Lords Sitting of 21 May 1908

PRIVATE BILL BUSINESS.
Honourable Artillery Company Bill [H.L.].—Presented (pursuant to leave given yesterday), and read la.
South Wales Electrical Power Distribution Bill [H.L.].—Reported from the Select Committee, with Amendments.
Cambrian Railways Bill [H.L.].—Reported from the Select Committee, with-out amendment.
Bristol Corporation Bill [H.L.].—Read 3a, and passed, and sent to the Commons.
North-East London Railway Bill.—Brought from the Commons, read 1a, and referred to the examiners.
Pier and Harbour Provisional Order (No. 3) Bill [H.L.].—Committed. The Committee to be proposed by the Committee of Selection.
Local Government (Ireland) Provisional Orders (No. 2) Bill [H.L.]; Gas Orders Confirmation Bill [H.L.].—Committed.
Gas and Water Orders Confirmation Bill [H.L.].—Committed. The Committee to be proposed by the Committee of Selection in regard to the Sevenoaks Water Order and the Stourbridge Water Order.
Tramways Orders Confirmation (No. 2) Bill [H.L.].—Committed. The Committee to be proposed by the Committee of Selection in regard to the Potteries and North Staffordshire (Amendment) Order.
Pier and Harbour Provisional Orders (No. 1) Bill [H.L.].—Committed. The Committee to be proposed by the Committee of Selection in regard to the Bridgwater Port and Navigation Order and the Llandudno Pier Order.
Pier and Harbour Provisional Orders (No. 2) Bill [H.L.].—Committed.

RETURNS, REPORTS, ETC.

  LIGHT RAILWAYS ACT, 1896.
  I.—Orders made by the Light Railway Commissioners, and modified and confirmed by the Board of Trade.—London United Tramways Light Railways (Extension of Time) Order, 1908; Amending the London United Tramways (Light Railway Extensions) Order, 1904. Clacton-on-Sea and St. Osyth Light Railway (Extension of Time) Order, 1908; Reviving the powers granted, and extending the periods limited, by the Clacton-on-Sea and St. Osyth Light Railway Order 1904, for the compulsory purchase of lands and for the completion of the railway and works by that Order authorised, and for other purposes.
  II.—Orders made by the Light Railway Commissioners, and confirmed by the Board of Trade.—Wolverhampton and Cannock Chase Railway (Light Railway) Amendment Order, 1908; Amending the Wolverhampton and Cannock Chase Railway Act, 1901, and the Wolverhampton and Cannock Chase Railway (Light Railway) Order, 1907, in reference to the fund deposited in respect of the application for the Act of 1901, and otherwise. Campbeltown and Machrihanish Light Railway (Amendment) Order, 1908; Amending the Campbeltown and Machrihanish Light Railway Order, 1905, by increasing borrowing powers, and for other purposes.

  MINES AND QUARRIES (GENERAL REPORT AND STATISTICS, FOR 1907: PART I. DISTRICT STATISTICS).
  Statistics of the persons employed, 'output, and accidents at mines and quarries in the United Kingdom, arranged according to the inspection districts.

  EVICTIONS (IRELAND).
  Return of evictions in Ireland for the quarter ended 31st March, 1908.
  Presented (by command) and ordered to lie on the Table.

  COMMONS ACT, 1876 (TOWYN TREWAN COMMON, ANGLESEY).
  Report by the Board of Agriculture and Fisheries upon an application for

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  a provisional order for the regulation of Towyn Trewan Common, in the parishes of Llanfihangel-yn-nhowyn, Llechylched, and Llanfaelog, in the county of Anglesey; laid before the House (pursuant to Act), and ordered to lie on the Table.

  PORT OF LONDON BILL.
  The Lords following were named of the Committee to join with a Committee of the House of Commons to consider the said Bill, viz.:—

  V. Milner.

  L. Leith of Fyvie.

  L. Clinton.

  L. Ritchie of Dundee.

  L. Hamilton of Dalzell.

  Ordered, That such Committee have power to agree with the Committee of the House of Commons in the appointment of a Chairman.
  Then a Message was ordered to be sent to the House of Commons in answer to their Message of the 14th instant, to inform them of the appointment of the said Committee by this House, and to propose that the Joint Committee do meet in Committee Room A on Wednesday next, at Three o'clock.

PREFERENTIAL TRADE.
Order of the Day read for resuming the adjourned debate on the Motion of the Duke of Marlborough, that an humble Address be presented to His Majesty praying for Papers relating to the recent changes which have been made in the tariffs of the self-governing Colonies for promoting their economic development and the extension of their trade relations with the United Kingdom and foreign countries.
LORD AVEBURY: My Lords, the noble Viscount on the cross benches who concluded the debate last evening, and who is always listened to with interest in any meeting of his countrymen, referred to the negotations that took place between Canada and France and pointed out that Canada was practically forced to make this agreement. What he meant to say, I suppose, was that the arguments in favour of that course were so strong that the Canadian Ministers felt they could not
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resist them in the interests of Canada. Whether we had given a preference or not would have made no difference in that argument. But where should we have been if we had granted preference? We should have entirely altered our fiscal policy, and yet the preference for which we did so alter it would have been taken away from us. I could not quite gather what the opinion of the noble Viscount was as to the effect of duties. When he was discussing the duties imposed by foreign countries he told us that no doubt foreign countries were very glad of a system under which they "taxed our imports as much as they pleased and we never retaliated," and I thought, when I heard those words, that the noble Viscount was against duties; but when he came to consider the case of the Colonies he adopted quite a different tone. He told us that our exports to Canada were not interfered with by the duties, and that in consequence of the protection they were larger than they otherwise would be. The noble Viscount said—
"If a free trade or less protected Canada is good for seventy or ninety million dollars worth of imports, a highly-protected Canada would be good for 300 million dollars."
VISCOUNT MILNER: I stated, as a matter of fact, that highly-protected Canada had between $200,000,000 and $300,000,000 of imports, as against $70,000,000 to $90,000,000 under a less protective system.
LORD AVEBURY: But does the noble Lord attribute the increase to the duties? At any rate, it shows I think, some difference of opinion as to the effect of import duties when imposed by the Colonies, and by foreign countries. I confess I read with surprise the Resolution which the noble Duke has placed upon the Paper. He states that the changes in the tariffs of the Colonies have been made with the intention—
"Of promoting their economic development and the extension of their trade relations with the United Kingdom and foreign countries."
and of—
"Increasing the productive power of the Mother Country and the Empire as a whole by the arrangement of reciprocal preferences."
In the first place, as regards foreign countries, surely the whole tendency of

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the preference given by our self-governing Colonies has been, not to foster, but to check trade with foreign countries. So far as we are concerned they have given us a preference, for which we are grateful. I am as anxious as any one to promote commerce with our Colonies. But do the Colonial Governments, do our tariff reformers, really wish to increase British imports? That is another question. I could not occupy the time of the House by going through even the principal Colonies. I will take two—Canada and Australia. As regards Canada, Mr. Fielding, the Minister of Finance, at the Conference of 1902, said—
"If we are asked to reduce our duties and bring in British goods and displace Canadian manufactures, we must frankly say that it is not possible for us to do so. But we may say that it is quite possible to give an advantage to British goods in some cases by raising the tariff."
And Sir W. Lyne since returning to Australia spoke even more strongly. Referring to the new tariff (if we may trust the report) in a speech reported in the Sydney Daily Telegraph, he said—
"This is not going to be any milk-and-water tariff. It is going through the Federal Parliament unaltered, except in a few isolated cases; and we will fight it to the bitter end. If I can make it prohibitive, I shall be glad. Importers are parasites on the trade of the Commonwealth."
This is to say, the Australian Finance Minister would, if he could, abolish imports altogether. Merchants are "parasites" whom he would like to suppress. Mr. Fielding would not go so far. He prefers English imports to foreign imports, but opposes any reduction of duties, which might increase imports and develop commerce. The object they both have in view is to discourage commerce, but especially that with foreign countries. In fact, protection of native industry means the discouragement of imports and of commerce. That is apparently the object, it is certainly the tendency, of the recent changes—to exclude foreign goods altogether and only admit British, as a witty Australian free trader said—
"On payment of a duty which would keep them out."
Do the Colonies wish, or do they not wish, to promote commerce with the Mother Country? With one hand they
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give us a preference, and we are grateful; but with the other they impose duties expressly to keep out our goods. The duties are not for revenue, for if that were the object they might be counterbalanced, as ours are, by Excise duties and would then be much more remunerative. They are, indeed, frankly intended to check the imports from the Mother Country. In this unfortunate tendency to exclude our manufactures they have been greatly encouraged by the action of so-called fiscal reformers here, whose policy is radically retrograde and who wish to carry us back to the terrible times of the hungry forties. What is the position of the Colonies? Surely their wisest policy would be to develop their splendid agricultural resources, and by taking our products enable us to purchase more of theirs. They would get cheap manufactures from us, and we should receive cheap food and raw materials from them—to the great benefit of both.
Consider the case of Australia. Their policy compels their farmers to pay 20 or 30 per cent. more than they need for their agricultural implements, their clothes—in fact, for almost everything they need except food; it checks the development of their railways by raising unnecessarily the price of iron rails; and, as far as they can, they close our markets against their own produce, for as they diminish our exports they diminish our demand for their wool and wheat. They injure themselves, for their duties drive us to other markets. If they admitted our products more freely we could take more of theirs. All these high duties check commerce, and drive trade into unnatural and less profitable directions. The noble Duke is under the impression that the modifications recently proposed in the Australian tariff will promote trade relations with the United Kingdom. I am not sure whether those changes have been actually passed, but I fear they would have the very opposite effect. At any rate, such is the opinion of those engaged in the Australian trade. At a large meeting held in the London Chamber of Commerce the following resolution was adopted—
"That this meeting of the Australian Section and other members of the London Chamber

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of Commerce protests against the imposition of further duties on British goods entering the Commonwealth, which, in spite of the financial support accorded to Australian industries by merchants and investors here, will seriously harm the manufacturing industries of the United Kingdom."
The Chamber of Commerce applied to leading Australian firms, and I hold in my hands their replies. For woollens and clothing, the answer is that the result will—
"Seriously damage British manufacturers and curtail trade. Orders sent under the old tariff have been cancelled."
For mining machinery, they say that—
"The new tariff is almost, if not quite, of a prohibitive nature."
For furniture, that it has—
"Killed our Australian trade."
And for motor vehicles, that it will—
"Cause great injury to automobilism in Australia."
I must not, however, take up the time of the House by giving further extracts, which are more or less strongly to the same effect. Commerce is, after all, only exchange, and Colonial statesmen, as well as some here, do not seem to realise that if you stop imports, you check exports. As Mr. Chamberlain himself very well said at the Colonial Conference of 1902—
"Now, what is the present position? I believe it is true of Canada—it is true, I believe of every Colony—we take already by far the largest proportion of Colonial exports, but there is not the least doubt that we might double or treble the amount that we take, but we cannot do so until we have the reciprocal advantage, and until you take in exchange a larger proportion of our goods, and so enable us to pay for the imports which we should receive from you."
We all wish to encourage commerce with the Colonies, but has the noble Duke considered how preferences could be given to the Colonies? Our imports from them are either food or raw materials. We understand that tariff reformers do not propose to tax raw materials. Do they really expect to persuade our countrymen to tax food? There are some, no doubt, who oppose the taxation on food or raw materials, but see no objection to the taxation of manufactures. They say that we import many millions—some £150,000,000
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—why not tax them? But what are manufactured articles? The Board of Trade include under that head pig iron, copper, lead, leather, indigo, quinine, and many other things which are really raw materials. Indeed, if we except, perhaps, works of art, the manufactured articles of one trade are the raw materials of some other. Moreover, if we look at any highly protected country, we find that if the policy profits any persons at all—and in the long run I doubt it—still those who gain are but 5 per cent., and those who suffer are 95 per cent. Mr. Atkinson, the great American economist, calculated that the result of the United States duties on iron and steel was that, in the ten years 1880–1890, the railway companies, the iron founders, machinists, and other consumers of steel in the United States paid for iron in excess of the prices paid by their competitors in Europe, a sum "greater than the capital value of all the iron and steel works, furnaces, and rolling mills existing in 1890 in the whole country. This sum stands for the cost of protection to iron and steel for ten years of largest consumption to that date."
And how could we benefit the Colonies by giving them a preference? The main export of Australia is wool. No preference on wool would benefit Australia, for the simple reason that we cannot consume all the wool that she produces. How about Canada? Here it is a question of wheat, but by the time the Canadian wheat is ready for exportation the Canadian ports are shut by the ice, and it comes to us in bond through the United States. It is practically impossible, therefore, even if we would, to give Canada a preference on wheat. We tried the system of Colonial preferences for years, and it broke down utterly. It was carefully inquired into and condemned by the House of Commons Committee, and one reason for abandoning it was that it gave rise to so much evasion. Cargoes of coffee were sent, not only from Brazil, but even out of bond, from England, to the Cape of Good Hope, whence the coffee was re-exported to England and admitted under the preferential rate of duty. Similarly cargoes of timber were sent from the Baltic to Halifax, and thence re-shipped

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to England as Colonial timber, the difference of duty making the transaction a very profitable one for the timber exporter. It has recently been stated in Australia that the preference has been a "gift" to us of £1,500,000 because we should have paid that much more in duties if our goods had come in under the foreign tariff. But does this follow? Who saved the £1,500,000? Free traders maintain that the Australian consumers would have paid £1,500,000 more, and that they consequently were the gainers.
This raises the whole question of who pays the duties. Do they fall on the producer or on the consumer? Free traders maintain that the consumer pays them. For instance, the price of wheat in Berlin is higher than in London by the amount of the German duty. But if the consumer pays the duty, it is surely evident that the Colonial policy has not promoted their economic development. On the contrary, it had the very opposite effect. It has diverted capital and labour from the healthiest and most profitable occupations. They have millions of acres of uncultivated land waiting to be developed, enough to occupy their whole population in the most profitable and advantageous manner, and yet they devise a system which tempts their people from the land, and crowds them into the cities on less remunerative occupations. I say less remunerative, because if these occupations were not less remunerative they would not require to be bolstered up by protective duties. I could understand a country making some sacrifice to discourage their people from living in the slums of great cities and carry them out into the country. Of course, the Colonies must determine their own policy; we have no right to complain, and do not complain of their high duties; but it fills me with astonishment that they should think it desirable to promote life in the slums and raise the price of necessaries, in order to discourage people from benefiting by the healthy life and fresh air of the country.
Will the advocates of preference to the Colonies condescend to give us a little information as to what articles they intend to give a preference on? We hear many vague professions in
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support of preferential trade with the Colonies, but I wish we had more precise information as to how this is to be effected. Then we could deal with the question more satisfactorily. The preference which most of our Colonies have given us is a boon, and we are grateful for it. We believe, moreover, that it will benefit them as much as us; but that the tendency of their fiscal legislation on the whole is to check, not to benefit, commerce. To some extent we, no doubt, shall suffer, but they themselves will do so even more. Some of our statesmen are alarmed for the future of British commerce. With the present tendency to protection, what, they say, is to become of us in the future? They need, I think, have no fear. No doubt, when we consider the very high duties imposed by various countries on our goods—duties imposed not for revenue, but to keep out our products, or, as it is euphemistically called, to "protect native industries"—it seems at first wonderful that we can do business with them at all. The explanation, no doubt, partly is that, firstly, manufacturers in these countries take advantage of their own countrymen, raise prices to the extent of the duties, and put the money into their own pockets at the expense of the community. This enables our manufacturers to pay the duties and yet compete with them. And, secondly, no country produces all that it requires. It is impossible to protect manufactures which do not exist. These considerations seem to me to relieve us from the apprehension felt by some of our statesmen, that if foreign countries and our own Colonies become more and more protectionist they will thus more and more restrict our commerce.
We should, however, have the advantage of cheap raw materials, and whatever any other country required, if they could not produce it and we could, they would find it to their advantage to purchase of us, rather than from any protectionist country. In fact, protectionist countries would surrender, as I have shown that they have already to a great extent surrendered to us, the neutral markets, so far as we can supply them and they cannot supply themselves. We need, then, have no fear for our

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commerce in the future so long as we maintain our free trade policy. Our trade is not, as is sometimes supposed, at the mercy of other countries; they may injure their own countrymen, they may to some extent diminish the commerce of the world, and ours as part of it, but they will restrict and injure their own most. If all the rest of the world became protectionist we should still be wise to remain free traders. Our trade is increasing more rapidly than that of any other country in the world. The late Lord Goschen, in his last speech in this House, expressed a hope that we should not "gamble" with the food of our people. I hope that neither your Lordships' House nor the House of Commons will ever gamble with our commerce on which the supplies of the food of the people mainly depend.
VISCOUNT ST. ALDWYN: My Lords, we have just listened to the speech of a thorough-going free trader, and last night we had a very eloquent speech from the noble Viscount on the cross benches as a thorough-going advocate of preference. I have need of your Lordships' indulgence, because I confess I feel myself unable to agree with the thorough-going partisans on either side The negative policy of the Government is not one of which I can approve. I have the strongest desire, for political rather than commercial reasons, that something should be done towards increasing and improving the commercial relations between the Mother Country and the Colonies, and to obtain that result I should not shrink from departing from the strict theory of free trade if I were satisfied that the departure would stop there. On the other hand, I by no means feel the confidence which the noble Duke and the noble Viscount who spoke last night appear to feel in the policy of Colonial preference. I think it is true, as Lord Cromer said last night that the grant of preference by the United Kingdom to the Colonies has been tried in the past without satisfactory results. There seem to me practical difficulties of the gravest kind in the way of the adoption of that policy now. I trust that those who are unable to advocate the granting of preference to the Colonies will not be charged with neglecting the interests of
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this country or with lacking in desire to bind the Empire together, for I feel that desire as strongly as any one can.
I certainly do not, however wish to carp at any of the steps which the self-governing Colonies have taken to alter their tariffs in order, as they believe, to make a change which would be to the advantage of this country. Changes have been made, as the noble Duke reminded us yesterday, by Canada, by South Africa, and to some extent by New Zealand and Australia. The results of the changes may, I think, be fairly summed up:—In South Africa they have been very small, owing to the great depression which has prevailed there for some time; in New Zealand and in Australia they have not been large because the advantage given to this country has in itself been small. But they should, I think, be received with gratitude as evidences of good will towards the Mother Country, and I hope also as some recognition of the great burden which the Mother Country bears in regard to Imperial defence, and also of the free and open market which the Mother Country gives to the produce of all her Colonies.
The case of Canada is, however, different. The changes made in her tariff in recent years have increased the trade between Canada and this country. How has that been done? The noble Duke said it is due to preference given to us. I should put it another way, and say that it is because Canada has lowered her duties on British goods. That is what has really caused this increase in trade. It is not a mere grant of preference. You may give preference to a country without lowering your duties on her goods. You may do it by increasing the duties on the goods of other countries, and I very much doubt whether the effect of such preference would be nearly commensurate with the effect which the lowering of duties has had on the trade between Canada and the Mother Country.
The noble Duke, I think, represented, as one of his principal reasons for bringing forward this subject, that since the Imperial Conference last year, and, of course, long since the grant of this preference by Canada to the Mother

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Country, there have been negotiations between Canada and France by which the preference given to us has been lowered in value to, in some cases, as low as 2½ per cent. The noble Duke seemed to conclude from that that all the benefit of the previous changes in the Canadian tariff would be lost to us. That is not my view. The concessions to France no doubt put us on a worse footing than before in our competition with France; but if there is any value whatever in our system of free imports, the effect must be that, given a fair field and no favour, we can beat France in the Canadian market on equal terms, except, perhaps, in such articles as silk and lace. The aptitude of the French people for manufacturing lace and silk goods may prevent us from beating them in regard to those articles; but take the articles which this country is best able to produce, and I maintain we can beat any other country on equal terms in any foreign or Colonial market.
That brings me to a point which I am very anxious to put before your Lordships, and that is the action of His Majesty's Government at the Imperial Conference. Those who have studied, as I have studied, the debates of the Colonial Conference of 1902, will remember that more than one of those who took part in that Conference seemed to be rather impressed with the idea that general preference might not be the best means of promoting trade between the Mother Country and the Colonies, because preference is no good when it relates to articles which neither country can send to the other, and that it might be better, in the case of Canada, for example, if a certain list of articles which we can and do send to Canada could be taken, and that the Canadian tariff on those articles should be lowered, of course to other countries as well as to ourselves. I should like to know why His Majesty's Government could not have taken up that idea and urged it on the representatives of the self-governing Colonies at the last Conference. It is obviously consistent with free trade. There is no question about that. I should not have ventured to criticise them for not assenting to the principle of preference, because they
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were bound by their own pledges and by the verdict of the country at the last general election. But if they had endeavoured to negotiate with, say, the Canadian representatives, on a basis of that kind, this country giving in return perhaps a subsidy for a fast line of Imperial steamships to and from Canada—which subsidy, to my mind, would have been much more justifiable in the interest of the Empire than the subsidy we gave to the Cunard Company in 1903—they might from their own point of view have made some little progress in establishing better commercial relations with the Colonies.
When the noble Earl the Secretary of State for the Colonies speaks presently I hope he will tell us why it was impossible to have adopted some attitude of that kind. I quite agree that it would not have been the particuler mode of action which the Colonial representatives at the Conference desired; but it would at least have shown that His Majesty's Government were anxious to promote the same object as they were. Anyone who reads the reports of the debates at the last Conference and compares the speeches with the speeches at the Conference in 1902 will see how enormously the desire of the self-governing Colonies for an arrangement with this country upon the basis of mutual preference has increased in the Colonies. It has increased to a point at which I do not think it can be met by a purely negative policy on the part of His Majesty's Government.
The self-governing Colonies have never suggested to this country that either we or they should impose any duties merely for the sake of preference which we or they did not want in our tariffs. They always say—"We are each of us free to impose duties or not in our own tariffs, but if you do impose duties, give us a preference, and we will give you a preference." At the last Conference a good deal was said by the Colonial representatives as to the possibility of a preferential arrangement by this country with the Colonies on the basis of our existing tariff. Of course, that would have meant that we should have given preference on alcohol, tobacco, coffee, cocoa, dried fruits, sugar, and tea. I think that

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such an arrangement might have been of some service to the Cape, Australia, and the West Indies; but it would not have been of any great service. The parts of the Empire which would have obtained most of the advantage from it would have been India and Ceylon, who have never asked for a preference of the kind, and who between them would have absorbed practically the whole of our tea duty. Of course, Canada would not have benefited at all.
Therefore, I do not think it would have been possible for any Government to have consented, as I think the noble Viscount on the cross benches suggested yesterday, to the principle of Colonial preference simply with regard to our existing duties. The crux of the whole question is, of course, whether this country is prepared to impose duties on corn, on meat, and on dairy produce. That, I think, is the point raised by my noble friend, and, indeed, by the noble Viscount on the cross benches. That idea was opposed at the Conference by the representatives of His Majesty's Government, and I do not think I am going too far when I say that their objection to any duty of that kind was the main strength of their objection to the grant of any Colonial preference by this country.
So far as the verdict of the electors at the last general election went, I think they were right. But the desire for better trade relations between Great Britain and her Colonies through a preference given by this country, has not only grown in the self-governing Colonies themselves, but it has grown in the United Kingdom as well. I think anybody who watches the political barometer, who sees the results of the elections that have taken place within the last year or two, must see that there is a movement in this country in that direction which no wise Government can neglect. You may think it contrary to the theory of free trade. Do not sacrifice a great good to the Empire merely on the ground of theory.
Let me examine for a moment what might be the effect here of duties of this kind. I do it, perhaps, from a somewhat independent point of
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view, because I was responsible for a small duty on corn myself. I think there are a good many people in this country whose minds have been tending in the direction of the possible imposition of such duties, or, at any rate, who are less opposed to them than they were two or three years ago, on account of the financial policy which His Majesty's present Government are pursuing. What is that policy? We have it before us now in all its nakedness. It is the increase of the burdens of the country, to an indefinite extent in the future, largely, no doubt, for what is called the social improvement of the people, and at the same time the repeal of indirect taxation. What is the ultimate object? I believe the ultimate object, if not of the Members of His Majesty's Government, at any rate, of the great party behind them, is that this increase of expenditure shall be borne by the payers of direct taxation, mainly by retaining the income-tax at a limit excessive and dangerous in time of peace; while, on the other hand, those who do not consume alcohol or tobacco and do not pay direct taxation shall be relieved altogether of the burden of the maintenance and defence of the Empire, and of these plans for social improvement which His Majesty's Government have in their minds.
I say that that is unsound finance. I say that it is not a fair distribution of the burden of expenditure among the people of this country. I believe that the minds of many, not only in the upper or middle classes in this country, are arriving at the same conclusion, and that there is a desire to add to the number of articles in our tariff merely for the reasons which I have stated. I believe the repugnance which undoubtedly existed to duties on corn, meat, and dairy produce has diminished. I think it may be said for these duties that they would produce a good deal in proportion to the amount of interference they would cause to trade. I do not deny that the imposition of duties of this kind, which could only be small—nobody has ever suggested that they should be anything but small—would have some effect on the price of the articles on which they are imposed. Mr. Chamberlain has never denied it, and nobody could deny it

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with reason. I have always admitted that my corn duty had this effect, that it tended to increase the price of the article when prices were rising and it tended to prevent the price from falling when prices were falling. Nobody has ever attempted to prove that the imposition of a small duty would have any greater effect. If that is all the effect it has, I must say that I do not think such duties would impose an undue contribution on the mass of the people towards the great and growing expenditure of this country.
Then comes the question of the practical working of the system of Colonial preference if it were brought about by the imposition of these duties, and, I am bound to say, this appears to me to be beset by difficulties of the greatest importance, one of which I will venture to place before your Lordships. Suppose we had made a bargain with Canada—that, I think, is the best case to take—that we would impose a duty on corn, meat, and dairy produce from foreign countries, and leave such articles coming from Canada free. The effect of that, if it was effective, would be to transfer the supply of these articles which now comes to us from foreign countries to Canada, and of course to any other colony which had the same advantage. That is a result which, so long as we get the articles cheaply, I do not know that anybody need quarrel with.
But, to whatever extent it did transfer that supply, you would lose the revenue upon the article. That is quite clear. If the time arrives, as, looking to the enormous area and possibilities of our great Colonies, it may arrive, when the Empire is self-supplying in regard to these articles, then all the revenue from the duty would be gone. There would be this additional effect, I think, that the burden would be gone also. For instance, there is a protective duty on com in France, but in a year when there is a good harvest and France is self-supplying that duty has comparatively little effect on the price as compared with the effect in a year when there is a bad harvest and France cannot supply herself. In the same way nobody would contend for a moment that if we imposed a small duty on coal imported into this country it would have
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the least effect on the domestic price of our coal, for the simple reason that we produce much more coal than we can consume and we do not obtain any supply of it from abroad. Therefore, although you would lose your revenue, the effect of the duty in raising the price would also, in my judgment, disappear.
But there would be another result. Supposing the United States were deprived of the market for her corn in this country, what would she do? Surely if she saw it going she would corns to us and say, "We do not like this at all. We are ready to make an arrangement with you. We will lower our tariff on some of your manufactured articles, which it is of great importance to you to send to us, if you will place us on the same footing as Canada with regard to the duty on corn."
What should we say? That is precisely the position which has occurred between this country and Canada and Canada and France. The difficulty at once arises, and it would be very much worse in our case because the trade between the United States and this country is very much more important in proportion than the trade between Canada and France, that, if we were bound to Canada not to alter the new duties that had been imposed for a certain number of years, we could only say to the United States, "We are very sorry, but we cannot relieve you from this duty." I know it is a very inconvenient thing sometimes to be bound not to impose a duty, but it may be very much worse than inconvenient to bind yourself not to take off a duty. We should, of course, be unable to obtain from the United States that which might be of the most urgent and utmost importance to the great manufacturing industries of this country.
Supposing the request was renewed when the term of our arrangement with Canada expired, what answer should we give then? If we had accepted the principle of preference because Canada is part of the Empire, and in order to obtain greater advantages in Canadian trade, we should have to depart from that principle at the risk of losing the trade advantages we had obtained from Canada in order to obtain the greater advantages which

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the reduction of the United States tariff might give us, and if we refused to make an arrangement with the United States, which might, as I have said, be of the utmost importance to our great industries, it would be said by everybody that we refused to do this in order to keep up the price of food. That seems to me to be a practical difficulty and one of very great importance. I do not wish, as I hope I have shown, to deal with this subject in any exaggerated spirit on either side. I am merely anxious to put before your Lordships the views upon it which occur to me from the standpoint of its practical working.
I feel that there are two principles in this matter which are hardly compatible. You want on the one side—and that is the great wish of my noble friend who leads the Opposition and of Mr. Balfour—to be in a position to bargain with foreign countries for reductions in their tariffs to your advantage. In this policy your principle is that you will treat other countries, including your Colonies, as they treat you. But then you want to depart from that principle by treating the Colonies better than other countries because they are part of the Empire. I am bound to say I am quite unable to see how you can work those two principles together. You may proceed on one or the other, but how you can practically combine the two I have never been able to understand. And I think what has happened in the case of Canada and Prance gives us some little inkling of the practical difficulty of that case.
Let me take another supposition, and it is one which certainly ought not to be neglected. I have been arguing upon the supposition that the preference would be really effective, and that a small duty on corn, meat, and dairy produce would really transfer our oversea supply of those articles, to a large extent at any rate, from foreign countries to our Colonies. Let me take the opposite supposition. These duties are to be small—that is an essential part of the case. Will small duties have that effect at all? Preference is a very easy thing to make effective when you give it on a high protective tariff. Preference on
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small duties is a very different thing. I remember when I proposed a duty on flour that it was supposed by some people that the competition of the United States millers with the English millers would be practically prevented. Nothing of the sort happened. Railway rates and steamship rates were lowered, and the American millers competed with our millers through that lowering of the rates in spite of the duty. And if all that you impose upon corn is a 2s. duty, and you have to deal with the able persons who regulate the railway and steamship traffic between Canada and the United States and England, I should not be at all surprised if certain arrangements were made by which that 2s. duty was made practically innocuous to the United States. Now, if that be so, what happens? At once Canada says, "What is the use of your 2s. duty? It has not done us any good at all. You have accepted the principle. You must increase the duty so as to make it effective." Well, what are we to say in answer to that? Are we to raise the duty? If so, surely there is a risk that we may be compelled to raise it to a point at which it would very considerably affect the price of the articles upon which it was imposed. If you decline to make effective the principle you have adopted you give a grievance to Canada which you cannot deny is a very real grievance indeed.
There is a real danger in this matter which ought never to be forgotten. The effect of a duty in this country is certain to be exaggerated by its opponents. Now a little incident happened last winter of which I may remind your Lordships, and that was an election in Devonshire. What happened there? The price of corn and consequently of bread had increased through the winter owing to deficient harvests—demand being greater than the supply—and to purely natural causes. These electors of Devonshire were disappointed because they had been told that His Majesty's present advisers would secure them cheap food. They promptly voted against the Government candidate, mainly because food had become dearer—although I am bound to say that no fair-minded and intelligent person would say that any action or inaction on the part of His Majesty's

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present Government had been the cause of the increase in the price of corn and bread last winter. But that was the result. Now if my noble friend had in the year 1905 been able to induce Parliament to impose a duty of 2s. a quarter on corn, and precisely the same thing had happened in the winter of 1907 as did happen, why, we should have had every speaker of the great Liberal Party throughout the country denouncing the Government of my noble friend for having by the imposition of a 2s. duty on corn raised the price of corn by 7s., 8s., or 10s. We know enough of electioneering in this country to know how those things are done. I cannot help thinking—though that would have been a painful subject—of the effect that might have had upon the position of the Government of my noble friend if the people of this country were being told that this duty had raised the price of corn 7s. or 8s. more a quarter, and that it was intolerable that this sort of thing should be allowed to continue for the benefit of Colonial farmers at the cost of the English working man. Now, would that have tended to improve the feelings of kindliness and goodwill in this country towards our Colonial brethen? These are two of the practical difficulties which I own that I see in the working of this policy.
But there is this to be said, and I feel it very strongly. As I have already stated, I think that the feeling of the country is tending in the direction of its adoption. I think that it is far from impossible that the next general election—which cannot be deferred beyond a certain time—may place a Government in office which will be prepared to recommend the adoption by this country of the grant of preference to our Colonies. Very well, they will have to face what a good many of those who favour us very often with eloquent and glowing perorations upon the unity of the Empire and the loyalty of our Colonies often forget. Any Government which takes this question up will have undoubtedly to face difficulties such as those which I have suggested, and others of the same kind.
If the next Government and House of Commons should adopt this
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policy, I hope that the representatives of this country at any conference which is called to deal with the subject will approach it, not merely with a strong feeling of sentiment which I am sure will be shared by the representatives of the Colonies, but also from the point of view of men of business. It will be so approached by the Colonial representatives. It always has been, and I think in nothing have they shown their wisdom more than in this, that although the most detailed statements have been put forward in this country by persons of high authority as to the precise way in which we should give preference to Colonial products, yet no Colonial Statesman, so far as I know, has ever reciprocated by telling us exactly what he would recommend his Colony to give if we gave the kind of preference which has been suggested here. They are perfectly right; they are wise in their generation. These things ought to be left until you come to discuss them together as such things must be discussed—as a matter of business. And if they are discussed as a matter of business, I venture to say that I do sincerely hope that no Government that accepts this policy here will ever be satisfied merely by the Colonies raising their tariffs against foreign countries without lowering them to this country. We may give something to the Colonies if they give to us something of real value; but it will be of no real value to us—nothing that can be given by the Colonies—unless their high tariffs are lowered, so that we might compete in their markets—I do not say necessarily on the same basis as that of goods manufactured in the Colonies themselves, but I do say on a basis which would admit of a great extension of exports from the Mother Country to the Colonies.
One thing more. I think all of us would agree that if there is to be a change in the policy of this country in this matter it ought to be made so that it should last. It ought only to be made, therefore, as the result of a strong sentiment and a deep and real conviction on the part of the great majority of the people of this country. That a mere fleeting party majority, returned perhaps upon

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grounds quite of another nature than the subject we are discussing tonight, should make such a change, and within a very short time the next House of Commons should come determined to reverse it at the earliest opportunity, would not be, in my opinion, an act of statesmanship; it would be an act almost of treason to the maintenance of those ties of affection and goodwill between the Mother Country and the Colonies which all of us desire to promote.
LORD GLANTAWE: My Lords, we have had the pleasure of listening to-day to a very effective speech from a free trader of very many years standing, and the speech delivered by the noble Viscount who has just sat down is, perhaps, the most interesting contribution to the fiscal controversy that we have heard. A tax on corn means a tax on the food of the people. Put it in any way you like, it comes to that, and that is a very dangerous element to introduce. I have carefully read the discussions which took place at the Colonial Conference of 1902 and also at the Conference of last year, and, although it is evident from them that there is a strong desire on the part both of the Mother Country and of the Colonies that some kind of preference should be given, the question of defining that preference is a most difficult one. Whatever is done, it will naturally affect the price of food, and consequently make the cost of living in this country greater.
Canada undoubtedly has very great resources, but the quantity of corn imported into this country from Canada is remarkably small as compared with that imported from other countries, and it would not by any means be sufficient to supply our needs; while Canadians are determined not to be tempted by any preference to neglect the development of their own mineral resources. And in order to develop those resources Canada, with all her profession of respect for the Mother Country and desire to place this country in a better position to trade with her, does not conceal the fact that it would be necessary to place a protective duty even as against the Mother Country upon the same basis as other countries.
Many of the manufactured articles that we import are also the raw materials
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of industry; and though "dumping" into this country may possibly have injured particular trades, it has, I think, been beneficial to us on the whole. That it has been beneficial has been proved over and over again in our shipping industries. We have been able to buy material for the construction of our ships at a very moderate price; and when there is a tendency on the part of particular manufacturers here to advance prices abnormally we get relief by the free import of goods from Germany or America. The prosperity of the United States and of Germany is often referred to. But those who have carefully watched the progress of these, the two most protective countries in the world, will have found that during the last twelve or eighteen months the distress among the working classes of the United States and Germany has been very much greater than among the working classes here. There are certain manufacturers in the United States who during the last twelve months have not occupied their machinery to more than 25 per cent. With all their protection, they have been reduced to producing only about one-fourth of their capacity. Yet nearly the whole of the manufacturers in this country have been working on full time.
What is the reason for that? The chief reason is that we buy in the cheapest market. We impose no tariff upon anything that we receive. Our working men get their food and all other necessaries much cheaper than in protected countries. Consequently we hold to-day the position we have held for the last century as the leading manufacturers of the world; and I have no doubt that if we continue our present policy we shall still hold that proud position. I look with great apprehension to any duty being placed upon corn. The noble Viscount who spoke last was instrumental in placing a duty upon coal. I shall not occupy your Lordships' time by going into that matter, but those who are interested in the coal trade know how prejudicial that duty was to this country. I am convinced that the prosperity of this country depends upon the maintenance of the policy which has been followed during the last half century.

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In his Motion the noble Duke lays stress upon the recent changes which have been made in the tariffs of the self-governing Colonies having promoted economic development and the extension of their trade relations with the United Kingdom and foreign countries. It is questionable whether that development will be altogether to our advantage. Certainly it will not be so at first, and if the Colonies carry out their present purpose we may find the same inconvenience to our trade as we did in the case of the United States when the McKinley Tariff was put on. There is no doubt, in my opinion, that free trade is the best and most advantageous policy for this country, and I trust that by never receding from it we shall retain our present proud position of being the leading manufacturing nation of the world.
LORD CURZON OF KEDLESTON: My Lords, I was prevented by another engagement from being present in your Lordships' House yesterday, and I had not intended to take any part in this debate; but, reading the report of the discussion, I observed that so many references were made to the position of the Government of India during the time that I was Viceroy, and attention has been so pointedly drawn to the despatch of the Government of India of 22nd October, 1903, for which I was in the main responsible, that I feel in duty bound to invite your Lordships' consideration to a few observations on the subject.
The noble Viscount, Lord Milner, whom I am sorry not to see in his place, was not justified last night in remarking that Sir Edward Law, the Finance Minister of the Government of India in my time, took a different view of the fiscal question and the position of the Government of India from the remainder of his colleagues. I remember very well the discussions which resulted in that despatch, and the conclusions were unanimous. On refering to my papers this morning I find that the despatch itself had the great advantage of being revised and corrected and much improved by the hand of Sir Edward Law himself, and in the introduction which he has just contributed to the excellent book by Mr. Webb I find
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that he concludes by citing with complete agreement the concluding passages in the despatch to which I have referred.
What was our position in India in writing that despatch? We had no objection in principle to a system of preferential tariffs; but after making the most careful examination of the trade of India, both with Great Britain and with foreign countries, we came to the conclusion, in which Sir Edward Law himself concurred, that India had not very much to gain, though she might possibly have something to gain, by such arrangement; but that, whatever she might gain, there were certain risks extending over the larger field of finance which it was conceivable she might incur, and which it was desirable in every interest that she should avoid. We were not averse at all from fiscal retaliation in defence of Indian interests. That, I think, is clear from the concluding paragraph of the despatch, and still more clear from the action taken by the Government of India during the time when I was connected with it.
Your Lordships may remember that in 1899 we did put by legislation in India, with the consent of the Secretary of State here, a countervailing duty on sugar in order to check the great imports into India of foreign sugar encouraged by foreign bounties. Then, again, a little later on I remember a case when the Russian Government suddenly enhanced the already exorbitant duty it was imposing on Indian tea. We at once retaliated by proposing to His Majesty's Government that we should place a differential duty on Russian petroleum. These two cases are symptomatic of the view taken by the Government of India at that time upon the policy of retaliation as a weapon of fiscal action. We desired in writing that despatch to retain the free hand which we enjoyed under the existing system, and we were very much afraid that in any change we might be called upon to forfeit that advantage, by having to accord equal treatment to the imports of foreign countries.
I think that in speaking just now of Sir Edward Law, I should qualify what I said by observing that he was not so strongly convinced as the remainder of us about the power of retaliation enjoyed

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by foreign countries, or as to the degree to which they would exercise it in the event of any change; but we were all absolutely agreed as to the supreme importance of the necessity of maintaining the balance of trade in favour of India, and still more of maintaining the stability of our rupee currency, which had so recently been established on a firm basis.
May I confess that our real apprehensions, when drawing up the despatch, about the fiscal future of India, were not so much economic as political? We said to ourselves, "What guarantee should we have, if any new system were proposed, that India would have free speech in the discussion of the subject or a free judgment in its decision?" I believe that Mr. Chamberlain's idea, when first he put forward his scheme of fiscal reform, was that in the Conference which he no doubt contemplated should precede any active steps, India should be treated as a self-governing Colony, and that through the mouth of her representatives she should indicate the degree to which it would be to her advantage to take part in any fiscal change, and that except with the consent of her representatives no such scheme should be forced on her. That at once raised the question, who and where are the representatives of India? Your Lordships know perfectly well that outside the Government of India itself, there is no organisation existing, or capable of being created, that could be considered as representing the opinion of the people of India at large. The Government of India does its best, and, I think, with a tolerable measure of success, to represent what it regards as the views and interests of the great country committed to its charge; but I do not know that the Government of India can fairly be said to represent India in any strict sense of the term. It has often occurred to me that with a continent of such an enormous size, and with such a huge complexity of population and diversity of interest, it is inconceivable that any organisation or association, European or native, should ever exist that could be fairly called representative of the whole of India.
As I have said, I believe the Government of India does its best to represent
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India, but it is not independent. Its degree of independence is extremely limited and it is limited by the Constitution of this country. The Government of India, after all, is an agent appointed by His Majesty's Government at home to govern India, and from them it takes its orders, through them it receives its payment, and the real master of India, the only man who has the right in the last resort to speak for India, is the Secretary of State, who is always a politician in this country. What has been our experience in the past in India of the manner in which the influence and power of the Secretary of State, as the ultimate ruler of India, are exerted in the direction of the fiscal policy of India? It is that in fiscal matters the Government of India has to take the views of the Secretary of State, whether it agrees with them or not; and those views are more likely to be guided and shaped by English than by purely Indian considerations.
Let me demonstrate this proposition. Your Lordships will remember that after India was taken over by the Crown for many years there was maintained a system of import duties. In 1879, when that system was abolished, when under the auspices of Lord Salisbury India was instructed, largely owing to pressure from Lancashire, to introduce a free trade system, and Lord Lytton, the Viceroy, was instructed to abolish the cotton duties in India, he only succeeded in doing so by over-ruling the majority of his council in India—the single time within the last forty or fifty years that such action has been taken. Again in 1894, when the tariff in India was re-introduced in consequence of the extreme financial depression from which India was then suffering, and when at first cotton manufactures were exempted altogether from the import duty—in December of that year, in consequence of the very strong feeling aroused in India, the noble Viscount opposite (Lord Wolverhampton), who was then Secretary of State, and who made a most valiant speech in the House of Commons in defence of India—a speech which will linger in the memory of all who were fortunate enough to hear it—consented to the reim-position of the cotton duties there.

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But, in deference to English agitation, he insisted on a corresponding Excise duty of 5 per cent. being imposed on Indian cotton manufactures. Still, however, Lancashire was not satisfied, and in 1896 the import duties on foreign cotton goods were reduced from 5 to 3½ per cent., and the corresponding Excise duty was put at an equivalent figure. On all these occasions it was not the Indian point of view that prevailed or the views of the Indian Government that were accepted by this country. It was the English point of view, largely affected by Lancashire considerations.
I think it would be true, therefore, to say that the fiscal policy of India during the last thirty or forty years has been shaped far more in Manchester than in Calcutta; and if that is the case I leave the House to understand how in viewing this question of fiscal reform and the participation which India might be called on to bear in it, we were a little nervous as to the degree of liberty that might be conceded to her. It is because of the complete dependence of India on the home Government, and because she neither enjoys nor, apparently, is likely to be given, any of the powers of a self-governing Colony; it is because she might have to accept at the hands of the Government in England, be it Liberal or Conservative, a system with which she herself was not in sympathy, that India has been so much afraid of any proposal to sacrifice or surrender the degree of fiscal autonomy she at present enjoys.
If we could understand that in any Imperial Conference which takes place the interests of India would be fairly considered; if a pledge could be given that no system will be forced on her in deference to pressure from England, or from any part of England, which is not suited to her own interests, and that she will not be called upon to accept any system devised exclusively in the interests of England, and that in the event of no such solution being found practicable she will be left in the enjoyment of the degree of fiscal liberty which she now enjoys, then I believe that India, so far as I have any right to speak on her behalf, would gladly join in any such Conference as I have spoken of,
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and that she would welcome any practical scheme of fiscal reform embracing preferential tariffs within the Empire, because she is already in favour of the main principles which underlie that reform, and because in the respects to which I have referred she has already put into practical operation some of the most effective means of carrying those principles into effect.
THE MARQUESS OF LANSDOWNE: My Lords, according to the unwritten law of the House the noble Earl opposite is entitled to the last word, and I therefore rise before him to address myself for a few moments to the subject before you Lordships. After the weighty speeches to which we have listened I feel that there is not very much that I can add to this discussion, but there are, I think, some points which have not received sufficient attention, and upon which I hope we shall elicit further information from His Majesty's Government.
Our position, I take it, is this. We are all in favour of maintaining the closest possible relations with our great Colonies, and we on this side give absolute credit to noble Lords opposite for holding that view with a sincerity equal to our own. We are all ready—at all events in theory—to sacrifice something to maintain and improve those relations; but I think that the difference between us is this, that when we come to practice we—on this side of the House—are ready to risk something, to make an effort, to make sacrifices, in order to bring about these improved relations; whereas, so far as I am able to understand the views of noble Lords opposite, they are not only unwilling to risk a farthing for the purpose, but they are not willing to risk even a troublesome discussion. It is worth while to consider for a moment how our Colonial Empire fares under this dispensation.
It is admitted on all sides that some of our great Colonies have given us valuable preference. I think one or two of the speakers in this debate have been inclined to minimise that preference, but I find it difficult to suppose that the noble Lord opposite will do so, for I find that in the course of the debates at the last Conference his colleague the present Chancellor

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of the Exchequer referred to "the substantial concessions" we had received as having been of "enormous benefit," and of a kind for which we ought to be grateful; and I venture to say that statistics which I will not repeat—they have already been given—confirm that view. The Chancellor of the Exchequer spoke indeed of the marked effect upon our trade of these colonial concessions. Well, it must be one thing or the other—either they are or they are not valuable; if they are not, we need say no more about them, but I assume that it is agreed that these concessions are of substantial value.
Then we come to the Conference, at the end of which Sir William Lyne moved the resolution which was supported by the whole of the Colonial representatives but met with no support from His Majesty's Government. Indeed, the present Prime Minister took credit to himself for having, as he put it, bluntly and frankly placed his own view before the members of the Conference, a view which, in the language of my noble friend Lord St. Aldwyn, may be described as a merely negative view. The position assumed by the representatives of His Majesty's Government was a two-fold one. They held that Colonial Conferences were bad and dangerous things in themselves; they held also that they themselves had no mandate from the people of this country to entertain any proposals of the kind, and that they were, therefore, incompetent to discuss them. It may be, and recent events suggest it, that, after all, the country has not said its last word on the subject of Colonial preference. In our view, however, the refusal of the representatives of the Government even to discuss this question of Colonial preference was an act of discourtesy, and more than that, a political blunder of great magnitude.
THE LORD PRESIDENT OF THE COUNCIL (Lord TWEEDMOUTH): Oh, oh!
THE MARQUESS OF LANSDOWNE: I adhere to my words, a very great blunder, and I say when a proposal of that kind was made by the representatives of the great Colonies common courtesy
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required that their suggestions should be attentively considered and fully discussed. Not only did our representatives refuse to discuss the Colonial proposal, but they gave a very broad hint to the Colonies that it was our intention in this great fiscal question to go our own way, and that we expected the Colonies to go theirs. Well, the Colonies have now begun to travel their own road, a road that may carry them very far, and this Franco-Canadian Convention, to which the noble Duke behind me has called attention, may be regarded as marking the first stage in the Colonial journey.
One word on the point to which my noble friend has referred, the manner in which the Convention was negotiated. We are unfortunately very imperfectly supplied with information on this point, but the Secretary of State for the Colonies will, no doubt, give us more. There has arisen, especially in Canada, an impression that these negotiations mark an entirely new departure in regard to these great Colonial transactions. It has always been the custom—a very wise and proper custom—to associate representatives of Colonial Governments with representatives of His Majesty's Government whenever these negotiations take place involving Colonial interests. The principles which have always been followed are clearly set out in a despatch of which my noble friend Lord Ripon was the author, and which bears the date of 20th June, 1895. The noble Marquess then wrote as follows—
"To give the Colonies power of negotiating treaties for themselves without reference to Her Majesty's Government would be to give them an international status as separate and Sovereign States, a result which Her Majesty's Government are satisfied would be injurious equally to the Colonies and to the Mother Country and would be desired by neither. The negotiations then being between Her Majesty and the sovereign of the foreign State must be conducted by Her Majesty's representative at the Court of the foreign Power, who would keep Her Majesty's Government informed of the progress of the discussion and seek instructions from them as necessity arose."
That has always seemed to me to be the sound and accepted doctrine which governed proceedings of this kind. But I see that this despatch was quoted in the Canadian Parliament by Mr. Brodeur,

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the Minister of Marine and Fisheries, who made the following comments upon it—
"It is enunciated very clearly there (in Lord Ripon's despatch) that the negotiations should be carried out by the British Ambassador. That was the position taken in that despatch of 1895. Now what is the situation to-day? I have in my hand the instructions which were given on the 4th July, 1907, by Sir Edward Grey to the British Ambassador or his representative in Paris concerning the negotiations for this treaty under discussion. I may say that by command of His Excellency, and with the authorisation of the Imperial authorities, I lay this despatch before Parliament. It sets forth, in the clearest manner, the situation, and shows that now, for the first time in Canadian history, negotiations for a commercial treaty were carried out exclusively by Canadian representatives."
I do not know whether I am right in supposing that these proceedings do amount to a new departure. I hope we shall have a word of explanation from the Secretary of State. I hope he will see his way to comply with the request of the noble Duke and lay upon the Table at any rate any Papers of which the Canadian Government have been allowed to make use.
What is the effect of the Convention? Canada, as your Lordships are aware, has, besides the surtax, three tariffs—the general tariff, the preferential tariff, and the intermediate tariff, which was framed for the purpose of enabling the Canadian Government to negotiate advantageously with friendly countries. It was always understood that that intermediate tariff still left a substantial preference to the Mother Country, that the Mother Country, as it were, kept her distance. Now, what has happened in this case? In the course of negotiations with the French Government Canada has had to yield considerably more than the intermediate tariff, with the result that, roughly speaking, the whole of the preference given to this country has disappeared. I think there are some miserable shreds representing about 2½ per cent. that remain of what the Chancellor of the Exchequer described as an enormous benefit to British trade. That is a somewhat disquieting result, but what makes it still more serious in the view of many of us is this. Not only does the Convention extend to the whole French Empire, but to every country which under existing treaties is entitled
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to most-favoured-nation treatment at the hands of the Dominion. As noble Lords are aware, some twenty Powers are entitled to such treatment, Powers by no means unimportant, for amongst them are Austria, Russia, Denmark, Switzerland, and others. That is, as I understand, the immediate effect of the Convention; but let us consider what the remoter effects are likely to be. We are virtually inviting these great Colonies to go as they please in these commercial matters. Is it not clear that Canada is likely to make similar conventions with other Powers, and is it not also reasonable to anticipate that other British Colonies will follow the example of Canada and make mutually advantageous bargains with other foreign Powers?
Not only so; you may have agreements between one Colony and another. What is to be the end of all this? Is it not fair to anticipate that before long the whole area will be covered by a network of these international and intercolonial conventions, so effectually, that should we at some future time desire to make advantageous bargains between the Mother Country and the Colonies, there will be no room, because the whole of the ground will have been covered? I think we are entitled to ask whether we are correct in so interpreting the consequences of the Franco-Canadian Convention; and whether, if the facts are as I have stated them, the Secretary for the Colonies regards this position with equanimity. I own that it fills me with feelings of considerable alarm and apprehension.
The noble Earl may tell us that everything is going well, that this country is very rich, that trade is prospering, and that no change is wanted. But is it quite clear that there is no reason for misgiving as to our prospects? I noticed a remarkable statement made by a supporter of the noble Earl on the occasion when Mr. Asquith for the first time met his party as Prime Minister. Sir John Brunner, who presided at that meeting, asked permission as a man of business to tender what he called a piece of hard practical advice to the Government. "He wished," he said, "to advise the Government to give up that part of the policy of the Manchester school which

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was called laissez faire." I understand it has since been suggested that Sir John Brunner was thinking of such things as railway, telegraph, and steamboat subsidies. I am not aware that the Manchester school ever opposed enterprises of that kind. But it is the case that at the Conference the only expression of sympathy that came from the British representatives was a sort of vague suggestion that something might be done in the way of steamship subsidies and of new lines of telegraph and improved railway communication. But are we not entitled to ask what is the use of offering new facilities for trade if, at the same time, you allow the trade itself to be cut off altogether from you by international agreements of this kind? You may widen the channels as much as you please, but if there is no stream of trade to flow through them you will not greatly gain by such improvements. It is admitted—my noble friend Lord St. Aldwyn admitted it, not, perhaps without a tone of regret—that there is throughout the country a general and growing desire for improving our commerce with the Colonies.
VISCOUNT ST. ALDWYN: I do not regret that at all.
THE MARQUESS OF LANSDOWNE: Are we, then, so very helpless to do anything to improve these Colonial trade transactions? We have been told in this debate of the difficulties which stand in the way. We have been warned of the great difficulty created by the case of India. Lord Wolverhampton, whom we all rejoice to see sitting in this House, warned us in solemn terms of the risk we should run if we did anything which might affect the position of India, which he properly described as a great producing and as a debtor country. I venture to express my humble agreement with what was said by the noble Lord. But I think his warning would have been more appropriate if he had been able to show us that we were proposing anything which was really calculated to interfere with the export business of India or with her ability as a debtor country to meet her obligations. I would have nothing to say to any system of Imperial preference which might have
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the effect of jeopardising the position of India in that respect. But although I hold that feeling strongly, I am not able to admit that there is no room for improvement in the conditions under which the trade of India is carried on.
It is rather a remarkable thing that of the immense export trade of India this country claims a very much smaller proportion than we used to claim twenty years ago. In 1885–1886, 63 per cent. of the total export trade of India was taken by this country, whereas in 1905–1906 we took only a little more than 46 per cent. In other words, twenty years ago we had considerably more than half and at this moment we have considerably less than half of the export trade of India. It does not seem to me to be by any means established that a system of preference would necessarily be injurious to the Indian export trade. We cannot sufficiently bear in mind what was pointed out by Lord Milner last night—that Indian exports are very severely taxed by the protectionist countries with which India deals, and that if she enjoys any immunities or advantages at their hand she enjoys them not because of any affection they bear her, but because of motives of self-interest: in my opinion, these motives of self-interest would continue to prevail in these foreign countries under any system of preference to which we are at all likely to resort. These countries take from India a number of commodities, principally raw materials, which are absolutely essential to them, and consequently it is highly improbable that under a system of preference India would find all these countries simultaneously closing their doors in her face I am, therefore, not very much moved by the apprehension that the export trade of India would be likely to suffer under a system of preferential dealing with the Mother Country.
I had intended to say something with regard to the views of the Government of India on this question, but my noble friend Lord Curzon has relieved me of the necessity of doing so. He has made it abundantly clear that it is entirely wrong to represent the Government of India as opposed to all idea of preference or retaliation. What the Government of India apprehended was that India

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might find herself, without sufficient consultation, entangled in some new Imperial arrangement entirely unsuited to her requirements; but it seems to me evident, both from the famous despatch of Lord Curzon in 1903 and from Sir Edward Law's statement, that India has no sort of objection to discuss the possibility of a system of preference in which her interests are adequately provided for.
My noble friend Lord Cromer dwelt last night upon the practical inconveniences which attend the operation of what he called a scientific tariff in which a great number of articles are comprised; and he was able to import into the discussion of a somewhat dry subject an element of humour which greatly delighted the House. I certainly should not attempt to contend that a long tariff containing a great number of articles would not give rise to more book-keeping and to more trouble, risk, and confusion than a simple tariff dealing with the taxation of a smaller number of commodities; but I do say that these are not the kind of difficulties which ought to deter us from even discussing the possibility of measures which might have the effect of drawing the different parts of the Empire more closely together.
Then we are frequently told that it is useless to attempt to bring about freer trade within the Empire, because all our great Colonies are frankly protectionist. I admit that our great Colonies are frankly protectionist; and I believe the protection of their own industries will be the consideration which will always rank most prominently in their minds. But that does not in the least diminish my belief in the possibility of coming to an advantageous arrangement with these Colonies. The simile which is frequently used when this part of the question is discussed is the simile of the wall. We are told that the Colonies have built up a tariff wall, and that if it is high enough to exclude British imports it does not very much matter to us whether the wall which divides us from the Colonies is a little bit lower than the wall which divides foreign countries from the Colonies. I am not sure that a fallacy does not lurk at the bottom of that argument. I
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think it would be a convincing argument if these great Colonies were self-supporting, if they could surround themselves with a ring fence, and draw everything they required from their own possessions. But they cannot produce everything they require. They must import from somewhere and the imports will come in where-ever the wall is lowest. If, therefore, the wall is made two or three bricks lower where our imports come in, then I believe our imports will come in, and we shall gain relatively to other and competing Powers.
I will only say one word upon the much-discussed question of the possibility of a system of preference under the existing tariff. I agree with those who believe that in the British tariff as we know it there is little room for a preference to the Colonies. But I am firmly convinced of the truth of what I think was said by Lord Ridley when he told the House that there is in this country a strong movement of opinion in favour of a fundamental revision of our present tariff. I believe that Lord Cromer only spoke the truth last night when he pointed out that His Majesty's present advisers have driven the longest nail into the coffin of the present tariff by the financial arrangements which they have this year announced. It is the reckless commitments into which the Government have entered—commitments the extent of some of which we are able even now to foresee with clearness—it is these commitments which, in my belief, will beyond all question before long compel a reconsideration of the tariff to which we have been accustomed. When that time comes we shall be in a better position to offer reciprocal advantages to the Colonies.
And I hope the time will come when we shall be able to go again to those great dominions which at five consecutive conferences have asked us to meet them with regard to this question of preferential trade, and when we shall endeavour, at all events, to discover some means of meeting their wishes. That there are difficulties in the way I should be the last person in the world to deny—the difficulties are enormous, they may be insuperable, but I should like to see an honest attempt made to face them and to overcome them.

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What I most regret is that His Majesty's Government, by their recent action in dealing with the Colonies and by the manner in which they repelled the advances of the Colonial representatives at the Conference of 1907, have driven the Colonies to think of something other than preference between the Mother Country and themselves, and to make arrangements with foreign countries which may render it impossible for us by-and-bye to effect mutually advantageous bargains between ourselves and them. The present Government could not, in my opinion, have left to their successors a legacy more detrimental to the interests of the British Empire.
THE SECRETARY OF STATE FOR THE COLONIES (The Earl of CREWE): My Lords, I need hardly say that we on this side of the House have no complaint whatever to make against the noble Duke for having placed this Motion upon the Paper; and for two reasons. In the first place it has led to one of those debates which, in these later days, which have been mainly given up to the ordinary cut and thrust of party controversy, have become only too rare—I mean one of those more set and formal debates, which used to be more frequent, when the House of Lords brings up its reserves; and I think that those outside the House do not always quite appreciate how powerful and distinguished those reserves are. In the second place, we frankly admit that if the noble Duke and his friends are not prepared to accept as final the undoubted verdict of the country given at the last general election in opposition to a fundamental change in our fiscal policy, and, in especial, to a tax upon food, they are, of course, entirely within their rights in bringing on a discussion such as we have had during the past two days. From a discussion of this kind I am bound to say we have nothing to fear.
The debate has ranged over a considerable extent of ground, but I think it is clear, both from the speech of the noble Marquess who has just sat down and from the speech of the noble Duke, that what I may call the causa causans of this discussion was the Franco-Canadian Treaty.
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There is nothing new about agreements of this kind. In 1893 Sir Charles Tupper negotiated a commercial Convention between Canada and France, far less favourable to Canada than this was, but still it was a convention of the same kind. Then followed what is a closer precedent for the action criticised by noble Lords opposite. In 1902, after the Colonial Conference met here, the Canadian Ministers, with, so far as I am aware, the complete sanction and agreement of Mr. Chamberlain, went over to Paris in order to try to get better terms than Canada possessed under the Convention of 1893; and I am not aware that there was any difference between what occurred then and last year, except the very important difference that in 1902 the Canadian Ministers were not successful in obtaining any change in the treaty.
With regard to this later Convention, there seems to be an opinion that something passed between the Foreign Office, and I suppose the Colonial Office, and the Canadian Government which involved an entirely new set of propositions. All that passed between the Canadian Government and the Foreign Office is contained in this small book which was laid upon the Table of the Canadian Parliament, and I think some misconception appears to have arisen over it. Sir Francis Bertie, our Ambassador, was associated with the two Canadian Ministers who conducted the discussion, though of course, the technical part of the discussion was entirely carried on by them. But during the whole period we were kept informed of the progress of the negotiations, and that, I think, is as much as we could reasonably expect.
The document which, I think, seems to have misled the noble Duke was a letter addressed by Sir Edward Grey to Mr. Fielding. It is dated 28th August last year, and in it Sir Edward Grey expresses his gratification at learning that progress was being made with the negotiations, and he added—
"On receipt of the draft treaty, which you hope shortly to be able to transmit, I will submit it to the Colonial Office. It must also be shown to the Board of Trade. I will request the Secretary of State for the Colonies and the President of the Board of Trade to

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expedite matters, and as soon as their approval is received full powers will be sent you."
I think the noble Duke must have been misled by that letter. All that was intended by the words "full powers" was that for the purpose of the actual signature to the convention Mr. Fielding had to be declared a plenipotentiary. That is all that passed, and there is nothing novel in it. It is perfectly true that under this convention the French Government obtain the advantage in certain respects of what is known as the intermediate tariff. The three tariffs have been explained by former speakers, so I need not go into them; but there are, in a sense, more than three tariffs, not merely because of the surtax upon German goods, but because, under certain circumstances, special advantages are given for particular goods.
What France gets on this occasion is part of the intermediate tariff, and, of course, it is perfectly clear, and it cannot be denied, that pro tanto the value of our preference is diminished by that fact. It is also true that under the most-favoured-nation treaties certain other countries obtain a similiar advantage; and it appears to have been supposed, I think by the noble Viscount, Lord Milner, who is not in his place but who courteously took the trouble to inform me that he had been called away by a public engagement, that we ought to have informed Canada beforehand of the fact that, under the most-favoured-nation treaties, other countries would be placed in the same position as France. Of course Canada knew that fact perfectly well before she entered into the Convention, and it seems to me almost incredible that anybody could have supposed that she did not.
I do not think I need trouble the House at this hour with any long account of the countries included. The countries from which a considerable amount of dutiable goods will gain preference under this Convention are Switzerland, and, to some extent, Japan. I do not think I need trouble your Lordships with the figures, but the total effect of the preference is that it affects only 5 per cent. of the total dutiable imports into Canada, and only 3 per cent. of the total imports of the country. It is true that there are a
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few cases, particularly those of lace, and, to a certain extent also, silk ribbons, in which the value of the preference is lost to British goods. I regret that it should be so. It is unfortunate, no doubt, from our point of view that the Canadians did not find themselves able—I do not know whether they will be able to do so on a future occasion—to maintain the preference for these particular goods. But even noble Lords who are strong supporters of tariff reform must agree that we could not properly be asked to change our entire fiscal system on account of one or two articles of that kind.
Perhaps I may be allowed to quote what was said by Mr. Fielding, the Canadian Minister, as to the spirit which had actuated the Canadian Government in making this Convention. On 19th January of this year Mr. Fielding said that the policy of the Canadian Government was—
"To keep as far as possible for British trade the degree of preference established by the tariff policy of last session (1907)."
and—
"In the granting of any special rates which might be thought desirable, to confine them as far as possible to French specialities which would not be likely to come into competition to any large degree with British industries."
In the case of wine, for instance, which is largely affected by this Convention, there is no competition with us.
I would point out that we cannot prevent these agreements being made even if we would. There have been occasions when agreements of a very marked character have been made. In 1902 what is known as the Bond-Hay Treaty was negotiated between Newfoundland and the United States. Newfoundland is a Colony which gives us no preference. That treaty provided that special articles exported by Newfoundland, such as cod-fish, whale oil, and whale bone, ores and metals and slates, should be admitted into the United States free of duty, and in return Newfoundland admitted duty free from the United States agricultural implements, machinery imported by agricultural societies, gas engines, printing presses, and a number of other articles. I make no complaint of the action of Newfoundland in that matter, but that treaty, if it had been carried into effect,

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owing to the proximity of the United States, would have had the effect of giving undue preference to the United States as against this country. Provided that no discrimination is exercised against any part of the Empire—that is to say, that no preference is given to any foreign country over any part of the Empire, and provided also that we are kept thoroughly informed of such negotiations as may take place, in order that we may be able to make representations on behalf of particular trades, we do not attempt to interfere with these special commercial agreements. On the other hand, when we make commercial treaties of our own the Dominions are not included unless they specially desire to be so, in order that they may be able to maintain their fiscal independence.
It is also important to point out that in the Franco-Canadian treaty we do gain materially in several ways. Article VIII. lays down that French goods will only enjoy the concession if they come by the port of some country which receives either the preferential or the intermediate tariff. That is a pure advantage to this country. Then, again, in Article XV. there is the recognition in Canada of the certificates of chambers of commerce as to value in cases where ad valorem duty is charged. The noble Duke's general argument points to this—that, if you allow these Conventions to take place, gradually your preference will be whittled away altogether. I think that is also the argument of the noble Marquess. There is more than one answer to that. I have quoted the words of Mr. Fielding. I think it is evident that in making these conventions the representatives of the different Dominions will desire to affect preference given to us as little as possible. But I also have the support of one of the arguments of the noble Viscount opposite, Lord St. Aldwyn, who, if he will forgive my temerity in venturing to pay him a compliment, gave us what, I venture to say, was one of the most remarkable specimens of reasoned eloquence to which we have had the pleasure of listening in this House for some time. The noble Duke and the noble Viscount on the cross benches seemed to be under the
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impression that the existence of an intermediate tariff had something to do with the Franco-Canadian Convention. There is not the slightest relation between the two things. The intermediate tariff was initiated before the Franco-Canadian Convention was contemplated.
It is evident, too, that when a country engages in a system of preference, it must have at least three tariffs if the power of retaliation is not to disappear. If you are to have a preferential tariff for your own Empire, unless you are entirely to abandon the power of bargaining with all foreign countries, you must have a general tariff, and also an intermediate tariff, and, accordingly as you are treated by those foreign countries, so they get, or do not get, the benefit of the better terms of the intermediate tariff. That, surely, is the essence of what is known in the phrase of the noble Marquess opposite as the policy of the loaded revolver. If the revolver has its effect and the hostile country climbs down, you must give it some advantage for doing so. Therefore, I am led to conclude that, in whatever system of preference we may engage, or the Colonies may engage, there will always remain, not merely the possibility, but the certainty of these commercial conventions being made with foreign Powers; and if our great Colonies undertake them, they will be bound to consider first and foremost what their own particulars interests are.
I do not wish at this hour to describe the existing preferences, to which allusion has been made, but I do heartily concur in what has been said on the other side of the House on the subject. We most distinctly appreciate these preferences, and we quite admit the value which they have been to British trade. That was frankly admitted by Mr. Lloyd-George at the Conference, and I entirely endorse what he said there. Even in regard to the Australian tariff, which in its first form was of rather an alarming character, because it made the position of some British commodities worse than before, we recognise that the representations of our commercial bodies as regards particular articles, have been met in a friendly spirit by the. Australian Government.

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I should like to ask what realty is the governing principle on which all these preferences are given, and to do that I must turn again to the Imperial Conference. The argument at that Conference was carried on, I think on both sides, with skill and dignity. I was sorry to hear the noble Marquess use the phrase "discourteous" in relation to the attitude of those who acted as plenipotentiaries for the Government. What I suppose the noble Marquess meant was that their refusal to enter into the details of an actual preferential arrangement was discourteous to the Colonial Governments. I do not believe they so regarded it. We certainly did not refuse to discuss the matter, for it was discussed at the fullest possible length. I do not admit that it was discourteous to refuse to accept the general proposition of the Colonies. It was absolutely impossible, having regard to the verdict of the constituencies and to our own known opinions on the matter, to go into the details of a scheme which, whatever it might be, we were debarred from accepting; but I think I can say, with the utmost truth, that it was a very real matter of regret to both of my right hon. friends who represented us there that there should be this strong and fundamental difference of opinion between the Colonies and ourselves on this matter.
I would like to quote a passage from the very remarkable speech of Mr. Deakin on this subject. It was felicitous in phrase and substantial in argument, like all the speeches of Mr. Deakin, to some of which many of us have had the pleasure of listening. On the general principle of colonial preference Mr. Deakin said—
"It is not for us to propose 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 be either to revive those industries which had suffered or were suffering, or to expand those already existing. That involves another set of principles altogether, and I should be distinctly departing from the rule laid down for myself if I entered upon any discussion 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
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profit, but also that in considering any proposal for preference to them the first obligation upon every British Parliament is to consider its own citizens, its own industries, and its own advantage first. So far as you might think it right to exclude us and everyone else from your own markets in order to maintain, or retain, or extend any kind of production or interest of your own, it would be impossible for us to raise one word of complaint. That is entirely a matter for the discretion of the people and the Parliament of Great 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 the 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 own 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."
That appears to point to a fact which, I think, is not entirely recognised here. When Mr. Deakin and Sir W. Lyne were speaking they were speaking as protectionists who were filled with a certain feeling of astonishment that we were not prepared to adopt a protective system with all the advantages that they conceived it would confer on this country. It certainly seems to me that they expected—and I confess there I am entirely in agreement with them—that if you adopt a system of Colonial preference you only can do it as part of a protective system. The two things go absolutely together. No attempt has ever been made to combine free trade with preference, so far as I know, and we believe the thing to be an impossibility.
I do not desire to enter upon the whole question of protective duties; I am not going to enter into the difficulties which would surround a policy of mere retaliation; neither do I propose to enter into the Parliamentary objections, very strong as they are, to greatly increasing the power of particular trades and their consequent influence upon the fiscal policy of the country. These are all matters which have been dealt with on a hundred platforms, and I do not propose to deal with them now. But I should like to say a word more in addition to what has already been said as to the actual and practical difficulties of entering upon a policy of preference. I do not desire, however, again to traverse the

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familiar ground as regards the question of the possible acceptance of food taxes in this country. The prime difficulties of that policy were dealt with by the noble Viscount, Lord St. Aldwyn, in a far more perfect manner than I could hope to do. But I should like to draw attention to the intense intricacy of any system of preferential tariffs which is to be fair to the whole Empire at large. It is obvious that unless you are prepared to tax some raw materials you must practically omit some of your Colonies altogether from preference. Then you have the almost unanswerable question as to what are raw materials. Take, for instance, the case of hops. Are hops raw materials? Supposing the hop invasion, of which so much complaint has been made, came from Ontario, where some hops are grown, instead of coming from California, what steps would the noble Duke take to deal with it? Would he be content to see the hop industry of England entirely destroyed by hops from some part of the Empire, or would he desire to place a 40s. duty on them?
If I might quote a shorter passage from Mr. Deakin, I should like to draw attention to one aspect of this question of Colonial preference which has not been sufficiently noticed. It is this. You cannot imagine that it would be possible to give the same preference to all the Colonies for the same article. At least, if you attempted to do that you would be causing almost as great a feeling of discontent in certain cases as if you left them out altogether. Mr. Deakin at the Colonial Conference said—
"The import of cheese into Great Britain, which is almost entirely in the hands of Canada, amounts to £6,350,000, to which Australia contributes to the extent of £1,000 only. Here, again, is an opening for trade which preferential treatment would greatly widen."
The meaning of that, of course, is that Australia is to have a preference over Canada in the import of cheese. If you let in Australian cheese free you must have a somewhat higher tariff for Canadian cheese—high enough to enable Australia to compete. At least, if not, you will leave Australia as it is. Over and above that you must have an intermediate tariff for the countries willing to meet you on other points, and you must have a general tariff almost of a pro-
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hibitory character against the world at large. And that has a bearing, I think, on what was said by the noble Viscount in a different connection—the extreme difficulty of keeping these food duties low, for the more tariffs you have the higher your duties must be; and that is quite apart from the point the noble Viscount made, as I thought, with unanswerable force, as to what would happen if your preference does not have the effect which you hope it will have. That is a point which cannot be mentioned too often. If your 2s. duty does not avail, are you going to put on a 5s. duty?
Then we have the further question of the extent to which we are ourselves prepared to impose duties against Colonial imports. You will find that when you have once started on this path of putting on duties for other purposes than revenue this country will, having tasted blood so to speak, acquire the zest for protection which is, as we know, very easily acquired, and you will find, I feel certain, that if some industry here which may be protected against foreign competition is in danger of being swamped by Colonial competition, you will undoubtedly do what Mr. Deakin anticipated, and what he fully approved of your doing—that is, impose a duty for protective purposes against your very Colonies themselves. And how that state of things would lead to anything approaching free trade within the Empire I am unable to see. When the question was asked in the House of Commons Mr. Balfour indignantly repudiated the idea that under any circumstances we should ever think of imposing a duty against the Colonies. He adopted almost the tone which a fond mother might adopt if she were asked if she were going to borrow money from her daughter's dress allowance. That is not the way in which the Colonies desire to be treated. They wish to be treated, as Mr. Deakin explained, as nations entirely competent to conduct their own affairs, and they do not desire us to take anything of a patronising view towards them, either in this matter or in any other. Then there was the point whether it would have been possible for us to give a preference which would not have involved protection. That was dealt with also by the noble Viscount. I

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think it must be agreed that the real value which anybody would have placed upon such a preference would have been that it meant the abandonment of our principle, and that it would have afforded an almost irresistible lever to the suggestion from some colony which did not get that particular advantage that they themselves should in turn become the recipients of a preference which would involve something like a protective duty here.
I pass to the question of India. In the Indian case there are two difficulties. There is the difficulty as to how you are going to protect India from being retaliated against by other countries in respect of commercial changes which may be of advantage to England but which are of no advantage to India. That point has been fully dealt with by Lord Curzon. But there is another fear which comes even more home to us here, and that is that if we set out on this career of preference India may be in a position to force a new system on us, or rather, to engage in a new system to our detriment. If we abandon the position of free trade, I confess I do not see how and in what case you could possibly refuse to permit India to place on duties even against our own commodities. In 1875 when the late Lord Salisbury was Secretary of State for India he wrote, with reference to the 5 per cent. cotton duty—
"It is impossible to believe that under these conditions the duty can be permanently maintained. The entire acceptance of the system of free trade by England is incompatible with the continuance of an exception apparently so marked. Parliament, when its attention is drawn to the matter, will not allow the only remnant of protection within the direct jurisdiction of the English Government to be a protective duty, which, so far as it operates at all, is hostile to English manufactures."
When you abandon that powerful argument of Lord Salisbury, I do not know what argument you can substitute for it. I confess that I think that Lord Curzon, speaking as he does in this House as a representative of India, overrated the extent to which the interests of India have been sacrificed to those of this country in the past. It is perfectly true that to a certain extent we have safeguarded ourselves, but I
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should be sorry if it went out, as the opinion of this House, that our past fiscal policy towards India had been one of pure-selfishness, and I am afraid that Lord Curzon's words gave some colour to that belief.
Lord St. Aldwyn asked us questions with regard to our attitude in the Colonial Conference. He said, in effect—"If you were prepared to take certain other steps in the interest of Colonial trade, leaving out of the question any fiscal preference which may involve pecuniary sacrifice, why did not you take those steps as a means of obtaining further privileges from the Colonies?" The answer is that the issue at the Conference was such a simple one between a free-trade policy and a protectionist policy that it was wiser to allow the issue to remain absolutely clear. Such a suggestion as that which the noble Viscount made is always open to the Government to adopt at anytime. But I do not think it would have been wise to attempt to discuss at the Conference large schemes of the kind which he indicates, and to mix them up with this question of Colonial preference.
One other point made by the noble Viscount, I will not attempt to discuss this afternoon—I mean the relation of this matter to our general financial policy. There will be opportunities later in the session when the Finance Bill comes up to this House; therefore, I will not enter into what possible relation the giving of old-age pensions may have to this question of Colonial preference. I quite appreciate the motives of those who look at this matter from a purely political point of view, and who desire to sink the economic point of view altogether. They would wish to do what the Colonies think it reasonable and wise for us to do without considering the economic results. But, my Lords, our point of view must necessarily be a different one, simply because we hold that it is not possible to enter at all upon this road without entering at the same time on the downward path to protection. We cannot consider this question of Colonial preference, so to speak, in a vacuum. It must necessarily be part of an economic change so far-reaching that its effects

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can hardly be calculated; and we believe that if you take a leap, which would not be a leap in the dark, but a leap in very broad daylight, into the ravine of protection you may not even have the chance which Sir Robert Peel had and took in the middle of last century of making a weary climb back into the regians of fiscal reason and common sense.
THE DUKE OF MARLBOROUGH: My Lords, I listened with the greatest attention and interest to the words which fell from the noble Earl, and I do not this evening propose in any way to attempt to follow him in his arguments. But I should like to ask, in closing this debate, the noble Earl having apparently forgotten the point, whether or not the Government will lay on the Table any further Papers in regard to the negotiations between this country and Canada. The noble Marquess the Leader of the Opposition alluded this evening to a despatch written by the noble Marquess the Lord Privy Seal on 20th June, 1895. I understand that since then a new departure has been taken, and communications on the subject have passed between Sir Edward Grey and the Canadian Minister of Marine and Fisheries. They have been quoted in the Canadian Parliament, and I think that any official despatches of that kind which have been laid on the Table of the Dominion Parliament ought to be accessible to us.
THE EARL OF CREWE: The only communication I know of that has passed between Sir Edward Grey and the Canadian Minister was that brief statement as to "full powers" which I read. A copy of this small Canadian Blue-book I am willing to place in the library, but I do not think it would be worth while to reprint it as a Parliamentary Paper, because a considerable part of it consists of letters between Mr. Fielding and Mr. Brodeur, which do not strictly concern the House. I will show the noble Duke the book, and, if necessary, extracts may be printed. In my belief there has been no change of policy or of attitude on the part of His Majesty's Government to these commercial treaties, and the practice followed last year was
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practically the same as that followed on former occasions.
Motion, by leave of the House, withdrawn.

PROSECUTION OF OFFENCES (AMENDMENT) BILL.
[SECOND READING].
Order of the day for the Second Reading read.
THE LORD CHANCELLOR (Lord LOREBURN): My Lords, this is a simple Bill to amend the Prosecution of Offences Acts, 1879 and 1884. It divorces the office of Director of Public Prosecutions from that of the Treasury Solicitor where that separation is needed. There is also one other clause which may have the effect of assisting to prevent vindictive prosecutions. The Bill is a small one in itself and has already passed the House of Commons. I hope, therefore, your Lordships will give it a Second Reading.
Moved, "That the Bill be now read 2a."—(The Lord Chancellor.)
On Question, Bill read 2a, and committed to a Committee of the Whole House on Tuesday next.
House adjourned at twenty minutes before Eight o'clock, till To-morrow, halt-past Ten o'clock.