SUPPLEMENTAL WAR LOAN (No. 2). (Hansard, 12 December 1900)

§ * SIR CHARLES DILKE (Gloucestershire, Forest of Dean)

said that on the three occasions when the Chancellor of the Exchequer had had to refer to the cost of the war he had announced to the House his intention of finding a consider- 662 able portion of that cost in the assets of the Transvaal Republic. He understood that the purposes named on the previous night, such as the new police, would somewhat mortgage future taxation in the Transvaal. But in addition to taxation there were large existing assets of the Transvaal Government, the condition of which was in a position of some urgency at the present time, because they were exposed to great risk of disappearing. Unless immediate steps were taken, and representations made at Pretoria and Johannesburg, those assets were very greatly in grave danger of being diminished. The South African financial papers had discussed these assets, had challenged the Chancellor of the Exchequer to find money in them, and had said that if there was any it did not belong to the British taxpayer, but ought to be handed over to the people to be locally administered. It was, as he hoped to show the House, most important that they should not look upon these funds as being the property of the local taxpayer in the Transvaal. If we considered we had an interest in them, steps should at once be taken to safeguard them. The Chancellor of the Exchequer could prevent these assets from being lost; he feared local custodians would not be able to do so, and many of them had an interest in wasting them. It was most important that some representation of the Treasury should be made in the Transvaal by a competent Treasury staff. The power of the financial interest in the Transvaal was enormous, and had been so even at the time when it was supposed to be oppressed. In 1897 the Industrial Commission of Inquiry, presided over by Executive Councillor Schalk-Burger, sat at Johannesburg, and the evidence then taken and the Report ought really to be before this House. It was not a complete document, but was of enormous value. The evidence showed, quite apart from new sources of taxation, that as regarded the existing assets of the Government, the gold tax had never been levied under the Transvaal gold law. It was not the case, as many Members supposed, that these matters were referred to the Commission which had been sitting under the presidency of a learned Member of Parliament in Pretoria, and was now sitting here; it was the concessions granted by the Government of the Trans- 663 vaal that were referred to that Commission. The evidence which had been taken before that Concessions Commission showed the difficulties with which in this matter the Chancellor of the Exchequer would have to deal. It was obvious that the interests had put their heads together; that there had been log-rolling before the Commission in order to avoid producing certain evidence. There were concessions which had never been the subject of detailed examination before the Commission, because it had been agreed to drop all opposition to them. In the endeavour to organise a civil Administration at Johannesburg Lord Roberts had had to avail himself persons who had been in the services of the great companies on the Rand. The employment of these gentlemen would not tend to a full collection of the revenue or a full finding of permanent assets, and that was why he was anxious that there should be at Pretoria a competent staff of persons whom the Treasury could trust. Some of the sources of assets were already represented in the income of the late Government. These included the ordinary licences under the mines laws, and the enormous interests in the Netherlands Railway. That railway had, he believed, violated the terms of its concession, and what might be the legal position of the Government towards it he did not know, but that it was a most embarrassing position there could be no doubt, because the Republic, by the terms of the railway concession, was represented in Europe by a Commissioner appointed by the late Government of the Transvaal, who resided in Holland and had great powers. Eighty-five per cent. of the profits, after certain writings-off, went to the Transvaal Government, a percentage which in the year 1898 amounted to three-quarters of a million sterling. That was an enormous asset. It had been alleged that not this 85 per cent. of profits, but the shares in the possession of the Transvaal Government, had been the subject of some recent transactions, in spite of the Government's proclamation—or perhaps they did not come within the exact terms of the proclamation. Those shares, he believed, had been alienated; the Transvaal had probably raised money for the war by a secret sale of them. As to the minerals under surface sites, they had been the subject of acrimonious discussion for 664 some years between capitalists and the Transvaal Government. There was the greatest possible difference as to what the value of the mineral rights was, but everyone put it very high. Under the Transvaal Government the capitalists had endeavoured to get permission to mine for minerals in virtue of their surface rights, and then they had tried to get the right of preemption, but the Volksraad decided that when the proper time came they should be sold to the highest bidder. It seemed to him that we ought to adhere to the position that whatever the mineral lights wore worth they were worth by sale in the open market. These mineral rights for the Rand alone had been valued at various sums. It was almost impossible not to laugh at the variation. They had been put as high as £75,000,000 sterling, and other estimates were £44,000,000 and £40,000,000 (this last having been accepted by the late Minister of Mines); another authority put it at seven and a half millions, and still another authority at a million, and on the strength of the last estimate it was suggested that the right was not worth while troubling about, and that the value being so small the asset might well be handed over to the people. There was undoubtedly danger of the disappearance of this asset, as well as in the case of the Netherlands Railway, and he would ask the Chancellor of the Exchequer whether it was possible, with a view to the ultimate redemption of his promise to the House, to take steps to at once establish proper Treasury control.

§ * THE CHANCELLOR OF THE EXCHEQUER (Sir M. HICKS BEACH,) Bristol,W.

I am very far from complaining of the action of the right hon. Baronet in bringing this matter before the House of Commons. On the contrary, I know that he does so with precisely the same object that Her Majesty's Government, and, I can assure him, my right hon. friend the Colonial Secretary and myself, especially, have—namely, that we should redeem the expectations which I have held out to the House and to the country, that a considerable contribution towards the cost of this war should be obtained from the wealth of the Transvaal. The right hon. Baronet has gone into detail into which I hope he will 665 pardon me if I do not follow him. The facts are not sufficiently before me, and it is obvious that in dealing with a matter which, as he has stated, is full of difficulty and delicacy it would be dangerous in me to attempt anything of the kind. But, as he stated, we have already appointed a Commission, under the presidency of my hon. and learned friend the Member for Warwick, which is inquiring into the concessions given by the late Transvaal Government, and that part of the question, I have no doubt, has been thoroughly examined, and will be the subject of an able and exhaustive Report. Then, with regard to the other points which the right hon. Baronet referred to—the assets of the late Transvaal Government—namely, the interest in the Netherlands Railway and the mining rights which they have not disposed of, I am well aware of the probable great value of those rights and of the disputes which the right hon. Baronet has referred to as to ownership and the amount of their value. Of course, up to this time, there has been nothing but a military administration in the Transvaal, and it has been absolutely impossible for Lord Roberts and those who have been associated with him to enter into questions of this kind, or to do anything except to devote their energies to the prosecution of the war. But before long, as my right hon. friend the Colonial Secretary said the other day, Sir Alfred Milner will be in the Transvaal as Governor of that country, and I am sure that, whatever hon. Members opposite may think of Sir Alfred Milner, anyone who knows him will admit that there are perhaps few men possessed of greater financial ability or more competence to deal with a matter of this kind. That is not all. He must have assistance, for he will have a good deal to do, and as a preliminary we have arranged that a gentleman who is well known in this country and has on several occasions given his valuable services to Her Majesty's Government, a gentleman of very high experience in matters of finance—Sir David Barbour—should go out as Commissioner to the Transvaal, practically in the course of the next fortnight or three weeks, and give us a full report on the very matters 666 to which the right hon. Baronet has drawn attention. I hope by the time of the next Budget to have some material in this way to present to the House, but I do not think it would be right that I should attempt to say more than this today. I assure the right hon. Baronet I am personally obliged to him for having called public attention to what, in my judgment, is a subject of the greatest importance.