HL Deb 27 March 1885 vol 296 cc808-15

in rising to ask the Secretary of State for Foreign Affairs, Whether any communications have been received from Foreign Powers explaining the reasons which have induced any of those Powers to require that the guarantees to the proposed Egyptian loan should be international rather than purely British; and, if so, whether he will lay them on the Table? said: My Lords, in putting the Questions which I have placed upon the Paper to the noble Earl the Secretary for Foreign Affairs as to the Egyptian Correspondence, I may state that they were designed to throw light upon what appears to be, after considerable study of the Blue Book, a very dark place in that Correspondence. If the Blue Book had come into my hands as a telegram, or, say, as some ancient manuscript that had been recovered from Herculaneum, I should have said that a large portion of it had dropped out, and that the sequence of its several parts had become unintelligible on that account. I want to know from the noble Earl whether there really are any Papers which he can supply to us which will fill up these very awkward and perplexing gaps? There is not upon the surface of the Papers anything to show that the Foreign Powers had any reasons for making the request, or even that they did make the request, that the Guarantees to the proposed Egyptian Loan should be International rather than purely British. Ail that we can find is that there was a great deal of very kind, charitable, and philanthropic interest in our own affairs on the part of the Foreign Powers, which induced them to facilitate the operations which we have had in view, and to lend us the help of their unimpeached credit in order to support our monetary transactions. For instance, I find that last year M. Waddington first introduced the proposal of an International Guarantee in this way—that, in order to facilitate the task of the English Government, the Powers should be asked to join in the Guarantee of the proposed loan. Then, again, this year M. Waddington said that it was far preferable and more simple to increase at once to £9,000,000 the amount of the loan to be issued, attaching thereto the collective Guarantee of the Powers, and then the motive was given; it was not that he demanded it—he did not desire it in the least—but he said that on those terms the loan might be issued at 3½ per cent, and that there would be no need of any special security or of a sinking fund. The suggestion, therefore, was offered entirely in the form of an assistance to English credit. That was the view which the Austrian Ambassador also took. He said, on the 19th of January, that the sum of £4,000,000 required for the payment of indemnities should be included in the new loan, and that in order to secure a cheap rate of interest this loan might receive the collective Guarantee of the Powers, and, finally, the Austrian Ambassador's view was that the attachment of the signature of Austria would enable us to raise money at a cheaper rate. There is no indication in the Papers of any other motive than that. There is no pressure, there is no expression of a strong desire, there is no argument for it. On the contrary, Italy received the proposal with considerable doubt. M. Mancini, on the 25th of January, said that, as far as his Government was concerned, they had no objection to a collective Guarantee if it were allowed by the other Powers. Russia, in the same way, made conditions, and said that unless all the Powers became parties to the Guarantee she should not be bound by it. Therefore, there was no desire on the part of the Foreign Powers, as far as is indicated by the Papers, to associate themselves in this Guarantee. They simply offer us the assistance of their credit in raising the loan. Perhaps if they knew more of the London Money Market than they evidently do they would not oven think it necessary to make the offer. When a similar transaction took place in 1855, Mr. Ricardo said that when a mercantile man saw two names on the back of a bill of exchange, and knew that the first was a good one, he did not care about the second. What I want to know is how it comes about that without a practical pressure on the part of the Powers, or even of apparent wish on their part in favour of this change, this change should have been made? Because this change has been made in the teeth of a very grave objection. The noble Lords and the right hon. Gentlemen who constitute the Government have had to swallow a good deal to make the change, and have had to retreat from the opinions which they so distinctly expressed last year. Mr. Childers, in the most formal way, stated to the Conference that the Government could not expect Parliament to agree to a Joint Guarantee. I observe that in "another place" a noble Lord, who ought to have known better, spoke of the Protocols as something not indicating very precisely what the Plenipotentiaries said, but as being only an abstract. But it is an abstract corrected and approved by the Plenipotentiaries themselves, and every word which appears in the Protocols has been submitted to the men in whose mouths the words are placed. Now, in spite of the strong objection that the Government entertained, and in spite of no pressure being exercised on the part of the Foreign Powers, we find the noble Earl opposite on the 21st of January sending to all the Courts the following statement— As regards the proposal that there should be a loan of £9,000,000 guaranteed by the Powers, to be a pre-preference stock, we have no desire to ask the Powers to share with us the liability which such a Guarantee would involve. Still if it is the desire of the Powers to join in the loan upon the same principle as the Anglo-French Guarantee of the Turkish Loan of 1855 we are ready to concede the point. There is the gap, there is the lacuna, which I wish the noble Earl to fill up. I trust that the noble Earl will produce Papers which will show us where this pressure comes from. It must have been made in the form of some communication, and all that we ask is that we should be allowed to see that communication also. The Anglo-French Guarantee of the Turkish Loan of 1855 has been brought forward as an analogous case with the present; but so far from being analogous, they are as distinct as it is possible for two operations to be. In 1855 France and England were fighting side by side for Turkey, and it was reasonable that if they wished a loan to be advanced they should share the responsibility attached to it. But now we are doing all the fighting, and not side by side, for the other Powers are merely looking on. It is a very remarkable allusion, because it is an allusion which I think Her Majesty's Government would rather have avoided. That Arrangement was fiercely contested in the House of Commons, and of those who opposed it, and who were in the minority of three, there were three distinguished persons. One was the noble Earl the Secretary for the Colonies, another was the noble and learned Lord who sits on the Woolsack, and the third was the right hon. Gentleman at the head of the Government. Their spokesman, the right hon. Gentleman, opposed it by every argument that it was possible for human ingenuity to conceive, and he opposed it with the utmost tenacity, so much so that Lord Palmerston and Sir George Gornewall Lewis actually went so far as to charge him with talking against time. I want to know why they made this unpleasant allusion? Did the Powers merely desire that the Anglo-French Guarantee should be taken as a model, and, if so, what reason had they for doing so? To explain that mystery I thought it well to refer to Mr. Gladstone's speeches, and I find two sentiments in those speeches which, I confess, made me quite understand why the other Powers should desire that the Anglo-French Agreement should be taken as a model, but which did not explain to me why Her Majesty's Government were so yielding as to accept the analogy. Mr. Gladstone made three long speeches, but I will only quote from his speech of the 27th of July, 1855. The first observation the right hon. Gentleman made is certainly alarming. He said— The worst of this Guarantee is, that all the Guaranteeing Powers acquire a political hold upon Turkey. Instead of Turkey let us read Egypt, because it is the case of Egypt now. That was Mr. Gladstone's opinion at that time; but it was not his only opinion. He went on to say— If you provide in a Treaty to leave the Revenue of a given Power as security for your Guarantee, no one can have a right to charge with ambitious designs the Government that occupies that Province."—(3 Hansard, [139] 1475.) What is the use of impounding the Revenues of Egypt unless such arrangements are of the nature of a mortgage? It is a most singular feature of the Convention, and one to which attention has not been sufficiently drawn, that the indebtedness to the Powers of Europe laid on Egypt by the Convention is of the nature of a mortgage. By, I think, the 3rd clause of the Convention there are special revenues of special Provinces that are mortgaged for the payment of the loans which the Powers of Europe guarantee. I confess that it is not reassuring to find that Mr. Gladstone has laid it down that if you provide in a Treaty to have the revenues of a Province as security for that guarantee, you give a right to the Guaranteeing Powers, under certain contingencies, to occupy that Province. The proceeding to which the Government have given their sanction is in a great measure new, and I cannot help feeling that we shall enter upon new difficulties in Egypt in consequence of it. Hitherto we have only had to deal with the debts of Egypt to private persons, and that has been difficult enough; but now we shall have to deal with the debts of Egypt to Governments, those debts being mortgaged on special Provinces, which, according to the opinion of the First Minister of the Crown, will confer upon them the right and power to occupy such Provinces in case of the debt not being paid. It may be said that this is a pre-privileged debt, and that there is no danger of it not being paid. The Anglo-French Loan was privileged, but I am not sure that it was found more easy to get the interest into the Treasury. We shall have further opportunities of considering this matter when it comes before us in the form of an Act, and I hope that it may be possible for this House to do something to dissipate the ambiguity and the danger which seem to me to surround this diplomatic operation. But in the meantime it is of great importance that we should have all the information which it is possible for the Go- vernment to give us. There must be some Correspondence indicating how this mysterious desire on the part of the Foreign Powers arose, what reasons they urged, what is the real cause of this Guarantee being inserted. I earnestly trust that some at least of that Correspondence the noble Earl will find it possible to lay before us.


My Lords, when I saw the noble Marquess's Notice on the Paper yesterday, I thought he intended simply to ask a Question, so much so that when I was unavoidably compelled to leave I supplied to my noble Friend (the Earl of Kimberley) the answer which appeared perfectly obvious—that was to refer the noble Marquess to the Papers, particularly to the communications with M. Waddington and the Memorandum handed in by Count Karolyi. But it appears that that was not the noble Marquess's object. His object was to take part in the debate which is going on in the other House, and still more to do what he particularly likes to do—that is, to enter into a debate with Mr. Gladstone—whether he thinks or does not think that his Friends in the other House are not quite equal to competing with that statesman in debate. I am not bound to defend the reasons which have induced Foreign Governments to enter into this International Guarantee. I quite agree that our credit is sufficient to float a loan at a very moderate rate of interest. The noble Marquess alluded to the possible motives of Foreign Governments in associating themselves in this Guarantee. I am not given to attributing motives to anyone, and certainly not as to the conduct of the greatest Powers of Europe. At the same time, there is one motive that may possibly have actuated them in the course they have pursued. Your Lordships may remember that on the last day of the Conference of last year the French Government made a proposition which amounted to an ultimatum which we could not accept, and it was impossible to go on, on those terms, with the Conference. We arrived at a deadlock, and surely if anyone desired to get out of that deadlock it was this country in its connection with Egypt. Of late it seems to be laid down as a principle that if a Government—and especially the Government of this country—ever makes a proposition or resists a proposition made by any other country, it is an absolute disgrace to withdraw in the slightest degree from that which they have once maintained, or to make concessions, or to give or take in any way. All that I can say is that I do not believe that there is any Court in Europe, except perhaps Monaco, which does not constantly make proposals which it afterwards modifies to a certain degree in order to come to a friendly understanding with other Powers; and if this practice was not usually adopted Europe would be perpetually either in a state of deadlock or of war. I do not think that it is an unfair thing to attribute to the French Government a good motive when making a proposal of this sort, which covered their withdrawal from the position they adopted in their ultimatum; and I do not think it was an unstatesmanlike act in us to meet them half-way in order to relieve Egypt from a dreadful incubus and ourselves from a millstone round our necks. I have nothing further to add.


pointed out that this was not merely a money matter; it included several points of great political significance, and he wanted to know whether, their Lordships' House being a part of Parliament, and it being announced that the Agreement would be submitted to Parliament, they should not have an opportunity of expressing their opinion upon the Convention?


The noble Duke cannot, I think, have studied the Papers, or he would see that in this Arrangement there were concessions, and very important concessions, made to Great Britain by the other Powers. In the first place, the Powers had insisted upon an immediate financial inquiry. Her Majesty's Government held that such a financial inquiry at the present time would be attended with very serious inconvenience; but the other Powers gave way to that remonstrance on the part of Her Majesty's Government, and the question of inquiry was reduced to the possibility of inquiry two years hence. Then there was a concession on a second most important point, which the Government regarded as vital. The Powers objected to diminishing the receipts of the bondholders; but there is to be a reduction from the interest paid to the bondholders. Then there is the third point, which certainly was regarded as one of some moment—namely, the taxation of foreigners, to which the Powers agreed. I merely mention these three points to show that it is an entire misrepresentation or misunderstanding, indeed, to suppose that in this Financial Arrangement there was no concessions on the side of the Powers. If we conceded something the Powers also conceded something.


One observation which fell from the noble Duke requires a reference. This Bill must pass this House as it must pass the other House, and on the stages of that Bill it will be open to take any further discussion. I confess the answer of the noble Earl is not satisfactory. His theory of the reasons why the other Powers pressed for this International Guarantee is that the noble Earl had refused it in July last. He says this is not very logical. It certainly is not. The noble Earl practically says—"If it is any pleasure to you to see me eat my words, I am perfectly ready to do it." That is very kind of the noble Earl. It is a weapon that I think he has exercised before, and found it very useful in conciliating friendships. But as he has started a theory, I will oppose to it a theory of my own, which is one, I think, very generally held, and that is that the Powers pressed for this International Guarantee because some of them, at least, intend to make it a weapon by which they shall obtain a share in the control of affairs in Egypt.


I have no right to speak again; but I trust that what I have said will be reported by professional reporters, and that there will not be attributed to me the paraphrase of it by the noble Marquess.