have effect beyond the borders of such Colony only when
granted to a person of Euroj)ean birth or descent. By such a
provision one Colony would not be bound to admit as British
subjects persons of non-European descent naturalized in some other
Colony under the provisions of the Lnperial Act put in force in
such other Colony as prescribed in the last preceding subsection.
Notwithstanding such a provision, a coloured person naturalized
in the United Kingdom could be a British subject in whatever part
of His Majesty's Dominions he may take uji his residence. It
is difficult to see how this can be avoided in view of the fact
that such is the position under the j)resent Imperial Act, which
has been operative since 1870. In section 9 of the Draft Bill, the
words ' except as otherwise provided by law ' shall be inserted
after the word ' shall ' in the first line of that clause 30, so as to
make it quite clear that a coloured person, naturalized in r]ngland,
although a British subject everywhere, would, on taking up his
residence in any Colony, be subject to the same political and other
disabilities as are imposed l)y the law of that colony on coloured
persons, even though they may be British subjects.

" (b) Section 7 of the Draft Bill provides as a condition precedent to
tlie issue of certificates of naturalization that the applicant for them
should have, within a certain limited time, resided in his
Majesty's Dominions for a period of not less than five years. It
would 1)P better to insist that for one of those years, namely,
for the twelve months immediatcdy preceding his application, he
should have resided within that portion of his Majesty's
Dominions in which his apjdication is made. This would give
tlie aiilliority in whom is vested the discretion of issuing
(•I'llilicatcs of iial iirali'/ation, a bcthM" ojipoiM unify ol' exercising

;)37

his discretiou so as to avoid, as far as possi1)l(\ iindosiraMo aliens Komtccnili Day.
from hein^ naturalised. 9 May 15)07.

"(c) Under the Draft Bill an absolute discretion to issue certificates of ^. ^ ^— "

naturalization is given to the Secretary of State. It ought, — ^^i "^"-'-^Y"^-

however, to he made imperative that a certificate shall not be ^*'«"''''" "«'""•)

issue to a person who has beeu convicted (jf au offeuce for which a

sentence of imprisonment has beeu passed without the option of a

fine \intil he has received a free pardon, or until a period of fiv(>

years has elapsed between the date of such conviction and the

application for a certificate of naturalization. Provision is made

in the draft Bill for cancelling certificates of naturalization

obtained by false representation or fraud. If an aiiplicant,

therefore, who has Ijeen convicted of any such offence as aforesaid,

conceals such conviction in making his application for a certificate

of naturalization, he runs the risk of having that certificate

cancelled.

" (d) The draft Bill further provides that au applicant who applies for
Jjetters of Naturalization must intend when naturalized to reside
in His Majesty's Dominions. It would be better, if such intention
is to 1)6 of any value at all, to limit future residence to the poi'tion
of His Majesty's Dominions in which the application is made.
There may be evidence available to show that a person applying
for a certificate of naturalization in New Zealand, say, does not
intend to reside there ; it would be hopeless to expect to get
evidence that he does not intend to reside in some portion or
other of His Majesty's Dominions.

" (e) f 'lause 2S (a) of the Draft Bill provides that any person born in His
Majesty's Dominions shall be deemed to be a natural Ijorn lU-itisli
subject. It is suggested that an exception should be made in the
case of a i)erson born in His Majesty's Dominions, but wli()s(^
father was at the date of his birth au alien indentured labourer of
non-European descent."

Mr. GLADSTONE : Lord Elgin and gentlemen, may I observe that tht'
memorandum which has just been read raises a number of points, but I think
that a good many of them are dealt with in the statement which I made on
the last occasion when this subject was under discussion. For example, with
regard to criminals, I pointed out the practice which we adopt in this
country with regard to the granting of certificates, and said that it Avoidd be
quite easy to put into a Bill what, in effect, is our practice at the present
time. On that point, I think it would entirely meet the case put forward
imder (c). I am not going through all the many points raised, but there is
some misapprehension in parts of the memorandum as to the intention and
meaning of the Bill. For instance, under (n) in the memorandum which has
just beeu read, there is this : "if such intention is to be of any value at all,
" to limit future residence to the portion of His Majesty's ])ominions in which
" the application is made." But that woidd defeat the very object of the
proposal, because if a person in England, meaning to go to one of the
Colonies, and perhaps not able to go for a month or a year, desires to have
a certificate of luituralization, of coiu'se he cannot under the present law get
that certificate of naturalization because he does not intend to reside in
the United Kingdom. Tiiat is the condition of the law under which he
would get his certificate. We desire to remove that restriction. We
think the fact that a man who is in l''.ngland now, not having a certificate,
who desires to go to a ('olony ought not to l)e debarred from getting a
cert i Ileal e Ijv the mere reason that lie desires to 2:0 to a ('(iK)nv raliierthan

538

Fourteenth Day.
9 May 1907.

Katuralizatiux.
(Mr. Gladstone.)

stay for the necessary five years in tliis country. Those are details which, I
suggest, could best be dealt with in the subsequent inquiry which is proposed
in the resolution read by Lord Elgin.

In paragraph (4), which has been read, it is stated : " It has been
" suggested that the Imperial Act relating to the naturalization of aliens should
" be so amended as to apply to every portion of His Majesty's Dominions
" The objection to this suggestion is that it is not desiralile that legislation
" should be imposed on a seK-governing Colony except Ijy the Parliament of
" such Colony." Our object is to have a general law for the whole Empire
as far as is possible. May I remind the Conference that a phrase I used in
making my statement runs thus, showing at any rate what is our wish and
intention : " Our chief desire is to make the Imperial laAV as comprehensive
" and acceptable to the Empire as possible, and we seek in short, willing
" agreement on a basis which will not interfere with local interests, and
" legitimate desires of all the individual Colonial Governments Avhich are
" concerned in this question." In another place I said Ave desired the Bill
to include as much common ground as possible to meet the general
convenience of all parts of the Empire. This suggestion now made is rather
an argument against any Bill at all. If that is so, we shoidd be rather
wasting time in this Conference. But I suggest that though this is a very
important matter, it is in the nature of a detail, though a very important
detail, on Avhich, perhaps, the whole Bill would depend, and I think it could
be met by discussion so that the view which I expressed and have quoted
could be carried into effect — that the local interests of a particular Colony
could be considered and regarded in any Bill which was passed.

Sir WILLIAM LYNE : Was not there a suggestion that only certain
parts should be applied to the Colony by proclamation ?

Mr. GLADSTONE : By Order in Coimcil.

Sir WILLIAM LYNE : That would do a^vay with any troTible Avith
regard to a general Bill.

Mr. GLADSTONE : Of course, conditions could be attached to an Order
iu ( 'oniicil so far as to meet General Botha's Memorandum.

General BOTHA : If you Avill read No. 5 yoxi will find No. ;"> provides
hoAv to OA^ercome the difficulty in No. 4.

Sir JOSEPH WARD : May I be allowed to put the position of NeAv
Zealand so that Mr. Gladstone may have the situation in vieAV all roimd. As
far as New Zealand is concerned I AA^ant to make it clear, without ofEence to
any other race in any respect whatever, that Ncav Zealand is a white man's
coiintry, and intends to remain a white man's countrj^ ; Ave intend to keep our
coimtry for Avhite men by every effort in our poAver. If there is anything in
this proposal and I am just afi-aid there is, that would bring about a position
that in years to come some members of an alien coloured race Avho had resided
in England for a period of iipwards of five years, and had obtained a naturali-
zation certificate would be entitled, if this Bill became of general application
to the Colonies, to letters of naturalization of the Empire, which would entitle
them to come into our Colony as naturalized subjects. Speaking for New
Zealand we Avould strongly oppose it on national grounds peciiliar to oxir local
circumstances.

Ml-. GLADSTONE : Could not you meet it with the immigi-ation law ?

NArUKAI.lZATION.

539

Sir JOSEPH WARD : The immigration law there wouhl come into l-'ouiteontl. Diiy.
conflict with the proposals imder this Bill. Under our immigration laws in 9 3I:i.v 1907.
New Zealand, which I think our country would not relax, we insist upon
certain examinations, and will not allow aliens who do not comply with the
reasonable conditions that we require to come into our countiy. 1 want to he
perfectly sure, speaking from a New Zealand standpoint, that in any legis-
lation that is put upon the Statute Book in the hope of having law common
to all as Mr. Gladstone said, we maintain the right of New Zealand to
exercise to the fidlest possible extent the control of an alien race that we
might consider an undesirable acquisition to our community. I am not
saying it offensively in any sense whatever to any other race, but the feeling
that w^e should help our own race permeates the whole country. The school
children in our schools are taught to regard New Zealand as a white man's
country. We look upon it as a glorious portion of the British possessions,
and we want to keep it so. We are advancing in many ways and are well
circumstanced with a fine poptdation throughout, and we want to avoid the
mixing up and the contamination of the races both now and in the years to
come by preserving it for white men to-day and not allowing any law, w'hether
for the purpose of naturalization or for any other purpose to interfere ■with
it. That is the fundamental and essential condition which I wish to sec
established in the interest of Great Britain just as well as of New Zealand.

With that reservation, as far as we are concerned, 1 should only be loo
glad to assist in the very laudable object Mr. Gladstone has in view of having
uniformity of treatment, but I do hope in giving effect to that uniformity of
treatment that in the main overriding law you will make provision that the
right of a self-governing Colony cannot be overridtlen Ijy saying we lyivc
assented to some principle which might be found in operation injurious to
our people.

Mr. GLADSTONE : ft woidd \m: our intention to meet the views you
have expressed. I am not prepared at the present moment to say in what
terms in the Bill it should be done. 1 think that is a matter for discussion.
It Avill be of great value to me to have the views of the representatives of the
different Colonies, so that we can consider subsequently having those views
in black and white before us how best they can be met in the provisions in
the Bill. The Bill itself, as explained last time, is only put forward as a
basis for discussion. It is a draft Bill. There is no idea of at once inti-cj-
ducing it into the House of Commons and discussing it there with all these
particular matters put forward to-day by General Botha and others unsifted
and practically imsettled. There is no idea of that sort. I think I can give
an assurance that the views put forwai'd generally to-day will be carefully
considered before anything substantive and final is proposed formally.
Probably the best plan, if this resolution Avhich has l^een moved is accepted
by the Conference, will be for us to consider, in the light of what has been
said, what alteration in the draft Bill could be made in order to meet the
views expressed and then to leave the fuUer discussion to the subsidiary
Conference which, I understand, could be held under the terms of the
resolution adopted on the 20th April.

It is a very difficult matter, from the point of view of the law alone, and
I shoidd not care to attempt to offer suggestions or solutions of the various
points raised straight away.

Dr. SMAUTT : It is a very important question to get settled, if you
can do so, somewhat on the lines suggested by you, because we have the
greatest difhcidty. For instance, in South Africa, 1 take it that an alien
naturalized in one Colony, perhaj^s holding the very highest office, who,

540

Kouricfinli Day. after j^earb and years goes into uuotlier Colony, linds that lie luis no
9 May 1907. privilege of British citizenship wliatsoever. That is a veiy undesirable

state of affairs. With regard to the people naturalized in Cireat Britain:

NATunALizAiiux. ji^gy liave an advantage, I take it, nuder your Act of 1870. If they go to any
(Dr. Smaitt.) Colony they have all the rights and privileges of British citizenship. I am
glad to understand, if I interpret yoiu' remarks aright, that you are prepared
to consider what has been said by Sir Joseph Ward in that direction. There
shoidd be no difficulty in arriving at a common term, or common period, of
natiiralization which woidd be acceptable to all portions of the British P^mpire.
It is a fact that, in Great Britain, you may naturaUze an alien of non-European
extraction, and if there would be any possibility of your modifying that clause
in your Bill so as not to allow him, ipso facto, to claim the rights of British
citizenship in British possessions, it would meet a great many of us to a very
large extent. Then there would be a possilaility of the Home Government intro-
ducing a Bill, fixing, say, i;pon a certain period of five years, and other terms
to be agreed upon, and practically without special legislation in the other
Colonies or Dominions, it would only be necessary to pass a resolution or a
clause adopting the Home Act, which really would aIloA\^ anyl^ody naturalized
in any portion of the British Empire, who was of European extraction, and had
resided the specified period of time, ipso facto to have all the privileges of
British citizenship in any part of the British Empire to which he went.

I might give you a very strong case indeed. We had in the Cape Colony
a A-ery notable alien in the person of the late Colonel Schermbrucker. He
Avas naturalized as a British siibject, and became a Minister of the Crown.
To everybody it must appear as most undesirable that if, during his lifetime,
he had gone, say, to the Colony of New Zealand, or to the Colony of Australia,
he Avould haA^e had to be re-naturalized, and could not have claimed the
privilege of British citizenship. I believe such is the law as it exists at the
present time. I should like to have Mr. Deakin's view i;pon the question
of an ali(m, naturalized in Cape Colony (no matter how high a post he held in
that Colony) if he went to Australia, and, being of alien birth, his British citizen-
ship in the Colony of the Cape of Good Hope would not give hijn the privilege
of British citizenship in the Commonwealth of Australia.

}^h: DI^AKIX : I think that is so.

Mr. GLADSTONE : Yes, 1 think it Is so.

Dr. SMARTT : I think it will appeal to everybody that that is a very
desirable thing to alter. I know of many cases of the same kind, and it is
f)ecause we feel that these cases will lead to friction that Ave do hope the
Lnperial Government will draft a Bill Avhich Avill be acceptable practically to
all the Dominions, so that it Avill be only necessary for the Colonies to adopt
the principles of the Imperial Bill, therel:)y giving all the privileges of British
citizenship throughout the Empire.

Mr. GLADSTONE : The Bill as now (h-awn is Avldi ihe object of meeting
that point.

Dr. SMARTT : If you can meet the case of the non-Euroi)ean, it avIII
at once simplify the matter.

Mr. GLADSTONE : That Is a matter of very considerable difficulty, for
reasons AvhIch I need not state. I think It Avould simplify mattei's, liut that
is the point Ave have to consider, and to get round in some Avay, in order to
meet the vieAvs of the different Colonies.

all

CHAIRMAN : May I tako it tliat this resohition is adopted ? Fouitocnth Day.

The resolution icas carried nnanimoitshj. ^ May 1907.

Tlic Conference discussed the question of the puhlication of the Proceedings Resolution XIX.,
and decided that theij should be jmhlished at as early a date as possible, subject p. x.
to anij necessary revision or omissions.

NAVAL DEFENCE. . N.wal Deken..e.

Dr. SMARTT : Woidd I be in order in moving this Naval Resolution
alter the discussion yesterday? I do not think it will take any time
because it is a resolution which requires no reuiarks to make it accept-
able to the Conierence : " That this Conference, recognising the vast
" importance of the services rendered by the Navy to the defence of the
" Ein]>ire and the protection of its trade, and the paramount importance ol
" continuing to maintain the Navy in the highest possible state of efficiency,
" considers it to be the duty of the Dominions beyond the Seas to make
" such cc-atribution towards the upkeep of the Navy as may be determined
" by their local legislatun^s— the contribution to take the form of a grant of
'• money, the establishment of local Naval defence, or such other services, in
" such manner as may he decided upon after consultation with the Admiralty
" and as would liest accord with their varying circumstances."

CHAIRMAN : I mav say I communicated with the First Lord of th(>
Admiralty what occurred, and he desires me to say he leaves himself
entirely in the hands of the Conference with regard to any modilication or
omission of the words referring to the Admiralty. Otherwise Ik^ has no
objection to it.

Dr. SMARTT : My reason for moving this resolution is the fact that I
think we have all been impressed with the character of the discussion and the
necessity of maintaining the Navy at the fullest possible strength, and I think
we all recognise the manner in which the First Lord of the Admiralty has
met us, especially in his desire to meet the views of the outlying portions of
t,he Empire to see whether it is possible that they can assist in contributing
to the strength of the Navy by organising local defences of a Naval
character. I feel convinced that a policy of that sort will appeal very
strongly to many portions of His j\Iajesty's Dominions beyond the Seas. I
gather from the statement of the First Lord of the Admiralty that the
establishment of submarines, destroyers. Naval Reserve forces, local defences,
and works of that character, will be of considerable advantage to the general
strength of the Navy. I do not think anybody can take exception to the
resolution, because it distinctly states that it is subject to the votes of the
individual Legislatures, and that though the money will only be spent after
consultation with the Admiralty, it tloes not in any way take away from
the individual Colony its rights to be heard and practically to decide
th<> best manner in Avhich that money can be spent. But I gather I'rom
the character of the discussion we have had in this Conference, and the
nat\ire of the reception we have received — those of us who have had
the advantage of discussing the matter with the First Lord of the Admiraltj-
and his atlvisers— that the Admiralty will deal with the Colonies in the
most sympathetic manner in this direction, the result being a movement
that I consider will be of great advantage to the defence of the Empire. I
think we all recognise that the time is coming Avhen it is utterly impossible
for the Colonies to expect Great Britain to bear practically the whole of this
great burden of defence. The commerce of the Empire is now becoming of
such an enormous character that it is more and more evident to the
self-governing Dominions beyond the Seas of what vital importance it is to
tlicni, as well as to llie heart of ihe F]u])ire, that this connnerci' sbiiuM have

?:>

542

Fourteeutli Day. tlie fullest and most adequate protection. Therefore, I feel strongly tliat it
9 May 1907. is tlie duty of the Conference to come to a general resolution of this sort

before we part. At this late period I do not wish to go into the whole facts,

iSAVAL Defj?.xok. gg^^j.gg^ r^Q(j statistics, which we have gone over before, and therefore Avill
(Dr. Smartr.) content myself by simply moving the resolution, which I hope will be
acceptable to every member of the Conference.

Sir WILFRID LAURIER : I am sorry to say, so far as Canada is
concerned, we cannot agree to the resolution. We took the ground many
years ago that we had enough to do in our respect in that- country before
committing ourselves to a general claim. The Government of Canada has
done a great deal in that respect. Our action Avas not understood, but I Avas
glad to see that the First Lord of the Admiralty admitted we had done much
more than he was aware of. It is impossible, in my humble opinion, to have
a imiform policy on this matter : the disproportion is too great between the
Mother Country and the Colonies. We have too much to do otherwise ; in
the Mother Country, you must remember, they have no expenses to incur
with regard to public works ; whereas, in most of the Colonies, certainly in
Canada, we have to tax ourselves to the utmost of our resources in the.
development of our country, and we could not contribute, or undertake to do
more than we are doing in that way. For my part, if the motion w^ere pressed
to a conchision, I slioidd haA^e to A'Ote against it.

Dr. SMARTT : But the public Avorks to which you refer are of a
reproductive character Avhich are vital to the interests of yom- Dominion.

Sir WILFRID LAURIER : Some of our raihvays have never paid a cent
of interest or expenses.

Dr. SMARTT : Still, it is developing and opening up the country to an
enormous extent. All the colonies are building develoj)ing raihvays of a
character Avhich may not be revenue-producing for years. I thought the
Avording of this resolution A\'ould have specially met your vieAvs because
you Avill find to make siach a contribution toAvards the upkeep of the Navy it
may take the form either of a gi-aut of money, or the establishment of a local
defence force or other serAdces. I understand Canada suggested strongly the
other day that some of their other serA-ices Avere in the nature of local delVnce.

Sir WILFRID LAURIER : I have said all I have to say on the subject.

CHAIRMAN : I think it is a pity to pass the resolution if it is not
unauimoiis.

Dr. SMARTT: I should like A^ery much to hear tlu^ ojMiiions of the
representatives of the other portions of the Empire.

Mr. DEAKIN : I have no hesitation in entering into the discussion if
desired ; but if we are not going to pass the resolution is it Avorth AA'hile?

Dr. SMARTT : I think it is a great pity Ave do not pass something. We
have done so much in the AA'ay of pious affirmation, that I am anxious we
shoidd do something of a practical character.

Sir WILFRID LAURIER : It can be passed if there is a majority. For
my part, I must vote against it.

Sir JOSEPH WARD: To do auy good avc would jvquire to he
unanimous about it.

r,A'i

54
Dr. SxMAUTT : Yes, I suppose so. Koui'ieenth Day.

9 Miiv 1907.
Mr. WINSTON CHURCHnX : It is not much good to liuve a resolution ^—

at all if we cannot be unanimous. ^'^'''^^ Dkie.ncb.

CHAIRMAN : I think we had better not proceed anj^ further just now.

Sir Wn.FRID LAURIER: We, of the different Dominions beyond the
Seas, have tried to l)e unanimous up to the present time. I am sorry to say
this is a question upon which we could not be unanimous. Therefore,
Dr. Smartt can move it if he chooses, or withdi-aw it. But if he presses it I
should have to vote against it.

Dr. SMARTT : I am absolutely in the hands of the Conference. I do
not want to press a resolution that is not likely to meet with the general
approval of practically everybody on the Conference, especially a resolution of
this particular character. We might, perhaps, let it stand over until the next
sitting. Between this and Tuesday I may be able to modify it in some way to
meet Sir AVilfrid's view.

DOUBLE INCOME TAX. Double Income

Tax.

CHAlIiMAN : The two questiuus tlic ( 'liaucellor of the Exchequer has

come about are, the double income tax aud as to the profit on silver coinage.

I understand it has been discussed akeady.

Mr. ASQUITii : Dr. Jameson, Dr. Smartt, and others were there and
discussed it with me.

Sir JOSEPH WARD : Is it necessary to go over tlie discussion again ?
\Vc have had it before.

Mr. ASQUITH : I hope not.

Dr. SMARTT : I understand the discussion Ave had before was printed
and Avill he forwarded to the Conference.

Mr. ASQUITH : It is to be taken as part of the proceed ings''- of the
Conference and therefore Ave need not go over that ground again.

Dr. SMARTT : We hold equally strongly the vieAVs Ave expressed the
other day. We only hope you may have modified yours since then.

Mr. ASQUITH : I am afraid I hold the same vicAv, I expressed then and
therefore Ave nmst agree to differ about it.

CHAIRMAN : I only put it on the agenda becaiise that was xmderstood.

Mr. ASQUITH : Yes, it is right to raise it again, but it must be taken
as Ave left it the other day.

Dr. SMARTT : You consider no further discussion AviU bring you any
nearer to what is our idea of what is fair.

Mr. ASQUITH : I am afraid not. It goes to the very root of our income
tax law whether right or wrong.

* See pp. 1 S3 -190.

544

Fourteeiuli Day. X)i: SMAliTT : As tlii« memorandum is going to be submitted to the

9 May 1907. CoufereucB and Avill form a portion of the Conference proceedings, though

_^~r. the Chancellor of the Exchequer is not in accordance with oiir views, woidd

Tax -^^^ '^^ ^■'^ advisable to take the vieAvs of the Conference on the question?

Mr. ASQUITH ;• If you please.

Dr. SMARTT : So that it is tabulated what the views of the various
portions of the Empire are on the question.

Mr. F. R. MOOR : I want to say that I have not heard any of the
arguments addressed either by the British Government or the Colonies,
because I imderstood this was a sub-committee which was going to discuss
the question particularly concerning those immediately interested. I think if
Mr. Asquith could just give us in a few words his reasons it would be
valuable.

Mr. ASQUITH : I am afraid Dr. Smartt would not be content without
adding his few words — quite rightly — and then Ave should go over the Avhole
grountl again. It Avas Avith the object of saving time in that respect that avc
had Avhat I call a sub-Conference on this subject.

Dr. SMARTT : The reason also was that it Avas referred to this Conference.
IhiAdng had a discussion in your Department, Ave should take the opinion of
the Conference upon this question, as the opinion of the Conference might
in the future Aveigh i;pon the mind of the Chancellor of the Exchequer.

CHAIRMAN : The proceedings of that meeting have been circulated.

Sir JOSEPH WARD : It seems to me that a reading of the proceedings
of the Committee by the different gentlemen not on the Committee Avill giA^e
them the vicAV put on record by the Chancellor of the I'^xchequer, in AA^hich
he pointed out it Avas not possible for the British Government to give effect
to some of the suggestions made. The A-ery fact of that being so, Avhatever
oj^inions might be expressed here — they are mere expressions ot" opinion —
cannot alter it, and Ave woiild not gain anything by re-discussing it. It is all
on record in these proceedings.

Dr. SMARTT : But the vote of the Conference is not on record on that
particular matter. I Avant simj)ly to take the opinion of the Conference.

Mr. ASQUITH : I have no objection if you think it serves any useful
purpose.

CHAIRMAN : You Avant the opinion of the Conference as to Avhether
they agree Avitli your resolution or not ?

Dr. SMARTT: Yes.

CHAIRMAN : I can ask the Conference tliat. The resolution is "That
" this Conference is of opinion that shareholders, resident in British Colonies,
" of companies which are already liable to Colonial income tax .payments,
" should be exempted from similar taxation in the United Kingdom, and
" strongly urges His Majesty's Government to adopt, at the earliest possible
" date, the legislation necessary to give effect to such exemption."

545

Sir WILLIAM LVXL : Do I mi<lci-st;iii«l that the practice is that I'oiirtcentl. Day.

supposing a conipauy is registerocl in another part ol' the workl with persons ^ ^^^y l-'O'-

living liere, deriving income from that company, you tax that income ? Double Jxcome

Tax.

Mr. ASQUITJI : If they Hve liere.

Sir JOSEPH WARD: We all do the same. What we want to try to
get is a mutual arrangement that one sliall a1)andon the imposition at one
end and the other at the other. We all do the same aljsolutely.

Sir WILLIAM LYNK : Then I think we ought to put on an overtax.
The IJritish C.lovernment stoi:>ped me when I Avanted to do something of the
kind once.

Sir JOSEPH WAIM) : If tliere is a shareholder in a British Company
carrying on operations liere entirely, and he is living in New Zealand and
gets his income out from England to New Zealand, we tax it there. The
AVM-y same is done by the British ( iovernment when a New Zealander is living
in r^nglaud.

Mr. ASQUITII : The whole thing is set out in the discussion we had the
other day. The considerations on one side and the other are stated with
perfect lucidity, and I think it would be a pity to have to go over the ground

CHAIRMAN : This resolution will l)e on record, and the proceedings at
the Treasury are recorded, w^hich show that the Chancellor of the Exchequer
cannot agree.

Dr. SMARTT: I understand Mr. Deakin, Sir Joseph Ward and
General Botha have accepted the principles laid down in the resolution
already. That is why I would like to have it on record at the Conference that
they have accepted it.

Sir dOSEPH WARD: If the resolution goes on record with the record
of the proceedings of the Conunittee and the views of the C'hancellor of the
Exchequer, I think it is just as good as a resolution passed one way or the
other.

Dr. SMARTT: It is unfortunate that Mr. Moor did not happen to he
present at the meeting we had. I know he agrees with the tenour of the
resolution, and I thought if w^e could have got it affirmed here, Mr. Moor, \vho
was not present at the discussion, would be able to vote upon it.

Mr. ASQUITH : No iloubt all the representatives of South Africa would
agree.

Mr. F. R. MOOR: We have no income tax in our Colony, but that does

not justify the double tax, in my opinion.

Mr. ASQUITH : They have in Cape Colony.

M III

546

Fourteenth Day. SILVER COINAGE.

9 Mav 1S07.

Silver Coinaoe. -'^^i'- DEAKIN : The papers for which I have sent and my analysis

of the return you have been kind enough to supply, have not reached me.
The general opinion with us that the profit on silver coinage is large, is
borne out by the return. The net result of the operations of the Mint must
be most satisfactory.

Mr. ASQUITH : They varj^ very much from year to year. We had a
very good year last year as it happens.

Mr. DEAKIN : The price of silver was low.

Mr. ASQUITH : The price of silver is one factor, but the demand is of
a very capricious kind, particularly from West Africa. A large part of our
profit is due to an abnormal demand fi-om West Africa, where the natives
like fresh bright silver and keep it.

Mr. DEAKIN : Apart from that, so far as I follow this return, the profits
made on Australian coinage alone look extremely well — over 40,000L a
year.

Mr. ASQUITH : That is not far wrong. I will tell you exactly how I
take the profit in Australia. The average amount taking five j^ears silver
coinage applied to Australia is 76,480L per annum. The mint profit on that,
if all the coins had been made out of new bullion, would be 41,4f IL, but we
have to deduct firom that the worn silver and on the average that was
withdrawn from Australia to the value of 11,706L per anntun, so that the net
supply of new coins was 7(3,480L minus this 11,706?., which would give you
64,774L a year, on which the profit woidd be 35,115?. Then if you deduct
the loss of the worn coin from that, as I think you ought fairly to do, because
there is considerable loss on this worn silver — we average it at about 10 per
cent, of the face value of the coin — if we take that 11,700?. which is the
average annual amount withdrawn of worn coin from Australia, 10 per cent,
of that is 1,170?. The net annual profit attributable to Australia 35,115?. less
1,170?. equals 33,945?. That is the best sum I can give you. That has been
worked out as fairly as it can be. That may be said to have been the
average profit of the Mint during the five years from the Australian issues.

Mr. DEAKIN : Have you any proposition to make for future coinage ?

Mr. ASQUITH : Would you like to coin yourselves, because we can offer
you that ?

Mr. DEAKIN : That has been proposed.

Mr. ASQUITH : We are quite ready to give it up and let you coin
yourselves, just as Canada does.

Mr. DEAKIN : Canada has a subsidiary coinage.

Mr. ASQUITH : Yes, and yours would be a local coinage.

Mr. DEAKIN : Yes, distinguished in sonie trifling way.

547

Mr. ASQUITH : You would have to choose for yourselves about what Fourteenth Day.
you did. 9 May 1907.

Sir JOSEPH WARD: Would you concede the same to New Zealand Silver Coinage.
if we desired it ?

Mr. ASQUI'l^'H: Yes, I thiidv you would stand on exactly the same
footing. I think that is a thing you might consider. I do not ask for an
immediate decision.

Mr. DEAKIN : I should like to consider it with any suggestions the
experts of the Mint can make.

Mr. ASQUITH : I make further the offer formd on the last part of the
memorandum as to withdrawing the worn gold coin which is at present done
in this country. I offered to withdraw that at Sydney, or Melbourne, or
wherever you please. That would be a great convenience to your trading
community. There are those two offers, if you will kindly consider
them.

Mr. DEAKIN: Thank yoxi.

Dr. SMARTT : How would that meet the Colonies which do not coin
their own silver ? Would you be prepared to make them any allowance off
(.be profits made on the silver coinage ?

Mr. ASQUITH : We wiU make you the same offer as the others.

Dr. SMARTT : But we do not coin.

Sir JOSEPH WARD : We do not coin either, but I will accept your
offer, kindly made, and will consider it.

Dr. SMARTT : You do not think you can meet us in any way so long as
we do not coin ?

Mr. ASQUITH : You would probably find the establishment of a separate
Mint in New Zealand would hardly be worth the candle ?

Sir JOSEPH WARD : I think that is very possible.

Mr. ASQUITH : Soxith Africa is rather different.

Dr. SMARTT : We see from the figures worked out that there is no
difficulty of apportioning the profit to each Colony; consequently, you might
be inclined to allow the Colony the profit made on the coining of tlie silver.

Mr. ASQUITH : I will consider your case ; and the whole of South Africa
stands on the same footing as regards this — General Botha and Mr. Moor
also.

Dr. SMARTT : You will consider my question without committing your'-
self as to what might be a fair allowance.

Mr. ASQUITH : Certainly, without committing ourselves at aU.

M 1.1 2

548

FoiTtecnth Day.
y Mav 1907.

General Botha's

t'AUEWELL.

GENERAL BOTHA'S FAREWELL.

General BOTHA : T^rd Elgin and gentleman, my time is over now.
I nnfortnuately have to leave before you resume again. I must go on
Saturday to South Africa, and probably this morning is my last attendance,
but I hope I shall again have the opportunity of attending later Conferences.
I cannot leave without saying good-bye to you all, expressing mj^ gratitude
to the Chairman for the able way in which he has led us and conducted the
proceedings. It has been one of the greatest pleasures of my life to meet the
representatives of the various Possessions here, and to shake hands with them,
and I want to give you all this assurance that the friendships which I have
formed here in person will alwaj's be strengthened as far as I am concerned.

CHAIRMAN : I think I may say on behalf of the Conference that I
am sure we entirely respond to the sentiments expressed by General Botha.
It has been a great pleasure to iis to see him here. We know he has come at
considerable inconvenience to himself, but I venture to tliink that the
Conference of this year would have suffered very much had he not been able
to attend. We, I am sure, also reciprocate entirely the feeling of the
advantages which we gain by mutual intercour.se, and though I do not know
which of us will be here to meet him, we shall hope that he, at any rate, will
attend another Conference.

After a short adjoui-nment :

British
Interests ik
THE Pacific.

BRITISH INTERESTS IN THE PACIFIC.

The Conference sat in private. On resuming :

Mr. DEAKIN : Lord Elgin, with the pennission of the Conference
I propose to invite their attention to this question from a general point
of view because without reference to the past, I doubt if the intention
of the Commonwealth Government can be made clear. There was a
time — and' that not so far distant — when this ocean was igiiored and
these Islands were little visited because they presented small opportunities
of trade or settlement — a time at which Great Britain was so much
the predominating power that almost anything desired in the way of
possession or suzerainty cotild have been acquired without difficulty.
Of coi;rse the dead past must be left to bury its dead, but some reference
is necessaiy to the indifferent attitude of statesmen in this coxmtry, a not
unnatural attitude because, to the United Kingdom, the Pacific is remote,
and not over the greater part of it even a highway of much traffic. On the
other hand, to Australia and New Zealand in particular, and also to Canada,
the future of the Pacific is extremely important, and may become more
so at any time, now that attention is directed to its great spaces where rival
nations have found a footing, and are if anything disposed to strengthen
their hold. This difference of situation led from the first to a different
attitiide of mind on the part of the people of the CommouAvealth and
New Zealand, the people of Australasia, as compared with that of the
j)eople of the Mother Country. As a conseqiience, the course that lias been
followed and consistently followed in Australasia has neitlier been under-
stood nor appreciated here. I ilo not wjsli to (IwcJl once more upon the

549

iniiiossihility of severiiiii; the interests of the Empire into those which couhl Fomtceiitti I)ay.
he allot tetl to the United Kingdom and those "which should be allotted to its 9 May 1907.
Dominions beyond the Seas. As a matter of fact, we have all but one interest,
though this may be moditied by the claims and interests of the several parts. Ixti-kfs'A"ix
But no gain is possible to the flag in the I'acific which is not of gi"eat moment thk V.unw.
to Great liritain as well as to Australasia. I do not j^retend to apportion the (Mr. Deakiu.)
relative values of gains or losses, that woidd be an idle task, liut we may
fairly assume at least an equality of interest in matters affecting the Pacific.

Owing partly to the dominance of a c-ertaiu school of political thought
in the I'nited Kingdom, which so far as appearances go has much diminished
in authority, there was a time wdien the anxiety of public men in this country
was to avoid under any circmustances the assumption of more responsibilities
and a great Avillingness to part with any that they possessed. I do not
know how far that school is still represented, nor does it matter ; but there
never was a time when a similar school of thought existed in our new
countries. From the verj^ first, the earliest settlers even wdien they were
few in numljer, were large in their andjitions, not for themselves l)ut for the
coimtry to which they belonged, and for those who were to come after them.
That w-as the original cause of difference of polic3^ Thus the opposite jooints
of A^eAV of those who live by the Pacific Ocean, as is our case, and those
on this side whose shores are washed by the North Sea, have been the
chief gi-oxmd for difference. But what is sometimes forgotten is that in
the veiy earliest periods, Avhen the British fiagw^as first carried into these seas,
there were British statesmen w^ho entertained the largest ideas of the scope of
oiu' authority in the Pacific. I think it was Avhen Governor Philip was sent
out to the Colony of New South Wales that his Letters Patent not only included
Australia, but Avhat Avere termed the adjacent islands, and although these were
the daj's liefore steam, at least one of his successors held that " adjacent
islands " exteudeil to Tahiti, naturally including all the groujis between. At all
events, the New Hebrides Avere distinctly included within NeAV Zealand in the
earliest days of that Colony, and our title to them was only abandoned in 1840.
The prevailing attitude of mind here is fairly exjiressed in a despatch
published in a Blue Book relating to the New Hebrides this year, relating to
the C'onvention with France. It appears on page G4, where a despatch of
JMr. Alfred Lytteltou, of October 31st, 19(13, is quoted. In reply to a paragraph
in a letter which I had written, commenting on Avhat I termed " the inaction
of the Imperial Govermuent," I was direct(Ml to this document, as (expressing
the views wdiich are still held. In this th>spatch it is pointed out that a vast
extent of territory in the Pacific Ocean has been definitely brought imder
British control during the last 30 years. It must not be forgotten, as I have
already said, that it Avas indefinitely under British authority before that ; but
the statements here made shoAV Avhat parts Avere definitely brought under
British control during the last 30 years. Pefcrence is made to Fiji, part of
NcAV Guinea, the Solomon Islands, the Gilbert and the l">llis Islands, and the
Cook Group, most of those acquisitions having been made as is admitted
mainly (sometimes entirely) of the interests and sentiments of Australia and
NcAv Zealand, Noav that is perfectly true, liut for the action of Australia
and NeAv Zealand, there Avould not be an island to-day in the Pacific under
the British flag. I am old enough to remember the long agitation Avhich
led to the annexation oL' Fiji Avhich Avas very iiearly alloAved to sliji through
our fingers. I rememl.)er only too AveU the Avaruings transmitted to the
Imperial Government Avith reference to Ncav Guinea Avhen Ave Avere assured
l)y the then Secretary of State for the Colonies, Lord Derby, that there Avas
no intention on the part of Germany to annex any part of that island. It Avas
in this faith that the ilag hoisted without authority Ijy the Governor of
Queensland, the British Hag, AA'as hauled dt)wn,

48668. M 111 3

550

Fourteenth Day.
9 May 1907.

British
Interests in
THE rACiFic.

Sir WILFRID LAURIER: By whom ?

Mr. DEAKIN : By order of the British Government. Lnmediately
afterwards one half of that very territory which we had just been assured
was not going to be touched was appropriated by the German Government.
Then, because under pressure of public opinion that Minister for the Colonies
was forced to take over the fi-action left, that is cited to us years afterwards
as a proof of the spirited policy pursued by the British Govermnent. What
is true of this island is true of the Solomon Islands and the Gilbert and Ellice
Islands. Whatever losses there are in the Pacific — and there have been
others — have been due to neglect here. Every single gain has been due to
pressure from Australia and New Zealand. Consequently, whatever credit
is due for the acquisition of these islands rests on the other side of the
globe and not on this. Is it, therefore, to be wondered at that a feeling has
been created and still exists in Australia — an exasperated feeling — that
British Imperial interests in that ocean have been mishandled from the first ?
It is more by good luck than by good management that we retain even the
islands that we possess. That is to be remembered, in coming to the
consideration of the recent developments to which these remarks are a
prelude, because, rmless you understand that, from the point of view of
Australia, we once had the Pacific within our grasp, and have retained
nothing of it Avithout constant protest and exertion, while we have lost a
great deal which we might have secured, our sentiment, which is apparently
quite unappreciated by the press and public men of this country, will never
be imderstood. Here we are represented as a grasping jieople who, settled in
Australia, a territory still too large for us, are reaching out in a grasping-
spirit to add to it merely becaitse we are in Australia. That exactly reverses
our point of view. We practically had these islands, or most of them, ahnost
as much as we had Australia in the first instance. It is not a series of
grasping annexations that we have been attempting, but a series of
aggravated and exasperating losses which we have had to sustain. There
you have our two absolutely opposite points of view, the point of view of our
part of the world and the point of view in this country, and it is only because
it is necessary, as it appears to me, to make that fundamental contrast of
attitude imderstood, that I have ventured to detain the Conference by
referring to it.

Let me now aj)proach the latest illustration of our misfortunes in the
New Hebrides. Ever since I have been in public life this group has presented
vexed problems to Australia. It was only after a very long struggle that in
1887 we were able to obtain a means by which the titles of British settlers
there could be officially recognised. We wished some foothold given to those
early and enterprising men. In 1887, as is now well understood, when the first
of these Conferences assembled, the project quite favourably regarded by the
British Government included the surrender of whatever rights were possessed
in that group. It was only on account of the very vigorous opposition to that
suggestion offered by Australasia that the islands did not then pass entirely
under the French flag. That was another experience which has not bee.n
forgotten, and is not likely to be forgotten. The intention in 1887 was that
some arrangement should be arrived at with the French Republic in reference
to the futiire of these islands. When the Conference of 1897 met, the only
reference to them that I remember, states that no decision had been arrived
at. For ten years the matter had been allowed to rest. In 1904 an
agTeemeut between the British and French Govermnents was signed which
provided for a settlement of matters in dispute between them all over
the world, in Morocco in particular, in Afiica generally and elsewhere.
Again the New Hebrides only ajppeared in a footnote indicating that
something was still expected to be done. It requires to be rememljered

551

that during all these years, before even land titles were recognised, there Fourteenth Day.
were British settlers in that group ; there were British missionaries ; and 9 May 1907.

that whatever was being done in the way of trade or to inculcate the

principles of Christianity was undertaken by Britons, including a certain i^tereItTin

number of Australians. I am not delaying for exact dates, but think it was the Pacific.

in consequence of our fi'esh representations made in 1902 that a British /jy^ Deakin.)

Resident was appointed, a gentleman without real status or legal authority of

any effective kind, who was to keep a general oversight of British interests

and to advise. He had no real power ; he was not aiithorised to keep records,

and has not even the means of necessary transport which would familiarise

him with the various islands and villages of the group. Under all these

difficulties it is not surprising that he has accomplished little. During

this earlier period, the New Hebrides had been dealt with by the individual

Australian States and New Zealand ; and among the very first resolutions

passed l)y Conferences which were then held at which six or seven Colonies

independent of each other were represented they passed strongly worded

resolutions about the New Hebrides, with which I do not desire to detain

you. Never at any time has this matter been out of the view of Australian

public men, and of the Australian public. It has always been Avithin tlieir

horizon. On January 1st, 19U1, the present Commonwealth came into being,

and within two months one of the first despatches ever directed fi-om the

new (Tovernment of the whole of Australia, addressed to this office, related to

the New Hebrides. Consequently, statements which have recently been made

in Parliament, here and elsewhere, that the New Hel^rides have been the

subject of correspondence for the last 20 years, and that some persons here

were saturated with the views we have expressed, have very good foundation.

We have kept on protesting and urging action without any cessation for the

last 24 years. Before that there were frequent and spasmodic outbu.rsts of

complaints as we saAv the islands slipping away, but for ihe last 24 years

there has been systematic agitation, yet practically there has been nothing to

show for it Tuitil this last.

Sir WH.FRH) LAURIEU : Are you asking for any special action
or protesting in general terms against the STipineness of the Government?

Mr. DEAKIN : Let me first get on record an explanation of the
Australian attitude expressed in both special and general protests and now
approach my second siibject, the Convention recently concluded. That I do
not propose to discuss in detail here. As to the merits or demerits of the
convention made, we have said our say and I have since had the opportunity
of communicating with Members of Plis Majesty's Government here in
reference to it. I feel it would be idle to criticise that Convention now ;
but I do feel in justice to ourselves, and to meet some statements to
which I must presently refer, that we are entitled to have it imderstood why,
and with good reason, we have an exasperated feeling. I do not know of
any series of public incideiits that have sown more discord in Australia
and created more discontent than those dealing with the Pacific Islands.
They have caught and kept the i-)opidar eye and inflamed the popular mind.
I think that after all our unfortunate exi)eriences these years we were entitled
to expect that in any dealings with the New Hebrides, AustraHa and New
Zealand would have been consulted, kept in close toiich with the Colonial
Office, and aflbrded every opportmiity of assisting to l)riiig about a fair
settlement. The trade of the New Hebrides, such as it is, is with Sydney
and Auckland, and consequently the best infoiTaation available is to be obtained

M m 4

552

Fourfeeuth Day.
9 May 1907.

British
Interests ix
THE Pacific.
(Mr. Deakin.)

in them. There was first of all a fair title of our people and their GoA'ern-
nient to be consulted, and there was next the possession of an intimate
knowledge of their local conditions possessed by our missionaries and our
traders. On hoth these grounds we, as representatives of the British people
in those seas and deeply interested ourselves, were entitled to be heard. The
fact is, however, that this Convention was arrived at without us in a most
extraordinary manner. It will be remembered that we have been for the
last 24 years corresponding, passing resolutions, and protesting ; and
when it appeared impossible to make any further advance on the lines that
we had been following, about the middle of 1905 I addressed two despatches
to this office. The first was in consequence of one of the many deputations
which waited on the Government fi'om missionaries and people interested in
the islands, asking, as they have asked a score of times, for some settlement
of the issues connected with them. My first despatch conveyed their
complaints and representations, but from aU the information I had been
able to obtain I had become persuaded at last that comparatively little
could be hoped for British supremacy in those groups at that time. 1 con-
sequently wrote another despatch, in which I suggested that a permanent
joint protectorate imder representatives of both coimtries and founded
upon conditions giving security for investment and settlement, might
be worth considering. This is given at page 3 of the Blue Book already
alluded to. That suggestion was prefaced in these terms : " YoTir
" Excellency's advisers, though most reluctant even to appear to relax
" their efforts to secure annexation, are so discouraged by the inter-
" minable postponements, and the uncertainties of the present position
" that they feel constrained to inc^uire whether a proposal for such a
" protectorate is favoured by His Majesty's Government and the Republic of
" France, and if so, iipon Avhat terms." At the conclusion of that despatch
we pointed out that the sentiment of the people of the Commonwealth is so
adverse to anything resembling a sacrifice of the great Imperial possibilities
of the New Hebrides, that this incpiiry was tentative only in order to ascertain
the prospects of such an arrangement, and afford an opportunity for its
consideration in the event of no better alternative being open to us. Tliat was
the end of August 1905. I do not think anything could be clearer or more
explicit than those despatches. We made an incj^uiry. We wanted to l\:now
on what terms a joint protectorate would be possible, and pointed out that oiu-
inquiry was tentative only to afford an opportunity for further consideration.
To that letter we received no reply — that is to say, no reply for
months afterwards, months during which a great deal was happening.
This Blue Book renders it unnecessary for me to follow the whole course
of tlie subsequent proceedings in detail. It commences with a letter from the
Foreign Ofhce to the Colonial Office of September 1905. The Foreign Office
then forwarded a memorandum from the French Minister in London with
reference to an examination of title deeds in the New Hebrides. Tlie
correspondence which had been conducted between the Imperial Govermneut
and ourselves had two or three different lines. One was the main corre-
spondence asking for annexation, anotlier and quite distinct corresj^ondence
was being carried on in reference to the titles to land claimed by
British or French settlers with the ol)ject of getting these in some way
settled, in order to avoid the quarrels which were springing up between
the settlers and the natives, or occasionally between nationals, either
British or Frinicli, over their transactions in land. There was a tliird line
of correspondence which related to the occasional disturbances in the island
or minor squabbles. This despatch containing the complaints ui the
deputation was written l)efore my despatch of August 29th, 1905, touching
upon a jiossible protectorate, '^llie negotiation in London differs from both

sinc(' it sprintjs out of the corrcspondonco aliont land titles, these being Founoentli Diiv.
in u very unsatisfactory position at that time. The French C'onnnissaire 9 ilay 1907.

(Jeiu'ral had l^een requested to furnish his observations ou the proposals

made bv the British Government with regard to the land claims in the , hitism
Xew Hebrides, that is on page 1. The suggestion was that a local mixed thk Tacikic.
commission would be necessary to deal with those land titles, but the (j^,, Oeakiii )
I'^reuch Oovernment thought there would be olijections to investing such
a commission with full powers, and thought it would be advisable at least
to specify the nature of the evidence which could be put in on one side or
the other. What was therefore suggested by them was not a commission to
settle laud titles, but only a chat between two officials to settle the terms
on which evidence regarding these titles could be put in. The French
( iovcrmiHMit suggested nothing more than verljal negotiations of a purely
semi-otUcial character between a French expert and a British otlicial. T^hat
was the proposal. The translation given certainly does full justice to the
i''rench recpiest, which will be foiuid in the enclosure. Then ccMues the
arrival of my August letter to which I have already referred. The French
Government on October 5th agreed that the examination of title deeds should
be trusted to a local mixed commission and suggested for the purpose of
settling the powers to be entrusted to the commission, that the nature of
the evidence which might be put in should be discussed in verl)al nego-
tiations oF a purely semi-ofhcial character. That seems to me to be a little
larger than the lirst proposal, " settling the powers to be entrusted " seems
an addition, liut it is immaterial. Needless to say, of all this corre-
spondence we heard nothing and knew nothing. So far as we w(>re
concerned it did not exist. Ou November the 4th, the Colonial OiKce tele-
graphetl to New Zealand to ascertain whether they were favourable to a joint
Anglo-French protectorate. They received an answer given on page o to
say : " li' no better arrangement could ])e made. They wouhl prefer annexation,
but railing that the island should be divided." Next, on page 4, we find that
the " functionary " named by the French is M. Saint-Germain, a senator of
lu-ance, occupying a very consideralile public position ot intluence in that
country, and scarcely I should say, the kind of functionary contemplated in
the earlier correspondence. In addition he is to be supported by two
officials, one attached to the Ca1)inet of the Colonial Office of France, and the
other attacheil to the Cabinet of Monsieur Clemenceau. We are thus prepared
lor the letter of Decemlier 0th, wliich shows that the next suggestion is that
the scope of the commission should be enlarged to discuss the i)est means of
terminating the difficulties which have arisen owing to the absence of
jurisdiction over the natives of the islands. The French enclosure is given
below. Then we find the Colonial Office infonning the Foreign Ofiice that
thn>e representatives of the French Government are expected in connection
with estal)lishing a land claim trilunial in the N(>w Hel)ri(]es. Mr. I.yttelton,
the Colonial Secretary, then submits, for the lirst time, that the opportunity
shouhl be taken to disciiss verl)ally with them, if they were wilb'ng, tlu^
question of a joint protectorate. Of this, too, we kneAV nothing.

We pass on now to a further communication of January 9th l'.)(M),
from the Foreign Odice, enclosing a copy of a communication from thc^
French Embassy. The chat between two officials about evidence has
become a Commission — " au sujet de la Commission des Nouvelles Hebrides "
is the phrase used in No. 13. In atldition to M. Saint-Germain, who has
the titl(^ oF " Commissaire," there comes IMonsieur Picanon, a very cai)able
and high official, who had just ])een (iovernor of New Ca]ed(,)nia, ami
MonsiiMir Wo^ber, who is joint chid ol the oifice of the Colonial Minister. In
adiHtiim tliei'c is a ^fonsieur (iouruay, who is to l)e secretary and interpreter.

554

Fourteenth Day. The single " fimctioiiaiy "has been transformed into a Senator, an ex-Governor
9 May 1907. of New Caledonia, a joint secretary of the Ministry of the Colonies, and another

gentleman from the same office. It is pointed out in the last paragraph that

Inte"'^<*° • ^^^^ ^^ ^'-'^ ^^ official Conference, but for the purpose of a simple exchange
THE Pacific, o^ views. It must be understood that we remained unaware of any of these
(Mr. Deakiu.) proceedings. The distinguished gentlemen came to London, and the
Convention sat in Febntary 1900. Except for the information conveyed to
us by ordinary newspaper cables, we were still unaware of its existence
and of its character. We had not the faintest conception of its scope.
We saw the notices in the papers, and were somewhat surprised that the
appointment of the French official and the British official who were to
settle the manner in which the evidence on titles should be put in had
not been conununicated to us, but regarding the meeting in that light and
remembering that it was to be unofficial and that everything was to be subject
to after consideration, we supposed it was by a mere official oversight that
we were being ignored upon a matter of small importance. It was not, in
fact, until expressions of astonishment began to appear in the Australian
papers after I had heen questioned about the meeting, that the correspondents
of English jiapers in Australia cabled to London some expression of surprise.
It was tlieu that we received the first reply by telegraph, which will be found on
page 10, March 5th, 1906, referring to our unanswered despatch of August 29th
and informing us that the " Joint Anglo-French Commission has signed
" Convention for sidjmission to British and French Governments for settle-
" ment of questions in New Hebrides. Convention wiU not be confirmed until
" His Majesty's Government has had opportunity of considering views of your
" Ministers. Co^Dy will be sent by next mail." This was signed by Lord
Elgin. That was the first intimation we had that there was a Commission,
that a convention had been drawn up and signed, and that it was to settle
questions in the New Hebrides other than those affecting land titles.

There I can stop my recital of events. But it is at least a matter of
interest and of some curiosity to know that though the Convention did not
sit imtil February 1906, previously, in December 1905, there appeared in
a French paper a forecast of the findings to be expected from this Commission
which was posted to me by a very experienced and able member of the
House of Commons. So that I was not altogether imprepared for the
Convention when it arrived, seeing that it followed, according to the member
who posted it to me, and according to my own recollection, the A^ery lines
on which the actual Convention was drawn tip. That means nothing more
than this, tliat the French Commission went into this meeting knowing
exactly what they wanted, thoroughly well eqiiipped with information, with
the personal experience of M. Picanon in New Caledonia where he had been
Governor for some time, and with the general knowledge of M. Saint-Germain.
They knew what they wanted and what they intended to get. There need
be no surprise if they got it — nor any suggestion of anything more than
their address — knowing their own minds they were successful. Then comes
a despatch to us dated March 0th, 1900, which I do not propose to refer to
except to quote a line fi'om page 14 the last paragraph, by which we were
informed that the di-aft Convention must be confirmed or rejected practically
as it stands. Except the telegram, this was the first reply we had ever
had to our suggestions of August 1905, which, as I have shown, were made
in a purely tentative ^v■ay and subject to consideration, and made only in
default of other possibilities. The first information we got was a CouA'ention
which we had to confirm or reject practically as it stood. That intimation,
it mnst be remembered, was not made to us by the British Colonial Office
for its own purpose, but was an intimation to us that, having debated this
matter with the French Commission its officers felt sure no better terms could

555

be obtained. Therefore, tbev told iis that this Convention must be accepted l-'omtoemii Day.

^ • . 1 1 1 ' •' 9 Miiv 1907.
or rejected us a whole. j

Now I take it that anyone who has followed this simple statement of the .?^""!'r"
course of events will realise that those who have heard the statements made ^\^^ Pacific.
in pidjlic in this comitry with reference to the manner in which this Con- ,,, ,.,- .
vontion IS formed may be pardoned if they have arnveu at an entirely
misleading view of the circumstances. To say that a correspondence with
us had been proceeding for many years is perfectly true, but quite irrelevant
to the making of this Convention. To say that we were consulted at every
step is an abuse of language, so far as that Convention is concerned. To
lead anyone to suppose that the Commonwealth or its Government had the
faintest tittle of responsibility for either this Commission or the personnel of
this Coimnission, matters on which I think we were fully entitled to be heard,
or to allow it to be supposed that we knew anything of that Commission,
its purposes, character, or work, or of this Convention until we saw it
complete, is to convey a series of wholly mistaken impressions. We knew
nothing until we received this Convention with an intimation that it must be
either taken as a whole or left.

I do not think that this procedure is capable of any defence except l)y
the frank statement that it was due to an entire oversight, that Australia
and New Zealand had dropped out of view, that the able gentlemen who
represented the British Government on that Convention l)eing capable and
well informed, it was not necessary for us to be consulted ; that they knew
better what we wanted than we did ourselves, or at all events were better
juilges of w^hat ought to be done in the New Hebrides than we could
Ije. Any one of those statements might be made, and I do not contradict it.
All I am concerned to insist upon now is that there should be no pretence
that any respect whatever was paid or sought to be paid to the opinion of
Australia, or any recognition given to us in a very serious matter on which
we certainly were eiititleil to he consulted, or at least informed, at every
step. We were not even informed of what was taking place except through
the newspapers. That it should be possible at the centre of the Empire to
conduct a negotiation upon matters of grave imx)ortauee which had been the
subject of corresj)ondencc for 2J: years between the Colonial Oilice and the
self-governing communities concerned and Avhich was of great moment to
Imperial interests in the Pacific in this casual and secret fashion, is, I think,
the strongest possible impeachment of the methods that have obtained in this
ollice.

It is not because I wish to return to the past, but to defend our
action and to prevent the possibibty of anything of this kind recurring in
the future, that I have recapitulated these incidents. But when I find in the
House of Conmions a question asked on the 19th February of the Under
Secretary for the Colonies i-elating to the New Hebrides referring to matters
upon which we had been in correspondence with this Department, I have again
to submit that the methods which make this possible are certainly in neeii of
entire reform. The question was asked by Mr. Whitehead and will be found
in column 708 of the Parliamentary Hansard : " I beg to ask the Under
" Secretary of State for the Colonies whether he is aware that the protective
" tariif in force in the Australian Commonwealth applies to maize, copra, and
*' other products of the New Hebrides, and has been a cause in limiting the
" nundier of British settlers and retarding the development of British interests
" in those islands, and whether, in event of further representations being made
" by the Australian Government with a view to Australian predominance in
" the New Hebrides, His Majesty's Government will endeavoiu- to persuade the
" Australian Government to encourage British settlement by od'ering a free
" market in the Commonwealth to British merchandise exported from the

es

556

P'ourtcenth Day. " islands." That, thougli put in the form of a question, suggests or provid
9 May 1907. material for a number of serious misapprehensions.

BuiTisii I must call attention to the answer, accounting for some of its several

Inteijests in misstatements by a too ready acceptance of the implications of the question.
riiL At iFiL. rpj_^g answer was to this effect : " I am aware of the facts stated in the first
(Mr. Deaau.) u ^^^.^ ^^ ^^le hon. Member's question. The Australian Government propose
" to submit to the Commonwealth Parliament at an early date proposals in
" connection with tariff revision which will, I gather, be designed to minimise
" as far as possible the disability i;nder which British settlers in the New
" Hebrides are now labouring." What were the facts stated in the first
part of the honourable Member's question ? The Under Secretary of State
said he was aware of them and endorsed the statement. Yet no tariff in
Australia ever yet has applied to copra, which is the principal export of the
New Hebrides and by far its chief hope ; it was always admitted free to New
South Wales, our principal and practically sole market, and, since the
constitution of the Commonwealth, has ahvaj's been athnitted free to Australia
as a whole. It is imported into Australia in large quantities, in part
manufactured there, Avhile other large quantities are transmitted to England.

Of course I know that the Under Secretary for the Colonies has no
personal resj)onsibility whatever for that statement. He is informed l)y
officials, who have before them the Commonwealth Tariff'. Copra has for
several years increased in value, and the trade is increasing in importance,
so that I cannot imagine how it can have been possible for anyone pretending
to even the faintest knowledge of production in the Pacific, not to be aware
that copra was and always had been free. The answer proceeds to say that the
Australian Commonwealth Tariff applies to maize and other products of the
New Hebrides. As matter of fact it scarcely touches any of the other products,
as far as I am informed, besides maize. Maize, ground-nuts, and bananas it
does touch to some extent. I presunie memliers of Ihe Conference know
that maize is a frequent crop, while ground-nuts and bananas, too, have their
season. They are not like copra of which one does not reap the full fruits for
from five to seven years, after which it is a permanent product for many decades,
perhaps 60 or 70 years, and of great value. The other crojis are used pending
the maturity of the coco nuts. There were, and are, duties in tlie Common-
wealth which affect maize and liananas, Ijut for the iirst two years after
their imposition they did not affect maize at all, l:)ecause those were the
seasons of great demand in the Commonwealth. Then we imported grain from
everywhere. The New Hebrides settlers in those two years did a thriving
business with us, notwithstanding the duty. They paiil the duty and still
reaped very handsome profits. One might expect, perhaiDS, that this shoidd
be known since it was a fact that for those two years from 1901 to
1903 the New Hebrides settlers were not in the least affected by our tariff
on maize.

Then, what ought to have been remembered and indeed it was directly
brought to the knowledge of the Colonial OiHce was that we had appealed to
them in order to ascertain if we could not grant a preference to the maize
grown in the New Hebrides, and had been informed that this would conflict
with treaty obligations. We had been so informed. This reply is given in
February 1907 ; and it Avas about that time. It was after we had been
bringing under the notice of the Colonial Office our anxiety to help the
settlers in the New Hebrides by making them special concessions. That was
a fact that was well known, and ought to have been stated iii reply to the
House when a question was directed directly against the Commonwealth
tariff and its supposed continuously adverse operation in the New Hebrides.

Mr. WIXSTOX CHlTIiflTITJ.: M.xy T say that I did not know that Fourteenth Duy.

]\Ir. Dcakiu wus to raise this particnihir jxjint, or 1 shouhl have refreshed my 9 May 1907.

nieniory bj"- a closer study of the facts ; but, so far as I recollect, the authority

stat(Ml bv me was Sir Everard im Thurn, our lliofh Commissioner in the New ^ Bkitish

ir 1 • 1 ■ 1 1 1 1 . 1- •,!• 1 1 • • ■ 1 IV X 1 IXTEIIESTS IN

lleondes, who reportetl to us that tlie Australian tarilt had injuriously aliected ^^^^ Pachic.
British colonization in the New Hel)ri(lcs. I think that has been pulilishtHl.

Mr. DEAKIX: It is published.

Mr. WINSTON OHURCHILL: I tliiuk llie authority on which 1 made
my statement which is, of course, only a General acceptance of the facts
eoutaiued in the ([uestion

Mr. DEAKIN : I am not quite sure that we had his Report before this ;
l)ut the point is this : lliat direc-tly we saw it we challenged it at once !)y
despatch. It was the unintentional misrepresentation of a gentleman
recently appointed, who had only paid one visit to the o'roup, and was
extremely unfamiliar with a _>ireat many of its details.

.Mr. WINSTON OIIUROIIILL : It is perfectly open to Mr. Deakin, with
the resources of th(> Australian (iovernmeut at his disposal, to diller from the
view of the facts which was taken by this ( lovernment, with such resources as
wo have at our disposal.

Mr. DEAKIX: Still there are the facts, we had proposed a preference.
The implication in both question and answer is that we have done nothing to
liglilen our tarilf, whereas we hail not only referred the case of the New
llebrid(;s to our Tariff Commission (that is, of course, a matter of our
internal j)olitics, as to which you need not have any knowledge), but we have also
been in correspinidence with you to iliscover whether it was not possible for us
to give a prefereuce to these particular settlers on these very products.

Mr. WINS1Y)X CHURCHILL : Since w^hen ?

IMr. DEi\KIX : I read the correspondence at yesterday's meeting, but
have not Virought it to-day. I read that correspondence anil the telegrams
yesterday that w(>re sent to us saying that we could not discriminate.
Tlieii we asked lliem about the discriminal ion to Ereneli nationals in New
Caledonia.

*

^\v. WIXSTON CHURCHILL : The report was to the effect that the

tendency of the tariff over a long period of years had been pr(>judicial to the
develo])ment ol' ijiitish settlements in the Xew Hebrides. It is quite clear
that anything done in the last year or eighteen months would not have affected
the substantial truth or justice of that conclusion, although I cpiite agree from
the])oint ol' view of the Australian < ioverniuent if a movement had been made,
it was desirable that it should have been stated. I say at once that if I had
kiKjwn it, [.would have stated il.

i\lr. l)lv\KTX : Of course you would, |jut th(> statfMuent which was made
was wrong, and that which you are now repeating is wrong again. Xew
South Wales never had a closed ixirt, and the iiusiness of the Xew llrhrides

J'ourteenth Day.
9 May 1907.

British
Interests in
THE Pacific.

(Mr. Deakiii.)

558

Avas with Sydney only. That is one of the ridiculous insinuations of the
writer. The New Hebrides enjoyed an absohitely free port, which was and
is the only port with which they have any trade ; they sent all their
goods to New South Wales, where they were aU absolutely free until we
imposed the Commonwealth tariff in 1901. Instead of their being hable to
duty over a long series of years, they had Free Trade all the time up till
1901. In 1901, 1902, and 1903 our new duties had no effect, because the
demand for maize was so exceptional. Instead of operating over a long-
period of years, our tariff had only operated for two years, 1904 and 1905.

Now, what is the fact ? Mr. Whitehead suggests that our policy has
limited the number of British settlers. The Commonwealth Government, at
an expense of several thoiisands of pounds, has planted British settlers in
the New Hebrides, and endeavoured afterwards to give them a tariff' conces-
sion. WiU it be believed that at the time this answer was given in addition
to that 1 obtained fi"om the House a sum of 500L to pay to these very settlers ?
They are only a handful of maize gi'owers, and this smn Enabled us to make
up to them the difference caused by the effect of our tariff. We are j)aying
out of our own pocket enough to enable these people not to be affected by
our duties.

What is the knowledge in this office ? All these facts have been
published in our newspapers ; we are actually spending our own money to
prevent these people being affected by our tariff, and have tried to grant
them a preferential tariff. Then when a question in the House of Commons
directly implies that we who had put settlers there were injuring them, and
doing nothing to help them, the only answer given is that we are only
proposing to do something in the future. All these circumstances were
ignored ; the fact is, that we have taken the greatest possible pains to
endeavour to help these people, first to put them there, then to keep them
there, and then to give them special advantages, finally voting them bounties.
Yet not one of these facts is referred to. I am qnite content that this
incident shoidd be buried, even with regard to those behind the political
responsible heads who committed these oversights, but the misfortune is that
such slanders tell against us very much. Not only this answer, but other
official references on which I do not wish to dwell have created an idea that
the Australian Government, while clamoiiring for everything to be done in
the New Hebrides, is at the same time doing everything it can to impede the
success of its settlers.

Mr. WINSTON CHURCHILL : No, the only suggestion made for
which I have any responsibility is that the policy of the Commonwealth has
not suiKciently considered the interests of British colonization in the New
Hebrides. It is quite possible now, in fact it is recognised even in that
answer to the question, tliat the Commonwealth Government is now taking
a different view, and perhaps if that view had been taken at an earlier stage,
the disproportion between the British and French settlers would not have
been as great as it is.

Mr. DEAKIN : Not at all ; that is another of Sir Everard's mistakes.

Mr. WINSTON CHURCHILL : We are bound to believe statements
made upon the authority of our Governor and representative ; it is a great
pity that we cannot disctiss over the telephone with you in Australia the
answers which have to be given in the House of Connuons. I am sure I

559

should \velcome the opportunity, biit veiy often having twenty questions a day
to answer in the House of Commons, it would not be a very easy matter. In
the meanwhile, that not being a possibihty, we have to go to the documents
which are before xis from our responsible representative abroad.

Mr. DEAKIN : Quite so, and I have not said a single word that conveys
a suggestion of anything else.

Fotirtpciith Day.
9 May 1907.

BniTisn
Interests in
THE Pactfic.

(Mr. Winston
Churchill.)

Mr. WINSTON CHURCIIILL : I should he very sorry if the ans\yer I
gave in any way appeared detrimental to the interests of the Dominion
affected and was at the particular time contrary to the fact.

Mr. DEAKIN : It has been detrimental ; these answers are also cabled
out, and our people cannot understand how it happens. It haa had a very ])atl
effect here because it is one of a strain of the same sort of misrepresentations.

I take it that what we are entitled to expect on these matters is that
somebody in a great office like this should be kept sufficiently well informed
of our ordinary public matters so as to be able to put accurate answers
into the hands of Ministers.

Mr. WINSTON CHURCHILL : I think it would be a great advantage.
I very much regret that I have to go to Manchester almost iuimediately, but I
think it would be a very great advantage if our attention Avas drawn by letter
and despatch to any inacciu'acies in these statements.

Mr. DEAKIN : A letter takes nearly five weeks to reach us, and live
weeks to get back, that is nearly three months, by then the whole thing is

de;

ad.

Mr. WINSTON CHURCHILL: True, the distance is one of the most
difficult facts that we have to deal with in the British Empire.

CHAIRMAN : If we could all meet
imfortunate happenings would be avoided.

across the table like this these

Mr. DEAKIN : I have finished with that matter, Mr. Churchill. I have
no desire to revive these incidents except as warnings for the future and in
order to explain the feeling that exists. Lord Elgin may think that on
this matter I hold strong A^ews. I do, but they are shared hj thousands. On
this matter I am certain that you cannot find a newspaper in Australia that
has a word to say in defence of our treatment in relation to the New
Hebrides. I am now speaking of the way we are treated quite apart from
all issues as to the merits of this and that Article of the Convention. All
of those I dismiss. They are settled and accepted for the present, but you
cannot find a newspaper of any shade of politics of the least importance
that upholds your action. It is unfortunate ; it is to be avoided. The
maintenance of a good understanding is impossible when all public opinion
and the Press become adverse. Especially when we are imal)le to follow our
invariable habit of defending in public any statements made by or on behalf
of the British Government. Could it be supposed by us to be necessary to
talk about what we have done in these islands ? We are paying an extra
subsidy to the only line of steamers which plies there, and which would not

560

l''ourteeutli Dii}'.
9 May 1907.

British
Interests in
THE Pacific.

(Mr. Uuakin.)

ply tliei'e at hU but for tliem. ^Ve paid tlieui an extra subsidy for the
assistance in the New Hebrides, of our settlers, the British settlers. We
induced those steamers in consequence of our siil:)sidy to lower their freights
for maize 75 per cent. Those settlers have been sending their maize to the
markets of Sydney at only 25 per cent, of what they paid before we inter-
vened, so that we are not only helping them by a grant, Ijut reduce their
freights to 25 per cent, of the ordinary rate. Yet it is alleged here that
we have never lifted a finger for them but only to tax and impede them.

We became indirectly the controlling power, although not the owners, of
certain lands in the New Hebrides, and we made these available for British
settlers at the nominal figure of a shilling a year for 50 acres. That was
in order to give those who had not sufficient land there, or others they could
bring with them, an opportunity of making a living in the group. What has
the United Kingdom ever done for its settlers outside its territory to compare
Avith this ?

I have now finished the story of what we did for the settlers in. the
New Hebrides, and why we resent a good deal of the criticism to which
we have been subjected in regard to them.

CHAIRMAN : I would like to say at once that there is no doubt on the
part of His Majesty's Govermnent of the importance of the Pacific-, and 1
entirely agree with Mr. Deakin, that the aim must be that as between the
United Kingdom and the Dominions beyond the Seas there should be no
difference whatever with regard to the interests Ave feel in them. I did not
knoAv the extent to Avhich Mr. Deakin was going into the past history of
this subject, and I am not prepared to folloAV him throughout, and 1 do
not know that he Avill expect me to do so. I think he, admitted that the
actual authority of Great Britain was subject to some limitations in the
Pacific and had ahvays been.

Mr. DEAKIN : It extended as far as " Tahiti."

CHAIRMAN : Mr. Deakin said that it was " indefinitely " under British
authority, and I think another expression he used Avas, that Axistralia
" practically had " more extensive interests than had been admitted. I
am not sure that that carries us very far, because, after all, Ave have to bear
in mind that when you convert indefinite interests into actual interests you
assume an amount of responsibility, and you become liable to an amount
of cost, Avhich does not apply to the indefinite possession, and of course Ave
in this coxurtiy, though we are AviUing and desirous to do all that we can to
protect the Dominions beyond the Seas, and have been so in the past
and noAv hope to be equally energetic Avith yoiu' assistance, there is a limit to
the extensions Avhich' we can contemplate, and certainly to the rajaidity with
Avhich those are made. If other nations — Avhich, after all, Ave cannot
exclude from interest in the Pacific Ocean — have adA-anced and established
themselves in certain parts of it, I do not think that is quite justiKable to
impute to lis on that account that Ave have caused what I think Mr. Deakin
described as a sense of aggravated loss to the CommonAvealth or to Australasia.
At all events, if there has been that sense, I hope that he Avill take into
account the other considerations to AAdiich I have draAvn attention, and Ijelieve
that it Avas not at any rate from anj' intention, I am sure, of our pretle-
cessors any more than it is of ourselves to cause aggravated loss, or in any
Avay to undervalue the sense of interest Avhich I can understand is more
present to them out there than perhaps it is possible that Ave shoidd feel. I
do not think that I shall serve any iiseful purpose if I foUoAV through the
details of the history of the New Heljridcs Avhich Mr. Deakin has given.
I Avill only just remark this, that I am informed Avitli regard to the British
Resident that he has a legal status, and I knoAV that the amount Avhich he

561

has been able to do has been
superiors but by others who are

recognised, recognised not only by his

no

in no way responsible for it. Therefore,
so far as that is concerned, I will only say that I deeply regret if there
has been the feeling which Mr. Deakin described as exasperation from
the series of incidents. I deeply regret it, but at the same time I cannot
altogether admit that Ave are to take full responsibility for that, or that we are
perhaps quite so guilty as ]\Ir. Deakin's eloquence would make us appear.

I must say a word or two, I think, as ^Ir. Deakin has put aside the details
of the convention, not with regard to the details of the convention, but to
what he has said with regard to the manner in which that convention was
negotiated. He referred to a despatch signed by himself on the 29th August,
which he quoted, and I will not repeat the quotation in the second paragraph,
but I shoTild like to draw attention to this : that he went on to mention (it
occurs in paragraph 3) certain conditions imder Avliich the Joint Protectorate
might be appointed, and he said this : " It would be most acceptable, if the
" conditions upon which the Protectorate is to be established, or any
" ameudjuent of them afterwards, in addition to receiving the approval of
" His Majesty's Government and the Reiiublic of France, were submitted for
" the consent of the Commonwealth and of Xew Zealand prior to their
" adoption by His Majesty's Government." That Avas the request AAdiich he
made in August 1905. Noav, Mr. Deakin said, or rather implied, I think,
that there Avas some cause of complaint as to delay in dealing with these
matters. I Avas not responsible, of course, for the first j)art of it, but I shoidd
say for my predecessor that this letter Avas dated August 29th. That letter of
August 29th Avould not arrive until a month or five Aveeks afterAvards— that
was a time Avhen Parliament Avas not sitting ; biit on November ith a telegram
Avas sent to NeAV Zealand. The NeAv Zealand Government replied ; that
reply Avas not received till December 5th ; and on December 9tli steps Avere
taken to proceed Avith the arrangement.

Fourteenth Day.
9 May 1907.

British
Interests in
THE Pacific.

(C'bairraaii.)

Sir JOSEPH WARD : What year Avas that?

CHAIRMAN: 1905.

Mr. DEAKIN : I beg your pardon ; the delay Avas not in the procedure,
but in informing us of the procedure and its meaning.

CHAIRMAN : I am coming to that, I think you also thought there Avas
delay there.

Mr. DEAKIN: No.

CHAIRMAN : So far so good. It Avent on and, of course, we came into
office soon after that, and at once proceeded Avith the commission Avhich our
predecessors had started, and it Avent on Avithout any delay. Put Mr. Deakin
makes two complaints against us in that respect. In the first place that the
Commission Avas not announced to him — I cannot explain that Avithout further
inquiry — I do not know how it happened. If it Avas my inadvertence I
apologise, but on a change of Governments sometimes these things may-
occur. Anyhow on the second complaint I should like to say a Avord or tAvo,
and that is that the characteristics of the Commission appeared first in the
neAvspapers and first reached Australia through the newspapers. Noav I

E 4i>(i(;8.1 N II

562

Fourteenth Day.
9 May 1907.

British
Interests in
THE Pacific.

(Chairman.)

ought to say that I took the most careful precautious myself to preserve the
strictest privacy with regard to all the documents of this Commission with
the object of their reaching the Australian and New Zealand Govermiients
before anybody knew anything of it all. Accidents Avill happen and
in this case an accident did happen. I should also just like to remind
Mr. Deakin that at the time this was going on a colleague of his was
in this countiy, Sir John Forrest, and he brought me a message, I think,
in regard to the Convention to which I attended to the best of my ability,
and therefore we had through him the advantage of conununication with
those who are responsible to Australia in these matters. I do not say that
in any way to imply that Sir John Forrest came to me with any authority
to represent the Australian Government, but at the same time

Mr. DEAKIN : He was a member of it.

CHAIRMAN : He was a member of it, and I took advantage of his being
here to converse with him on the subject. That was how it stood. We did
our best to keep the thing secret until it reached the hands of the Common-
wealth Government. I admit we did not succeed entirely in doing so, but
there it stood, and then the Governments in Australia and New Zealand had
their opportunity of suggesting amendments.

Now, Mr. Deakin has referred to a passage which has often been referred
to in which it is said that " the draft convention must therefore be confirmed or
rejected practically as it stands." I wish to make one explanation in regard to
that. Taken by itself that may seem a very peremptory statement, but it
really means if you are to accept the Convention at all it is obvious we cannot
do very much more with the French in the matter. At the same time an
opportunity was given to the Governments to submit amendments, and they
did submit amendments. We were prepared to negotiate with the
French Government again, and were on the point of doing so, when
circumstances arose Avhicli induced the Australian Government to advise
that we should close with them at once, and we did so. That is the history,
and I venture to think that at any rate in intention we did not neglect
the interests of the Colonies, but did our best to secure them, and also with
the full cognisance and revision by the Colonies as far as it was possible to
do so. That is all I have really to say upon that. It is a question which has
caused a great deal of uneasiness. The last thing I should wish to do as far
as I personally am concerned is to treat the Colonies in an overbearing-
manner ; and I can only assure the representatives here that every effort will
be made to avoid their finding cause of complaint again. But I also wish to
put on record that as far as the negotiations are concerned I think that we
were well represented. Mr. Deakin asked that our representatives should be
well informed and capable.

Mr. DEAKIN : I said they were well informed and capable. I do not
take any exception to them now. The only exception that has been
taken is that they were not acquainted with the islands themselves or the
circumstances of island life as M. Picanon was directly and M. Saint-Germain
was indirectly. M. Picanon is an extremely able man, and so is M. Saint-
Germain, with the additional advantage that M. Picanon had lived in the
Pacific, and the English representatives did not.

CHAIRMAN : We achnit certainly that they had that advantage ;
I only wish to say that, having been consulted on these negotiations day by

503

day hy the representatives who came in here to see me, I t-aiinoi help tliinking Fourteenth Day.
we did rather well. 9 May 1907.

Mr. DEAKIX : You did exactly what they expected yon to do. I do not Interests in
say you did badly on that account. the Pacific.

(Chairman.')

CHAIRMAN : I do not think Mr. Deakin will want me to say more upon
the siibject of that particular Convention.

CHAIRMAN : There is only one other item on the Agentla.

Sir WILFRID LAIJR11'>R: I am not prepared to take up any other
point now.

CHAIRMAN : Could we dispose of this in 10 minntes ?

Mr. DEAKIN : I do not think so. I want to say something with
regard to the interchange of officers and the questions arising out of that.

CHAIRMAN : Of coiirse, I am in your hands entirely. In the
despatch with regard to this Conference, it was assumed that the members
coming fi"om Ijeyond the seas would wish to separate bj- the end of four
Aveeks. We have now reached that point, and I have done my best to finish,
and have brought you very near it. If, hoAvever, it is more convenient to
finish by having another meeting, we can meet again on Monday morning

Sir W^ILFRID LAURIER : I think it Avould be advisable.

Dr. JAMESON: Yes.

CHAIRMAN : General Botha will be gone ; but I do not know that
anybody else will.

Sir JOSEPH WARD : Is it nnderstood that we close the Conference on
MondaJ^

Dr. SMARTT : Would not Tuesday do instead of Monday, wonld it ?

CHAIRMAN : As far as I am concerned, I am entirely at your disposal,
as I have been throughont. Is Tuesday more convenient ?

Sir WILFRID LAURIER : To me Tuesday and Monday are the days
that would be convenient. Dr. Smartt has just expressed a preference for
Tuesday, and I am willing to agree to that.

Sir WILLIA]\I LYNE : It would suit me much better, too.

CHAIRMAN : Then we Avill make it 11 o'clock on Tuesaay.

Adjourned to Tuesday next at 11 o'clock.

N II 2

564

Fifteenth Day. FIFTEENTH DAY.

14 May 1907

Held at the Colonial Office, Downing Street,
Tuesday, 14th May 1907.

Present :

The Right Honourable. The EARL OF ELGIN, K.G., Secretaiy of State

for the Colonies (President).

The Right Honourable Sir Wilfrid Laurier, G.C.M.G., Prime Minister
of Canada.

The Honourable Sir F. W. Borden, K.C.M.G., Minister of Militia and
Defence (Canada).

The Honourable L. P. Brodeur, Minister of Marine and I'isheries
(Canada).

The Honourable Alfred Deakin, Prime Minister of the Commonwealth
of Australia.

The Honourable Sir W. Lyne, K.C.M.G., Minister of Trade and Customs
(Australia).

The Right Honourable Sir Joseph Ward, K.C.M.G., Prime Minister of
New Zealand.

The Right Honourable Sir Robert Bond, K.C.M.G., Prime Minister of
Newfoundland.

The . Right Honourable L. S. Jameson, C.B., Prime Minister of Cape
Colony.

The Honourable Dr. Smartt, Commissioner of Public Works (Cape
Colony).

The Right Honourable F. R. Moor, Prime Minister of Natal.

The Right Honourable Winston S. Churchill, M.P., Parliamentary
Under Secretary of State for the Colonies.

Sir Francis Hopwood, K.C.B., K.C.M.G., Pei-manent Under Secretary
of State for the Colonies.

i^ir J. L. Mackay, G.C.M.G., K.C.I.E., on behalf of the India Office.

Mr. H. W. Just, C.B., C.M.G., | j ■ g,,^,^^^-,,
Mr. G. W. Johnson, C.M.G., ^ 'Joint Secretaries.

Mr. W. A. Robinson,

Assistant Secretary.

565
Also Present : Fifteenth Day.

14 Mnv 1907.

The Right Honourable ]). Lloyd Geofjoe, ^l.P., President of the Board — —

of 'J'rade.

Mr. H. IxEWELL'iN Smith, CM., Ponnanent Secretary to the Ik^ard of
Trade.

Mr. A. "Wilson Fox, C.B., Comptroller-General of the Commercial.

Statistical, and Labonr Pepartnioiits of the Board of Trade.

The Right Honourable Sir Edward Grey, Bart., M.P., Principal
Secretary of State for Foreign Affairs.

The Right Honourable Sydney Buxton, M.P., Postmaster-General.
Mr. H. Babin€Ton Smith, C.B., C.S.I., Secretary to the Post Office.

CHAIRMAN : Gentlemen, there are one or two notices which I have
received, one of them from Sir Wilfrid Laurier, which ilr. Lloyd George has
attended, in order to speak to. As Mr. Lloyd George has to leave, perhaps
the Conference Avill allow that to be mentioned lirst.

MAH. SERVICE TO AUSTRALIA AND NEW ZEALAND

VIA CANADA.

Sir WHiFRID LAURIER : Lord Elgin and gentlemen, on different Mail SF.nvicE
occasions during the present Conference mention has been made of the idea to Aistralia
of connecting all parts of the Empire, so far as it can be done, with an „^^^ ■^'^^^..
improved system of communication; and I said at the last meeting that I Canada""
would be prepared to lay on the table a resolution, which I now read : " That
" in the opinion of this Conference the interests of the Empire demand that
" in so far as possible its different portions should be connected by the best
" possible means of mail communication, travel, and transportation ; that to
" this end steps should immediately he taken to establish a fast service from
" Great Britain to Canada, and through Canada to Australia and New Zealand,
" and also to China and Japan ; that such service upon the Atlantic Ocean
" should be carried on by means of steamships, equal in speed and character
" to the best noAv in existence, and upon the Pacific Ocean by steamsliips of a
" speed of not less than 18 knots, and in other respects as nearly equal to the
" Atlantic ships as circumstances will permit ; that for the purpose of carrjnng
" the above project into effect, such financial sii]iport as may be necessary
" should be contributed by Great Britain, Canada, Australia, and New
" Zealand in equitable proportions."

The resolution I have now thehonoiir to submit to the Conference resolves
itself into two parts : the part which affects the Atlantic Ocean and the part
which affects the Pacilic Ocean. At the present time Great Britain has a
mail service between the United Kingdom and New York of a very high
character. We have a mail service also between Canada and Great Britain
not aided by the British Government. If wo had on the Atlantic Ocean

566

Fifteenth Day. between Canada and Great Britain a mail service equal in speed and character
U May 1907. to tlie service now in existence between Lngiand and Xew York, there is no

donbt, and there can be no doubt at all, that we would save in the journey

Mail Service ^t least two days, or about two days, inasnmch as we have an adA-antage in

TO Australia ^^^, f^yg^^^. j^ distance of nearly 900 miles. Takina- the iigures between

Zealand cm Liverpool and New York and Liverpool and Halifax, the distance in our

Can-Ada. favour, I think, is exactly 882 miles, or in the neighbourhood of 900 miles.

(Sir Therefore, it follows, as a thing which cannot be disputed, that if we have

Wilfrid Lanrier.) a servicB of equal speed, and offering the same advantages and inducements

as the service which now plies betAveen Xcav York and Liverpool, Ave would

save in distance to be traA^elled at least tA\'o days. The actual miles betAveen

Liverpool and Halifax are exactly 2,342. The distance betvA'een Liverpool

and Quebec, AA'^hich might be the summer route by Avay of the Strait of Belle Isle,

is 2,636 miles. The distance between Liverpool and VancouA'er by Avay of

Halifax is 6,004 miles ; the distance from Liverpool to A'ancouver via Quebec

is 5,330 ; it is a little shorter via Quebec. Halifax is nearer than Quebec

fi-om Liverpool. I do not think there can be any dispute but that a great

advantage Avould be derived and easily a service could be made in eight days

— four days on the Atlantic, and four days crossing the Continent or probably

less.

Sir WILLL\:\I LYNE : That is to Vancouver.

Sir WILFRID LAURIER : Yes, to Vancouver. As to this proposition
I do not apprehend that there can be any two vieAvs upon the subject. The
facts cannot be disputed that a service can be abbreviated and A^ery much
shortened by using the line from England to Halifax in preference to the line
from England to Ncav York.

With regard to the Pacific Ocean, in the motion which I hav^e proposed I
say that the object we should have in vieAv should be to establish a steamsliip
service of at least 18 knots. If this be accepted, the distance between
VancoiiA'er and, say, Sydney, taking that as an objective point, Avonld be
6,818 knots.

Sir WILLIAM LYNE : That is leaving out New Zealand.

Sir WILFRID LAURIER : I take Sydney as an objective point. The
figures might be modified Avith regard to the different ports. The distance
Avould be 6,818 knots to Sydney. The distance could be covered in 16 days,
and therefore Ave should have lietAveen England and Sydney a service of aboiit
24 days — four days across the Atlantic, four days across the Continent, and
16 days on the Pacific Ocean.

Mr. LLOYD GEORGE : How many miles to New Zealand ?

Sir WILFRID LAURIER : A little less— about 300 miles less.

Mr. LLOYD GEORGE : That would make it about 23 .lays.

Sir WILFRID LAURIER : The only objection I see to the plan Avhich
I now propose, as far as the Pacific Ocean is concerned, is having at once a
service of 18 knots. I think it is an object, however, Avhich should be kept
in mind, as a goal to be striven to. I do not say that it would be possible
to have it in operation immediately, but the proposition that I lay before the

567

Conference is that it is a goal which you should endeavour to reach to have Fiftt-oi ih Day.
a service of IS knots on the Pacific Ocean. If you can accomplish that u ihy 1907.
service of 18 knots on the Pacitic Ocean there is no doubt whatever — the •= —

thing is mathematical -that you can have between England and Australia a Maii, Servkk
service of 25 days, which is far in advance of anything we have at the present '^" Ai^tkai.ia
time. Of course, it requires some money. This thing cannot be done ytViAxu ";«
without we have more expenditure. No line could tmdertake such a service "caxapa.
as that imless it had a liberal subsidy from tlie Governments concerned. /j^j^

What should be the proj^ortions of the different Govermnents interested in wilfriil Laurier.)
this, is a question, which, at this moment, I would not be prepared to venture
any opinion upon. In the resolution which I have submitted, I simply say
that the service ought to be supported in not equal but equitable shares. I
am prepared to saj' that the Government of Canada would have to contribute
liberally, perhaps more liberally than the others, because it Avould have to
contribute to both sides, both the Pacitic and the Atlantic. Therefore,
Lord Elgin, I sulnnit this resohition to the favourable consideration of the
Conference.

Mr. DEAKIN : My Lord, I am very glad that this proposition has been
submitted by the Prime Minister of Canada, and feel sure that the Conunou-
wealth would look upon it with the utmost sympathy, even if it went no
further than studying tlie interests of Canada itself in her Atlantic service,
although that is not a matter on which we are entitled to speak. It appears
to us manifest that the Canadian position cannot be secured, or its claim as a
part of the Empire fully recogiiised, until it is enabled to meet its fonnidalile
competitor to the south with a means of connuunicatiou equal to that which is
supplied to New York. We recognise that, and sympathise with everj'^ effort
which may be made to give effect to it.

But, of course, the interest of Australia in the Pacilic trade might be as
great as that of Canada is in getting its direct communication if we can
foresee the possibilitj'' of obtaining such a service as Sir AVilfrid has referred
to, on terms that the Commonwealth could afford to face. It would mean so
great a reduction of the time at present occupied that it would be invaluable
for a mail service. Om* difficulty is that we can scarcely see how with vessels
of that speed with the freight charges which they would make, and with the
double task of transhipment involved by a railway journey between two lines
of mail steamers, it coidd ever become a cargo line.

Mr. LLOYD GEORGE : That is one of the questions I wanted to put.

Mr. DEAKIN : The goods you send to us are goods of bulk and weight,
and when our ships face foreign competitors, especially those subsidised, the
competition becomes very keen. Certain!}-, British goods could not afford to
pay mail freight, except for small, exceptional, or light j^arcels. In the
same way the raw materials we send to you are even more bidky. The
charges on two transhipmerits piit them out of the categorj' of possible trade.
This would, therefore, be for us a fast passenger and mail line of communica-
tion, and as such, very valuable. We should welcome it most cordially if it
can be financed. The saving of a number of days is a consideration for
commercial men who travel or who communicate by post. Consequently, we
do not look coldly iqjon this proposition, though I am bound to saj^ that its
economic possibilities on our side are so limited that the subsidies required
may be, quite beyond our means. My colleague, in whose Department these
questions more inuuediately are, has made some examination of this proposal.

CHAIRjMAN : We should be glad to hear Sir William Lyne.

N u 4

568

Fifteenth Day.
14 May 1907.

Mail Service
TO Australia

AND New

Zealand via

Canada.

Mr. DEAKIN : May I add that at preseat our coanectiou with, this
country is by the alternative routes round the Cape or through the Suez
Canal ? These are our principal routes and must always remain our great
cargo routes because there is no transhipment.

Mr. LLOYD GEORGrE : And, from the point of view of developing
trade, they are much more important.

Mr. DEAKIN : Yes, much more important, except so far as our trade
can be assisted by quicker mail and passenger communication. ' Our principal
routes must remain in the other direction. We also are even at this moment
endeavouring to obtain a swifter means of communication through the Canal,
and swifter transit around the Cape. It will be, I presume, a part of tlie
policy of the British Government, so far as financial considerations permit and
business opportunities justify, to encourage an all-round route— the half
which goes through America and the other half which goes either round the
Cape or through the Canal. As the Antipodes are reached whether you go
east or west, we are interested in the development of this proposal made
to you by Sir Wilfrid Laurier. We are also interested in the development
of our existing means of coumiunication which go east instead of west, and
trust that practicable projects relating to both of them will be submitted by
and to His Majesty's Government in due course.

gentlemen, this route has been
known to us as " the all-red

Sir WILLIAM LYNE : My Lord and
advocated verj- often in Australia. It is icnown to us as
route " being through British territory all the way, and it is verj^ much desired
that we should get it, but I am afraid,
subsidy would have to be very large. I

and have made calculations, and,

me,

with my Prime Minister, that the
have had the matter submitted to
as far as I can gather with the
could not reach Australia with an
is, if you go via New Zealand.

stoppages that would be necessary, you
18-knot service under 30 days, that

That is a consideration, because, of course. New Zealand would be expected
and asked to add to the subsidy, and, I think Sir Joseph Ward would
like the service to go via New Zealand. It is roundly 8,000 knots from
Vancouver via New Zealand to Sydney, and the distance was given just now
of 6,800 knots if you leave New Zealand out. I look at it from a practical
standpoint. I think eight days fi'om Liverpool to V^ancouver is a short time.
Four days l^y water from here and four days by rail. I am not a jiulge of
that, but it strikes me as being short. When you leave Vancouver you have
to call about four times, I think, before you get to Sydney, and you cannot
stop without wasting time or losing time. If you take the distance direct

" ' ' " 27 days, but if you
To be of service

is just a question

a company to do it. The trade is not
ow. When the line was first started

you could do it via New Zealand m
I think it would take you 30 days,
much more than three weeks. It
money would be required to enal^le
great at present. I hope it will .qt

take the stoppages
it should not take
to how much

as

between Sydney and Vancouver the trade
considerably, but not as much as we
satisfied with the Prime Minister that
would look favourably at this question.

was nothing. That has grown
could wish, and though I am
the Commonwealth Parliament
it is all a matter of practical

results. As for as I can gather from the resolution proposed by Sir Wilfrid
Laurier, I cannot see any harm in it, because it is a matter to be desired and
a question to be inquired into. Of course, Canada would receive the greater
benefit by getting a fast service from Liverpool, and would be prepared, I
suppose, to pay a larger proportion of subsidy. I just wish to put clearly
before the Conference, that 30 days at 18 knots is about what it would take

to

go via

New Zealand. I had a letter from one of

the leading

companies

569

this morniug iu which they say the last 3 knots woukl just double the Fifieemli Duy.
consumptioa ol coal, or very nearly, which is a very great item. H May 1907.

Sir JOSEPH WARD : Lord Elgin and gentlemen, I am a little ^»'^'l Service
disappointed, I candidly say, at the suggested speed of this line of steamers ^'*A>n "ne^v'*
as outlined l)y my friend, Sir Wilfrid Laurier. I think it is too slow. If Zealand via
we want to do something really practical in this matter, we want to recognise Canaua.
what the existing condition of matters until a short time ago has been from (Sir

the standpoint of tlie furthermost of the British countries affected. There is Williiim Lyue.)
a route now from New Zealand to I^oudou via San Francisco by the American
route which we used for many years. This suggestion now made is to
practically give us about the same time to London via Canada that we have
been enjoying from New Zealand for a long period of years via San Francisco.
It has been quite a common matter for mails to reach London from New
Zealand iu 27 or 28 days and vice versa. If we are, and I am sure we are,
practicall}' sincere and anxious to bring into very much closer touch all
portions of the outljaug colonies, we ought to have some improvement upon
what has been in existence for quite a number of years. From the standpoint
■of New Zealand, although we are quite wiUiug to come into this matter in
order to have an effective service, if it is going to be only equal to what we
have been getting with comparatively a small suljsidy fi-om our coxnitry, then
from our point of view we are not going to get ahead very far. Sir Wilfrid
Laurier is very anxious I know to bring about an improved service, and I
want New Zealand to help to the utmost capacity. I attach the greatest
importance to speed and efficiency. I went from this country specially in
1895 to Ottawa to interview the then Government in Canada iu order to have
a mail contract entered into between New Zealand and Canada via Vancouver
to give us that altei'native route as against the American one. We wanted to
have the Vancouver one all through the piece, and we entered into the contract
at that time for a very suitable service, but luifortiuiately difficulties with the
contractors supervened, and that service was for various reasons withdrawn
from New Zealand and transferred to Queensland, and that rendered the
service from New Zealand to Canada, and Canada to England impracticable.
If Ave are prepared only to give a modei-ate subsidy towards obtaining such a
service as suggested here, then I admit the possibilities of getting a fast
service are very remote. ^ly idea was, and is now, that New Zealand at
all events should give an incomparably larger sum than it has ever given for
the purpose of Ijringing it closer to England. We have had the authority of
Parliament of 40,0(l()/'. a year for years past ; that is 20,000L each to the one
via Vancouver and the one via San Francisco. I am prepared to say that our
■country woidd be prepared to go to 100,()00Z. a year without a moment's
hesitation in order to get a fast service across tlie Pacific and through
^Canada across the Atlantic if it were one of say twenty days or three weeks.
But I want more than 18 knots an hour and I will give my reasons. This
proposal ought to be divided into two ; first there should be an effort made
to get a fast service from the English coast to Canatla, and that service ought
to be a 22-kuot service at least.

Sir WILFRID LAURIER : 24.

Sir .lOSEPlI WARD: Or for preference a 24-knot service. You get
steamers now running from here to New York which do the jovirney right
through frequently at 21 knots an hour over the whole passage. I went across
nearly at 22 knots myself 12 years ago. It is only a question of money
whether you can get a speed of the Idnd. It is admitted and must be
conceded from the steamship owners' point of view, that to have a 23-knot or
even 24-knot service to Canada with a number of days when the steamer has
to provide for coaling and incidental attendance to machinery is quite within

570

Fifteenth Day.
14 May 1907.

Mail Service
TO Australia

\ND New

Zealand via

Canada.

(Sir
Joseph Ward.)

the bounds of possibility, aud there is no difSenlty provided you like to pay
enough nione}' for it. Conceive the iDOSsibility of that service being carried
across at 23 knots an hour. That brings Canada and England within
foiir days of one another. Beyond all doubt we are qiiite prepared to give
our proportion for such a service on the Pacific between Canada and New
Zealand so as to make the other portion of the link between the Colonies
and the Old World. Sir Wilfrid Laurier has said, and I have heard it said
by other Canadian gentlemen well-informed too, that it is quite possible to do
the Canadian journey across that continent by rail in four days. That makes
eight days from England to Vancouver. Now, come to the question of the
Pacific. I may be taking too sanguine a view of it, but I base all my remarks
upon the one potential factor, that if you want to have this close connection
you must pay sufficient money for steamers of large tonnage —passenger and
mail steamers only, I should say, except for the purpose of carrying certain
cargo between Canada, Australia, and New Zealand. To expect it to be nsed
for a cargo service throughout, from Australia and New Zealand across
Canada to England is to expect what is not possible. I do not contemplate
it will ever be possible to carry cargo across the Canadian continent and
tranship it at both ends. For ordinary cargo purposes, we ought from a
practical, common-sense, business standpoint, to rely for transport, as everj-
country in tlie Avorld does, on tramps, keeping them quite distinct from a
passenger and mail service. Between Australia and England the great
proportion of cargo coming from there is carried by cargo steamers — tramps.
It is quite true the great liners provide a certain amount of cold storage
for perishable products, but they carry only a limited quantity of cargo.
If we are going to mix up the two systems, and try, as it were, to call for
the moon by expecting to have a cai'go service, and a fast passenger service
across the Atlantic, across Canada, and the Pacific all in one, we might as
well agree to abandon it altogether and let it go. It is not possible to
Ijring about anything practical in that way at all. I apply my remarks, first
of all, to providing a large subsidy which is essential, and which I think
the countries ought to be prepared to pay if the}" want to do something-
practical. Then, next come the possibilities across the Pacific ; the
distance fronr Vancouver to Wellington is 6,589 miles, to Anckland it is
279 miles less. If this Vancouver service is carried out I am sure Australia
has the sentiment, and Ave have it too, that we ought to remove every
element of parochialism of every possible kind, and should establish a
service which is the swiftest and best for the whole of us. If this service, as
is indicated here, is to go to Sydney first, and then on to NeAv Zealand from
I'mgiand, we woitld noi; give anything whatever to it. I say that very
frankly, because that would be putting the cart before the horse. The nearest
country from Vancouver is New Zealand, and the first touched at ought to
lie the country which is nearest, and then it should jDass on to the other
country, which is to have the first turn coming backwards from
Australia to Vancouver, and which would Ije the first place to
receive benefits of that kind. It should onlj- touch at New Zealand,
Sydney remaining the terminal port, aud getting all the benefits of the
terminal business, and the employment of labour supplying j^rovisions attendant
iqDon it. If you Avant this service to be a success, the only countrj^ the floats
should touch first is the country en route either going or coming. I Avant
to disciiss the possibilities from a New Zealand point of \'iew, because Ave
have an alternative, and that alternative I should reluctantly carry out on
Ijehalf of oiir country, that is, to put oiu" money doAvn and run a serA-'ice A^ia
San Francisco. Unless the British GoA^ernment, Canada, and Australia
recognise the position in Avhich NeAv Zealand is, that Ave are a groAving
country and an important country, though a smaller country than some of the
others, Ave cannot afford as a developing country and a progressing coimtry
to be kept at a great distance from England, oAving to our circumstances

■Jt

as to geographical position. We cauuot allow that coinlitiou ot" matters to
exist. I am making my own position clear and not presuming to snggest
what anybody else thinks, Ijut from the point oi" view of New Zealaml, in
order to approach this frojn the practical point oi the nsefnlness to iMiglaml
to Canada and to New Zealand, inid to Australia, too, tlie route for that service
distinctly from the Pacifit- side would ])e sh(jrter fnjm Vanconver to Auckland,
which, as I say, is nearly 300 miles shorter than the distance stated in tills
chart furnished here. It is abont 6,300 miles to Auckland from ^'aucouver.
The contractors at their option wonld call at either Wellington or Auckland.
I approach it from the standpoint that we must have New Zealand as one of
the intermediate ports for touching at only, that is, steamers would remain
there half-a-dozen hours as has been the case all along with the San Francisco
mail steamers. We gave the major pcn'tion of the subsidy to that service,
and Aiistralia, Sydney especially, got the full benefit of it, being a terminal
port, and giving a very small amount of sul)sidy towards it. That position
Ave recognised as imavoidable.

Now coming to the question of the spctnl at'ross the Pacific, there are two

touching places for coaling. From \'ani'ouver to Honolulu, with a service
such as we are contemplating here, woulil I)e done under three days.

Kiftceiith Day.
\i May 1907.

Mail Sekvioe

TO AlSTRALIA

AND New

Zealand via

Canada.

(Sir
Joseph Ward.)

Dr. JA^IESON : Yoti are limiting your remarks to a fast mail sei'vice,

nothing to do with cargo at all V

Sir JOSEPH WARD: Yes, I said we require cargo to be carried by
tramps. This is a fast mail service — -a passenger service with a fast speed,
«uch as, if we gave a large coutriljution from our coimtry, we should expect.
For coaling purposes and for the necessities of carrying on a big steamship
service, Honolulu is within three days steam of Vaucoiiver. It is only four
(lays under the existing service from San Francisco to Honolulu with the
ordinary steamers trading there, and only four days when the San Francisco
steamers were running to New Zealand. The next point is from Honolulu to
Suva, which is the other place they would touch at. That Avould be about
six days with the high speed I am talking of. It was done in seven or eight
days with the mail steamers that were engaged.

Sir WILFRID LAURIICR : At what speed ?

Sir JOSEPH WARD: Only 15 or lb knots. Then from Suva to New
Zealand would be well under tliree days. The coaling places referred to by
Sir William Lyne, which is the all-important element from a steamship point
of view, are within easy ilistanee for fast steamers which require coal at
intervals, and require a few hours' rest at intervals for machinery purposes,
'i'he question arises what speed is a steamer to put into operation to cross the.
Pacific? AVhile Sir Wilfrid Eaurier was speaking, I was looking into the
matter and I Hud that with under a 22-knot service — only a little over
21 knots — the whole business from Vancouver to New Zealand could be done
in practically 13 daj's. The whole point comes back to this : Are you looking
at the Pacific Ocean as a long sheet of water iipon which a steamer is suppiosecl
■to be coaled up to the eyes, and prepared up to the hilt to do a 6,000 inile
journey without any assistance whatever in the way of coaling facilities ?

Sir WILFRID EAURIER : You can only stop at Honolulu for coal.

Sir JOSEPH WARD : And at Suva, whicli is within six days steam
from Honolulu. It is the stopping point now from Honolulu, and so you get
a coaling depot at Honolulu, and a depot at Suva, and a coaling depot at
Auckland. Now, our steamers do it in 3 days 3 hotn-s irom Aucklaiul to
Sydney, which is quite common. Witli a steamer of the speed I am speaking
•of, they would do it under three days quite easily.

Fifteenth Day.
14 May 1907.

Mail Service

TO Australia

AND New

Zealand viii

Canada.

(Sir
Jcieph Ward.)

572

We come to the point of tlie project of bringing the outlying possessions
into toiich. This is all-important. We have heen talking abont emigration
schemes and of subscribing large sums of money for the purpose of assisting
emigrants going from the British Islands ont to Canada, Australia, and New
Zealand. If yon gave them the opportunity of third-class accommodation
at low rates upon those steamers of going with this speed to these coiantries
it would be a good thing. Canada has the inestimable advantage of being
A'ery much closer in that respect, and to some extent it would minimise its
importance to them, but speed, of course, is a very important element to
Canada. Fi-om our point of view, instead of spending anything for emigra-
tion, we would one hundred thousand times rather give it as a matter of
practical business to a fast service to bring our countries within three weeks
of London. Supposing this service were to cost probably 300,000L or
400,000L a year by way of subsidy.

Mr. LLOYD GEORGE : Do yon mean in the aggregate ?

Sir JOSEPH WARD : Yes, between the whole of ns.

Mr. LLOYD GEORGE : Not with a 20-knot service. I am afraid that
does not agree with my information.

Sir JOSEPH WARD : To-day you have got running, and for many
years have had running, from London to Australia through the Suez Canal, a
weekly steamship service between two lines of steamers, a fortnightly one by
each company, and by that route as far as your subsidies went, for under
180,000/. a year. Australia has entered into a contract, I understand, for less.

Mr. LLOYD GEORGE : There is a pretty big trade there-
difference.

-that is the

Sir JOSEPH WARD : Well, it is a passenger and mail service — there
is veiy little cargo.

Sir WILLIAM LYNE : And a weekly trade.

Sir JOSEPH WARD : A weekly trade. I understand a contract has
been entered into by Australia for 125,000L a year, I do not know whether I
am right in the figures.

Mr. DEAKIN : That was the figure, I25,000L

Sir JOSEPH WARD : If we are going to aim at getting something
superior in the way of speed to bring these countries together you cannot
hope to get a fast service unless you pay for it.

Mr. LLOYD GEORGE : How many knots would that be ? Is not that
a 15 knots service ?

Sir JOSEPH WARD : The new service ?

Mr. LLOYD GEORGE : No. The service you are referring to now,
that we are subsidising through the Suez Canal.

Sir J0S1<:PH ward : They run about 15 knots, I believe.

573

,Mr. Lr.OYD GEORGE
an enormous dift'erence.

Yes, and increasing it to 18 knots would make

Sir JOSEPH WARD : If you are going to pay 250,000L a year, and if
the other countries coming in pay another 100,0U0 a j'ear, in my opinion it
wouhl 1)0 worth it.

Mr. LLOYD GEORGE : I agree, if it is only that.

Sir JOSEPH WARD : To bring the countries together as a matter of
business you want to carry out a feasible scheme. If these steamers running
out to Australia should run out to Vancouver and back again on a 15-knot
service I would not give twopence towards it ; I would just as soon travel by
our direct cargo steamers, if I were going home as a matter of speed. From
a New Zealand standpoint, I would not be prepared to put down any money
for a slow service. These powerful self-governing countries are prepared
to do something and we want Britain to join, which would enable us to come
within three weeks of London. For ni}^ part, I should be exceedingly glad to
see the proposal made in the direction Sir Wilfrid Laurier is urging, but
with an effort to greater speed to both between England and Canada,
and Canada, Australia, and New Zealand. I know the obligations upon
Australia for other services ai*e greater than ours, and make them necessarily
consider whether they can afford to give large sums of money to another
service running at a high speed. One can thoroughly understand that
as being a reasonable view to take, but the advantages all round
to them would be very great, and it is at all events worthy of
consideration. You cannot tell what the steamship competitors would be
prepared to do. If we were to pass at this Conference a resolution inviting
offers, say, for a service to run from England to Canada, to Quebec or
Halifax, whichever alternative you like, in suniaaer or winter, and make it
a condition that the speed was to be 23 knots an hour, and ask tenders for it,
and do the same thing on the Pacific side, I should go straight for a 21-knot
service there, and find out what amount of subsidy was required for it. I
have got sufficient knowledge of the whole proposition to realise that you
cannot get a fast service like this even with the coaling depots available at
short distances, unless you are prepared to pay a large subsid\^ for it. What
is a few hundred thousand a year to Great Britain, Canada, Australia, and
New Zealand in order to get something of the kind when you consider the
advantages to l)e obtained ?

Sir WHJJAi\I LYNE
service means ?

Fifteoutli Day.
14 May 1907.

Mail Service

to austualia

AND New

Zealand via

Canada.

What additional amount do you think a 20-knot

Sir JOSEPH WARD : I should think 303,OO0L a year, by comparison
with anything you have done for Australia now, including the Canadian
side.

Mr. DEAKIN :. You can easily test this question by inviting offers for
services at 18. 19, 20, 21, 22, 23, and 24 knots.

Sir JOSEPH WARD : This matter of a route across to Vancouver we
have been urging on for many years. I have been at it for 17 or 18 years
personally. Every opportunity' I have had I have . been talking about
improving the service across to Vancouver. I took the trouble 12 years ago
to go straight from London to Canatla for the jnirpose of interviewing the
Canadian Government to get a contract signed. I got it signed and took
it back to New Zealand, but where we are going to be landed, as far as
New Zealand is concerned, in the absence of united action is that the

Jb'ifleenth Day.
U May 1907.

Mail Service
TO Australia
AND New-
Zealand via
Canada.

(Sir
Joseph Ward.)

574

"all red route" ^^llic•h we prefer would have to be given up, and the
alternative for New Zealand will be to go via America. The American
service has only ceased at the moment because of the difficulties which
cropped up consequent upon the earthqiiake in San Francisco. It is the
fastest way we have from New Zealand. It is the shortest route under any
conditions.

Mr. LLOYD GEORGE : What knot service is it ?

Sir JOSEPH WARD: Only a 15 or 16 knot service.- I went back
myself from here to New Zealand and landed in New Zealand in 28 days, or
rather, I should have done so if I had left here two days later. I went on tv/o
days ahead from England, and the mails were landed in 28 days by that route.
Our alternative, in order to bring us close to the Old Country from the
standpoint of the nearest route, is to join with the United States Government
and to pay sufficient money to have an up-to-date line of steamers put on from
San Francisco to Auckland. We would get a faster route than we are getting
here, but as that service is at the moment stopped we ought to try and secure
the "all red route " and help our people to come through Canada and help
Britain to have that route through Canada, and on to Australia, and New
Zealand. I say it is infinitely preferable for us to put our minds upon that
and come together and offer a larger subsidy to have a fast route for mails
and passengers across Canada and the Pacific, and if we do that we do one
of the finest things for the Empire.

Sir JAMES MACKAY : A service once in four weeks ?

Sir JOSEPH WARD : The one across America has been a three-weekly
service. I am suggesting now a fortnightly service.

Sir JAMES MACKAY : For 300,000L a year?

Sir JOSEPH WARD : 300,000Z., or whatever it may be. Speaking from
the New Zealand standpoint we are not going to remain a fifth wheel to a
coach in the matter of giving our money to siipport a line of steamers as
is supported by Britain and Australia at the present moment, which are slow,
for the purjjose we desire ; that is the 15-knot service out through the Suez
Canal. That is used bj^ our passengers very largely, and for mail services,
but it is keeping us comparatively in the back woods, and we are not going to
continue to give our money directly or indirectly to a slow service by the
P. and 0. and the Orient or any other line, and allow ourselves to remain
in the position of being kept nearly six weeks from England, when, at this
age of steam development, we know it is quite possible to get here, under
improved conditions, in about three weeks. So, what I luge is. that we
ought to achieve a really fast service by the best route of the lot, from the
passenger point of view. The view was put forward by Sir Wilfrid Laurier
that the service shoidd also go to China and Japan. It is one of the finest
things possible. They have a line of steamers now from Vancouver to the
East — the Empi-ess line — which has done a good deal to divert passenger
trade through Canada from England. If you want a large diversion of trade
go for larger and faster steamers on that route and you will change the
direction of the traffic from the East, which is now filtering through the Suez
Canal, with all its high charges and imposts. If you want to bring about
a revohition and a complete reformation in the transport of people, then
help Canada to get this fast service to the East, via Vancouver, and you
get an "all red route" there also. But from the point of view of
New Zealand, I only want to make it as clear as I possibly can that

575

we never contemplated doing a cargo business across Canada. We want to Fifteenth Day.
lielp the transport of passengers and luails that way, and get them to and from u May ifK^T.

England as fast as possible b}^ that route. As far as cargo is concerned, au}-

man doing l)usiness in the Colonies can make his own arrangements. He Mail Service
does not want any assistance Jjy way of sidjsidy. What he wants is to get "^^ Austkaha
some of the charges upon the tramp steamers taken off on the Suez Canal, ze\land rio
wdiich is quite a tlifferent thing to giving him the benefit of that shorter route C'axaua.

avaihdile. We do not want a subsidy for (.-irgo steamers. Canada and New (>^i,.

Zealand, at the moment, in order to give our people au opportunity of Joseph Ward.)
working up trade, are giving 20,()00i. a year for tramp steamers — 10,000?.
each. It is not a satisfactory thing from our point of view or the Canadian
point of view, but we do it in order to give our people a chance of working
up a trade. Once trade develops that subsidy will be withdrawn, and the
cargo steamers will have to work out their own destiny, as everywhere else,
without the material assistance of sid)sidies.

r>ut if we want to do a great thing for CJreat Britain and the outlying
British countries, let us be prepared to pay the necessary money for it, and
licud our efforts to bringing these countries into close touch wdth England,
which can be done provided we are prepared to pay enough for it. If we
are not prepared to pay for it, we cannot expect to do it at all. I support
the resolution of Sir Wilfrid Laurier because it is in the right direction ;
but T would ask him to alter it in the dii'ection of inviting tenders, and to
provitle for faster speed, and let us have the assurance from the British
Government that they will help us.

Sir WILFRID LAURIER : I have no objection to making some such
alteration.

]\Ir. LLOYD GEORGE : Before altering the resolution, perhaps you
will hear what I have to say as I have one or two suggestions to make.

Dr. JA]MESON : Lord Elgin and gentlemen, this proposal does not
directly affect iis at all, but purely xVustralia, Canada, New Zealand, antl
the United Kingdom ; but what does alarm one a little is Sir Joseph Ward's
suggestion that unless something of the kind is done the " all red route "
goes and we fall back on San Francisco.

&

Sir JOSEPH WARD : We must, it is our only alternative.

Dr. JAMESON : Yes ; these things are often done better piece-meal.
I should have thought it was better for Canada to get a better service with
the United Kingdom so as to compete with the United States. Sir Wilfrid
r^aurier dealt with a service between the United Kingdom and Canada.
Then there is no reason afterwards for the alternative that Sir Joseph Ward
put forward as between San Francisco and Vancouver. If you once had
a fast service to Canada, and through Canada, then it might be a question
of dealing with the second i)roposition as to whether a fast line should go across
the Pacific to Australia and New Zealand. As to whether it goes to Australia
or New Zealand first, that is a further question to be argued and settled,
but in the meantime you avoid that horrid possibility of abandoning the " all
red route " and entering into an arrangement from San Francisco. If
Canada got what is suggested by Sir Wilfrid Laurier, a 24-knot service to
Canada, then you begin on the other side to Jiegotiate 15 knots, either 15. 18,
or up to 20 knots, in the Pacific.

Sir JOSEPH WARD : Undc-r the idea which New Zealand has, and
which 1 am strongly impressed \vith myself — and nothing that I know of

576

Fifteenth Day. SO far coiilcl change me from it — I know under the mail arrangements we
14 May 1907. want to carry out that it is a necessity that Sydney should be the

terminal port for the steamers. That is right. That means steamers must

Mail Service -wait there a Aveek or more for the purpose of OA^erhauling and all kinds of

TO Australia tilings, and from the point of A'iew of an effective mail service via Vancouver,

yf^T .x^^!..'. ' New Zealand must be the point first touched at on the outward route, because

Canada. they have to wait so long when they get to oydney lor all the attendant work

(Sir required on the steamer. So, of necessity, in any route we are considering,

Joseph Waiil.) and any proposal, if you want to carry it out practically, you must link New

Zealand as the first port outward from Vancouver ; otherwise, as far as we are

concerned, Ave have to Avait for seven or eight days after the steamer has been

to Sydney.

Sir WILLIAM LYNE : Could it not be done by a branch service from
Fiji?

Sir JOSEPH WARD : No, that means another transhipment, and people
Avill not stand it in these times.

Dr. JAMESON : That is just the point it must come to, practically, in
plain langiiage, betAveen Australia and New Zealand as to which gets the
sei-A'ice first. I should like to see that dealt Avitli later on, so as not to
prejudice the Canadian suggestion as to a fast service practically from
England to Vancouver.

^&^

Mr. DEAKIN : I do not controvert Avhat Sir Joseph Ward has said at
all, but my allusion to it simply pointed to the fact that if your steamers do
not cany cargo you have to give them a larger subsidy.

Mr. LLOYD GEORGE : Especially for a very fast line of steamers.

Sir WILLIAM LYNE : I think in Ncav South Whales we transferred the
subsidy from Queensland to the Vancouver service to help us, and Ave have
refused to support Speckles, Avho is the owner of the American line, two or
three times during the last feAv years. To support the Vancouver route Ave
gave all Ave could to that route instead.

Sir JOSEPH WARD : We have offered to give the same amount all
through the piece to Vancouver. We have for years paid the money for San
Francisco, because it was the only line Ave could get. If Ave Avere driven into
the same position Ave would have to do it again.

Mr. LLOYD GEORGE : Lord Elgin and gentlemen, I am very glad Sir
Wilfrid Laurier has brought forAvard a proposal which we can examine without
coming into conflict Avith any popular mandate and highly controversial
topics like the fiscal question. I am only sorry that Ave did not get this in
time to enable us to give real consideration to it, and to enable us also to put
foi-Avard considered vicAvs before the Conference. The first I saAv of this
scheme Avas yesterday. I think I saw the resolution last night, and the
resolution which is placed on the paper to-day is different in one or two
material jiarticulars. We hav(^ done our best in the very short time
which has been placed at our disj)osal for considering such a very important
biisiness proposition, and we have made some inquiries Avith regard to it.

Even this discussion has shoAvn what a very difficult problem it is, and
what a many-sided prolilem it is. Yoii have to consider a good many things.
You have to consider the best route. As to the desirability of bringing New

577

Zealand and Australia nearer to the Mother Country, there can be no doubt at
all, and we shall, as far as the Government are concerned, adopt the first three
lines of Sir Wilfrid I^urier's resolution by way of establishing our agreement
with the general proposition. But it is a matter that has to be gone into
verj' carefully, and here I agree with Mr. Deakiu, that it is a matter which
ought to be gone into very carefully by experts. It is a question as to the
best route. It is a question as to what it would cost. Even such
a very desirable object as that which has been foreshadowed by Sir Wilfrid
Laurier, might cost a sum which would be absolutely prohibitive. I have
been told, for instance, that a very fast service from Vancouver to New
Zealand would cost such a large sum of money, that it would be quite beyond
anything that you coidd possibly expect either the New Zealand Govern-
ment, the Canadian Govermneut or the Imperial Government to face. That
is a matter that should be examined, I think, by experts. What we suggest
is that we should at once proceed to examine the proposal and any other
proposals that may be put forward, because there is an alternative I
understand, which will be suggested by Australia with regard to the Suez
Canal route. I think they all ought to be considered, and considered
practically by the same body.

Sir JOSEPH WARD : What is the alternative ?

Mr. DEAKIN : It is not an alternative. We need both the eastern and
western routes, so that there is no alternative from an Australian point of
view.

Sir WILFRID LAURIER : I never understood it to be an alternative
but a matter to be considered by itself.

Mr. LLOYD GEORGE : These are the very few alterations we propose
to suggest in Sir Wilfi-id Laurier's resolution. We propose to leave in all
about the Canadian service and put that as the foremost object, as it is the
first scheme placed Ijefore the Conference ; and we propose also to recommend
that we should inquire into other schemes which may be later tabled by other
Governments.

Fifteenth Day.
14 May 1907.

Mail !Service

TO AfSTRALIA
AND Nkw

Zealand via
Canada.

(Mr.
Lloyd George.)

Mr. DEAKIN : The proposal submitted by New Zealand is for a
fortnightly service. We require a weekly service. One service could come
this way one week and the second by the other route on the alternate week.

Mr. LLOYD GEORGE : We cannot examine it apart from the question
of the carriage of goods, too. We must take that into account. It is not only
a matter of a fast mail service, l)ut also a question of the cheaper transport of
goods and materials from the Colonies. I consider that to be a very important
item, so far as we are concerned.

Then we cannot altogether overlook the fact that the Panama Canal will
make a verj' material alteration in the whole problem of communication with
Australia and New Zealand. The Canal will probably be open within the next
10 years. When you are framing a scheme of this kind you cannot overlook
the effect which the Panama Canal must necessarily have on the whole
problem. It will probably revolutionise the whole question of commvmication
with the southern seas, as the Suez Canal revolutionised the whole problem of
comnmnication with the East. That has to be considered.

What we suggest is something to this effect. We adopt the first three
lines of Sir Wilfrid Laurier's resolution, and put in the word " practicable "
insteail of " possible," but that alteration is merely verbal, suggested because

S 48668. o o

578

Fifteenth Day.
1-i May 1907.

Mail Service

TO AlSTKALIA

AND New

Zealand via

Canada.

(Mr.

Lloyd George.)

the word " possible " occurs later on. This part of the Resolution would
therefore read : " That in the opinion of this Conference the interests
" of the Empire demand that in so far as practicable its different portions
" should be connected by the best possible means of mail communication,
" travel, and transportation." To that we agTee. We then propose to
continue as follows : " That to this end the various Governments concerned
" should initiate concerted incpiiry into the proposal submitted to the
" Conference for establishing a fast service from Great Britain to Canada,
" and through Canada to Australia and New Zealand, and the financial
" support which would be necessary for the purpose of maintaining such
" a service, and also into any other proposals for similar purposes which
" may be submitted by any of the Govermnents concerned." That is what
I propose to submit to the Conference, and that will enable lis to go into
the whole question of time that will be consumed, and the question not merely
of the money to be required, but also of the contributions which may be
expected from each of the respective contracting States. All these practical
questions could be thorouglily sifted and scrutinised, and I do not see why
any time should be lost, and why experts should not be appointed before
the Premiers leave London now, and why they shoidd not proceed at once to
examine into the matter and take evidence. That is the proposal which
the Lnperial Government piit forward.

Sir WILFRID LAURIER : Lord Elgin and gentlemen, I am quite
pleased with the general acceptance which this proposal has received, and
still more pleased that so far as New Zealand is concerned the only criticism
offered by Sir Joseph Ward is that the proposal is too limited in its scope.
The proposal which I submitted is in these words, " that such service upon
" the Atlantic Ocean should be carried out by means of steamers equal in
" speed and character to the best now in existence." We camiotdo anything
more with regard to improving our conununication with Canada than to have
a service equal to the best that is now in existence between New York and
England. So far, I think, it requires no expert knowledge or evidence at all.
If you are not prepared to do that, then it is blocking the whole system.

Mr. LLOYD GEORGE
different matter, I agree.

Between England and Halifax — that is a

Sir WILFRID LAURIER: With regard to the Pacific, I limited my
proposal to an 18-knot service. I have looked into the matter the last few
days, and I find in conversation with some i^eople interested in this service
that at this moment it would be very difficult to have more than 18 knots.
I agree with Sir Joseph Ward if we could have something 1;etter it
would be well to do so, and if it can be done by spending money, I may say
on behalf of the Government of Canada, that we are prepared to go as far as
any Governments here interested in overcoming the diificidties. If agreeable
to Sir Joseph Ward, I will amend my proposition in this way. " That such
" service u^dou the Atlantic Ocean should be carried on by means of steamships
" equal in speed and character to the best uoav in existence, and upon the
" Pacific ocean by steamships of a speed and character as nearly equal to the
" Atlantic shii)s as circimistances would permit." Would you accej)t that,
Sir Joseph ?

Sir JOSEPH WARD : Quite so.

Sir WILFRID LAURIER : I would limit it in this way, but if Mr. Lloyd
George would permit me to say so, I do not think it is a question of experts
in this matter, but a question of policy. We want to have an " aU retl route,"

579

as it has l)Pon vorv happily terniprl in Australia over British territory Fifteenth Day.
absolutelj-. Il' that he the case it requires no experts at all. U Muy iyo7.

Mr. LLOYD GEORGE : For cost, surely V

Sir WIIjFRID LAURIER : If you have a company in which you would
have such a man as T^orfl Strathcona, who will imdertake it for such a
sum, you will have to determiue whether you are prepared to paj' the sum or
not. No expert would be required there. If j'ou found a Company on the
Atlantic Ocean who would be prepared to put down their money for such a
service provided they get a siUjsidy. Five years ago you gave a subsidy to
the Cunard t'ompanj^ for the service between Great Britain and New York.
I think it it would have been far better if it had been given to a line to Canada
but it is no use going into that now.

With this amendment that I have made you have two proposals before
you ; one with regard to the Atlantic service, and one with regard to the
Pacific service. With regard to the Atlantic service, what we want to have
is a service equal to the best now in existence in the world ; that requires no
expert knowledge, but it is a question of policy, shall or shall we not have it V
If we want to have it we must pay for it. No company will undertake such
a service without a liberal sidjsidy. The only question, therefore, is, will
you do it, and be prepared to pay the price which is reasonable for it ?

As to the second question, the Pacific service, I limit it according to
the suggestion of Sir Joseph Ward, to say we are prepared to back a service
as nearly equal in speeil and character to the Atlantic ships as circumstances
will permit. Here again, there is no necessitj* for experts ; it is a question
of policy, shall you or shall you not have such a service ? That is a question
for the Conference to decide and I think you should put the question.

CHA1R]\[AN : Do you wish it put as it stands ?

Sir WILFRID LAURIER : With the amendment.

Mail .Service

TO AUf^TUALIA

AND Ne«'

Zealand ria

Canada.

(Sir
VVilfiiJ Laurier.)

Sir WnXIAM LYNE : May I say that the wording of that resolution
might be misunderstood, the words are " speed and character " as nearly as you
can get them to those running across the Atlantic. It does not want such
large boats. At th(^ present moment there is a turbine boat running between
Melbourne and Launceston at 21 knots, and a boat 1,000 or 2,000 tons larger
than that is not a fourth the size of the boats running from here to New Y'ork,
and it would do that service well and do it much cheaper.

Sir JOSEPH WARD
say size.

It says, " speed and character." It does not

Sir WILLIAM LYNE : The character means as nearly as possible like
those between here and New York.

Sir WILFRID LAURIER: How would you change it?

Sir WILLIAM LY^NE : So that it is clearly und(>rstood that they are not
ships of the size or anything like the size of those running to New York now.
As long as they have the speed, and they are suital)le, a ship of 5,0t)0 or
0,000 tons would be quite sufficient.

Sir JOSEPH WARD : We have a similar steamer now running in
the Vancouver service in the summer months, owned by New Zealand, the
" Maheno."

0 o 2

580

Fifteenth Day. Sir WILFRID LAURIER : How would this satisfy you : " Of a speed

14 May 1907. as nearly equal to the Atlantic ships " ?

Sir WILLIAM LYNE : Yes, leaving out character altogether.

Mail Service

TO Australia

AND New

Zealand via Sir WILFRID LAURIER : Yes, I will take out the word " character."

Canada. j ^^^^^^ ^^^ objection.

Sir WILLIAM LYNE : There is a steamer of 6,000 tons running across
now, but not at that full speed.

Sir JOSEPH WARD : Yes. One more word about this. I should be
Sony to support the idea of mixing this up with what experts may think
is the best course to follow, because I look upon that simply (although
Mr. Idoyd George does not intend it) as having the eifect of delaying this
before we arrive at any conclusion at all for a considerable period. I think
it is infinitely better if we make up our minds to test what is possible here
on the suggestion put forth l)y Sir Wilfrid Laurier — make up our minds
what the speed is that we are prepared to have between England and Canada
and between Canada and Australia and New Zealand, and then call for
tenders for it. Lot us lix it as a matter of policy and give it out definitely
that we are going to support a service of that kind.

Mr. LLOYD GEORGE : I have said something about experts in my
observations, but that is not my proposal. M.j proposal is really described in
the words used by Mr. Deakin in his resolution last week. I used the Avords
" concerted inquiry," and he put "systematic." I do not think it matters.
We really cannot pledge ourselves now as to the best means of doing this
thing. The resolution has not even been placed on the paper. I do not
think it really fair. If it l)e regarded as a matter of inunense practi(^al
moment — and I think it is — , I think it would have been fair to the Imperial
Government, at any rate, to let its have a copy of the resolution. We have
had copies of all the resolutions about fiscal reform, but never a copy of
this one practical proposal, which we could have examined. It ought to
come before the Cabinet. But we saw this resolution for the first time this
morning, and it is really rushing us mifairly, I must say, to ask us to
j)ledge ourselves, not to the general proposition that it is desirable or that
we will look into the matter, but to pledge ourselves to the actual route, to a
20-kiu)t service here, a 2-J:-knot service there, and an 18-knot service in
another place. Surely that is a thing that ought to be inquired into. The
dilTerence in cost between an 18 and a 20-knot service I am told is simply
prodigious. The figures given to me were ahiiost prohibitive. Possibly,
when we look into it, it may simply have been that a shipowner was trying
to frighten us off it ; I camiot say, lout the figui-es were very alarming. To
ask us to pledge ourselves to the very smallest detail (Ijecause that is what
this means) without the slightest further talk amongst ourselves as to the best
plan of doing this thing, I really do not think is quite fair to us.

Sir WILFRID LAURIER : The concrete resolution has been placed
before you, but the idea has been running in this Conference all through of
such an import service as we have been asking for.

Mr. LLOYD GEORGE : I agree.

Sir WILFRID LAURIER : The idea has not only been agitated, but
talked about and conferred upon intormally for about some three weeks. The

iiiiiur. 1

581

resolution coinos in a concrete I'orin t()-(l;iy, hut it has not conic as a new idea Fifioenth Day.
or subject at all. " H iluy uio7.

Mr. LLOYD (lEOIJCE: Not the -encralldoa, hut the actual proposal. if:"A,.srpy!?!
Sir Joseph Ward says you have to coininit yoursou to an 1 6- kuot service here, ani> Nr.w
and a 23-kuot service there. Zealand ria

Canada.

Sir JOSEPH WAlil) : What I say is this : from the New Zealand stand- ....,, S^}'
point, to-day, we are in this position, that the only mail route wnicJi we nave
for which we give a suhsidy to the American Cioverninent is stojjjied. We
want to give the bcueht of our subsidy to a service through Canada. I do not
think it is possible for a service such as we want to be put into elfect without
the assistance of the British Ciovernineut. That is the point of view I take
up. You are probably right from your point of view. It is believed that I
am suggesting too fast a speed for these steamers. We launched a steamer
the other day to do a portion of our work in New Zealand, to steam 20 knots,
which does not get a penny of subsidy.

Mr. LLOYD GEORGE : Where is it running to ?
Sir JOSEPH WAIiD : Between the two islands.

Mr. LLOYD GEORGE : No doubt there is a big trade.

Sir JOSEPH WARD : Yes, it is, though short compannl to ocean
voyages. I can give you the ocean passage from Australia right across to
Vancouver, to which that argument will not apply. We have a steamer
belonging to that service that does the journey across at 19 knots, the
"Maheno."

Mr. LLOYD GEORGE : Does she run regidarly ?

Sir JOSEPH WARD : All the siimmer months, and in winter between
Australia and New Zealand. She runs all the time, frequently at 18 knots,
and she has averaged over IS between Australia and New Zealand more than
once. That steamer, without any ditliculty, could, if required, average over
17 knots.

Mr. LLOYD GEORGE: Here is a scheme which will involve
hundreds of thousands of jiounds, one way and another. There is a
dilference between one estimate and another of, perhaps, two or three
hundred thousand pounds a year. As far as I can see, you have no
estimate of the cost, and we are pledging ourselves to the very route and
the very method without even having an estimate^ of what the scheme may
cost. I do not tliink it is a business-like proposition to ask us to commit
ourselves to all the details at the present moment without concerted
examination.

Sir JOSEPH WARD : We do not propose to commit ourselves to
details either. Wliat we want as a matter of policy is to try lo bring our
countries closer to the Mother Country.

CHAIRMAN : That is what is done in this resolution.
mm. 0 o 3

582

Fifteenth Day. Sir ROBERT BOND : I would like to ask Sir Wilfrid Laiixier if he is

14 May 1907. wedded to any particular scheme or any particidar proposal. I ask that

question because the Colony that I represent has already entered into a

Mail Service contract with reputable people in this City for the purpose of carrying out

TO Australia ^ short line scheme to connect Great Britain with the American Continent

Zealand^i-^« ^y *^^ shortest and fastest route. We have gone so far as to offer a

Canada. considerable subsidy in cash as well as in lands and minerals, and I should

not like to have that proposal excluded from the consideration of His

Majesty's Govermnent by any resolution to be proposed here. I understand

that the contractors have already approached His Majesty's' Government in

reference to that matter. If they have not done so, I know they intend doing

so, and I now ask that that proposal may receive due consideration, and

that the Resolution be so worded as to admit of such.

Sir WILFRID LAURIER : I have not defined it ; it may be this or
that. We want a good service between England and Canada. As I know,
there is a project via Newfoundland, but I do not object to that being
considered.

CHAIRMAN : I hope the Conference understands that the resolution
read by Mr. Lloyd George does not take uj) the expert view which was
objected to. It is an inquiry simply which is desired by concerted action
between all the Governments.

Sir WILLIAM LYNE : Really to find out how much money would be
required.

Mr. LLOYD GEORGE : How much it would cost and how much each
Colony would contribute.

CHAIRMAN : I had better read the two resolutions.

Mr. LLOYD GEORGE : I think it is a great pity we shoidd not arrive
at some unanimous decision to enable us to go on with the matter. The two
conflicting resolutions will leave the thing quite in the air.

CHAIRMAN : Sir Wilfi-id Laurier's resolution, as he proposed it, is :
" That in the opinion of this Conference the interests of the Enquire demand
" that in so far as practicable its different portions should be connected
" by the best possible means of mail communication, travel, and trans-
" portation."

Mr. DEAKIN : Why not put that part now ?

CHAIRj\IAN : I wiU read the whole thing.

Sir WILFRID LAURIER : I understand the first is accepted.

CHAIRMx'VN : " That to this end steps should be immediately taken to
establish a fast service from Great Britain to Canada and through Canada
to Australia and New Zealand and also to China and Japan ; that such
service iipon the Atlantic Ocean should be carz'ied on by means of
steamships equal in speed and character to the best now in existence, and
upon the Pacific Ocean by steamships of a speed as nearly equal to the
Atlantic service as circumstances will permit ; that for the purpose of

583

" carrying the above project into effect stich financial support as maj'^ be
" necessaiy should be contril)u(ecl by Cireat Britain, Canada, Australia, and
" New Zealand in equitable proportions." His Majesty's Government
suggests that it should run in this way : " That in the opinion of tliis
" Conference the interests of the Empire demand that in so far as practicable
" its different portions should be connected by the best possible means of
" mail coiumimication, travel, and transportation ; that to this end the various
" Governments concerned should initiate concerted iuquiiy into the
" proposals submitted to the Conference for estal)lishing a fast service from
" Gr(>at liritain to Canada, and tlu-ougli Canada to Australia and New
" Zealand, and the financial support which will be necessary for the purpose
" of maintaining such a service, and also into any other proposals for similar
" purposes which may be submitted by any of the Governments concerned."
That covers Sir Robert Bond's position, I think.

Fifteenth Day.
14 May 1907.

Mail Sekvice

To Ai;STKALlA

ANI> KeW

ZeaLAM> via

Canada.
(Chiiirnmii.)

Sir ROBERT BOND : I tliink that is preferable to the resolution
proposed by Sir Wilfrid Laurier.

Mr. LLOYD GEORGE : That will cover the route to AustraUa through
the Suez Canal.

Sir WILLIAM LYNE : Austraha has very little to do with Japan and
China.

Mr. LLOYD GEORGE : I know, but that is not part of om- proposal.

CHAIR]\LVN : Do you see your way to accept that, Sir Wilfrid ?

Sir WILFRID LAURIER : I am sorry that we cannot agi-ee. I hope
we may agi-ec upon something. Perhaps we can after aU ; it only wants
making an effort.

Mr. LLOYD GEORGE : I hope it may be possible.

Sir WILFRID LAURIER : I must ask you at once to limit the inquiry.
An inquiry means simply delaj'.

LIr. LLOYD GEORGE : Then we can go on to propose the method of
inquiry.

Sir WILLIAM LYNE : Limit the inquirj- as to the time for reporting

iipon it.

Mr. DEAKIN : Let us do all we can to agree. Perhaps I might occupy
a moment with a not irrelevant suggestion which has been made, and as far
as I know, not considered, certainly on our side. Sir .loseph Ward has put
forward so clearly that it is not necessary to roj^eat it, the case that can be
made for a reduction of the dues in the Suez Canal. It is pointed out to me,
on the best information, that those dues are levied on the capacity of the ship
— the cargo capacity, whether loaded or not, and the passenger accommodation,
whether occupied or not. I imderstand that the levy on the cargo capacity
stands by itself ; it measures the capacity of the vessel at its customary
standard ; but there seems to be force in the contention that it would be a
fair thing to suggest that so far as passenger accommodation is concerned,

O o 4

584

Fifteenth Day.
14 May 1907.

Mail Service

TO Australia

AND New

Zealand via

Canada.

(Mr. Deakin.)

the dues should be levied only on the amount of that accommodation actxially
occupied. Trade passing through the Suez Canal varies immensely at
different seasons of the year, and the vessels which use the canal regularly
require to provide a maxinuun carrying capacity for passengers. That, as I
understand, does not involve a serious addition to the bulk of the vessel, but
a larger superstructm-e and upon this they have to pay for some months of
the year when the greater part of it is mioccupied. When the question of
the rates in the Suez Canal comes up for consideration and relief is being-
sought, if it cannot be given to the whole extent and if we are comjjelled to
fall liack upon other minor reductions which may be made, surely it is a
reasonable thing to proj)ose that, so far as passenger acconnnodation is
concerned, the dues should be j)aid only on that portion which is actually
occupied. Then whatever the steamer received for passenger fares, the Canal
would receive its proportionate dues. This would Ije a consideral^le relief
in some seasons of the year when the passenger traffic is very small. This
implies no retention of the cargo dues, but is suggested as the passenger
accommodation stands on a different footing. This is one practical waj^ in
which a good deal of relief could be given to the vessels using the Canal.
They include vessels whose cargo capacity is seldom used to the full, but on
that they have to pay, consequently their charges are high. I would be
glafl if ]\Ir. Lloyd George would be good enough 1o note that
consideration. Pro1)ably it has reached him before.

suggestion for

Mr. LLOYD GEORGE: Unfortunately, we have no real control, I
forget what our holding is — it is something lilce four-tenths of the whole,
but the control is practically in the hands of the shareholders, and His
Majesty's Government have no proportimiate voice in framing the schedule of
rates. That has been our diffieuhy ; in fact, the only thing we could do
would be to refund a part of the rates. That ^voldd have to l;)e by a
contrdjution from the various Governments affected.

Sir EDWARD GREY: We have had complaints
shipowners of the way the dues are levied.

from our own

Mr. DEAKIN : I long since wrote despatches asking for a reduction
of all the Suez dues, but certainly a preference for British ships would
be better secured by remitting the dues on all ships. We could pay
them ourselves for our own vessels. For the iirst proposal you woidd get
support from other nations, because, although their shipping is smaller than
ours, they must pay the dues at the same rate.

Sir WILFRID LAURIER : Would this be acceptable to Mr. Lloyd
George ? I dislilve the word " inquiry." " That in the opinion of this
" Conference the interests of the Empire demand, that in so far as practicable
" its diiferent portions should be connected hj the l^est possible means of mail
" communication, travel, and transportation ; that to this end it is advisal^le
" that Great Britain should be connected with Canada and through Canada
" with Australia and New Zealand by the best service available under
" existing circumstances ; that for the purpose of carrying the above project
" into effect such financial support as may be necessary should be contril)utcd
" l)y Great Britain, Canada, Australia, and New Zealand in equitable
" projportions."

Mr. LLOY^D GEORGE
first resolution ?

What is the difference between that and the

585

Sir WILFKID LAURIER: That it doos not call for inquiry " that to Kiftoe.ith Day.
" this end the various Governnionts concornecl should initiate concerted i^ May 1907.
" inquiry into the proposals suljniittod." The first we limit. The second is
that this connuunicatiou should be through Canada, and from Canada with ^''^''- ^ei'vice
Anstralia l)y the ])est availaljle means without specifying anything. ^"^and Vew'*

Zealand via

Mr. LLOYD GEORGE : That is committing us to this route as the best Canada.

route without inquiry.

Sir WILFRID LAURIER: If you want inquiry whether it is the best
route or not this is exactly the object.

Mr. LLOYD GEORGE : That is committing us to the trans-continental
route as the only route we can consider. We an^ not allowed to consider any
other route.

Sir WUJJAM LYNE : What other route could you consider if it is to be
an " all red route " ?

Sir WILFRID LAURIER : If j'ou think there is another available route
I do not think I or anybody else is prepared to agree with that. We say
that is the route.

Mr. LLOYD GEOIKiE : It is committing us to the scheme before we
have had time to consider it.

Sir JOSEPH WARD : We say it is a matter of policy to have a route
through Canada. It is the only British country we can go through, and
that is the countiy we want to get this service through if we can. As a
matter of policy we Avant a British route ; that is the route we wish to support,
and if possible to obtain your support too.

Sir WILFRID LAURIER : I oliject to Mr. Lloyd George's proposal,
because he wants to examine whether (u- not we should ad{)i)t another route or
this route. We say there is no inquir\^ reql^ired. This is a question of policy
we ]iut before you to have an all British route, and this is the only British
route possible. There is no other.

CHAIRMAN : It seems to me your resolution would commit us to 3'oiir
proposals, even if the conditions were prohil)itive.

Sir WILFRID LAURIER : Not at all.

Mr. LLOYD GEORGE : It is absolutely regardless of cost.

Sir WILFRID LAURIER : No, put in a modification if tbe cost is too
heavJ^ I do not object to that. This is the route. 1 use the words " available
under existing circumstances."

Mr. LLOYD GEORGE : If we are to go into this question, we shall
have to take the advice of people who will tell us what the thing will cost,
and we must have the figures before us.

Sir WILFRID LAURIER : Very weU, " by the best service available
within reasonable cost."

686

Fifteenth Day.
14 May 1907.

Mr. LLOYD GEORGE : Yes.

Sir JOSEPH WARD : " Subject to the cost being approved by the

Mail Service respective Governments.'
TO Australia

AND New

Zealand via

Canada,

Mr. LLOYD GEORGE : Yes, that is all we want really. We want to be
allowed to examine into the cost o£ the thing.

Sir JOSEPH WARD : My idea is you will never ascertain the cost until
you make up your mind what you want first, and then invite offers for it, and
examine the offers l^y yoiir experts.

Sir WILLIAM LYNE : That resolution binds us to the route via Now
Zealand. The present route is to Brisbane. I do not know what my Prime
Minister thinks.

Mr. DEAKIN : I do not think it does bind us.

Sir WILLIAM LYNE : I think it does. If we pass a resohition and
agree to it that it shall be one route and one route only, and that route via
New Zealand, it might place Australia in an awkward position.

Sir WILFRID LAURIER : I wiU put it tliis way : " That, to this end
" it is advisable^^that Great Britain should be connected with Canada, and
" throiigh Canada with Australia and New Zealand by the best service
" available within reasonable cost."

Mr. LLOYD GEORGE : Yes.

Sir WILFRID LAURIER : I say " for the purpose of carrying the above
" project into effect such financial support as may be necessary should be
" contriljuted by Great Britain, Canada, Australia, and New Zealand, in
" equitable proportions."

Sir WILLIAM LYNE : Then that does not fix the route.

Sir WILFRID LAURIER : It fixes the route.

Itesolutiou XX.
p. X.

Mr. DEAKIN
about.

Not on our side. That is what Sir WiUiam is talking

CHAIRMAN : I will read the resolution again : " That in the opinion of
this Conference the interests of the Empire demand that, in so far as
practicable, its different portions should be connected by the best possible
means of mail communication, travel, ami transportation, and that to this
end it is advisable that Great Britain shoidd be connected with Canada,
and through Canada with Australia and New Zealand by the best service
available within reasonable cost ; that for the purpose of carrying the
above project into effect such financial support as may be necessary should
be contributed by Great Britain, Canada, Australia, and New Zealand in
equitable proportions."

Mr. LLOYD GEORGE : We accept that.

CHAIRMAN : Is that accepted by the Conference ?
The resolution was agreed to.

587

NEWFOUNDLAND FISHERY.

Fifteenth Day.
14 May 1907.

NEWFKrXDLANl)

CHAIRMAN : Yesterday I received a notice from Sir Roljcrt I3oiid that Fishery.
he wished to bring a subject before the Conference concerning the
Newfoundland Fisheries, and Sir Edward Grey has attended for that
purpose.

Lord Elgin

and gentlemen

In

this

Sir ROBERT BOND : i^orci iiiigm ana gentlemen : in proposing
question for the consideration of this Conference, I do not intend to make
more than a passing reference to the conditions that appertained in
Newfoundland imder the modus vivendi entered into between His Majesty's
Govermiient and the Government of the United States of America in
October 19U6. All the facts are well known to His Majesty's Government
and to the CJolouial Members of this Conference, for I have taken occasion to
place in the hands of the latter a concise history of the same. Any
comments iipon what transpired under that arrangement, or upon its
terms, or the manner of its accomplislmient, might be regarded as vexatious.
It will, therefore, only be necessary for me to briefly outline the Treaty
relations that have existed and that still exist between His Majesty's
Govermnent and that of the United States of America ; the obligations that
are imposed upon American subjects muler the existing Treaty and the
contentions of the Government of the United States of America now before
His Majesty's Government, and which, I submit, are sufficiently grave to
warrant the most serious consideration of this Conference, inasnmch as
they challenge the binding effect of Colonial laws upon foreign subjects
when coming within the jurisdiction of a Colonial Government. The question
affects the Colony that I represent i^rincipally and most vitally, but it also
■affects eveiy Colony represented in this Conference.

I have had the privilege of discussing the question with Sir Edward
Grey, of the Foreign Oilice, with your Lordship, and Mr. Winston Churchill,
and have stated, as clearly as I know how to do so, what I believe to be
the rights of those I represent. That statement I desire to repeat here
and now, for il' it is held l)y this (\)nferencc to be unrcasonal)le or unduly
exacting, I shall be preparetl to modify it to meet what may be coiisidered
reasonable and right.

588

Fifteenth Day.
14 May 1907.

Newfoundland

FiSUERV.

(Sir R.Bond.)

Now, theu, with regard to the Treaty relations between His Majesty's
Government and the Government of the United States of America.

Before the American Revokitiou the inhabitants of all the British
Colonies in North America possessed, as a common right, the right of fishing
on all the coasts of what was then British North America, and these rights
were, in the broadest sense, prescriptive and accustomed rights of property.
At the end of the Revolution, and by the Treaty of Peace signed in 1883,
the boundaries between the possessions of the two Powers, that is to say, the
United States and Great Britain, were adjusted by Article III. of that Treaty,
which reads as follows : —

" Agreed, that the people of the United States shall continue to enjoy
unmolested the right to take fish of every kind on the Grand
Bank, and on all the other banks of Newfoundland ; also in the
Gulf of St. Lawrence, and at all other places in the sea, where the
inhabitants of both cotmtries used at any time heretofore to fish,
and also that the inhabitants of the United States shall have
liberty to take fish of every kind on such part of the coast of
Newfoundland as British fisliermen shall use (but not to dry or
cure the same on that island), and also on the coasts, bays, and
creeks of all other of His Britannic Majesty's Dominions in
America."

This was a grant or recognition of a right agreed upon for a consideration
viz., the adjustment of the boiindaries and other engagements into which the
United States by that Treaty entered.

For our purpose, it is unnecessary to deal with the other articles of that
Treaty.

From 1783, until the war between Great Britain and the United States
in 1812, citizens of the United States continued to enjoy the ancient rights
belonging to them as subjects of Great Britain before the Revolution, and
reserved to them as citizens of the United States, to the extent outlined in the
article of the Treaty of 1783, to which I have referred. Between those dates,
other subjects of difference and negotiation, apart from the fisheries, arose
betAveen the two nations, which were disposed of by the Treaties of 1794 and
1802, but the fishery provisions of 1783 continued down to the period of the
outbreak of war in 1812.

At the close of that war a Treaty of Peace was concluded on the 24th of
December, 1814, which provided : —

(1) For the restoration to each party of all countries, territories, &c.,

taken by either party during the war, without delay, save some
questions of islands in the Bay of Passamaquoddy ;

(2) For disposition of prizes and prisoners of war ; and

(3) For questions of boundary and dominion regarding certain islands

and for the settlement of the north-eastern boundary, and also
for the north-western Ijoundary, but it made no reference
whatever to any question touching the fisheries referred to in the
Treaty of 1783.

On the 3rd of Jidy 1815, Great Britain entered into a Commercial
Treaty with the United States, which provided for reciprocal liberty of
commerce between all the territories of Great Britain in Europe and the
territories of the United States bitt made no stipulation as regards
commercial intercourse between British Dominions in North America and the
United States.

After the conclusion of the Treaty following the war of 1812, viz., that
of the 24th of December 1814, there being then no treaty obligations or
reciprocal laws in force between, or in either of the countries respecting

589

commercial intercourse, the British Govermneut couteuded that the fishing Fiftepnth Day.
rights recognised and secured to the citizens of the United States by the 14 Muy 1907.

Treaty ol' 1783 liad become abrogated in consequence of tlie war of 1812,

on the principle ol war annulling all unexecuted engagements between two Newfol-ndland
belligerents. The fishing rights conveyed to the United States of America Fishery.
by the Treaty of 1783 having l)oeii annulled by the war of 1812, the citizens ('^''" ^- Bond.)
of the Unitetl States no longer had the right to fish in any of the North
American waters. This exclusion continued until th(; conclusion of the
Ti-eaty of the 20tli October 1818, which Treaty remains in force to-day, and
embodies the whole of the lisliing privileges to which United States citizens
are entitled in the waters that wash the coasts of Newfoundland and the
Dominion of Canada.

Article I. of that Treaty contains a recital of the fishing privileges in
British North American waters conveyed to the United States by the
Imperial Government. That article reads as follows : —

" Whereas dilferences have arisen respecting the liberty claimed by
the United States, for the inhabitants thereof, to take, dry, and
cure fish on certain coasts, bays, harbours, and creeks of His
Britaiuiic IMajesty's Dominions in iVmerica, it is agreed between
the high contracting parties that the inliabitants of the said United
States shall have for ever, in common with subjects of His
Britannic Majesty, the lil)erty to take fish of every kind on that
part of the southern coast of Newfoundland, which extends from
Cape Ray to the Rameau Islands ; on the western and northern
coast of Newfoundland from the said Cape Ray to the Quirpon
Islands, on the sliores of the Magdalen Islands, and also on the
coasts, bays, harbours, and creeks from Mount Joly, on the southern
coost of Labrador, to and tlirough the Straits of BeUe Isle, and
thence northwanlly indelinilely along the coast, without prejudice,
however, to any of the exchisive rights of the Hudson Bay Company.
And that the American fishermen shall also have liberty for ever
to dry and cure iish in any of the unsettled bays, harbours, and
creeks of the southern part of the coast of Newfoundland, above
descril)ed, and of the coast of Labrador ; l)ut so soon as the same,
or any portion thereof shall be settled, it shall not be lawful for
the said fisherman to dry and cure fish at such portion so settled
without previous agreement for such purpose with the inhabitants,
proprietors, or possessors of the ground. And the United States
hereby renounces for ever any liberty heretofore enjoyed or claimed
by the inhabitants thereof to take, dry, or cure fish on or within
three marine miles of any of the coasts, bays, creeks, or harbours
of his Britannic Majesty's Dominions in America not inchided
within the above-mentioned limits :

"Provided, however, that the American fishermen shall be admitted to
enter such bays or harbours for the purpose of shelter, and of
repairing damages therein, of purchasing wood, and of obtaining
water, and for no other j)urpose whatever. But they shall be
xmder such restrictions as may be necessary to prevent their
taking, drying, or curing fish therein, or in any other manner
whatever abusing the privileges hereby reserved to them."

The Treaty limited to a territorial extent the fishing rights of the people
of the United States, which they had enjoyed as British subjects, and which
had been recognised and continu(>d under the Treaty of Peace of 1783, and
down to the year 1812.

It provided for the continuance of the aui-ient rights of fishing on certain
parts of the coast of the Colony of Newfomidland and of His Britannic

590

I teenth Day. Majesty's other Dominions in America. It also provided for a rennnciation

It May 190(. ]jy (^]jg United States of pre-existing rights to take fish within 3 marine

miles of any of the coasts, bays, creeks, or harbours of His Britannic

F^sHEUY^'''' Majesty's Dominions in British North America, not included within the

rS' R R ' n liiiiits set forth in the article which I have read, that renunciation being

subject, however, to the proviso that " American fishermen shall he achnitted

" to enter such bays or harbours for the purpose of shelter, and of repairing

" damages therein, of purchasing wood, and of obtaining water, and for no

" other purpose whatever. But they shall 1)e under such restrictions as may

" be necessarj^ to prevent their taking, diying, or curing fish therein or in

" any other manner whatever abusing the privileges hereby reserved to

" them."

The Conference will not fail to observe that this Treaty contained no
j)rovision as respects the exercise of what may be termed " commercial
rights " by American fishing or other vessels in the waters of the Colony of
Newfoundland or of His Majesty's other Dominions in America.

It was not until the year 1830 that a reciprocal arrangement was entered
into between the Government of Great Britain and that of the United States
for what might be j)roperly termed " commercial " relations, the Act of
Congress of May 29th, 1830, j)roviding for the opening of all iiinerican ports
to certain British Colonial vessels on a mutual opening of British Colonial
ports to American vessels, and a Proclamation dated the 5th of October 1830,
giving eft'ect to it on the part of Great Britain.

This arrangement would appear to have led to acts of aggression on the
part of American sid^jects, and to a violation of the Treaty obligations of
1818, for we find that in the year 1836 the Government of Newfoimdland
passed a Bill, entitled, " An Act to prevent the encroaclunent of aliens on the
" fisheries of this Colony, and for the further protection of the said fisheries " ;
that, in the same year, the Province of Nova Scotia passed laws in respect to
the seizure of American fishing vessels for trading and fishing within the
3-mile limit ; and, that in the year 1838, the said Province of Nova Scotia
complained by address to the Queen of such aggressions, and asked for naval
force to prevent them. This force was supplied by the British Govermuent
and seizures of American fishing vessels became conunon.

Down through the years until 1854 the same conditions applied, when
on the 5th of June, 1854, a comprehensive reciprocal trade treaty was
entered into between His Majesty's Government and that of the United
States, under which Americans were granted the right to fish within the
limits j)rescribed by the Treaty of 1818, under certain restrictions. That
Treaty terminated in the winter of 1864, by a vote of the Congress of the
United States.

Between 1864 and 1871 the policy of issuing licences to American
fishermen to fish in the waters from which they were excluded for fishing
pm-poses by the Treaty of 1818, was adopted by the Canadian Government,
and, during the year 1866, 354 licenses were issued by that Government at
the rate of 50 cents per ton. The next year the licence fee was increased to
$1 per ton, and the number of licences issiaed amounted to 281. In 1868
and 1869 the license fee was doid^led to $2 per ton, and in the years 1868
and 1869, 56 and 25 licences respectively were taken out. The Canadian
Government then changed it policy and enacted exclusive laws against
American fishermen forcing them to keep without the 3-mile limit.

In the year 1871, another reciprocal trade Treaty was entered into
between His Majesty's Government, and that of the United States, which pro-
vided that, for a period of 10 years, fishermen of the United States shoidd have,
in addition to their right under the Treaty of 1818, the j)rivilege of inshore
fishing in the waters of British North America under certain limitations. In
return for that privilege, it was provided that the fishery products of

591

NcwI'oiiiKlIiind and of the iici^hhouring Douiiuion were to have, free entry Fifteenth Daj.
into the markets of the Unitt^l States. On the 1st of July ISSo, that Treaty 14 May 1907.

was terminated by the Congress of the United States, and the iishing rights of

United States' citizens reverteel l>aek to those outlined in the Treaty of 1818. Newfoundland

One month later, namely, on the 1st of August 1886, a telegram was FisnEKv.

receivetl by the Ofhcer Administering the Government of the Colony of i^'^ ^^- 1*""^.)
Newfoundland from the Secretary of State for the Colonies, intimating that
His Majesty's Covernment deemed it " desiral)le that steps should be taken
" by the Government of the Colony to decide definitely on the exact nature of
" the proposals to be made to the Government of the United States in
" anticipation of the negotiations which were contemplated in view of the
" termination of the temporary arrangements that were made by His Majesty's
" Minister at Washington with the United States Government arising out of
" the termination of the lisheries articles of the Treaty of Washington of 1871,
" on the 30th June, 1885." The answer Avhich was given by the Government
of Newfoundland to this representation was the introduction of the Bait Act
in the year 1880. The reasons that prompted the adoption of that measure
were set out by the then Governor of the Colony in a despatch to the Colonial
Oihce, bearing date 25th day of May 188G, wherein he stated that :—

" The people of Ne^vfoundlaud, like those of Canada, desire to use the

right to withhold a supply of bait as a means of inducing the

American Government to remove the import duties on British

fish."

And again, in another despatch from Sir G. WiUiam Des Voeux to the Colonial

Office, bearing date Jth of January 1887, hi support of the Bait Act, which

was held in abeyance by His Majesty's Govermnent for 12 months, he stated

that : —

" American fishermen are protected in the markets of the United
States, which take all their j)roduce by a duty of 5C cents per
quintal, which is almost prohibitive to the results of British
industry," and

" Though the measmv, if allowed, would, to a large extent, place the

lisheries in this neighbourhood within the control of the people of

this Colony, they have no desire to monopolise them, and I feel

satisfied that they would willingly modify the provisions of the

provisions of the measure in favour of such Govermuents as

would grant a reciprocity ... I have good reason for

believing that as regards the United States, the right of olitaining

bait would be restored on the opening of the iVnierican markets

to Newfoundland fish . . . in a word, the principle tliat the

colonists desire to maintain is ' live and let live ' and they merely

object to that of let others live ljy killing us."

Following upon this despatch from Sir George Des Voeux to the

Secretary of State for the Colonies, and under date the 16th Jmie 1887, a

letter was received by the representative of the Newfoimdland Government,

then in London, from the Office of Legation of the United States, intimating

that : —

" Should the Government of Newfoundland see fit to give notice that
American fishermen be admitted to the ports of that province
for the purpose of obtaining supplies, the proposal will be
cordially accepted and acted upon by the Govermnent of the
United States. In that event there would be no objection on tlie
part of the United States Government to entertain suggestions
for an independent agreement in respect to the fisheries of
Newfoundland, and if made by the authorised agents of the
Imperial Government."

592

Fifteenth Day. The invitation was most cordially received by the Government o f

14 May 1907. Newfoundland. Negotiations were opened by His Majesty's Government

with the Government of the United States of America, and on the 15th of

Newfoundland February 1888, what is Ivnown as the Chamberlain-Bayard Treaty was
Fishery. signed at Washington. This Treaty provided for free fishing in exchange
(Sir E. Bond.) £qj. ^]jg fj.gg admission of fish and fish products, the result of British catch,
into the markets of the United States of America. This Treaty was apj)roved
and signed by the United States Government, but was rejected by the
United States Senate, and the fishery privileges of the United States
consequently reverted to those embodied in the Treaty of 1818.

In this same year, 1888, the Bait Act referred to in the dispatch of
Sir G. W. Des Voeux, extracts from which I have quoted, was brought into
force with the assent of the Crown, and tmder the provisions of the same,
foreign fishing vessels were excluded fi'om the inshore bait fisheries, except
under licence, and notices were issued to the United States Government from
the Department of the Colonial Secretary of the Colony calling attention to
the provisions of the said Act.

By virtue of the authority vested thereunder in the Governor-in-Council,
a tax of $1.50 per net ton was imposed upon all American fishing vessels
visiting the coast in quest of bait fishes.

Our relations with the United States continued in this form until the
year 1890, when, by a despatch, beai'ing date 28th February 1890, fi'om
Sir Terence O'Brien, Governor of the Colony, to the Secretary of State for
the Colonies, the question of a direct and independent trade arrangement
between Newfoundland and the United States of America was revived. This
negotiation resulted in my being authorised to proceed to Washington to
assist in bringing about such an arrangement. The result of my visit to
Washington was what is known as the Bond-Blaine Convention of 1890,
which was virtually upon the same lines as the Chamberlain-Bayard Treaty
of 1888. This Convention was approved by the United States Government,
but was not ratified by His Majesty's Govermnent.

In view of the fact that the United States Govermnent had signified its
willingness to exchange a free market with us for bait privileges, and that
our Convention was not held in abeyance by reason of any action or want of
action on its part, the Government of Newfoundland extended to United
States fishermen, for a period of 12 years, all the privileges that it was
contemplated should be granted under the Convention of 1890.

Mr. DEAKIN : You say the Convention was approved by the United
States Government, but did that include the United States Legislature ?

Sir ROBERT BOND : No ; it did not come before the United States
Legislature. It was signed by Mr. Blaine on behalf of his Government.
It was then sent over to this country for His Majesty's ax)proval, and a
protest was entered against its ratification by the Dominion Government,
and His Majesty's Government held it in abeyance for 12 years.

Sir WILFRID LAURIER : Is it not a fact that the Treaty was
submitted by the American Government to the Senate, and they refused
to ratify it ?

Sir ROBERT BOND : No, the 1890 Treaty never went before the Senate
at all, but the 1902 Treaty did. I am coming to that now.

During 12 years from 1890 to 1902, the Government of Newfoundland
persistently urged His Majesty's Govermnent to fulfil its undertaking as
regards the United States Convention, but without avail.

593

Li 1902 I was in this country in connection with His Majesty's
Coronaf 1(111 and the Conference of Colonial Premiers, and 1 availed myself of
the opj)ort unity of pressing upon the then Secretary of State for the Colonies
— Mr. Chamberlain- -the unfairness of the treatment that had been meted out
foils as a Colony during the 12 years previous in relation to our proposed
trade arrangement with the United States of America, and begged the
privilege of being again permitted to proceed to Washington to re-open
negotiations with the Ignited States (lovenimeut for an arrangement upon the
lines of the Convention of 1S90. My request was acceiled to, and I was
furnished with the necessaiy authority to proceed to Washington. The
result of my visit was what is known as the Ilay-Bond Treaty of 1902. This
Convention was rat Hied hy the Secretary of State of the United States on
behalf of his Government, and by the late Sir Michael Herbert on behalf of
His ^lajesty's (Tovernnient. It provided, as did the former Convention, for
the free admission of iishery products of Xewfoundland into United States
markets in exchange for baiting privileges in the Colony. That Convention
was held in abeyance for some considerable time by the Foreign Relations
Committee of the United States of America, but in the year iOOi it was
reported by that Coimnittee to the United States Senate, where it was virtually
amended out of existence at the instance of the fishery interests of Gloucester
(Massachusetts).

Between 1902 and 1904 the privileges that had been freely extended to
the United States during the 12 years previous were continued, but after the
action of the United States Senate became known to my Covermnent, in the
interests of the trade and commerce of the Colony, it was determined that
the jKjlicy of the Government of 18SG —which had been so forcibly advocated
by the then Governor, Sir G. W. Des Voeux — should be enforced against
AJnericau fishermen.

When the Legislature met on the 30th of iMarch 1905, His Excellencj''
the Governor, in the speech from the throne, said : "I would observe that
" the serious loss occasioned the fishermen of this Colony last season by the
" difficulty of ol)taining a full supply of bait fishes rendered it very imperative
" for my Ministers to consider whether the very valuable bait privileges
" conceded to the fishermen of the United States by the Government of this
" Colony in expectati(jn of ratification of the Convention could be continued
" without detrimcMit to our fishery interest. After very careful inquiry and
" consideration, it was decided that, under existing circumstances, local
" interests would be best conserved by withholding those privileges."

In order to more efl'ectively carry out the j)rovisions of the Bait Act,
which had been in force for nearly 20 years against French fishermen, but
which, for the reasons I have set forth, were not enforced in their entirety
against American citizens, the Government introduced the Foreign Fishing
Vessels Act of 1905, whereby it was provided, amongst other things, that it
shall l)e unlawful for the master of any foreign fishing vessel "to engage any
" person to form part of the crew of said vessel in any port or on any part of
" the coasts of this island."

The method adopted by American fishermen of conducting the herring
fishery on the west coast of the Colony had ever lieen by purchase or barter.
The Bait Act, as it stood, enabled us to prevent a continuation of that practice,
but the Government appreciated that the Americans would attempt to
overcome the dilliculty occasioned by the enforcement of the Bait Act by
engaging local fishermen to form part of their crews, and to catch the fish
they reqidred. It was for the purpose, then, of preventing this evasion of
the spirit and intention of the Bait Act of 18S7, that the clause that 1 referred
to was inserted in the Act of 1905.

At the close of the Session of the Xewfoundland Legislature of 1905, this
Foreign Fishing Vessels Act was assented to and became the law of the land.

E 48668. P p

Fifteenth Day.
11 May 1907.

Newfoundland
Fishery.

(Sir R. Boi.J.)

594

Fifteenth Day. In October of that year the autumn herriBg fishery on the west coast

14 Mav 1907. conunenced, when it was found that American fishermen were determined

— — to ignore the provisions of the Bait Act as well as the Foreign Fishing

Newfoundland Vessels Act of 1905. The position was further aggravated by their refusing

Fishery. to comply with our Customs and Revenue Laws and to enter and clear and

(Sir R. Bond.) pay light dues as they had ever done heretofore.

Out of deference to the wishes of His Majesty's Government my
Government alastained fi-oni enforcing local statutes against American
citizens on the Treaty coast, during the autumn fishery of 1905, thereby
occasioning themselves very considerable embarrassment. They were led
to adopt this course Ijelieving that during the period that woidd elapse
before the next fishing season came round a special effort would be made
by His Majesty's Govermnent to arrive at a satisfactoiy solution of the
difficulties that had arisen by reason of the action of the United States
fishermen, and failing such solution that His Majesty's Government would
strictly confine the United States to the privileges accorded its inhabitants
by the Treaty of 1818.

Li the session of 1906, I introduced a Bill to amend the Foreign Fishing
Vessels Act of 1905, by declaring that the first part of section 1 and the
whole of section 3 thereof do not apply to foreign fishing vessels resorting
to Newfoundland waters in the exercise of Treaty rights. This was done at
the request of His Majesty's Govermnent in order to meet objections that
had been raised to the measure by the Govermnent of the United States.

This Bill also contained the provisions : — (1) that it should be uidawful
for a resident of the Colony to leave it for the purpose of engaging in foreign
fishing vessels intending to fish in the waters of the Colony ; and {2) that it
should be unlawful for the master, owner, or agent of any foreign fishing
vessel to engage British subjects to fish for them within the territorial waters
of the Colony. These provisions were rendered necessarj' because while the
Bait Act of 1887 declared that no man should take bait fishes within the
jurisdiction of the Colony without a licence, and the Foreign I'ishing Vessels
Act of 1905 declared that any master who attem^Jted to engage any person to
form part of the crew of any foreign fishing vessel in any port or in any part
of the coast of this island should have his vessel confiscated, in the autimm
fishery of 1905 the Americans deliberately proceeded to aid and abet our
fishermen in violating the Bait Act by engaging them through agents in Bay
of Islands as part of their cre\v, taking them outside the 3-mile limit to
formally ship and enter their service, and returning with them inside our
jurisdiction to fish.

It wiU be observed that whereas the Foreign Fishing Vessels Act of 1905
penalised the master of any foreign fishing vessel for engaging any person
to form part of the crew of said vessel within the jurisdiction of the Colony,
the amending Act of 190C penalised the master, owner, or agent of such vessel
who should engage British subjects, either outside or inside our jurisdiction,
and utilise them within our jurisdiction to fish for them.

The machinery for a complete control over our own people so as to prevent
them from aiding the Americans in catching such fishes was thus provided by
the Legislature, but this machinery was rendered inoperative by the modus
vivendi entered into between His Majesty's GoA^ernment and the Government
of the United States of America in October 1900, the terms of which may be
summarised as follows, viz. : —

1. Permission to the Americans to use purse seines during the ensuing

season, the use of which instruments of capture the law of the
Colony prohibited and penalised ;

2. Pennission to the Americans to shij) Newfoundland fishermen outside

the 3-mile limit, which, Ijy the law of the Colony, was prohibited
and penalised ;

595

3. The imdortaking on the part of His Majesty's Ministers not to Ining Fifnenth Day.

into lorce the Foreign Fishing X'essels Act of 1900, an Act regardeti m May 1907.

by the Legislature of the Colony as essential in order to control the

conduct of British fishermen and effectively enforce the provisions Newkouni>land

of the Bait Act of 1887 ; Fibhery.

i. An undertaking on the part of His Majesty's Ministers to limit the ^^"" " °" '■'
operation of a law of the C^olony (the Foreign Fishing Vessels Act,
1905) by the non-enforcement of the first part of section 1 and the
whole of section 4.

With the validity of the modus viveiidi of 190G, I do not propose to
deal. Sufiice it to say that the Supreme Court of Newfoundland has decided
that it ccndd not override local statutes as intended. With the humiliating
circiunstauces that attended its enforcement I shall not trouble this
Conference. I shall content myself by stating that the concessions contained
in the modus vivendi were placed there to satisfj' the demands of the
Government of the United States of America.

The contentions of the American Government were as follows : —

1. That there shoidd be no interference on any grounds by ofiicers of

the Newfo midland Government with American fishermen.

2. That the Convention of 1818 justifies uo interference.

3. That the fishing laws of the Colony are not binding upon United

States fishermen.

4. That American fishermen are not obliged to conform to our Revenue

and Custom laws.

Now I would draw attention to the fact that the assertion of the United
States Government " that the Convention of 1818 justifies no interference on any
" groimds with American citizens exercising a right to a fishery in common
" with His Majesty's subjects," is equivalent to a declaration that American
citizens can do as they please and violate our fishing and other laws with
impmiity.

In answer to that position, I would refer to the opinion of the Law Officers
of the Crown, Messrs. W. Atherton and Roundell Palmer, who, on the
6th January 1863, declared as follows : —

" That, in our opinion, inhabitants of the United States, fishing within
waters in the territorial jurisdiction of the Legislature of New-
foundland, are bound to obey, and are legally punishable for
disregarding, the laws and regulations of the fisheries enacted by
or under the authority on the provincial Legislature. The plain
object of the Treaties above referred to was to put the inhabitants
of the United States as regards the ' liberty to take fish ' within
the parts descriljcd of the British Dominions on the same footing
as ' subjects of His Britannic Majesty ' ' in common with whom '
under the terms of the Treaty, such liberty was to be enjoyed.
Tlu^ enactments suljsequcutly passed Avuuld not confirm the
Treaties and provitle for the suspension dui-ing the operations of
those Treaties of such laws, &c., as were or would be inconsistent
with the terms and spirit of the Treaty, which ' terms ami spirit '
are, it appears to us, in no respect violated by the regulations bond
fide made by the Government for the conduct of the fisherj- and
applicable to British suljjeets so emyiloved."

My contention is that the Colony (subject to the King) is the Sovereign
Power, and that the Sovereign Power has the right to enact bond fide legisla-
tion for the preservation of its fisheries, and also all legislation inherent in its

P p 2

596

Fifteenth Dav. Sovereignty, such as Customs and Municipal Laws, and that suhjects of a
14: May 1907. foreign Power that liave Treaty rights in the territorial waters subject to

Sovereignty are liable to be governed by our fishing laws, when they are

JsEWFouxDLAXD applied to British subjects and are admittedly made for the preservation of
Fishery. the fisheries.

(Sir R. Bond.) j -^yould also refer to the opinion of an American jurist, Hall, which occurs

in a passage on International Law. He says, in commenting on the
Newfoundland fisheries question : — ■

" It was argued by the United States that the fishery rights conceded
by the Treaty were absolute, and were to be exercised wholly free
from the regulations or statutes of Newfoundland, and from any
other regulations of fishing now in force, or that may be enacted
by that Govermnent ; in other words, it was contended that the
simple grant to foreign subjects of the right to enjoy certain
national property in conunon with the subjects of the State
carried with it by implication an entire surrender, in so far as
such national property was concerned, of one of the highest
rights of sovereignty, namely, the right of legislation. That the
American Govermnent should have put forward such a claim is
scarcely intelligible.

As to the duty of the subjects of one nation to conform to the laws of
another, the doctrine is laid down as follows in Phillimore's International
Law : —

" With respect to merchant and private vessels, the rule of law is that
except under the provisions of express stipulation such vessels
have no exemption from the territorial jurisdiction of the harbour
or port, or, so to speak, territorial waters in which they lie."

And this is supported by the late Chief Justice Marshall of the United
States as follows : —

" When private individuals of one nation spread themselves through
another, as business or caprice may direct, mingling indis-
criminately with the inhalutants of that other, and when merchant
vessels enter for the purpose of trade, it woidd be obviously
inconvenient and dangerous to society and would subject the
laws to contini;ed infraction and the Govermnent to degradation,
if such individuals or merchant ships did not all temporarily
submit to local regulations and were not amenable to the
jurisdiction of the coimtiy, nor can a foreign sovereign have any
motive in wishing such exemj)tion. His subjects thus passing
into foreign countries are not employed by him, nor are they
engaged in national pursuits. Consequently there are powerful
motives for not exempting persons of this descrij^tion from
the jurisdiction of the country in which they are found, and
not one motive for acquiring it. The implied license therefore,
imder which they enter can never be construed to grant such an
exemption. One sovereign, being in no respect amenable to
another, is bound by obligations of the highest character not to
degrade the dignity of his nation by placing himself or its
sovereign within the jurisdiction of another. A foreign sovereign
is not understood as intending to subject himself to a jurisdiction
incoupatible with his dignity and the dignity of the nation."

English law is the same, as in the celebrated case of the "Franconia,"
the jiidges concurring with Mr. Justice Lindley when he said :-^

" It is conceded that even in time of peace the territoriality of a foreign
merchant ship within 3 miles of the coast of any State does not

597

exempt that ship or its crew from the operation of those laws Fifteenth Day.^

which relate to its revenue and its fisheries." i-l May 1907.

And Sir Travers Twiss states ihe law thus : — Newfoundland
" Treaty engagements in such matters as fisheries in common do not '^'u'^ i \

give any other right than that which is expressed in the specific <>■''"■ ^^- '^""^O
terms."

Again, the United States Government, as far back as 1S5G, recognised
not only the right, l)ut the desirability, of the enforcement of the laws of
Newfoundland upon United States citizens entering the territorial Avaters of
the Colony to engage in iishing. On the 28th March 1850, the following
instruction to the masters of American iishing vessels Avas issued from the
State Department, Washington, namely : —

" It is understood that there are certain Acts of the British North
American Colonial Legislature, as also, perhaps. Executive
regulations, intended to prevent the wanton destruction of the fish
which frequent the coasts of the Colonies and injurious to the
iishing thereon. It is deemed reasonable and desiral)le that both
United States and British fishermen should pay a like respect to
such laws and regulations which are designed to preserve and
increase the productiveness of the fisheries on these coasts.
Such being the object of these laws and regulations, the observa-
tion of them is enforced upon the citizens of the United States in
a like manner as they are observed by British subjects. By
gi-anting the mutual use of the inshore fisheries neither party has
yielded its right to civic jurisdiction over a marine league along
its coast. Its laws are as obligatory upon the citizens or subjects
of the other as upon its own."

In 1886 there was a similar recognition by the Government of the United
States ol; the binding efiiect of Colonial laws upon its citizens when coming
within the jurisdiction of the Colony. In a despatch irom Mr. Bayard, of the
Department of State, Washington, to Sir Lionel West, bearing date lOth May
1886, it was stated : —

" Since 1818 certain important changes bave taken place in fishing
which have materially modified the conditions under which the
business of inshore iishing is conducted, and it must have great

weight in any present achninistration of the Treaty

Everything will be done by the United States to cause its citizens
engaged in fishing to conform to to the ol:)ligations of the Treaty
and prevent an infraction of the fishing laws of the British
provinces."

Again, in a despatch from Mr. Bayard to Sir Lionel West oE date, 20Lh
May 1886, that gentleman stated that he was desirous that due and full
observance should l)e paid by the citizens of the United States to local laws
and commercial regulations of the ports of the British provinces.

This position is further upheld by a despatch from the Marquess of
Salisbury to Mr. White in 1887, in which he states that " such staljutes are
" clearly within the powers of the respective Parliaments by which they
" were passetl, and are in conformity with the Convention of 1818, especially
*' in view of the passages of the Convention which provide that the American
" fisliernien shall 1)0 under such restrictions as shall be necessary to prevent
them from al)usingthe privileges thereby reserved to them."

The question of the legality of laws and regulations in relation to the
conduct of the fisheries under the Treaty of 1818 passed by the Canadian

48GG8. P p 3

598

Fifteenth Day.
14 May 1907.

INewfoundlanu

FlSHEKV.

(Sir K. Bond.)

Parliament was discussed between the British. Government and the Canadian
Government and that of the United States in the year 1886.

As far back as the year 184d, the Provinces of British North America
had adopted legislation for the enforcement of the provisions of this very Treaty.
They were passed by Nova Scotia, New Bnmswick, and Prince Edward's
Island, and afterwards by the Dominion of Canada. Even while the dispute
was pending between the United States and Canada, an Act was passed to
further amend the Act respecting Foreign Fishing Vessels, which, having
passed the Canadian Parliament, was reserved by the Governor-General for
His Majesty's pleasure, and eventually received the Royal Assent on the 26th
November 1886. In March 1886, the Canadian Government promulgated
the following instructions to its officers enforcing the Canadian fishery
laws : —

" You are to compel, if necessary, the maintenance of peace and good
order by foreign fishermen pursuing their calling, and enjoying
concurrent privileges of fishing and cm-ing fish with British
fishermen, in those parts to which they are admitted by the
Treaty of 1888. You are to see that they obey the laws of the
country, and that they do not molest British fishermen in the
pursuit of their calhng, and that they observe the regulations of
the fishery laws in every respect."

In a report to His Majesty's Government dated 1886, the late Sir John
Thompson, then Minister of Justice, and afterwards Premier of the Dominion
of Canada, wrote : —

" The right of the Parliament of Canada, with the Royal Assent, to
pass an Act on this subject to give that Treaty effect, or to
protect the people of Canada from an infringement of the Treaty
itself, is clear beyond question. An Act of that Parliament, duly
passed according to constitutional form, has as much the force of
law in Canada, and binds as fully offenders who come within its
jurisdiction, as any Act of the Imperial Parliament ; and the
efforts made on the part of the Govermnent of the United States
to deny and refute the validity of Colonial Statutes on this subject
have been continued for years, and in every instance have been
set at noiTght by the Lnperial authorities, or by the judicial
tribunals."

If the Parliament of Canada had, and still has, the right to pass and
enforce such laws, the Newfoundland Legislature has an eqiuil right, for its
constitution is the same.

That was placed beyond question by the Lnperial Act of 1865 " an Act
to remove all doubts as to the validity of Colonial laws," the 7th section of
which reads as follows : —

" All laws or rej)uted laws, enacted or purporting to be enacted l)y
the Legislatures which have received the assent of Her Majesty in
Council, or which have received the assent of the Governor of the
said Colony, in the name and on behalf of Her Majesty, shall 1)e,
and be deemed to have been, valid and effectual from the date of
such assent for all purposes whatever."

Now, with regard to the shipping of Newfoundlanders to form part of the
crews of American vessels fishing within territorial waters. This was
permitted by His i\lajesty's Govermuent under the modu.s vivcndi of 1906 in
contravention of the Colonial law. The Colony has prohibited the engaging
of Newfoundland labour. This course was rendered necessarj'^^ because the
United States Treasury Department has ruled that herrings taken by

599

Ncwfoiuidland crews on board of American vessels may be landed free of Fifteenth Day.
duly ju«t us though they had been taken Ijy American crews. Tlie effect of ii May 1907.

that ruling has been to give to the merchants of Gloucester, Massachusetts,

what amounts to a monopoly of the United States herriiig market, independent Newfoun-dland
competition being impossible in the lace of an import duty equivalent to ' "

25 per cent, of the value, which American traders are enabled to evade. *•' " ' °° '•'

I would once again revert to the despatch of Governor Sir George
Des Voeux to the Colonial Office, at the time that the Act wider which this
prohibition is enforced was before His Majesty's Government. You will
please remember that this Act has been on the Statute Book for 20 years.
Sir George Des Voeux saitl, in speaking for his Government :—

" The people of Newfoundland, like those of Canada, desire to use the
right to withhold a supply of hah as a means of inducing the
American Government to remove the import duty on British fish.
. . Li a word, the principle that the Colonists desire to
maintain is ' live and let live,' and they merely object to that of
' let others live by killing us.' "

When the prohil)itive import duty is removed, the restriction imposed by
the Bait Act, 18S7, will cease to be enforced ; for Newfoiuidlaud is prepared to
compete with the fishermen of the United States or of any country upon equal
terms, but she objects to give free access to her \mrivalled bait supplies to
those who debar her from their markets by prohibitive tariffs worked in so
unjust and evasive a manner as that set forth in the Treasurv Order to which
I have referred.

Just a few words more and I have done. I submit that there is nothing
in the Treaty of 1S18 which conveys a right to the United States to employ
Colonial fishermen to fish for them. I have heard it argued that "what one
does by another one does by himself." That is a maxim which applies
entirely to the law of agency.

Under the Treaty of 1818, the privilege of a fishery in common with
British subjects was granted to " the inhabitants of the United States," and
the privilege was to " take " fish (not to buy or procure it in any other way.)
The Avord " take " was used in its special and restricted meaning to distinguish,
the lilierty from the rights Avhich the British subjects enjoyed, namely, to use
the land as well as the sea, and to buy, sell, trade, or deal in any Avay with
the products of the fisheries. I submit that the United States can only
" take " fish and can only take it in common, that is to say, bj'^ the same
implements of capture as British subjects and subject to the same restrictions,
regulations, or laws that govern their conduct.

'fhe permission to enter and fish cannot be construed as conferring upon
the admitted foreigner a right, but only a liberty or a privilege.

In considering the Treaty of 1818, it is importaiit to remember the class
to whom the concession is given, namely, the American fishermen named
in the article. (1) They must he inhabitants of the United States. (2) They
must be American fmhermcn, antl the liberty granted to them is to take, dry,
and cure fish. The word shows the privileged class to whom the Treaty
applies, and the vessels employed therefor, and the special Treaty privilege of
fishing iu the territorial waters of NewfouniUanil. There is no maxim of the
law better known than that which affirms that the " express mention of one
person or thing is tli(> exclusion of ani)ther." It would, therefore, follow that
the mention of "inhabitants of the United States," " American fishermen,"
named in the Treaty, excludes all othei-s. But we are not left to ourselves to
place the interpretation on this Treaty, as to the class to whom the privileges
are granted. It has been so read by the inhabitants of the United States for
the last hundred years, and no later than last July, Mr. A. P. Gardner, the

Pp 4'

600

F'ifteenth Day.
14 May 1907.

Newfoundland
Fishery.

(Sir E. Bond.)

representative for Gloucester in Congress, writing to the " Boston Herald,'' of
July 9tli, under date of July 7th, said as follows : —

" I am in receipt of a letter, dated July 2nd, from the Secretary of
State (that is the Secretary of State for the United States)
answering a large niunber of questions raised in my Memorandum
to Mr. Alexander, of the United States Fishery Commission.
The State Department believes that Newfoundland has the right
to prohibit its own citizens from engaging in or proseciiting the
fishery unless they are inhabitants of the United States. If they
are inhabitants of the United States we are entitled to have them
fish from our vessels regardless of their citizenship.'"

The State Department of Washington having thus placed this interpretation
on the Treaty, it is difficult to conceive why the Newfoundland laws were
over-ridden last year under the modus rivendi, or why the Act of 1906 which
merely enaJjles the Colony to more efi^ectively enforce the Bait Act of 1887
upon its own citizens is still held in abeyance by His Majesty's Ministers.
What I have asked for at the hands of His Majesty's Government is : —

1st. The Assent of the Crown to the Act of 1906.

2nd. That the Colony be permitted to cany out those laws that have
been approved by the Crown.

3rd. That His Majesty's Govermnent define the rights of American
citizens under the Treaty of 1818.

The Colony does not desire to limit in any waj^ the rights of American
citizens under that Treaty. It asks for nothing but justice and responsibility
sanctioned by the spirit and forms of the British constitution.

We do not think it just that permission should be given by His Majesty's
Government to a foreign Power to over-ride or contravene the laws of the
Colony, or that an imdertaking should be given to a foreign Power by His
Majesty's Government not to sanction certain Colonial legislation.

It has been suggested that the matters in dispute might properly be
submitted to arbitration. I cannot see what there is to arbitrate upon. To
my mind, the only question is, as to the binding efi'ect of Colonial laws
upon American citizens when they come within British jurisdiction. If it
is intended to submit the Treaty to arbitration, then I contend, that its
terms are clear, that the privileges granted to the inhahitants of the United
States thereunder are not set forth in language that is amijiguous. Vattel,
probably the best authority iq^on the interpretation of treaties, says : —

" The first general maxim of interpretation is, that it is not allowable
to interpret what has no need of interi^retation. When the
wording is in clear and precise terms and its meaning is evident
and leads to no absurd conclusion, there can be no reason for
refusing to adujit the meaning which such Treaty naturally
presents, and to go elsewhere in search of conjectxires in order
to restrict or extend it is but an attempt to elude it."

If, on the other hand, it is intended to submit Colonial statutes to
arljitration, then I respectfully contend that it would l)e derogatory to the
Crown, and in direct contravention to the constitiitional right of the self-
govenn'ng Colonies, to submit their statutes to the arbitrament of any foreign
Power or of any person, or body of men.

[.■l//cr a short adjouimmcnt, tlic Conference, after discussion in pj-ivate,
agreed tJiat Sir li. Bond's Statcjncnt should be rceorded.\

601

WIRELESS TELEGRAPHY CONVENTION. Fiftocih Day.

CHAIRMAN: There was a point with rc'ganl to wireless telegi'aphy whicli ^_ ''

Mr. Deakin wanted to put, and we have the Postmaster-General and Mr. Wiuele^s
Babington Smith here. Telegraphy.

l\rr. DEAKIN : With regard to the proposeil convention in relation to
wireless tel(>graphy, as to which an agreement was arrived at some little time
ago, I midcrstand that convention is now under the consideration of a
committee of the House of Commons.

Sir WH^FRID LAURIER : Agreement between whom ?

^Ir. BUXTON : It is an international agreement, and we are parties to
it, but none of the Colonies are parties to it. The Colcmies have the absolute
power and option of coming in, supposing we ratify it, at any time they like,
or going out at any time on a year's notice. Every self-governing Colony has
absolute liberty in regard to it. We have oul\- committed ourselves so far as
this coimtry is concerned.

Mr. DEAKIN : The convention, as I remember it, proposes to entrust to
a future Conference the decision of questions relating to wireless telegraphy,
the systems to be used, and the methods adopted, by means of Avliich
something like a imiversal system of wireless telegraphy may be established
or the various systems may be co-ordinated.

Mr. BRODEUR: Interchange.

Mr. BUXTON : Inter-communication.

Mr. DEAKIN : These questions are to l)e referred to some permanent
liody on which each Power has votes.

Mr. BUXTON : This Conference took place, and all the great Powers —
I think every Power interested in it — was represented. They came to certain
arrangements which now form the convention, as to which the question is
Avhether we should ratify it or not. The Conference has now adjourned for
live years and that convention, so far as the Powers who ratify it are
concerned, will come into force for all of them ; but they can all go out on
a year's notice. In the meanwhile, in the five years, the only things by
which they are bound are the actual terms of the convention. There is
no standing body which has any voice or power in regard either to the
interpretation or enforcement of these regulations and articles of the
convention. The only body that exists is an International Bureau for merely
clerical purposes, the listing of wireless stations, and so on. It has no sort of
executive power of anj'^ kind. Between the meeting of one Conference and
the next each Power is free to carry out the convention and to interpret it
in the way it thinks right. There is no body with executive power between
the two meetings of the (conference.

Mr. DEAKIN: Is it lor the next Conference that a scale of voting
was proposed under which the maximum nmnber of votes or represen-
tatives was to be six for a coimtry with colonies ?

Mr. BUXTON : Each of the self-governing Colonies was commimicated
with and infonned the Conference was to take place. A draft was sent
to them for consideration. I tliink they all desired that they should not be

602

Fifteenth Day.
14 May 1907.

Wireless
Telegraphy.

(Mr. Buxton.)

committed by any arrangements come to hy this country in regard to wireless
telegraphy imtil they had had an opportunity of seeing how the convention
worked out alter it was discussed, considered, and ratitied. They would
have fiiU power then to come in at any moment, or to go out again if they
liked on a year's notice. Therefore, with regard to the Colonies, there was no
question about their having a vote at the Conference which took place last
October. As regards future Conferences, the qiiestion was raised as to the
method of representation of the various Colonies and the votes they should
have, and how they should be enabled to join in future Conferences. There
were two precedents : one is the International Telegraph Convention, under
which any country can practically say that it desires a vote for this Colony
or the other Colony so long as they have separate telegraph administrations.
The other system is that of the Postal Union, under which each eoumtry,
according to the importance of its Colonies, is allowed so many votes. It
was a question really which of those two precedents, that of the Telegraph
Convention or that of the Postal Convention, was the best for our purpose.
The Conference finally decided they would follow the Postal Union rather
than the Telegraph Convention, on the ground that that enables the
Conference to allot votes to the Colonies according to their importance,
and does not enable a country to claim any number of votes for,
perhaps, nainute Colonies of no importance, simplj" because thej' happen
to have a separate telegraph administration. The article passed by the
Conference the other day fixes for any coimtry and its Colonies a
maximum of six votes. No country need have six votes, but that is the
maximum. That is the principle of the Postal Union which has been in
existence for many years, and has worked very satisfactorily. Under it, I
may say, at the present moment India, Australia, New Zealand, Canada, and
South Africa each have a vote.

Mr. DEAKIN : It might be presumed, then, at the next Conference
that each of the six, if adhering, would be entitled to a vote.

Mr. BUXTON : Not " entitled " ; that is to say, there is no obligation
on the Conference to allot votes, or to allot any particular number of
votes. It is a question of discussion as between the different countries,
those interested in Colonies and having Colonies. I do not think there
is any question alrout it that the precedent of the Postal Union wiU he taken,
and these five votes in addition to one for Great Britain will unquestional)ly
be giveu.

Sir JOSEPH WARD : Who would settle that ?

Mr. BUXTON : It will be settled by the next Conference. Meanwhile,
before the next Conference, which is five years hence, the country proposing
to suggest Colonial votes for its Colonies makes the suggestion to the various
countries concerned. Any other country may then make suggestions,
and what we have had in mind in reference to the matter is that sometime
Ijefore the next Conference takes place, we should communicate in a
friendly way with, at all events, the important countries concerned to
discuss what numlier of votes should l)e allotted and how allotted. I
shoidd like to add tliat, on the motion of tlie British delegates, it Avas
decided by the Conference that that should be the first business of the
next Conference, and that, therefore, any votes allotted wiU come into force
at the beginning of the Conference, so they will have the full power of
voting from the beginning of the new Conference.

603

Mr. DKAlvIX : The new Conference may, if it likes, say yes, we agree,
Canada may have a vote ; and then go on to consider a tiny colony of
some other Power, giving it a vote and placing it on an equality with Canada.
I am taking a most exaggerated contrast. Is that possible ?

Mr. BUXTON: Certainly.

Mr. DEAKIN : That is to say, there is no standard fixed below which
there shall be no vote.

Mr. BUXTON : Except that under the Postal Union, the theorj'^ and
practice has been that votes arc all allotted to important Colonies.

:\Ir. BABINGTON S:\irLTI : It is a matter for the Conference to decide.
As a matter of fact, under the Postal Union some of the other countries Avhich
have colonies have a certain number of votes for them. France, for instance,
which has colonial possessions of considerable importance, has, 1 think, three
colonial votes. Germany has two ; Portugal, has two ; Holland has two ;
and the other countries which have small colonies have most of them one
vote.

Mr. DEAKIN : Then there is no real proportion.

Mr. BABINGTON SMITH : There is no precise proportion as to the
importance of the Colony ; but, as a matter of fact, 1 tliink Sir Joseph Ward
will agree that the system has not worked unsatisfactorily for us.

Sir JOSEPH WARD : That is so.

Mr. BABINGTON SMITH : With the additional vote obtained for New
Zealand at the last Conference, I think the allotment of votes is satisfactory
from the point of view of tlie British Empire.

Sir JOSEPH WARD : I think it is satisfactory for this reason. There
is no getting over the general position in the world at large, which forms the
Postal Union, that the great majoritj' of the representatives are outside the
British Dominions. At the Postal Conference we had quite a fight to get one
extra vote for a liritish Colony — that is. New Zealand — and at the same time
to get South Africa put in the position of having a direct vote. On the matter
of voting I do not think we can improve upon that of the Postal Conference,
which has worked satisfactorily. The great majority of the contributors to the
Postal Union are Continental people and they outnumber us, and imtil we get
into the position of having other great Colonies in addition to those we have
already, which have grown to manliood, the odds are 50 to 1 that we will not
get an increase in the representation we have now. As long as we have the
assurance from Mr. Buxton that every effort to get the maximum of votes to be
used in the interest of Great Britain and her Colonies at the next wireless
telegraphy conference I think we have nothing to complain of. Although I
know you cannot control it, it comes l^ack to the Conference to say whether or
not those votes are to be exercised.

Fifteenth Day.
14th May 1907.

Wireless
Telegraphy.

Mr. BUXTON : I meant, we have the precedent of the Postal Union in
which we have these votes, and I have little doubt from the knowledge which
one has acquired with reference to the working of these international
conventions and conferences, that they would see the reasonableness of
our proposal to put wireless telegraphy on the same basis as the Postal
Union, and we shoidd obtain those votes. I cannot guarantee it. Though we

604

Fifteentl) Day. ^lay Only have five votes, the representatives of any other colony can be

14 May 1907. present and take part in the discussion at the Conference as a British

delegate. But I would like to put this as strongly as I can that the actual

WiuELEs^ voting is really not very material. The material thing is the influence and

ELEciUAi'iiY. po^ver of those representing Great Britain and its colonies, and also the

(Mr. Buxton.) ability of the delegates. At this wireless telegraphy conference last time
we only had one vote. We had on the whole a hostile majority against us,
but in consequence of the attitude we took up and the very admirable
handling of the matter by the British delegates, we really turned that
convention topsy-turvy. We obtained every single point we wanted, and
made the convention as we now believe a convention very satisfactory from the
national point of view and the Admiralty j)oint of view ; whereas, as it stood
it was very unsatisfactory and we should not have agreed to it. We only
had one vote at that time and all the other Powers one vote ; so we were in
an absolute minority, and it was really more moral strength than voting-
strength.

Mr. DEAKIN : But was not that due to the circumstances that
British predominance in wireless telegraphy is so marked, the situation of
the Empire is so special, and the opportunities it affords for wireless telegraphy
so much greater, that you only had to step out of the Conference and it would
have practically fallen to pieces ?

Mr. BUXTON : No, it would have gone through anyhow.

Mr. DEAKIN : Besides that, is not there a great difference between the
Postal Union, with its exchange of services, and its absolute necessity for joint
action throughout the world, and the present condition of wireless telegraphy
which has taken great developments only in this Empire, where it plays an
important part with thr; navy r The system is being extended to some of
its dominions, and will be extended to others. What gain corresponding
to those, which are oljvious in the case of the Postal Union, is there in
establishing a Union for wireless telegraphy while one member is so far
immensely superior to the others ? What are we to gain ? Are we not
accepting a limitation of a power we at present enjoy without an equivalent
advantage ?

Mr. BUXTON : That raises the whole question of the merits of the
Convention, which is now before the Select Committee of the House of
Commons, and opens out a very big question. I hold strongly the view that
while it is perfectly true that we are in a dominant position in regard to
wireless telegraphy at the present time, it is to our advantage to have inter-
communication between the various systems, and it is to our disadvantage
to have a particAilar system in this country, the predominating system, which
refuses to inter-communicate. I am speaking specially from the naval point
of view as well as the commercial point of view. The liest method in
which wireless telegraphy can be developed (and it is to our advantage to
have it developed) is by means of an International Convention which will
introduce free inter-communication, though subject to e.^emption of any
stations which we think are better exempted. International regulation
will tend to prevent coni'usion and interference which is really the evil of
wireless telegraphy. Unless you have very carefully drawn regulations
antl power to enforce them, th'i dilliculty is to pi-event confusion and
interference and to make the best use ol' the invention. The advantage to
us in having an International Convention is that you bring all these different
systems and different countries under an oljligation not only to inter-com-
municate, which is to our commercial advantage, but also to carry out these

Wireless
Teleiikaphy.
(Mr. Buxton.)

605

very carefully drawn regulations under which we believe interference and Fifteenth Day.
confusion will be reduced to a minimum. I am only treating it very broadly. '■* ^°y 1907'

Mr. DEAKIX : If there were reciprocal preferences in this matter, it
might be very advantageous ; but when the Empire has at present all to give
and very little to gain, are not we anticipating a state of things which has not
yet arisen ?

Mr. BUXTON : May I ask what we are giving ?

Mr. DEAKIN : We give a power of communicating with the whole
of the stations which we have and all our ships.

Mr. BUXTON : Except so far as we like to exempt them.

Mr. DEAKIN : That exemption could only be used in very special
circumstances.

Mr. BUXTON : It could be used so far as the Government is concerned
at every one of their stations.

Mr. DEAIvIN : You mean you could adhere to the Convention and at
the same time exempt the whole of your territory from it ?

Mr. BUXTON : No, you must have a certain niimber of stations for
carrying out the international work, but all the existing stations, and any
others you like to name, from an Admiralty or any other point of view, can
be exempted ; that is one of the conditions on which we agreed to the
Convention.

Mr. DEAKIN : What does that mean ? Those stations will be sending
out their wireless messages. In what way are they prevented from being
picked up because the station is exempted ?

Mr. BUXTON : Exempted stations come under the Convention in every
other respect ; that is to say, they are as much protected from confusion and
interference as are the other stations.

Mr. DEAKIN : That is to say, they can receive but are exempt from
exchanging and communicating ?

Mr. BUXTON : Yes. They are protected from wilful interference or
even accidental, by the various regulations laid down for the management of
coast stations and ship stations.

Mr. DEAKIN : We in Australia have before us at present at least two
systems of wireless telegraphy. One has established stations.

Ml-. BUXTON : One is the Marconi, and what is the other ?

Mr. DEAKIN : The Do Forrest, and we have proposals from a third.
It means consideralile expense on a very loug coast line if any one of those
systems is to be adopted. If stations were established simply for defence
purposes, should we bo under any ()l)ligati()u to allow their use in time of
peace? When this Couveutiou avus coucludcd, we were iu the midst of local
negotiations, and a good deal of apprehension was created lest, if we went to
this expense, one of the etfeets of the Convention might be to require us to
place those stations at the disposal of Bowers inimical to us.

606

Fifteenth Day. ]\f j. BITXTOW: Do voTi mean in time of peace or war ?

14 May 1907. -

Wireless ^Ii'- DEAKIN : In time of peace.

Tele&kaphy.
■ Mr. BUXTON : How in time of peace would it be disadvantageous ?

Mr. DEAKEST : Would they not become familiar with their where-
abouts, and range of communication ?

Mr. BUXTON : Supposing you had a station which was not intercom-
municable, what would you pi-opose to use it for ?

Mr. DEAKIN : For our own ships only ?

Mr. BUXTON : These other ships can be fitted with the non-Marconi
apparatus ?

Mi. DEAKEN : I assimie so.

Mr. BUXTON : Then there is nothing to prevent them comnumicating.
If you are going to iise a station for any practical piu'pose you cannot keep
its whereabouts a secret. I understood you to say they would get to know
where it was.

Mr. DEAKIN : Get to know exactly how many stations there were
on our coast.

Mr. BUXTON : Svirely that would be the same whether it was the
Marconi system or anything else ; because if they are going to be used they
must know where they are.

Mr. DEAKIN : Certainly. But the question for us, was whether these
stations for defensive purposes should become public property.

Mr. BABINGTON SMITH : There is nothing in the Convention which
prevents purely Naval and Military stations being kept absolutely secret and
free from connnimication with anybody. Such stations are outside the Con-
vention.

Mr. DEAKIN : It is months since the papers passed imder my hands, and
probably I am not recalling the exact terms of the Convention.

Mr. BUXTON : I think you wiU find undoubtedly, when you come to look
them up again, that every one of those points j'ou have made, and many others
which were made as to the original draft Convention, have been entirely met.

Mr. DEAKIN : Since the Convention was pubhshed ?

Mr. BUXTON : There is an amended Convention. You are speaking
probably of the draft of tlie old one in which there are probably many points
to which we should not agree.

Mr. DEAKIN : I did not read any Convention except the first.

(507

Mr. BUXTON : I would like to say, as oiiiphatically as I can, that the
Board ol' Ailiniralty, who, after all, are the people most concenied iu this
matter, think it would be a very serious matter if this Convention were not
ratified. That they have stated publiely ; and they have sent their experts
and other witnesses to say so, and very emphatically, to the Select Committee.
Putting aside the question of naval defence — on which 1 think they are
satisfied — any naval station is absolutely outside the Convention if it is
intended to be purely a naval station. Then comes this question fi'om your
point of view : as to a commercial station which can only, unless intercom-
munication is made, communicate with certain ships, it would surely be to
your advantage, in Australia, that if you have a wireless station at all, it
should be able to communicate with everj' system and every ship, whether
British or foreign. Recollect that all British ships are not fitted with the
Marconi system ; there is the l)e Forrest and other British systems. It would
surely be to the disadvantage of Australia, from the conmiercial point of view,
if a ship comes out there fitted with the De Forrest system and finds a
Marconi station and cannot communicate ; whereas it would be greatly to the
advantage of Australia, from the commercial point of view, that whatever the
ship's system might be it should be able to communicate with the station.

Fifteenth Day.
14 May 1907.

WlKELESS

Telegr.vput.

Mr. DEAKIN : Your argument would apply equally if we adopt the
De Forrest or any other system.

Mr. BUXTON : Yes. The only company which objects to inter-com-
nnmication is the Marconi Company. They consider they have, though I do
not think they have, to a certain extent a monopoly, and Avould like to keep
it. I do not think they have a monopoly, and every month and every year is
reducing this monopoly, because the De Forrest and other big companies
are coming to the fore. They want you no doubt to agree to put up a station
which will prevent any ships coming to Australia fitted with any wireless
apparatus except Marconi, because they will not communicate with anyone.
That cannot be, I should have thought, to the advantage of Australia, or to
the advantage of the coimnercial community.

Mr. DEAKIN : The only advantage is fi-om a naval defence point of

view.

Mr. BUXTON : That I can safely say has been entirely met, and the
Admiralty are absolutely satisfied with regard to it.

Mr. DEAKIN : Our two points are, first, as to representation, we seemed
to be in danger of entering a conference in which the chances wei'c we should
be outvoted by coumiunities far sn)aller than ourselves, and with far less
developed systems of intercommunication. They would get all the benefit
of having intercommunication throughout the British Dominions in this way,
and practically do nothing or next to nothing in exchange. Our second
point was whether, as there are parts of Australia where conmiunication
for all ordinary conmiercial purposes would be rather rare and inconsiderable,
but where stations would be justified from a defence point of view, this
conference would not oblige us to place them at the service, in time of peace
at all events, of all ships, and by that means dej^rive us of some advantage
in time of war. 1 am criticising generally from memory the substance of
the memorandum which came before me last year.

Mr. BUXTON : I think both those fears are met by the terms of the
Convention as passed.

608
Fifteenth Day. Mr. DEAKIN : Was it amended in Ijotli tliose respects ?

14 May 1907.*

WiiiELEss ^^^- BUXTON : Yes, very nmcli so ; because in the original Convention

Telegraphy. Germany proposed that there should be no votes for the Colonies whatever,
bat only one vote for each country and the Colonies not represented at all.
In regard to the other point the Admiralty having got all the amendments
they required in the original draft Convention, are now fully satisfied, not
only that the Convention is a good thing in itself, but that it would be a
disadvantage both from a naval and commercial point of view if we did
not ratify it.

Mr. DEAKIN : The great safeguard so far as I can grasp it at present
is the power of withdrawal after 12 months.

Mr. BUXTON : Yes ; supposing it is found that intercommimication is
not satisfactory, and certainly if it is found to be in any possible sense a
danger, we should have no hesitation whatever about withdrawing from the
Convention, which we can do at 12 months' notice.

Mr. DEAKIN : I understood it Avas final, that if you were in you
could not get out, unless you took the extraordinary step of seeking to
dissolve the conference.

Mr. BUXTON : No, you can withdraw with the greatest ease.

Mr. BRODEUR : What is our position in the Colonies with regard
to tliat Convention which has been made ? Are we affected in any way ?

Mr. BUXTON : No. The position of each self-governing Colony is
this : They did not take part in the deliberations of the Conference because
it Avas imderstood they, naturally, did not Avish to be conunitted to the terms
of the Convention until they had an opportunity of considering it in all
its bearings after it was passed. Therefore, they had nothing to do with
the drafting of the Convention. The Convention has now been radically
modified from the draft, and they have full liberty to adhere or not. They
can come in at any time.

Mr. BRODEUR : The draft Convention has never been submitted.

Mr. BUXTON : Yes ; that Avas sent to all of them. The new Conven-
tion has noAV been sent out, but it was only last January, so that the position
of the Colonies is that, after they have considered the amended Convention,
there is no obligation to come in ; and if they do not Avant to come in, they
standout; it is on their own initiative. If they AA^ant to come in, they can
come in at any day, and can go out on a year's notice.

Mr. BRODEUR : I Avas not in the Department Avhen the matter Avas
brought to the attention of the (lovernnient, but I understand the draft
Convention Avas submitted by the British Government to the Colonies. We
ausAvered, as far as C'anada Avas concerned, that we had no objection to that
draft Convention. The meeting of the Conference took place, and a modified
Convention has been made out, Avhich has been submitted to the
Government.

WlKELKStS

Tkleokaphy.

609

Mr. BUXTON : The. original draft Convention was sent to the various Fifteen! h Day
Colonies, not asking them to agree to it or join, but for information, and H May 1907.
pointing out at the same time that they would not be bound by it
until alter they had an opportunity of considering the draft Convention
as amended after the Conference. That has now been sent out, some time
in January, to the various Colonies for their consideration, pointing out,
I presume, this particular clause, which was put in at the desire of the
Colonial Office, enabling them, as I say, to stay out if they liked, or come
in if they liked at any time and go out again on a year's notice.

Mr. BRODEUR : The question of representation has been discussed
in this despatch sent to Canada.

Mr. BUXTON : It was merely a copy sent for information. It does
not come into force until July of next year.

Mr. BABINGTON SMITH : It runs for an indefinite period.

Mr. DEAKIN : The Conference is to meet five years from when ?

Mr. BABINGTON SMITH : It meets in 1911 .

Mr. BUXTON : That is about five years from the time of the last
meeting.

CHiVIRMAN : With regard to the explanations, we purposely put off
our general despatch nniW the Select Committee had finished sitting.

Mr. BRODEUR : The Coimnittee is still sitting ?

CHAIRMAN: Yes.

Mr. BUXTON : We have practically completed taking evidence. We
shall probably report after Whitsuntide.

Mr. DEAKIN : That will deal completely Avith the whole of this
question ?

Mr. BUXTON : I imagine so.

Mr. DEAKIN : Does it point to still further amendments to the draft
Convention ?

Mr. BUXTON : There is no question before the Connnittee and the
Government of amendment of the Convention as it now stands. We have
to take it or leave it as it is. The Convention was hammered out with
British delegates representing the War Office, the Admiralty, and the Post
Office. They agreed to it and thought it satisfactory. The Conunittee is
appointed to report to the Govermuent what they think would be the
results if it is ratified or not ratified.

Mr. DEAKIN : There was then an original Convention and an
iding Convention ?

1 48(;G8. y q

610

Fifteenth Day.
14 May 1907.

Wireless
Telegraphy.

Mr. BUXTON : There was an original Conference in 1903. To that
we did not adhere because we thought it was premature and had no legislation
to carry out any conclusion they came to, but it was generally understood
to be a preliminary Conference. That Conference agreed to a protocol,
which formed the basis of the draft proposal for the new Conference which
was called last October. The draft Convention I have spoken of all through
is based upon the protocol of 1903.

Mr. DEAKIN : The one for which you are responsible, which you
reconnnend, and which has been considered by the Committee, is the amended
Convention of 1906 ?

Mr. BUXTON: Yes.

Mr. DEAKIN : That is now being disposed of by the Conunittee of the
House of Commons ?

Mr. BUXTON: I think only two Articles out of the whole of the
draft Convention have not been altered, in some cases entirely reversed,
between the draft and the amended Convention at the instigation of the
British delegates.

Mr. BRODEUR : I imderstand at the next sitting of the Conference
you will discuss the question of the representation of the Colonies ; it has
not been disposed of.

Mr. BUXTON: Yes, that is the first thing. The question of the
maximum of votes has been discussed. The question how these votes
shall be allotted has not been discussed. In regard to voting, it would have
been physically impossible for that question to be discussed at the last
Conference, because all Colonies have liberty to come in or not, and nobody
knows yet w^ho is coming in, and therefore it would be idle to allot votes to
Newfoundland or Canada until we knew whether they were coming in or not.

Mr. DEAKIN : Did you fix a meeting without leaving it open ?

Mr. BUXTON: Yes.

Sir JOSEPH WARD : As far as I am concerned, the information which
has been adduced is very valuable.

Mr. BUXTON : I am glad to have had the opportunity of clearing
up some misapprehensions which have arisen.

Mr. DEaKIN : It is evident that the memorandum placed before me
related to the original Convention and not to the amended Convention.

Mr. BUXTON : No doubt the Colonial Office sending it made it clear it
does not come into force for 18 months and, therefore, it did not appear
urgent.

Mr. BRODEUR : I understand it was simply commuuicated to us and
we were not asked to make any representations with regard to the Convention.

611

Mr. BUXTON : It was sent to you for information to show how the Fiftoemh Day.
Colonies stand, and for them to consider whether they will join it or not. '■* '"^^ '^"^-

Wireless
Mr. BRODEUR : I understand we will have some further communication Tkleokaphy.
with regard to it.

Sir WILFRID LAURIER : Is there anything else to discuss ?

CHAIRMAN : There is this motion of Mr. Deakin.

Mr. DEAKIN : It is witli reference to steps to be taken to bring the
Colonial Office in touch with the self-governing dominions with which it has
to deal.

INTERCHANGE OF PERMANENT STAFF. Interihange

OK Fermaxent
Mr. DEAKIN : The resolution, of which notice was given, is " That Staff.

" the Secretary of State for the Colonies be invited to fi'ame a scheme which
" will create opportunities for members of the permanent staff of the Colonial
" Office to acquire more intimate knowledge of the circumstances and
" conditions of the Colonies with whose business they have to deal, Avhether
" by appointments, temporary interchanges, or periodical visits of officers, or
" similar means." May I first in a general way point out that Departments
of State are subjected to two entirely different criticisms ; first of all those
of the laissez-faire school, who wish to see those Dej)artmeuts limited to
the narrowest possible sphere of action, and who endeavour to justify
their doctrine of the unwisdom of State interference by continual attacks
upon the State servants employed. ^Vith those we have never had any
sympathy. The school of thought with which we are most familiar in
Australia is antipodean in this regard as in some others. We have freely
used State agencies and continue to Tise them, and many of us are strongly
of opinion that it is only by their emplojnnent that the complex conditions
of modern government can be dealt with. K, therefore, we criticise State
Departments it is because so much of the success of the policy which we
advocate depends upon them and upon their power of adaptation to the
bvisiness side of social life. In Australia we are constant critics of our own
Departments, and experience shows, with good reason. One of the chief
tasks of our Parliament is that of endeavouring to bring the various
agencies comprised in their pidilic offices into more fruitful relation with
the circumstances of the country. We liaA^e busy Parliaments passing
many laws, most of them demanding some administrative work, and many
of them demanding a great deal, but we find the purposes of those laws
defeated or their ends avoided, unless by constant criticism and revision of
methods we keep our Departments, to use a familiar expression, up to date.

In Australia we are also somewhat singular, inasmuch as political
patronage, as such, does not exist. The Government of the Commonwealth
has not the power to appoint an office boy in the Commonwealth. Our
Parliament has passed a law which disassociates us entirely from the great
public service over which we pi'eside. Entry into that service, the stages
of promotion and remimeration, and all other conditions of the service, are
laid down in the law. The administration of that law is entrusted to an
independent Public Service Commissioner.

Sir WILFRID LAURIER : Who makes the appointments ?

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612

Mr. DEAKIN : He makes tlie appointments. Ministers cannot differ from
tlie recommendation of the Public Service Commissioner witliovit laying the
whole case before Parliament, and stating the grounds on which they propose
to reject it. If it is rejected the Commissioner makes another nomination.

Sir WILFRID LAURIER : [He has the appointment, and yon cannot
dissent, except for cause ?

Mr. DEAKIN : Except for cause laid before Parliament and approved.
That interposes another set of considerations. There being no direct power
of control in Ministers, that is to say, there being no control by appointment or
dismissal in the hands of Ministers, the service having a certain independence
of its own, it becomes all the more necessary for us to exercise our criticism.
Rewards and pimishment are dispensed by the Commissioner, whose task it
is to maintain etficiencj^. Our departments, free fi-om patronage, might
become merely mechanical in methods without criticism. Perhaps in that way
we pay something for our freedom from the burden of patronage, and the many
annoying associations connected with it. So that when we criticise a public
service, it need not be, and certainly has not been in any criticisms I have
uttered here, a reflection upon the capacity of those engaged. It certainly is
no reflection upon their integrity. Every country has its public service,
and so far as I am acquainted with it, no country has a public service
of a higher standard than Great Britain and its Dominions. The criticism
of a public department does not necessarily mean a challenge either of the
ability and certainly never of the honesty of its members. There are public
departments in cA'ery other country besides our own. An interesting but
rather imaginative gentleman who waited upon me some little time ago, and
afterwards was good enough to credit me in the public press with some of
his own observations, pointed out that in his own coimtry the bureaucracy
was dominant, extremely capable, not, in his opinion, extremely efScieut, but
more powerful than ministries and parliaments. He pointed to his own
coimtry and certain other Continental countries as indicating what he called
the rule of the bureaucracy. I told him then frankly that we saw
something of that spirit even in our own country. We saw something
of it in this country. But neither showed the state of things described
by him. Our public departments were in much closer touch with our
legislature, and not, as he suggested, sometimes ahnost in revolt against it.
I mention the incident because it is partly the reason why I have made these
preliminary remarks before coming to the C[uestion of the possible means
we suggest for the consideration of the Secretary of State in regard to the
Colonial Office. We make similar siiggestions in our own country for every
department. Possibly if we were associated with every public department
in this country we should make it in all here. It is only becaiise it is the
Colonial Office with which we are directly connected and in respect to
which we have a title to be heard, because its operations directly affect us that
my observations are confined to it. I hope I have cleared away any possible
misapprehension in this regard.

The Colonial Office has, apart from the very important relations of
which it is the channel, not only the most extensive, but the most difficult
task, that a department can be called upon to perform. The very ablest
men of Great Britain, if they were pul^lic servants in this department,
collected into this building, shut up in it, and left dependent upon what
they read or hear to understand the conditions of the hiuidred and one
forms of government and varieties of conditions mider which the Crown
Colonies and self-governing Colonies grow up, would be quite unable

613

to cope with them. What is done in the Crown Colonies is done with Fifteenth Day.

oflicers of this department ; that is to say, their whole services are composed ''^ ^^"^ '^^^•

of members of this department. They return here more or less frequently,

certain of those now in this office having been employed in the Crown o *■* Persi'anent

Colonies, and certain of those who were in this office having been sent Staff.

to the Crown Colonies. By this means there is a certain interchange (Mr. Denkin.')

which keeps them in touch with one another, and most essential that touch

is. But with regard to the self-governing Colonies, the only officer who

does come and go is the chief officer of all, the Governor or Governor-General,

as the case may be. His functions are of so general and of so serious a

character that they are not numerous. Pie does not come into frequ.:nt

relations with manj' of the departments of the government he administers,

and looks down upon their working from an altitude wliich, though

advantageous, does not permit of the intimate acquaintance with them

which Ministers necessarily gain ; moreover, when he is transferred to

another government, or even when he returns to this country, his services

and knowledge appear to be employed to a comparativelj^ limited extent.

Consequently, we have at present an altogether insufficient means of touch

l)etween the Dominions which we specially represent and the oflicers in

Downing Street with whom we are in continuous relation by correspondence.

Most of the officers here are necessarily working for people who are living

under conditions unknown to them. That is more true of tropical countries

or those in which there are coloured races, but it applies to some extent

to the great self-governing Dominions. We had one illustration here in

relation to the Emigration Board, showing that even when they were

dealing with our own people and our own circumstances, a most regrettable

want of knowledge and a most distinct want of sympathy were displayed.

I do not see how any effort on the part of able men here can suffice unless

they are assisted by direct means of knowledge and of assimilation. The

body politic would be unhealthy, and must remain unhealthy, as om* own

would if the circulation of its blood were impeded, and so must this office

imless there is some continuous intercommunication of a personal character

kept up. We have suggesteil in this resolution several means. We

propose that men of experience in the outer Dominions might be selected

to fill some vacancies that occur here. J do not know enough of your

system of appointment and promotions in the public service in this coimtry

to judge how far that is practicable, but the suggestion made is that, where

practicable, such appointments when made might be extremely advantageous.

What seems much more feasible are temporary interchanges or, at all events,

periodical visits of officers. The idea we had in temporary exchanges was

that just as we are now sending our military ofhcers to Canada, to South

Africa, and to this country to complete their training as members of the

military service here, while British officers come to us to gain colonial

experience, there might be a similar advantage from an interchange of

officials, of about the same salary and stantling, so far as it could be arranged

between this office and the Colonies. We have always some military officers

away from Australia, gaining experience of service elsewhere. Whj^ should

not some of our civil ofHccrs be employed here, their places being taken in

our countrj' by the officers whose work here they would for the time being

assume ? By this means we slioiJd obtain in each office men who after

being twelve months in the other country would have gradually absorbed

a gi-eat deal of that knowledge which is necessary for the interpretation of

despatches, especially on important subjects where they are affected either by

local conditions or local situations. That is a method which w^ould only

involve something for travelling expenses. It would not be expensive, and

might prove extremely valuable also to the men from the Dominions over the

seas who were temporarily employed in this office. They would be aljle to

614

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(Mr. Deakin.)

inform us of those methods either for our adoption or to enable us to
understand the communications that we received. Where this is not possible,
we suggest that men of higher standing in the service, when they could be
spared, should spend, say, six months in Canada, and then return here for a
time, then give six months to South Africa, or some lesser period if that be too
long. It need not necessarily be the same officer or officers. By this means
a Minister might have the advantage and benefit of having at his elbow
men who would be associated with the correspondence and communications'
relating to these particular Colonies and their constitutions who would be
able at once to put him in relatively direct touch with them.

These are only mentioned as some of the means Which might be
adopted. Some means nuist be adopted. We feel that this Colonial Office
not onljr has grown but will continue to grow. The population in its
charge will multiply, its problems will increase in variety. There can be
no corresponding increase in the numbers of Ministers or of Parliamentary
Under Secretaries of State. More and more therefore must Ministers and
Parliamentary Under Secretaries rely upon the permanent officials and
more and more is it necessary that those officials shoidd have the opportunity
of personal acquaintance with the countries Avith regard to whose proposals
they have so much to say. I am admitting that in Australia itself to
understand either the temper of the peoj)le, the manner of working our
pohtical institutions, or the interpretation that is put upon our constitutional
relations is a task of years. It is taking us a considerable time to know
ourselves. We are not surprised to discover at this end of the world that
because we use the same names as are employed in Great Britain, and often
the same procedure, institutions of ours are siipposed to be identical with
yours, which when examined exhibit marked divergencies. I know no
means by wliich that kind of knowledge can be acqitired without personal
knowledge.

Of course it would be highly advantageous if a certain number of recruits
for the Colonial Office were obtained from time to time fi'oni 3'oimg men born
or brought up in Canada, South Africa, or other parts, provided they came
at an age which allowed them time to become identified with the Colony.
That is not a matter for me to dwell upon. If the Colonial Office is to
contintie to occupy its present relations to all these various Dominions it
is perfectly certain that as its responsibilities increase its equipment must
increase also, and in that new equipment a conspicuous place, we venture
to suggest, should be given to men who speak from personal knowledge, and
who deal with distant countries with whom they s}anpathise after making
themselves familiar with the facts upon which they are called upon to
advise.

It must be remembered that as years go on the number of the men in
the Dominions who were born in Great Britain and are acquainted with
its political and social conditions tends to diminish. Our fathers, of course,
were Britons, most of them of full age before they entered either Canada,
Australia, or South Africa ; but our new generation, growing tip imder very
different conditions from those which obtain in this coimtry, has not that
knowledge. It is only natural to expect therefore that they will take
somewhat different roads, and that they not only will be less understood
themselves, but will tmderstand less what is really meant by many of the
objects and procedures which are accepted as quite customaiy in this
coimtry.

I do not desire to labour the point. I have put it already in a ntmiber of
different ways, and could put it in many more. It appears to me that, from
our point of view at all events, a case is made out for laying before the
Secretary of State for the Colonies the suggestion that some scheme for
bringing his officers into direct touch with us should be adopted, and is
indeed essential to secure efficiency.

615

Then there is the fiirther set of circumstances hardly touched upon by Fifteenth Day.
that Resolution wliich relates to the Colonial Office. There remains to be 14 May 1907.
mentioned the new Secretariat which we conceived as a kind of Imperial
office, charged with knowledge of and responsibility for all the great self- Intekchange
governing Dominions, and concerned with the oversight of a great variety of '^^ St'aIt*^'"^
Imperial interests. These might be concentrated in such a Secretariat, .^^ ^ '
instead of being, as they now are, divided over several departments in this
country, to which would be added other questions hardly yet associated.
I do not propose to do more than recapitvdate some of the more familiar.
I do not know, my Lord, in shaping a departmental Secretariat, how far
you will take this into your consideration ; but I hope you will weigh the
necessity of keeping our Dominions in closer touch with external questions
that particvdarly affect them, even when they maj^ not be coming forward for
immediate treatment? I might mention the case of Alaska in regard to
Canada, and tlie New Hebrides and Pacific interests in our case ; and of
Delagoa Bay in South Africa. These have arisen in the past. But it is easy
to see, being wise after the event, how much better qualified the Empire
woidd have been for consistent action in regard to those matters, if they had
been objects of study before the crisis arose, or if, as and when the crisis
arose, Canada, Australia, or South Africa or all of them had been kept
informed of the state of those problems and the difficulties that had to be
encountered in settling them. I might develop these possibilities at great
length, but the case appears to me to be plain enough as it stands. There
are manj^ matters still at issue of deep interest to Canada, for instance, or
South Africa, upon which this office possesses or can obtain much knowledge,
which would be of great value to Canada or South Africa as the case might be.
Part of it would be confidential ; but to have these problems kept in view,
and to have them from time to time presenied to us in their new phases,
would save many possible misunderstandings, and enable proposals to be
made from the Dominion affected which might often be useful to the
Colonial Office.

The next suggestions were summarised a short time ago in an article by
Mr. Drage in the " Fortnightly Review," in which he pointed out that a
study of other colonial systems generally, first of all, and then in regard
to a particular problem or problems might be of much use. He said that
the French in Northern Africa, the Germans in Eastern Africa, and the
United States in the Philippines were conducting a number of very
interesting experiments. Some of those, it occurs to me, are climatic, and
some relate to health. Those, 1 am aware, the Colonial Office has, to a con-
siderable extent, dealt with, but others relate to their products and their
methods of government, upon which valuable information could be found.
Foreign blue books, it is said, are not laid as freely imder contribution
in this regard — the French, Germans, and Italians are mentioned in
particular — as they might well be.

I omitted to mention that among the questions upon which, for
instance, it would be a great gain if from time to time we were kept in
touch with such proposals as were lately made, in regard to important
action in Madeira, and similar tendencies elsewhere, portending to the
acquisition of territory by other Powers. We have lately been brought face
to face with ourselves, with our want of knowledge of Treaty obhgations,
of how far we are reaUy bound as Dominions, and how far we have been
committed. I am aware that steps are being taken to mitigate this.
But that experience suggests other directions in which the same course
can be followed with advantage. Of course, in trade affairs, there
are a great variety of directions in which the article, to which I have
referred, points out our needs. For instance, ]\Ir. Drage says there is at
present no common statistical method, no conunon statistical year, no

616

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(Mr. Deakin.)

annual report of the trade of the Empire, no common year book of the
trade of the South African Customs Union, nor of the West Indies.

Dr. JAMESON : It is want of knowledge on his part.

Mr. DEAKIN : The article says " There is no common system, as there
" should be, for India, the Straits Settlements and other Asiatic Possessions."
He mentions the Cro^'sai Colonies " apart fifom Lidia, an Empire of
" 2,678,330 square miles, a population of over 36,000,000, a total trade
" of 180,000,000L a year," which rather supports what I said about the
burden which must rest upon your shoulders, — " and a revenue of
" 19,500,000L sterling." He does say " even the statistics we have are
" difficult to understand, because it is not customary to prefix a note
" explaining the system of valuation, of registration, or origin of destination,
" inclusion and exclusion and transit, trade, bullion, and specie, bunker
" coal, &c." These are details, but we are all occasionally driven to statistics
to the sorrow of our hearers ; and when we must be sure that we are
measuring things which are properly comparable. These questions now go
to the Board of Trade. If there had been a real secretariat it might
have been desirable to consider whether, as imperial questions, they ought
not to be either collected, or at all events collated, there. Industrial issues
are matters of deep interest biit are not so general as what are termed
Chamber of Commerce questions. Legislation and its administration
affecting commerce within the Empire are matters which, I venture to
hope, the secretariat, even in this office, will take in charge. British
merchants freely apply for information in regard to our changes in these
matters, and so far as possible we supply it, but it is desirable that we
should all be brought into line with changes of administration and, still
more, of legislation. Copies of laws, reg-ulations, and fuU explanations
concerning them, might be forwarded from all the Dominions classified,
and made complete, so as to serve all of us.

There are a great number of other matters which are referred to in this
article, to which I need not call attention ; but the general idea of the
secretariat was that it should act very largely as an intelligence department
for all the self-governing dominions and the mother country in relation
to all other matters of common concern. The number of persons who seek
for detailed and exact information of an Imperial range are not great, but
they include the publicists of every dominion, and through our newspaper
press, which freely avails itself of any such knowledge, it would filter
through to the public. It is laid before Parliament, and aft'ects to a certain
extent legislation and administration.

Mr. Haldane's proposal for a General Staff and an exchange of officers
is only another illustration of what is proposed here to be done on the civil
side. With regard to officers, Mr. Haldane suggests that, to some extent at
all events, his staff might be described as the brain of the army ; so also we
might have in this secretariat the brain of the empire so far as that operates
here and within the self-governing Colonies.

The main aim of the secretariat is so well understood that it is not
necessary to repeat and explain its ramifications. Its regidar work wiU
largely consist in giving effect to the resolutions arrived at in Conference
and following up any action taken by His Majesty's Government in
connection with such resolutions ; but it also lies in the Avay of i:)reparing
for future Conferences, and responding to requests from the dominions in
order that when they meet their members may find a fund of information
ready to hand .

I have to acknowledge the f idness of the details supplied to us on this
occasion, and believe it exceeds that of any other Conference which has ever met.

617

lu 1887, it is iruc, wo had a <^eat mass of material iaitl Ijeforc us, because Fiftcctuli Day.
that was the first of all the Confereuces, but a good deal came too late even 14 May 1907.

then to be of much use. 1 regret to say the circiunstauees mider which

these sittings have been held have prevented me fiom making anything Interchange
like the use I ought to have made, and would have been glad to have ^*' Permanent
made, of the information supplied. If I maj' venture to look forward ' '^*^^^-

to future Conferences, in the interest of those who attend them, 1 think (^^r- Deakin.)
all hero will advise that it is highly desirable that this infonnation should
be in theii' hands, or as much of it as can be, l)efo)-e they leave their
homes, so that they may have an opportunity on the journey here, or, if
possible, before that, of discussing them with their colleagues, in ortler
fluit tliey may do justice to that inrormatiou, take full advantage of all that
it oilers, ami prove their appreciation of it.

CHAIRj\IAN : The difficulty we have here is to know what the subjects
are sometimes. This may, to some extent, meet it, but hitherto we did not
know initil a very late date what subjects were to be brought up. Another
thing— and I meant to have brought it up at the Conference — is the dilli-
cidty of fixing the actual date. Tluit postpones final arrangements very
much, because Ave want the figures up to the latest possible date. 1 wish
even now before you separate you could indicate in some way or consider
among yourselves what sort of date in tlie j'ear would be the most convenient
for these Conferences.

Sir WILFRID LAI'KIKU : It is difhcult to agree, because the antipodes
and the other regions vary so greatly in regard to the time when
Parliaments meet.

Mr. DEAKIN : It is rather dilHcult, but I think we are all l)ecomijig
converts to the conviction that we oiight not to meet at a time when social
obligations are numerous. I think we would also agree that we ought
not to meet when the Imperial Parliament is sitting. To do so imposes an
unfair strain on Ministers of departments, and, moreover, prejudices to
some extent oiu- proceedings here. Do Avhat we will, or say what we will,
we are interpreted as if we had some relation to political proceedings in tliis
country. In addition to that the conmieuts in the House of Commons and
House of Lords here suggest that the proceedings of the Conference are
being watched with somewhat similar ideas. It would be much better
for both of us that when any future Conference is held here it should
lie at a time when Parliament is nut sitting, when Ministers are disengaged,
when departments are free, and social obligations arc not enforced.

(MiAIIi^lAX : It is rather dilHcult to say when Parliament will not
be sitting, and as to saying when a Minister is disengaged, I dechue
altogether.

Mr. D1*>AKIN : All Ministei's are in the same position ; it is with the
greatest dilhculty one can tear ouesel I' away from one's responsibilities. When
any criticisms of mine of the Colonial Office are being read it should be
remembered thai 1 have a(buitted Iioav precisely the same criticisms apply not
only to our own departments, but to ourselves as politicians. We are just as
absorbed in our ov^m affairs on that side of the w-orld as you here are in yours.
The great liidk of our aifairs do not interest or attract you, and will not be
brought l)ei'ore you, just as the great bulk of your aifairs in this country have
but a secondary interest for us. Our large common ground is admitted, but
it is because we become so absorbetl in local matters which have but a general

I 4866!:). li r

618

Fifteenth Day. relation to our common business that we so often fail to understand each other

14 May 1907. I say nothing by way of criticism of the want of knowledge here that does not

tipply to ourselves. I make no distinction whatever, though of course we

INTERCHANGE qj-q jjetter iufomied as to yom- politics than you are as to ours.
OF Permanent

(Staff.

(Mr. Deakiii.) CHAIRMAN : The ditficulty about the date is really Ijetween Canada

and Australia, I do not know how to bring them together.

Mr. DEAKIN : What is the time of year when the Imperial Parliament
is not sitting ?

CHAIRMAN : Last year it sat 10 months out of 12. It was only up in
August and Seiatember.

Sir WILFRID LAURIER : 1 am afraid there are a nmnber of difficulties
that cannot be overcome ; our Parliauient commences to sit in November, and
sits during December and January.

Mr. DEAKIN : December ami January are suggested ; it is a very
unpleasant time to arrive, Ijut perhaps it would be £ree ; aj)parently you are
engaged at that time.

Sir WILFRID LAURIER : Yes, the best time woxild be what is summer
here, Jime and July.

Mr. DEAKIN : That is when our Parliaments are in full swing.

Sir WILFRID LAURIER : You must put somebody to inconvenience
w^henever these Conferences are to take place.

CHiVIRMAN : That is the difficulty.

Mr. DEAKIN : Yes, and it requires to be settled. That is one of the
matters which, if the new Secretariat takes it in hand, they would be much
better able to deal with than we are. Although this new Secretariat is
to remain under the Colonial Oifice, may I hope that it is to fidfil one
of the functions of the Imperial Secretariat, that of being a free channel
of communication between the different Dominions and the United Kingdom
on any matters which may be proposed by them or proper for inquiry
and investigation, instead of sending direct to each other, as of com-se
we do now. At all events, copies of all these communications should
be registered in this Secretariat, in order that we may be kept in
touch with them. A nmnber of other matters may be taken up in a
tentative way, whether they are pursued or not, as to which it seems
desirable for any one of the Dominions to obtain the opinions of the other
Dominions or of His Majesty's Govermnent. Such occasions might not be
frequent, but if the policy of the open door prevail it ought to encoiirage
further Imperial co-operation.

I have trespassed quite enough on your patience or the patience of my
colleagues, but this matter is of the gravest importance to us, and I cannot
attempt to deal with it as it deserves in these last moments of the Confei-ence.
Every increase in the harmony that obtains between us and goes to establish
the thorough understanding which we desire to see maintained between
His Majesty's Government ami oiir Governments is most valuable. We get
• that understanding ahnost wholly through the Colonial Office if we get it at

619

all. Finally, any proposals we make for bringing this office into closer Fifteenth Dsj.

touch with ourselves are made in the common interest, not for merely H May 1907.

selfish ends, but in the hope and belief, that it is possible to enable this

vast Empire, dissevered by great distances, with its scattered popidations Intercuange

absorbed in their own immediate interests and pursuits, to see all its »*' ^^!^^J^^^^'^

members brought into line for closer co-operation with each other ; this will ' '.

be one means of accomplishing that great and most admirable end. *■ '"' *" '"■'*

CHAIRMAN : 1 do not propose to follow Mr. Deakin through his very
interesting statement, which he has kindly put more as an invitation to me
to consider than anything else. There are one or two remarks I would like
to make to clear up, as far as I can, any misunderstanding of my position.
In the first place I am not quite sure I entirely follow yet the system of
appointments which Mr. Deakin described as obtaining in Australia. But, of
course, as far as this office is concerned, it is not a separate organisation aU
by itself ; it is a part of the general Civil Service of the country, a civil
service of which we are extremely proud. It is recruited from the Civil
Service ; the Civil Service itself being a competition open to men of high
abilit}^ and among them, if I may say so, open to men from the Colonies too,
if they choose to come forward. I should suppose that Rhodes' scholars
might possibly come forward in the future, and increase the number of
Colonials we may have in the Civil Service. That being the method in which
this office is recruited and staffed, I fancy that it woxdd be, perhaps, a little
difficult to arrange exchanges on equal footings. I only think it might
be so. At any rate, you must remember that this office, when you come to
it apart from the Civil Service, is one with a very intricate organisa-
tion. We have, as Mr. Deakin has said, colonies in all jjarts of the
world, and in all stages of development, and we have, therefore, to arrange
a very complicated division of duties within the office. Hitherto the main
scheme of the office was geographical. In the obligation which I imdertook
at the beginning of these sittings I practically accepted the position that, in
future, at any rate, as far as the responsible governing Colonies are concerned,
we depart from the geographical division and take the responsibly governed
Colonies under one branch. That, I venture to think, may make even a fresh
difficulty in the question of delegation as between offices and different parts
of the Avorld. It seems to me impossilile for me to hold out any very large
expectation in that respect. We have, I l)elieve, already on occasions found
opportunities of sending gentlemen to the Colonies for the occasional services
alluded to. That may occur again. But any large delegation, unless it was
possible to arrange regular exchanges — and even perhaps in that case^must
mean some increase in staff, which I am not at all sure it woidd l)e possible
for me to contemplate, and certaiiJj' I coidd not contemplate it without
consulting those in charge of the finances. I should like also to point out
with regard to services in the responsibly governed Colonies that, without
in any way demurring to the view which you expressed of the value
of knowledge of localities and the contlitions of the people and so
on, at the same time as far as this office is concerned we deal in no
way with the local administration. That is your own affair ; you are
autonomous in every respect, and it is the last thing you would wish
us to interfere with. Therefore, the business which actually comes here from
you depends more upon principles than upon local characteristics. I am not
quite sure, I admit, that it is absolutely necessaiy for the performance of
these duties that the men who are in charge of them should journey over the
world — because they would have to journey over the world — as it is no use
in a secretariat of this kind, their taking one colony only ; they musi
exchange ffoni one colony to another in order to qualify themselves in all.
Indeed, I rather think that if you wish to push that principle to an effective

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(Chairman.)

point you ought to go a little higher and I am not quite sure that the people,
who, according to your principle, ought to exchange offices, woidd not be the
Ministers. I do not say that I woxdd exchange posts with my friend on the
left ; but, even there I might give you an instance to show how the thing
actually works. There is one office in a dominion beyond the seas which is
continually filled by politicians coming from political life in this country, and
that is the Vice-Royalty of India ; but it is curious that no officer of Viceroy
of India has ever sat in the office on the other side of this quadrangle. I do
not say it with any degree of complaint at all, and I can see reasons for it,
but at the same time it is an illustration that in dealing with certain questions
it is not absolutely necessary for a inan to be chosen because of his knowledge
of the place fi-om which those questions come.

Mr. DEAKIN : I think we all feel — at all events, I feel — an immense
gain from a Conference of this kind, simply because coming to this
country even for so short a time we do get more in touch with political men
and events about which we are reading eveiy week of our lives. It is part
of my duty and part of my interest to follow British politics and British
affairs, but I have never come here (each of the three times) ^vithout getting
a great deal of fresh light and removing a certain number of misunder-
standings, with which my reading has left me. I feel the many advantages
of such visits. I do not wish to occupy the position of a British Minister, but do
realise that presence at these Conferences teaches me a great deal about this
country which careful study has not brought me abreast of in Australia.

CHAIRMAN : I agree, I was putting the point of the Minister essentially,
because that is an exchange from a Ministerial position in this Office to a
Ministerial position in the Colonies. But as to these Conferences and oppor-
tunities of intercourse, I think I said on more than one occasion I valued
them extremely.

I only want to say this word more aboiit the secretariat. I hope the
Conference will be disposed to give me a little both of time and confidence
in this matter. I have not undertaken this lightly, and I do not think it
is a very light task I have undertaken. Therefore, it is that I do not wish
to make any direct promises with regard to the subjects which Mr. Deakin
has put before us. What I will do is, I will bear those things in mind,
and I hope to make an organisation such as wiU at any rate decrease the
chances of friction between this office and the Colonies.

I hope, from what Mr. Deakin has said, that I shall be met fully in that
respect from the other side, because I think he has admitted not only to-day,
but on other occasions, that he has found this office both capable and willing
to meet the calls made upon it. I do think myself that if that was clearly,
distinctly, and emphatically stated to others beyond the seas by men who
could speak with the authority which he can, nothing would more tend to
diminish friction and prevent a feeling of vexatious loss or anything of that
kind than that taking place. We must look to you, Mr. Deakin, and to you
fellow leaders across the seas to represent this Office and this Government as
I think you really understand and believe it to be, as one thoroughly
determined to do justice and to study, to secure, and protect the interests of
these under its charge by every means which it is in our, power to use. We
have Imperial duties, and Imperial duties sometimes may make it less easy
to show the entire sympathy which we should desire ; but I think you will
accept it from me that those occasions never come to us without our being
determined to perform the duties they impose upon us with every intention
to secure the interests of our fellow sul^jects across the seas. I hope you wiU
excuse my having made that observation.

621

Mr. DEAKIN : If I had the Hansard of my Parliament here I could Fifteenth Day.

show you many occasions on which I have defended the action of this H May 1907.
Office and this Government, in some cases when 1 did not at aU agree with

it. I doubt if you wiU find an instance on which I have criticised this Office Intekchangk

there with the frankness I have shown here. °*" staf^j^^"^

THANKS TO THE EARL OF ELGIN.

Sir WILFRID LAURIER : 1 have to propose a resolution. It is in Resolution XXL,
recognition of the services rendered to us by Lord Elgin as Chairman, P- ^•
and I will move it : " The members of this Conference, representing the
" self-governing Colonies, desire, before they separate, to convey to Lord
" Elgin their warm and sincere appreciation of the manner in which he
" has presided over their deliberations, as well as of the many courtesies
" which they have received fi-om him ; they desire also to put on record
" the deep sense of gratitude which they feel for the generous hospitality
" which has been extended to them by the Goverimient and people of the
" United Kingdom."

Mr. DEAKIN : I have very great pleasure in seconding that.

Sir JOSEPH WARD : Lord Elgin, I wish to say I veiy heartily endorse
the sentiments contained in the resolution, and I want to ex];iress my personal
appreciation of the courtesy extended to me as the representative of the
Colony of New Zealand, both by yourself and your colleagues at this table,
and the whole of your staff, and I hope 1 may have the opportunity in the
future of seeing you all either out in New Zealand or else here. I go away
with very great regret from London, and that regret has been deepened by
the boundless hospitality and kindness which has been extended to me
on all sides, which has made a gi'eat impression on my mind as showing
the way in which the people of Old England treat their sons from the
Colonies.

CHAIRMAN : I am much obliged. Sir Joseph Ward, for what you have
said, anil to Sir Wilfrid liaurier for the motion he has put. 1 should just like
to say this : that I have had the ambition throughout this Conference of ^

endeavouring to make the Conference work as 1 think it should work. I
ventured to point out at the beginning of the Conference that we had laid
before you papers, not merely Colonial Office papers, but papers prepared by
all departments of His Majesty's Government. We have done more than that.
We have had representatives of His Majesty's Govermnent present at tliis
Conference, and I find that no less than 12 have been present and taken part ')>

in the deliberations. Of course, I may take this credit to myself, that that I
had to arrange before the Conference met, and it was satisfactory to me to ,

iiiul that it was in accordance with the first resolution which this Conference \

passed, namely, that what they desired was that these Conferences should be
conferences between Government and Governments. That is the principle on
which I endeavoured to arrange the Conference, and in which I think it has
been carried out. Of course it does, in a sense, mean that the Secretary for the \

Colonies, if he is sitting in the chair, has not necessarily to argue the different \

points that come before the Conference. I do not know that he ever
did do so. But at any rate, I have endeavoured to study the convenience
of the members of the Conference, and I am very grateful to those who
have said that they have found that I have done so. Somebody has to do
that. I think the Secretary of State for the Colonies, imder all the circum-

^

622

Fifteenth Da}-, stances, is the proper person to do it ; and I hope therefore that looking into

14 May 1907. the history of these conferences we may not in the future hear anything — I

— — do not say in this room, but anywhere — of any question of a dictatorial

Thanks to t he Secretary of State for the Colonies, who usurps the fTinctions of the

Eakl Of Elgin. Government with which the representatives of the Colonies desire to

(Chairmnn .) confer .

I thank you very much for the kindness with which you have spoken of
myself.

Mr. DEAKIN : Lord Elgin, I cannot imagine the severest critic of the
proceedings of this Conference levelling any charge of dictatorial aggressive-
ness against you. I have no charge to make, except that of your having
placed yourself and the whole of the resources of your office absolutely
at the disposal of the representatives of the Colonies in the most considerate
manner.

CHAIRMAN : I have only again to say good-bye to the members of the
Conference and to express my grateful thanks to them for their uniform
kindness to me daring the proceedings.

The Conference then concluded.

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