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140

No. XVI.

Memorandum and Correspondence respecting Restriction of Australian Preference to British Goods in British Ships manned by White Labour.

The Australian Customs Tariff (British Preference) Bill, which has been reserved for the signification of His Majesty's pleasure, provides for the levying of lower duties on certain articles the produce or manufacture of the United Kingdom and imported direct in British ships until the 31st day of August 1907 inclusive and thereafter on such goods imported in such ships manned exclusively by white seamen.'

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11

Attached is a set of printed correspondence with the India Office and General Post Office with special reference to the provision underlined above, and also to the analogous provision in section 16 of the Commonwealth Act No. 12 of 1901, under which no subsidy was to be given for the carriage of mails by any steamer employing other than white labour.

The treaty questions involved in the Preference Bill will be discussed at the Conference, and the suggestion of the India Office that India should share in the preferential treatment granted to the United Kingdom is also one which should be raised in the Conference by the India Office representative.

As regards the white labour condition, the General Post Office are interested because under clause 4 of the Peninsula and Oriental Contract the Company is at liberty to throw up the contract if legislation is passed in Australia of such a nature as to make the maintenance of the service commercially disastrous to the Company.

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The proviso as to white seamen in the Preference Bill can hardly have a disastrous" effect, though no doubt it might have some effect upon the profits of the Company.

The India Office object to the white labour provision in the Preference Bill, as they objected to section 16 of the Act of 1901, on the main ground that it means unfair and invidious discrimination against a class of law- abiding and loyal subjects of the King.

Mr. Chamberlain left the Act of 1901 in operation for the reasons stated in the letter to the India Office of April 4th, 1902, though he regretted the provisions of section 16, as may be seen by reference to the marked passage in his despatch printed in [C. 1639].

In the letter to the India Office of April 4th, 1902, a distinction was drawn between an Act imposing penalties on steamers employing coloured labour, and an Act merely refusing special employment, &c. to such steamers.

The present Bill practically imposes a penalty on such steamers, because it debars them from privileges which all other British steamers would receive if the Bill became law.

It would appear desirable that an attempt should be made to induce the Commonwealth Prime Minister to drop the white labour provision in the Bill, in view of the general objection in principle taken by His Majesty's Government to specific legislative discrimination in favour of or against particular races and colours.

Colonial Office, May 1907.

7163.

SIR,

No. 1.

INDIA OFFICE to COLONIAL OFFICE. (Received February 13, 1902.)

[Answered by No. 3.]

India Office, Whitehall, London, S.W.,

February 18, 1902.

I AM directed by the Secretary of State for India in Council to acknow- ledge the receipt of your letter No. 45920, dated 7th January 1902,†

• No. 3.

† Not printed.

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transmitting a copy of the " Post and Telegraph Act, 1901," of the Common- wealth of Australia, and inviting observations on the Act, with special attention to section 16, relative to the employment of white labour only in the carriage of mails.

2. In reply I am to make the following remarks :—

At present the conveyance of mails between Brindisi and Bombay, Brindisi and Shanghai, and Brindisi and Adelaide, is provided for by one contract between His Majesty's Postmaster-General and the Peninsular and Oriental Company, dated 25th May 1897. Presumably this contract will not be affected by the Australian Act. The contract can, however, be determined on two years' notice being given by either party at any date not earlier than the 31st January 1905. Should the contract be determined in or after 1905, and new arrangements become necessary, it will apparently be impossible for Australia, so long as section 16 of the Commonwealth's Act of 1901 remains in force and unaltered, to become a party, either directly or by an arrange- ment with the Treasury, such as now exists, to any contract for the carriage of mails which does not contain a clause prohibiting the use of coloured labour in connection with such carriage. At present, as is well known, large numbers of British Indian subjects are employed on board the steamships that carry the mails. Either, therefore, the contracting steamship company or companies will be debarred from employing these natives of India on the Indian and China Mail Service as well as on the Australian Service, or else Australia will be compelled under this section to stand out of the arrange- ments for the next Indian and China contract, and will require a special contract for its mails.

From the point of view of India either contingency is undesirable, as the steamship companies would be put to increased expense, and would, therefore, expect increased remuneration for the carriage of the mails between India and Europe. It is also possible that the disabilities and restrictions arising out of section 16 might lead to the companies putting up their rates for goods and passengers, to the direct detriment of India as well as to that of China and Australia. But, apart from the financial loss which it is thus likely to inflict on India, both as regards mail charges and ocean steamer rates, Lord George Hamilton desires to protest strongly, on behalf of India, against a clause which in its present shape places Indian seamen under unmerited disabilities, and tends to exclude a large number of His Majesty's subjects, ou the invidious ground of race, from an employment for which they are thoroughly well suited, and on which they have been engaged for many generations; more especially as that employment is carried on almost entirely in situations beyond the jurisdiction of the Australian Parliament. His Lordship earnestly hopes that Mr. Secretary Chamberlain will do his utmost to secure the amendment of any legislation in His Majesty's colonies or possessions which would produce a result so unfair in itself and so oppressive to the classes affected by it.

Lord George Hamilton would also point out that if the Australian law is allowed to stand in its present state, the Postmaster-General of this country may hereafter be placed in the embarrassing position of either having to refuse to enter into a contract in conjunction with the Postal Department of the Australian Commonwealth for the carriage of mails between England and Australia, or of having to become a party to a contract which would absolutely prohibit the employment by the contracting company on their mail steamers of Indian subjects of His Majesty. In the debate in the House of Commons in May 1900, on the subject of the accommodation of Lascars on Peninsular and Oriental steamers, the opponents of the company did not advance the proposition that Lascar scamen should be excluded from employment on the company's boats; while most speakers frankly recognised that their exclusion on the ground of race would be quite improper.

Lord George Hamilton gathers from the discussions in the press and elsewhere on section 16 of the Act that that section is regarded as a necessary, or at least a natural, complement of a law prohibiting the immigration into and settlement in a colony of people of a coloured race; but a moment's reflection will show that it stands on a totally different footing. Assuming