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of their proper condition, and the saving from any financial embarrassment following the great change of Federation, Those conditions will apply for some. years, and they make a very large revenue, no matter what principle moves the Government in power, a sheer necessity, and it becomes, also, a sheer neces sity, that for the purposes I have indicated that revenue should in the kept up for a period for distribution among the States who are3⁄4toʻreceive three-quarters of it. That sets up a position which, of course, is a difficult one in the early years of the Commonwealth, which I have already explained in connection with another subject, but it leaves us very much in the position which Sir Albert Hime has described. My own view is that we should begin by endorsing the principle of the preferential treatment of imported goods subject to the opinion of the Parliaments concerned, leaving it to the Governments and Parliaments concerned to determine in what way the preference should be given. It may be more suitable to one self-governing country or colony to allow this preference by way of rebate of duty or reduction of duties. It will, however, be for others who can only give the preference by way of increases against the remainder of the world, to adopt that as the only way open to them, and it may be that there will not be very much difference in the operation of those two processes. A Protectionist country may still be under such necessities of income as to render it, as in the case of Australia, quite impossible to do very much by way of rebate of duties, but I think it would be a bad thing for us to separate without laying down the principle of preference, in such terms that, just as we see our opportunity, we may do that which we think, or some of us think, at any rate, would be a duty to the Empire, and in that respect I feel in the same position myself as Sir Albert Himo has described.

I think that in whatever we do in this matter we should not attempt to mako reciprocal concessions the subject of any demand or obligation, but that we should leave any action that is possible of that kind to the wisdom and good feeling of the Imperial Government and Parliament just as opportunity may arise. I should not like to see the effort at making a beginning in this direc tion abandoned simply because some of us were anxious for some reciprocal concession. The Mother Country has always treated its Colonies in such a manner that we cau, I think, place full reliance on it to give some return as occasion arises for any action that may be taken by the Colonies. If no such return were made, I, for one, should not complain. And it does not follow that any such return would necessarily be made in the shape of alterations in the Customs rates. There are other ways, perhaps, in which it seems to me fit to give some preference to the self-governing Colonies without consi·leration of present alterations in tariffs which, of course, I think it would be at this stage absurd for us to demand from the Imperial Government. We might, be treated with reference to Army and Navy supplies and various other matters in a way which would give fuller scope to our products and industries without the necessity for oven proposing any alteration in tariff arrangements. In the absence of Colonial representation in the Imperial Parliament—and I, for one, do not pretend to say that the time has come for that; in fact, I think it would be perhaps safer not to push that question too much to the front at the present Conference-but in the absence of it, everything must clearly be left to the autonomous action of the various Parliaments concerned, and it must, in my view, be as clearly left to thom to decide whether they will give their preference by raising their duties against foreigners or by reducing them in favour of the United Kingdom. And I think the extent of that preference may very well be left to the Governments when they have had an opportunity of consulting their Parliaments. I prefer, Sir, some such resolution as this:--

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That the principle of the preferential treatment of imported goods, the product of other parts of the Empire (the United Kingdom) is endorsed by this Conference, subject to the opinion of the Parliaments concerned, "and to the determination of those l'arliaments respectively as to the

nature and extent of the preference to be granted.”

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I will not propose that at the present moment, but I just throw it out for consideration, because it seems to put the principle I have endeavoured to express in the shortest possible form.

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Mr. SEDDON: Mr. Chairman and Gentlemen, I fear there may be a possibility of duplication, and that in the general remarks now when we como. to deal with the matter in detail probably we may he repeating ourselves, and as I think it is necessary to show that preferential tariffs between the Mother Country and the Dominions would be an advantage, in anything that I may say. I should hope to have an opportunity later on when moving tho resolution to give fuller information to the Conference. I did not think when Sir Wilfrid Laurier suggested that we should have the general remarks made now that it was with the view of effacing the resolution that has been submitted to the Conference by me, and I expect that resolution, however it may ultimately be amended, will subsequently come on for consideration. On that understanding I first of all say that the Premiers at the 1897 Conference, laid the foundation for preferential tariffs between the Colonies and the Mother Country, and committed their respective Colonies by asking the Imperial Government to denounce the treaties with Germany and Belgium. Having gone so far, it is only reasonable and consistent that we should now go further and completo what we then began. At that time there was nothing much said as to tho Mother Country reciprocating by giving a preference to the products coming into the Mother Country from the Colonies. In fact, there was so little lutiable at that time that any concession then possible must have been almost immaterial. Since then, the position of the Mother Country to reciprocate has improved, and there is a possibility, or at least there would be a possi- bility, of giving something substantial in the way of rebates if it was so determined. may say, at all events, as far as the Colony of New Zealand is concerned, although we shall be able to show that some advantages could be considered, speaking for our Colony, we do not press it.

And our reasons for that are these: We see that there will be a difficulty on the part of the Imperial Government to comply, and we have no desire to embarrass Secondly, we think that if anything comes spontaneously from the Mother Country to the Colonies, it will be more appreciated in the Colonies than if we made it the subject matter of a compact. And I think it is more likely to come from the Mother Country with the generous support of the members of the Imperial Parliament than if we were to pass resolutions anticipating or asking that reciprocity should be granted.

it.

Now, as I stated at one of our previous meetings, 10 per cent. rebate on British manufactured goods carried in British ships to New Zealand will, I suppose, give an advantage of 150,000l. per annum. We are, of course, in a position to grant that without interfering with our tariff in another direction. But there is, of course-and that is a matter which each Government and Parliament, as stated by Sir Edmund Barton, must determine-the manner in which the concession with the manufacturers of the Mother Country is to be given. I stated at the former meeting also that in connexion with this matter, apart from the question of revenue, there is the question of colonial industries, which are protected under existing tariff's, and which might be interfered with if the tariff now existing were reduced to give the rebate with the British manufactured goods. That, of course, would be a matter to be decided by the respective Parliaments. There are some goods upon which you could give the rebate without interfering with the Colonial industries. Others, again, you would have to raise the amount upon the foreign goods and still give the preference to the British manufac turer, as I proposed, of 10 per cent., or a greater amount whatever Parliament might think desirable. There are those two questions, therefore, which must be borne in mind, the question of revenue and the question also of Colonial industries: On the question of revenue to show our position, I may say that I find here that the total duty paid on British manufactured goods in the Colony of New Zealand-that is for the year 1900—was 2,174,4971. The imports already from the Mother Country to our Colony-the Free imports in the same year was 2,239,517, so that we already have Free Trade to that extent between the Mother Country and the Colony of New Zealand. I may say also this, generally, that I think that if the larger ques- tion of reciprocity is raised it will not be likely to injure or prejudice the position of Free Trade in the Mother Country. I cannot see it in that light myself. I do not think it would do so. What I do claim is this, that- where I speak now of the Mother Country I speak of the Empire—there is,

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no doubt, as compared with other countries who within themselves are actually carrying on free trade, we are lagging behind them. I shall show

that very conclusively by taking, say, the 20 years from 1882 to 1901.

Now take the trade of the United Kingdom and the exports to Germany and America. I find this, that the increase in the United Kingdom in those 20 years

is 63,438,6311. in value, while the increase to the United States in the same period is 643,703,5681.-ten times the increase of that of the Mother Country. I am not to go further than to state that there is in that alone food for reflection and matter requiring careful consideration, because during this period America has not added to her territory, she has not added to her outside population beyond that of the Hawaiian Islands, Porto Rico, and Cuba for a short time, whilst during this period Great Britain has added largely during the 20 years to both territory and population. Under those circumstances it is Great Britain that ought to have increased the ten times and not the United States of America. Germany, of course, has very largely also during that period increased over and above what the increase has been to the Mother Country.

Now I wish further to say that in this, although I admit that Free Trade within the Empire is not possible just at present, still I do not think that later on it will be impossible. I think that a careful analysis of the duties payable, at least the duties received by the Colonies, would show that a large amount of that duty would be the same under Free Trade, that is spirits and tobacco in the Colonies; some of the larger amounts received, I believe myself, need not be interfered with at all; that you could have a selection made, upon which between the Colonies and the Mother Country there could be Free Trade. That is the opinion I hold. But there is nothing to prevent a commencement, and what was asked for at our last Conference, and that which has been kept steadily in view since has been to make a start and go as far as possible.

Ultimately, with the possibility of accomplishing that which seems to be considered wise and prudent on the part of the great majority of the gentlemen who are here, the commencement which has been suggested and mentioned in the resolution is that we should, as far as we can now, give preference, and I hope, myself, that we shall come to a resolution deciding so to do. As to the latter part of the resolution, providing for rebate to bo given by the Mother Country, it is now possible we might modify that, and by that means there would be a general declaration in favour of the policy. and later on, as I say, we could carry out the necessary details. As to what has been said, that if we do this it will irritate other nations is far fetched for by the denouncing of the treaties which I referred to previously, and which was favoured by the last Conference, the Germans and Belgians know very well that so doing was the forerunner of the preferential tariff, and that if there was to be any irritation at all it was the denouncement of these treaties that would cause the irritation. I say that those nations were prepared and are prepared for that, but I say further that other nations cannot complain if we do within the Empire what they themselves are doing. How can Germany reasonably complain of the preferential tariff when she has practically Free Trade within the German Empire? I do not see myself that it is possible. As for America she seems to be going still further. As far as our manu- factured goods are concerned their doors are practically closerl, and they are still prepared to go further. Members of this Conference must have read the debate on the subject of the Subsidy Bill in the United States Senate. This is a quotation from a speech made by Senator Gallagher on 17th March 1902. "Mr. Presidout, it goes without saying that if this Bill is bad for “Great Britain and the Continental nations, it must be good for the United

States." They are simply putting it that what is unfavourable to Great Britain must be favourable to America. Senator Vest says:

We can exclude foreign ships from our constwiso trade, and no foreign nation can complain; and, of course, with the monopoly of building these ships and repairing them, our shipowners have a harvest each year which they could "obtain nowhere elso." There is too much made of this fear of irritating. When Canada took upon herself to give preference to Great Britain, Canada, who is next-door neighbour to America, did not trouble itself much about United States irritation, and the representatives of Canada will tell you

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now that it did not cause irritation. That is why 1 repeat too much 18 said and made about this retaliation, and this bogus irritation. We are told that it is going to bring retaliation. I say we cannot have the war of commerce that has been going on for so many years. The policy of all commerce and trade, the policy of these other, nations, is such that they cannot go further than they have gone up to the present time. We have nothing to fear in the way of retaliation at all, and I can only say they only give us raw products because Britain, is the best market for them. Under the circumstances we come back to this position: are we to be consistent with the policy laid down at the last Conference, and that we advised the Imperial Government to commence by denouncing the treaties, or are wo to go back and say that it is impossible to do anything in the direction indicated? I think not. Let each Parliament carry out the detail and affirm the principle, as you may safely, at the Conference. I think that will be a wise and proper thing to do. I shall, therefore, when the time comes, proceed with the Resolutions, and ask the Conference to adopt them perhaps, after our general conversational remarks, with modifications, but I am quite prepared to modify them so as to make provisions and to secure, if we can. the carrying of something unanimously that shall be doomed binding on one and all of those who are in attendance. I think after what has been said that

that can be done. I shall at all ovents do my best in that direction.

Sir EDMUND BARTON: I should like to say a word in explanation of something which was said a little while ago. I may be taken to have said too much on a certain topic. I was speaking of the question of tariff' changes in the United Kingdom, and I indicated that I did not think that we could expect or demand any changes in the tariff in the way of reciprocity for such preference as we have that we might offer; but, of course, I intended that to apply to the question, which is so often raised, as to whether it is not to be expected that the United Kingdom should lay on duties for the purpose of making us concessions, and I wish to confine what I said to that idea which has been made so public, and to point out that any willing. ness of ours to make concessions, which we are now meditating, could not, for a moment, be supposed to be dependent upon any such changes as that. I know I am treading on delicate ground, which I think may be more interest- ing to Sir Wilfrid Laurier than to some of us. I wish to say this also, that I had no intention in indicating the form of resolution, to endeavour to forestall my friend, Mr. Seddon, in any way whatever. I wish to endorse thoroughly his remarks, and I see no reason why this Empire, or any part of it, should be afraid of the action of any Power in consequence of our minding our own business and our own territories.

Sir WILFRID LAURIER: I was just going to take exception, Mr. Chamberlain, to the statement which had been made by Sir Edmund Barton, but he has himself anticipated the course which I intended to follow. I am sorry to say that Sir Robert Bond has not yet spoken; perbaps I had better wait until he has given his views.

Sir ROBERT BOND: Procced, Sir Wilfrid.

Sir WILFRID LAURIER: We understand now that on the part of the Colonies there is a desire for closer trade relations with the Mother Country. There is a question of sentiment in it; thero is also more than a question of sentimont; there is a question of business. The foreign nations to which Mr. Seddon has alluded are practically engaged in developing a commercial war, I take it, and I speak of our neighbour the United States, whose tariff is absolutely prohibitory. Their policy is to sell to the foreign nations as much as they can, and not to buy. That has been their tendency ever since the Civil War, and it is becoming more and more their tendency. The protective tariff was first started on the broa:l ́ground of giving a lift to industry, but as time went on it became more and more elevated, and more and more prohibitory. I do not know that Mr. Seddon altogether

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