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PUBLIC RECORD OFFICE

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C.O. 885

PUBLIC RECORD OFFICE, LONDON

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by the Governments respectively. I think myself that that would be the best course, and would bring us more quickly to a conclusion, and what I suggested at our first meeting, and which I think is desirable now, is for the Imperial Government-after taking the advice of their experts-to submit a list of articles which we could best help home manufactures in giving a preference Then after we have that list submitted by them given to the respective Colonies we would see how far we could go. As to the amount suggested, instead of having a fixed amount, a general rebate, a fixed amount, we could help the particular items of manufactured articles to the extent which had been previously mentioned. But the reason that I say that I do not think we can come to very close quarters is that we should want to consider what effect it would have upon our own local industries. We have local industries, as you are aware, in the Colonics, and large capital invested in these industries. And to commit the Colony where it might affect prejudicially affect those industries would be a very serious matter, and it might have the effect, at all events, of placing the representatives of a particular Colony in a false position. Not done wilfully, but through want of knowledge-specific knowledge-in respect to the particular industry and the effect that the alteration would have. I am quite prepared, myself, to fall in and to come as far as we can to a unanimous conclusion, but I do not think we shall be any closer after each of the Premiers has seen the Imperial Ministers and the Imperial experts. I do not think we shall be any closer to a solution of the question.

The SECRETARY OF STATE: Well, gentlemen, I do not think that there need be any difference between us and Mr. Seddon. In fact, I rather thought that the proposition which I made was carrying out the view which he had expressed at our las meeting. The Prime Minister of New Zealand in his first speech on this subject stated that he was prepared to recommend to his colleagues in Parliament a general rebate of 10 per cent.

Mr. SEDDON: Yes.

The SECRETARY OF STATE: Then in the course of a conversation I think he himself suggested that it might be more advantageous to both parties if the equivalent of the 10 per cent. were given upon a limited number of articles rather than as a general rebate upon the whole, and it was to see how far that principle could he practically carried out that I suggested the meetings of sub-committees for the purpose.

As I understand, however. Mr. Seddon says that in his case he would not be prepared to go into those details at present, and I think it would be quite sufficient, and I am sure on behalf of His Majesty's Government I should gratefully accept bis proposal that he should propose a rebate of 10 percent. or its equivalent, leaving to him hereafter when he returns to New Zealand to see how far that equivalent can be given in the shape of a larger reduction on particular articles. But failing that if be found on getting home that that was impracticable, in view of the industries already established in New Zealand, then, of course, it would be open to him to fall back upon his original proposition and to say, "I cannot go beyond 10 per cent. which I have offered you as a general reduction." And, of course, if he does not, feel able or desirous of pursuing the matter further into detail at these meetings it would not be necessary that appointment should be made in the case of that Colony, nor do I think that it would be necessary unless the representatives of the Cape and Natal desire it for any special conference to be held with regard to their offer because their offer is also a definite offer as it stands. I wish privately in the first instance to make to them a suggestion for a slight alteration with regard to these offers, but that could be settled without any attempt to go into the general tariff of either of those Colonies, and then there would only remain the question of the Australian Common- wealth.

The SECRETARY OF STATE then explained to Sir Edmund Barton who had just entered the room what had transpired since the opening of the proceedings, and added :—

"I should be-glad to know what you feel in regard to the matter."

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Sir EDMUND BARTON: What I feel about it, Mr. Chamberlain, is this. We have never thought over this subject in Australia before this Conference was hold except from the standpoint of giving a preference on goods all round, whether by way of rebate or increase against the rost comes little of the world, and as the matter is now projected it newly upon me who have never considered the matter from the other stand- point. I do not, however, think that that ought to prevent me from falling in with the general proposal of having a discussion on the subject in a sort of sub-committee in the way you suggest, and therefore, having explained myself to this extent. I shall be prepared to fall in with that proposal, at the same time not indicating-not allowing that to indicato -that I shall eventually be prepared to substitute for the idea of a general preference that of a specific preference. The whole subject is one so very difficult to deal with in the present stage of the Commonwealth, that I am bound to protect myself in that way.

Mr. FULLER: May I just say a word? I think it is necessary, and I should say that my interview with Sir Gordon Sprigg was a very hurried one, and you, Sir, have alluded to the fact of the Cape Government having made an offer of 33 per cent. all round, but I have been looking into the matter since our last meeting in the light of what took place then, and while that would apply to the ad valorem duties which would have by that proposal a very moderate addition of 24 per cent. on the duties, it could not apply all round to the Rated Tariff Sir Gordon Sprigg's attention was not drawn to that. He spoke merely in general terms, but there are a number of the rated articles which could not be increased, and then a rebate made upon the basis of 33 per cent., nor should I, on behalf of the Colony, be able to say just what articles-rated articles-it could be applied to, under any general principle, or the extent of the robato to be given. I will just take the article of flour; the duty on flour if increased 33 per cent. would be enormous, it would be equal to 18. 6d. on every 100 lbs. of flour, and, on the principle asserted yesterday that the preferential tariffe would not apply to the Colonies interchangeably, but only between each Colony and the Mother Country, we should get no assistance from the rebate from any other Colony. If it were interchangeable, then the Canadian flour, for instance, might come in at the present rates, but our flour could not come from England, therefore, we should have no reliel whatever if a general rebate were made on the rated articles. The same remark applies to spirits which would have a very large addition, the duties being now very high, and the whole of the rated articles would have to be gone through very carefully. Therefore, any resolution that might be come to by this Conference in reference to South Africa, would have to be of a very open character so far as the rated articles are concerned. And like Mr. Seddon, without conferring with experts and with the Govern- ment, I should not be able to say at all minutely or accurately, what rated articles would be the subject of any general rebate. That is the position.

Sir EDMUND BARTON: Articles subject to specific duties.

Mr. FULLER: That is what I mean, the rated articles. These, of course, are higher duties than the ad valorem duties and the application of the principle to the ad valorem duties would be a simple matter.

Sir EDMUND BARTON: Could we have, before the Sub-Committee meetings are held, an indication of the class of goods or manufactures to which it is suggested that the rating should apply? Then we should be able to get out the figures relating to them.

Sir WILFRID LAURIER: That seems to me to be a inatter for the Colonies themselves to look into, because as Mr. Seddon has just remarked, there is a good deal of capital invested in certain industries, and the English Government do not know which are those industries; it is for us to make suggestions.

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