1
Hansard,
No. 355, page 1124.
Printed
COTTER-
para, 22.
6
time, its liability to do so, when financially capable of bearing the charge, is clear, and that liability should be again asserted in any reply which the Government may make to the representations now under review.
25. The experience derived from dealings with this and with other Colonies indicates that, if the Government made concessious as to the amount of the contribution to be paid, without at the same time re-asserting the principle it so tenaciously held, and so frequently asserted, in 1858-71, the Colony would take silence on that point, coupled with a reduction in the charge, to be an admission of the soundness of its arguments, and this would create undesirable complications bereafter, should the question again come up for reconsideration,
No. 2.
The contention that Mr. Goschen's pledge has not been redeemed. 26. Mr. Goschen, in July 1891, stated in the House of Commons that--
I do not think we have gone one jot beyond the fair justice of the case in the demands which we have made upon the Colony.
I do not think we are called upon to retreat from the decision we have takou, but
if the revenues of the Colony should decrease, if they are less able to bear this contribution than they now are, the Goverment will be inclined to review the situation."
27. This pledge was repeated in Lord Knutsford's despatch to the Governor, dated 5th August, 1891.
pondence.
28. The majority of the Committee of 1888, while maintaining that the Enclosure 1, to No. 47., agreement of 1866 remained in force and should ultimately be carried into effect, recommended that payment for the full cost of the garrison should not immediately be demanded, but that it should be reached by progressive steps extending over three years. The total cost of the garrison was estimated at 136,1541, and the contribution recommended, commencing at 100,000%., was to reach the maximum in three years, the average for the five years being 124,5021. Report of This, on the estimated revenue of 1888, 3,812,200 dollars, with the dollar worth 1894, paras. 35. 3d., represented about 20 per cent. of the revenue, and with the estimated 2, 3, and 4. local charges added, about 21-25. Ibid, paras. 7 and 8.
Ibid, para. 11.
Ibid, 69.
para.
Appendix
No. 1a,
pares.
8 and 9.
29. The Government modified that recommendation in favour of the Colony, and fixed a contribution averaging 95,8241., or about 16:55 per cent. of the actual revenue of 1888, viz., 3,858,909 dollars, and this, with local expenditure added, brought the total military expenditure of the Colony (exclusive of capital expenditure) up to 17:10 per cent, of the gross revenues of 1888.
30. This Committee, in its 1894 report, show the actual result---
It is
"The total military expenditure, excluding capital expenditure on works and barracks, for the period 1889-93, represents 16-05 per cent. of the revenue of the Colony, as compared with 201 per cent. recommended by the majority of the Committee of 1888, and 1710 per cent, the estimated charge, exclusive of capital expenditure, fixed by the Government in 1889. evident, therefore, that the average charge to the Colony for the past five years has not exceeded that contemplated by the Government. If the capital expenditure on works and barracks for the period 1889-98 be added, the total military expenditure of the Colony for the above period amounted to 18-84 per cent. of its revenue, as compared with an estimated charge of 26-66 in 1866, and of 22-29 in 1871.”
31. Up to the end of 1893, therefore, the Colony had clearly no reason to complain that Mr. Goschen's pledge had not been redeemed, as the actual charges incurred by the Colony were less than those he contemplated when he gave the pledge.
32. In consequence of the value of the dollar having fallen from 3s., its value when the contribution was fixed in 1889, to 2s. 3d., the value on which the calculations in the 1894 report were based, the Government, in redemption of Mr. Goschen's pledge, provisionally reduced the contribution for 1894-98 from 100,000l. to 80,0001, rising annually by 10,000l. to 120,000l., and stated that—
"This arrangement will give a seusible relief to the Colony for the years 1894–95, and during 1895 a more trustworthy forecast will be possible of the financial conditions that will probably rule the remainder of the quinquennial period.
*Should unexpected circnmstances arise, sich as a further material fall in silver, a seriona check to, or diversion of, trade, or losses from other causes materially affecting the financial position of the Colony, Her Majesty's Government will not fail to take note of the altered situation, and to consider any representation which the Colony may make as regards the situation generally, and especially as regards the enhanced payments for the later years of the present quinquennial period. In arriving at an immediate decision on such a question as this, the unexpected cannot be taken into calculation in one direction or another, and, assuming that the e a titions remain normal, and that there is a continuation of that moderate expansion in the dollar value of the trade, which is already apparent, Her Majesty's Government entertain the belief that the charge above proposed will prove to be a reasonable one."
33. In consequence of a further fall in the value of the dollar to 2s., 90,000Z., payable in 1895, would require 900,000 dollars for its discharge instead of 711,111 dollars, which it was estimated that the Colony would have to pay in 1894. The gross revenues of 1894 amounted, approximately, to 3,863,000 dollars, practically the same as those of 1888, viz., 3,858,909 dollars, which Mr. Goschen had in view when he made his statement in the House in 1891; while the estimated amount required to pay the contribution for 1895, 900,000 dollars, exceeds by 240,000 dollars the estimated contribution payable by the Colony, when Mr. Goschen made his statement. Thus a sterling charge of 99,0001, in 1891 was discharged for 240,000 dollars less than would be necessary to discharge a sterling payment of only 90,0001, in 1895.
34. It must therefore be admitted that the conditions which Mr. Goschen Appendix referred to, and which the Government met by the reduced contribution of No, la, 1894, have become accentuated, and, in pursuance of his pledge, and of that para. 9. given in Lord Ripon's despatch of 6th November, 1894, some further relief must be given to the Colony,
35. It must not be forgotten that the burden of the Singapore Military Contribution has been thus largely augmented, not by increased demands made by this country but, by the depreciation of the Colonial currency. If the dollar had not fallen from the value it formerly possessed, the contribution required to defray the whole cost of its garrison, 154,730., would have been 728,141 dollars, or slightly less than it paid in 1894, 729,118 dollars, in order to defray little more than half its cost. In their report of 1894 on this Colony the Committee state-
"Loss arising from depreciation of its currency properly falls on the Colony, and such loss is 1894 not, in itself, a reason for relieving Colonial, at the expense of Imperial, funds. At the same time, Report of if that depreciation so augmented the military charges as to render them excessive, the Colony Committee would have reasonable grounds for claiming relief from some portion of the charge.
on Singa-
The loss sustained by the Colonial Government through the depreciation of the dollar has, pore, paras. however, increased so largely and so rapidly during the past two years that the Committee are not 56, 57. only unable to recommend any present increase to the Military Contribution, such as was contem- plated by the Government in 1889, but they feel constrained to recommend that some relief should be given to the Colony by a temporary reduction of its Contribution."
No. 3.
Objections to Contributions fixed in sterling.
36. The position of the Government with regard to the Eastern Colonies has in it elements of great weakness. Although it may be quite just that the Colonies should pay for their land defence, the Imperial Government bearing the whole cost of their naval defence, they are aware that that principle is not fully applied to larger and richer Colonies, and that some Colonies contribute nothing towards either their land or their sea defence.
The Appendix
No. 5a. complaints of the Eastern Colonies on this point receive much sympathy in this
para. 19. country. It is therefore important that some amicable arrangement should be come to with them that will last for many years, that will not be the subject of periodical discussion in the Colonial Legislatures and of protests in the local press and in that of this country. Any repeated or prolonged agita- tion on the subject might so prejudice the claims of the Government as ultimately to end in the entire loss of the contributions now received.
37. In fixing the contribution to be paid in the future, it is very desirable, therefore, even at some present sacrifice, to settle it on a basis that will, as far as possible, satisfy the Colony, and that will be self-regulating, ie., that will, automatically, without discussion and without controversy, fall with any decrease in the revenues of the Colony and rise with its rising fortunes.
38. Experience proves that if the contribution be fixed in sterling, as at present, it cannot be maintained when the Colonial revenues suffer from great depression of trade, or serious depreciation of their currency; while on the other hand, when the Colonial revenues augment, or the currency rises in value, this country can obtain no increase to the contribution except by re-opening the whole question and imposing a higher rate, a course never accomplished without many protests from, and much agitation in, the Colonies concerned.
39. In considering their report of last year on Hong Kong, the Committee 1894 Report had before it a proposal that the contribution should be fixed in currency of Com- instead of in sterling, and reported that--
"From the point of view of policy, there is a good deal t's be said for this proposal. It is argued that this country is better able than the Eastern Colonies are to bear the loss arising from fluctuations in the currency in which their Military Contributions are paid. The unforescen
mittee on
Hong Keny,
para.
22.
507