HL Deb 15 May 1899 vol 71 cc573-8
* THE EARL OF ABERDEEN (Viscount GORDON)

My Lords, I rise to ask Her Majesty's Government whether, in view of the importance of an understanding being arrived at between Her Majesty's Government and the Governments of Canada and of the Australian Colonies, with reference to the proposed Pacific cable, Her Majesty's Government will be disposed to reconsider some of the stipulations recently set forth by them in relation to the scheme. My question is expressed in a somewhat guarded and condensed manner, and therefore I hope your Lordships will not consider it out of place if I add just a word or two by way of explanation. Your Lordships will have observed that in the year 1896 a Committee was appointed to consider the question of the Pacific Cable. It was a very strong and representative Committee, as its constitution shows, and anyone reading the Report will at once see that the members of the Committee were entirely in favour of carrying out the Pacific Cable. Various recommendations are, of course, given as to the methods to be adopted, but the Committee are favourable to the proposal. On August 29, 1898, the Premiers of New South Wales, Victoria, and Queensland agreed that if Great Britain and Canada paid five-ninths and New Zealand one-ninth, New South Wales, Queensland, and Victoria would contribute one-ninth each. New Zealand practically complied with that proposal in giving their one-ninth. In December, 1898, the following message was received from Canada approving of the proposal alluded to in the Australian telegram:— Am authorised to inform Mr. Chamberlain that the Canadian Government will gladly join Imperial Government in contributing each a half of five-ninths for Pacific cable provided Australian Colonies contribute remaining four-ninths. In consequence of these communications, a letter was sent to the Agents-General for the Australian Colonies and the High Commissioner for Canada by the Colonial Office. This is an exceedingly important letter. It gives the views of Her Majesty's Government upon the Pacific cable, and states what they are prepared to do; but I should like to remark that before this authorised statement appeared there was an announcement, which had all the appearance of being authentic, which stated that Her Majesty's Government had decided to do something considerably more than they really had decided to do, and this more favourable announcement was greeted with unanimous approval not only by the Colonies concerned but by the British Press generally. In the letter to which I have referred it is stated that, in the opinion of Her Majesty's Government, the construction of a Pacific cable was a matter of much greater importance to Australia and Canada than to the United Kingdom, but it also remarked that the success of the project cannot fail to promote Imperial unity. I venture to submit that anything which supports Imperial unity is of very practical consequence, though in an indirect sense perhaps, to the central portion of the Empire. Moreover, there is no allusion in this letter to another important feature of the cable—namely, that it would provide an all-British line of telegraphic communication. I think the significance and importance of that, from a strategical point of view, is obvious. Canada and the other Colonies have often been exhorted to do their part in contributing to the defence of the Empire, and so forth. I think the active part they propose to take in this cable is an indirect contribution to what will be of great value in military organisation. Then we come to the conditions upon which a certain measure of support will be given by Her Majesty's Government. The letter states that the Government are prepared to offer For a period not exceeding 20 years, an annual subsidy not exceeding a maximum limit of £20,000 in any one year. There are several other conditions, and the feeling on the part of Canada and of the Australian Colonies, so far as I have been able to ascertain it, is that these conditions are extremely stringent, and consequently have created great disappointment. Another condition of the Government's contribution is that the cable must be in accordance with specification, and samples to be approved by the Treasury, and to the satisfaction, and so forth, of the Treasury, and to be effectually worked with a sufficient staff who must be British subjects. The condition as to the employment of British subjects is an indirect indication that Her Majesty's Government do recognise the importance of a British cable under absolutely British control. But the point is that it is difficult for Canada and the Australian Colonies to estimate what they would be liable for under this stipulation. Your Lordships know that the cost of the cable will largely depend on the number of words which it is to be capable of conveying per minute, and obviously it is very desirable to have a cable capable of rapid transmission; but, at the same time, if Her Majesty's Government lay so much stress on the efficiency of the cable in that respect, one would think they might give further encouragement to secure that the cable should be of the highest possible efficiency. There are several other conditions which seem to me extremely severe. For instance, the Government insists that all rates charged to the general public shall be approved by the Treasury. At first sight that might seem for the protection of the public, but when we think of the delicate questions in regard to possible competition I am afraid this clause might have a hampering effect, and perhaps make it more difficult for the Governments concerned to raise such loans as they might wish to raise for the purpose of carrying out this project. We all know the damaging effect of too many restrictions being imposed upon the contribution contemplated by the Government. I am afraid that an impression may be created that Her Majesty's Government do not regard the project with that confidence which we had hoped for, and that therefore it may not be carried out with such facility as is desirable. The principle of giving some contribution having been contemplated, I cannot help thinking that it would be a perfectly safe and reasonable course for the Government to have gone a little further, not merely as to the amount, but as the manner in which their aid is offered. It is well known that the feeling of Canada and of the Australian Colonics towards the Mother Country is of an excellent character, and it would be a great pity if anything were done which would check their confident expectations regarding the readiness of the Government to meet them at least half way in such an undertaking as this, which is obviously either directly or indirectly for the benefit of the Empire at large. The attitude of Her Majesty's Government, hitherto as expressed through the Colonial Office and the Secretary of State for the Colonies, has been eminently one to encourage and foster the desirable state of feeling to which I have alluded, and I hope it may be possible for Her Majesty's Government to still further strengthen the ties between the Colonies and ourselves, and help forward this great scheme by relaxing something of the stringency of the conditions upon which the subsidy is offered.

* THE UNDER SECRETARY OF STATE FOR THE COLONIES (the Earl of SELBORNE)

My Lords, the noble Earl has criticised the letter announcing the decision of Her Majesty's Government upon this subject, but I assure him that there was no intention in the letter either of throwing cold water on a project of such great public interest, or of conveying the decision in a manner which would seem to be ungracious. Government departments are constantly striving to formulate their proposals in letters which shall not appear to be ungracious, but I am aware that they are constantly finding that they fail in that attempt. The point raised has been a good deal discussed in the Press, and, somewhat to my surprise, particular stress has been laid on that paragraph of the letter which states that the construction of this cable is a matter of greater importance to Australia and Canada than to the United Kingdom. Now, my Lords, surely the two proposals are not incompatible. It may be perfectly true at one and the same time that a project such as this may be of great general interest to the Empire, and also that it may have greater importance to specific portions of the Empire. I think that what was meant to be expressed in this paragraph states no more than the fact. It is open to anyone who reads this letter to form his own opinion as to whether the particular form of proposal which the Government have made is the best or not in the circumstances, but I do not think that anyone who really understands the proposal in its financial aspect can say that it is ungenerous, because it is nothing more or less than an offer to bear the full share of the annual burden which has been suggested as appropriate by the colonies concerned, and at the same time not to demand any share in any profits that may arise. That may or may not be the best attitude to adopt, but whatever opinion may be formed in that respect I do not think it can be criticised as an ungenerous offer. The maximum of £20,000 seems, according to the evidence adduced before the Committee, to be the highest possible sum, on the proportion of five-eighteenths, that could ever fall upon the Government of this country to bear. The noble Lord has animadverted on what he has described as the stringency and severity of the conditions. I speak with deference in the presence of my noble friend opposite, who was once Parliamentary Secretary to the Treasury, but those conditions are only of the kind which the Treasury make it a rule to impose whenever this country bears a share in any project such as this one of the Pacific cable. I do not know whether the details are identical with the details of similar conditions which have been imposed when this country has subsidised a cable, we will say, of the Eastern Telegraph Company, but I do not think they will be found in any way to differ in principle. There is no ulterior motive lurking underneath them. They are merely those which the experience of the Post Office and the Treasury has shown it is prudent to insist upon as the most likely to conduce to efficiency of the work and the satisfactory maintenance of the service. But if, as would appear, the Australasian and Canadian Governments have any objection to urge on any ground to the exact form in which this proposal has been made, Her Majesty's Government are perfectly prepared to review the whole matter in the light of those representations, with a sincere desire, if possible, to arrive at a decision which will be mutually satisfactory to all the Governments concerned.

LORD TWEEDMOUTH

My Lords, I am very glad to hear the closing words of the noble Earl, for at any rate we have the assurance that this arrangement is open to revision, and that the door is not finally closed. But I am sorry the noble Earl has taken as the sort of keynote of his speech to-night the last paragraph of the letter, which says that Her Majesty's Government trust that the liberal arrangement proposed will meet the views of the Colonies. This arrangement may be a sufficient one; as to that, I say nothing; but I do not think it can rightly be called a liberal one. The noble Earl rather challenged me with regard to the financial aspect of this question. What was the proposal made by the Colonies to the Mother Country? It was that the Australian Colonies and New Zealand should bear four-ninths of the cost of the construction of the Pacific cable, provided that Canada and the Mother Country bore the other five-ninths. Canada said she was ready to bear her part—five-eighteenths—if the Mother Country would bear her part—the other five-eighteenths. Five-eighteenths of a million and a-half amount to £417,000 in round figures. That is what the Mother Country was asked to bear. Now, what is the "liberal offer" that was made by Her Majesty's Government to the Colonies? Not that they would bear five-eighteenths of the cost of this cable, or even of the cost of working this cable, but that they would bear five-eighteenths of any deficit that might occur from year to year for 20 years up to a sum of £20,000. Before the Mother Country would be called upon to pay its five-eighteenths —to pay £20,000 in any single year— the total deficit on the working of this cable would have had to amount to £70,000. Therefore the risk the Mother Country was taking for the next 20 years was not a large one, for we expect the cable will prove a profitable concern. Then the noble Earl said the Mother Country was very generous because it gave up all claim to any part of the profit. Naturally it would if it did not provide any of the money on which the scheme is to be carried out, but by a clause in these provisions it is laid down that the messages of the Imperial Government are to be transmitted in priority to all other messages, at rates not exceeding half the charge made to the general public. To begin with, the Mother Country insists on reducing the profits in respect of the cable, which seems to me commanding a very considerable concession on the part of the Colonies, and I cannot say I am surprised that they consider these conditions by no means satisfactory. I quite agree with my noble friend that these are the conditions that are ordinarily imposed by the Treasury in the case of any enterprise in which they take a part. That is exactly the point. It looks as if these conditions had been framed when the intention of the Mother Country was to take part in the construction of the cable, and pay its portion towards the capital cost, but I do think these conditions are extremely stringent and unfair to the Colonies if all we are to do is to provide, in the event of a deficit, a certain proportion of that deficit.