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27. Irrigation works possess for me a special attraction. I am keenly alive to their vital importance to the health and prosperity of the people, and not less so to the neglect they have, with occasional exceptions, experienced at the hands of those who have successively possessed this country-a neglect, however, perhaps not more prejudicial to them than well meant but ignorant and injudicious interference with long established traditional customs by which they were locally maintained.

Several of my predecessors have thoroughly appreciated what was wanting, and made efforts to supply it; and had Sir H. Robinson's intention that a certain sum should every year be devoted to irrigation purposes been steadily adhered to, the material condition of the agricultural population would in many parts of the island be, at this moment, better than in fact it is.

I fully share the views of Sir H. Ward, Sir H. Robinson, and Sir W. Gregory, as to the moral obligation incumbent on the Crown in this matter; and did I allow myself to be guided by the bent of my own inclination, I should urge above all other things the construction and restoration of works of irrigation. As it is, I consider that constant attention to this object, and the steady pursuit of it, are among the most serious duties of the Government; and were it the case that such works of this description as are now contemplated would necessarily be arrested to provide funds for meeting the expenses of a railway loan, I should certainly hesitate before I put forward the extension of the railway to Haputalé as a work to be immediately undertaken in preference to all others.

But this is not so. No diminution in the sums now annually voted for irrigation purposes need, as I have already shown, take place on this account; and I doubt whether a larger amount than what is now given could, under present circumstances, be expended with advantage. The promotion of native agriculture, and the improve. ment of the health and prosperity of the people, depend far more on the repair of the village tanks and smaller elas, or canals, and on the careful utilisation of the water- supply of each river system, now largely allowed to run to waste, than upon the restoration of the great works of antiquity, useful as these latter often are, and necessary as they sometimes are, for the purpose of storage and regulated supply. But the number of small works which can be undertaken in any one year is necessarily limited by our present means of survey and supervision, and the strength of the departments concerned is fully taxed, and indeed overtaxed, in the expenditure of the money now voted. Were it otherwise, and had I at my disposal for either purpose a sum at all approaching to the amount now proposed to be spent on the railway extension, though I might hesitate to pronounce whether its application to irrigation works or to railway extension would most generally benefit the people of Ceylon, even then I should practically have no option as to my choice. The accomplishment of a great scheme of irrigation works is at present impossible. Even had the plan received your Lordship's sanction and that of the Imperial Government, the proposal to raise a large loan for such a purpose would be one which it would be hopeless to expect the Legislative Council voluntarily to adopt while the railway extension scheme remained in abeyance. The experience of the reception of the fortification proposals is quite conclusive on that point. I suppose there are but few of those who voted against any expenditure for that purpose who would not like to see Colombo well fortified; yet the rejection of the proposal, (and that not an illiberal one), was unanimous. Even more decided would be the rejection of irrigation schemes, for which at the best of times it is by no means always easy to secure acceptance.

28. I am, therefore, of opinion that neither additions to the breakwater, the fortifica- tion of Colombo, or the commencement of great irrigation works, should take precedence of the extension of the railway from Nánu-oya to Haputalé.

29. I have now replied to both the questions which Sir F. Stanley informed me it

"Conclusive would be very satisfactory to him if I could supply conclusive answers.

is an epithet which I naturally hesitate to attribute to my own arguments, and probably there may still be difference of opinion on the subject in discussion; but I think that it has been indisputably shown that some of the doubts expressed by Sir F. Stanley were founded on misapprehension; that the tea culture of Uva, whatever may have been the case in the past, is now at all events, no speculative uncertainty; that the coffee crop of Uva has not continued to diminish; and that it is almost an absurdity to suppose that men having any regard to their own interests would decline to use a railway, the terminus of which they must pass if they continue to use the present road. Though with less certain demonstration, it has also, I think, been shown to be highly probable that the cost of the work will be less than was expected, while it has,

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I think, been made clear that, were it otherwise, the Colony, (which is not either only just able to pay its administrative expenses, or "in great financial trouble,”) can well afford to bear a heavier charge.

30. Thus far, as in my previous despatch on the same subject, I have argued this question almost wholly from the financial point of view; but I cannot conclude without a few words relating to its wider political aspect.

31. I will not dwell on the direct and indirect benefits which the extension of the line is likely to confer on the district that it is intended to reach, or on the stimulus to agricultural and commercial enterprise which it will supply. These are patent and self-evident facts, which would in themselves justify action, on the strength of reasonable probabilities of success, without waiting for absolutely mathematical proof. I quite admit, however, that they would not justify a rash and precipitate decision, or the adoption of any step which there were grounds to fear might involve the Government of the Colony in pecuniary embarrassment.

32. But there is another consideration which strongly weighs with me in urging an early assent on the part of Her Majesty's Government to the proposals I have had the honour to submit. It is that the prolonged uncertainty with regard to the prospects of railway extension renders the adoption of any other measures of public utility well- nigh impossible.

33. The anticipation that a large sum may possibly have to be devoted to this object makes, of course, any considerable outlay in other directions imprudent. But, more- over, an apprehension is widely entertained that expenditure on other objects may be used by Her Majesty's Government as an argument for withholding sanction from the proposed extension. This apprehension has created a general unwillingness to listen to projects of improvement however reasonable. Any proposal involving even incon- siderable expenditure, is, as things now are, not unlikely to be rejected by the Legislative Council: firstly, lest the means available to meet the interest and sinking fund of a railway loan should be thereby diminished; and, secondly, because the great majority of that body sincerely believe that the railway should have precedence over all other works. The species of paralysis thus induced is, I need hardly say, most disheartening to those who, like myself, perceive that there is great need of improvement in the condition of the people in various parts of the island, and who believe that much might be done to effect this object at a moderate cost, which would not really diminish our ability to face the prosecution of the railway scheme. The block thus caused in the adoption of useful measures is in itself productive of no little mischief, and it is much to be desired, even on this ground alone, that the question of railway extension should be finally disposed of. But finally disposed of it can only be in one way. So long as the probabilities of the success of such an undertaking are so considerable as they have been shown to be,--so long as the great mass of opinion is decidedly pronounced in its favour, so long as it is of vital consequence to important interests that the extension should take place, so long the agitation in its favour will continue:—and no veto on the part of Her Majesty's Government, however positive, will be regarded as otherwise than merely suspensive. A negative settlement of the question cannot be a final one: it will not be regarded as setting free a penny which may be required to meet expenses of the loan; nor will it cause other schemes of improvement to be taken up with greater willingness. On the contrary, it is not improbable that it may lead to a yet greater disinclination to take any step which may appear to imply acquiescence in a decision which it will be the main object of a large part of the community,—(including nearly the whole of the Legislative Council,)-to reverse and overturn.

34. The claims of the planters of the Province of Uva to consideration are also such as to merit serious attention. The estates in that province have, like those in more favoured localities, been subjected to the exceptional taxation imposed on the planting industry for railway purposes, although as yet they have never received any com- mensurate benefit from the existing railway. They were told that their turn would come, and was a question of time only; that the lower portions of the line must necessarily be made first; but that, sooner or later, it would reach a point at which it would be available for the conveyance of their produce downwards, and of their supplies upwards; and in that faith and hope they have cheerfully bore the special burdens imposed on them for railway purposes. They have already been much dis couraged by long delay, and to many, early possession of facilities for bringing up supplies which the extension of the railroad alone can give, is essential to enable them to hold their own against the severe competition of those districts already served by the railway. This is especially the case with regard to the article of manure, which G 3

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owing to its bulk, cannot be conveyed so long a distance in carts, except at a prohibitive rate, and supplies of which have in many cases become of vital importance. In short, the whole future prospects of a province which is, as the Commissioners observe, "the "richest portion of the island as to soil, and one of the most favoured as regards climate," depend not only on the extension of the railway, but on its speedy

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extension.

It may be said that it is still only a question of delay; that the end, no doubt, the railway will penetrate to Uva; and that, in an economic sense, it is of no moment, provided the estates are at that time still cultivated, whether they are then in the hands of their present proprietors, or have passed to others who may have replaced them. In a financial point of view this is BO. But I confess that I think political considerations

of a higher character are also involved.

35. These men have, by the enterprise and energy they have displayed in opening up the country, rendered real and important service to the Colony. They have done so, no doubt, with a view primarily to their own interest and profit, but the services they have rendered are not on that account the less substantial or efficient. They have converted wastes into cultivated fields, they have introduced large supplies of labour,—- they have expended great sums in the Colony,-they have contributed, directly and indirectly, to the augmentation of the revenue, and they have paid their quota towards the construction of the existing railways. I do not think that the Government of this Colony ought to view their position with indifference, or contemplate their abandonment. They have, I think, a moral claim not only on the sympathy, but the efficient aid of Government. They are entitled to it, I think, on two separate grounds. They entered on their enterprise with the warm encouragement of the Government of that day, and something very like a tacit understanding that they were to receive such support from it as could properly be given; but were this not the case, I believe sound policy would dictate to us the expediency of coming to their aid, if they can be aided without calling for sacrifices from other sections of the community. Even some slight degree of risk of loss might, I think, fairly be faced for such an object; but, at all events, its attain- ment should be attempted when the probabilities of a successful result are shown to be so fair and reasonable as in the present instance. The planters of Uva are engaged in a struggle which, if the railway be not extended, will probably end in their ruin. abandon them, not because the adoption of the scheme which would save them would involve a loss to the Colony, but because, until the loan raised for its construction is paid off, the profits of the new line will be in any case but small, and the narrowness of the estimated margin such as to leave room in the minds of some for doubt whether any profits will exist at all, will be a policy calculated to deter others from investing capital in agricultural enterprise, and will involve serious loss to the Colony.

To

36. Even granting, (which I do not,) that some risk were involved, I should still urge the undertaking on this ground. The results to be obtained are worth some risk, if the We cannot look-we never hitherto probabilities be strongly in favour of success.

have looked to absolute certainty as a preliminary to action. And if we abandon so promising a project, and consign to ruin such important interests, simply because of the existence of doubts, which may be equally entertained as to the success of any enter- prise whatever, I do not see, if that policy is to be followed in the future, how any important work can be again undertaken here. Most certainly, had such a principle been laid down as a rule of action at an earlier period, the present railway, which has conferred such benefits on the island, and contributed so largely to the Colonial revenue, would never have been undertaken. It might have been reasonable to anticipate, but it would have been wholly impossible to predict, its success, and many excellent reasons might have been adduced to show that its estimated returns "could not be regarded as beyond all doubt."

37. I need not remind your Lordship of the reasons which render as early a decision as is compatible with a due consideration of the subject by Her Majesty's Government, expedient. They will, I am sure, be present to your Lordship's own mind, and I am confident that your Lordship will not unnecessarily delay the formation of a judgment upon the materials now sent. I am, therefore, reluctant to appear to urge your Lordship on this point; but I think it right to inform your Lordship that, in addition to all the other reasons which call for an early announcement of your Lordship's decision, the services of Mr. Waring, the Resident Engineer of the Nanu-oya railway, and of his staff, whose engagement in connexion with that line is now over, have been temporarily retained pending the discussion of this question, as in the event of the work of extension being undertaken, it would be a serious loss to the Colony, and most prejudicial to its

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satisfactory and economical prosecution, were its control to pass into the hands of other engineers new to Ceylon and to the nature of the task to be performed.

I have, &c.

The Right Hon. the Earl Granville, K.G.,

&c.

&c.

&c.

(Signed)

ARTHUR GORDON.

P.S.-I have communicated the drafts of this despatch, and of my two other despatches, Nos. 258 and 259 of this day's date, to my Executive Council, all the members of which express their entire concurrence in what I have written.

GENTLEMEN,

Enclosure 1 in No. 3. LETTER OF APPOINTMENT.

Colonial Secretary's Office, Colombo, January 27, 1886.

I AM directed to transmit to you the enclosed Commission, appointing you to inquire into and report upon the proposed railway line to Uva.

I am, &c.

(Signed) R. W. IEVERS, The Hon. Cecil C. Smith, C.M.G., Colonial Secretary. for Colonial Secretary. The Hon. W. H. Ravenscroft, Auditor-General. The Hon. F. C. H. Clarke, C.M.G., Surveyor-General. The Hon. R. B. Downall.

T. N. Christie, Esq.

W. Bowden Smith, Esq.

COMMISSION.

In the name of Her Majesty Victoria, of the United Kingdom of Great Britain and Ireland, Queen, Defender of the Faith.

By his Excellency the Honourable Arthur Hamilton Gordon, Knight Grand Cross of

the most distinguished Order of Saint Michael and Saint George, Governor and -- Commander-in-Chief in and over the Island of Ceylon, with the dependencies thereof.

о

ARTHUR GORDON.

To the Honourable Cecil Clementi Smith, Esquire, Companion of the Most Distinguished Order of Saint Michael and Saint George, Lieutenant-Governor and Colonial Secretary, and Member of Our Executive Council; the Honourable William Henry Ravenscroft, Esquire, Auditor-General and Member of Our Executive Council; the Honourable Francis Coningsby Hannam Clarke, Lieutenant-Colonel Royal Artillery, Companion of the Most Distinguished Order of Saint Michael and Saint George, Surveyor-General and Member of Our Legislative Council; the Honourable Reginald Beauchamp Downall, Esquire, Member of Our Legislative Council; Thomas North Christie, Esquire; and William Bowden Smith, Esquire.

Whereas we have deemed it expedient that a Commission should issue to inquire into and report whether the financial prospects of the proposed railway line to Uva are such as to secure the revenues of this Colony against heavy liability:

Now know ye that We, reposing great trust and confidence in your prudence, ability, and fidelity, have nominated, constituted, and appointed, and by these presents do nominate, constitute, and appoint you, Cecil Clementi Smith, William Henry Ravenscroft, Fraucis Coningsby Hannam Clarke, Reginald Beauchamp Downall, Thomas North Christie, and William Bowden Smith, to be our Commissioners for the purposes of the said inquiry :

And We do hereby authorise and empower you, Our said Commissioners, to make all necessary inquiries into the said matter, and to report whether the financial prospects of the proposed railway line to Uva are such as to secure the revenues of the Colouy against heavy liability:

• Nos. 4 and 5.

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