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is not the whole of the amount which is purchased for the Navy. The supplies of the Australian squadron, the China squadron, and the Indian squadron are very largely drawn from Australia for those parts of the world. The Australian canned meat now competes, and very successfully competes, with the American canned meat, and we have been practically buying exclu- sively Australian canned meat until the present year. In the present year. owing to the great drought in Australia, we were able to obtain only one-half of the supply of tho required brands from Australia, but, of course, we shall be very glad to go back to the previous arrangement as soon as the Australian firms are able to furnish us with what we require. I should that the

say Canadian firms who were asked to tender this year have not been able to do so, but they expect to be able to come into the competition at an early date.

The point has been raised that we might enlarge our list by going direct to canners in Australasia, but there are objections which are felt both by the War Office, I believe, and by ourselves to adopting that course.

We are informed, and I think it is the fact, that all the principal firms have agents in this country, and we are not only ready but willing, we are anxious to add to that list any approved canners who are brought under our notice. But there are very strong motives for confining ourselves to those who have agents in this country. In the first place we are dealing with people who can act directly, and not only can they act directly to obtain these orders, but they can confirm these orders directly by telegraph from their principals. But there is this further point, that supposing we receive a consignment direct from a manufacturer in Australia, and that consignment is not up to sample and does not meet our requirements, we have no means of disposing of it. If we buy through an agent and any of the goods that are sent over here do not meet our requirements the responsibility lies with him of disposing of them, and practically he does dispose of them without any difficulty. Therefore, we prefer, as the War Office prefers, to continue the plan of dealing only with those who have agents in this country, though we are very glad to add to the list of firms as soon as we can find qualified persons to put on to it.

The other matter is coal, and we have done all we can in the matter of coal. Our power is limited in advance in this matter by the strict conditions of efficiency, for so much of the coal which is obtainable does not approach the steaming qualities of the Welsh coal, which we are supplying to the Navy. But we have made a large number of attempts to utilise any coal which cau be obtained in the Colonies. There are seven different kinds of coal on the Atlantic on the castern side of Canada which have been tried with varying, but on the whole, I am sorry to say, not with satisfactory results, as high quality steam coal. We have tried four or five different kinds of coal, I think five different kinds of coal on the western side, and though the quality on the whole is more satisfactory than that on the eastern side, it has not been largely used, in the first place, because it does not give the full efficiency of the Welsh coal, and in the second place because the Pacific Squadron is at the present time a small one. But it is used for short passages and no doubt in war time will be used for the ships of the squadron. The Australiau coal is not of any value at present for the Navy, but New Zealand coal, as is well known, is of very high quality, at least certain portions of the yield are, and we have made special arrangements with the Westport Company in New Zealand for the supply of ships on the China station, and we draw the whole of the output of the mine from the Colony and convey it in a special ship to supply the needs of the China station. Natal has for some time past been giving us a supply of Natal coal, but now as the result of a correspondence which has taken place between the Colonial Office and the Government of Natal, Natal has agreed to substitute a payment in lieu of the coal. There is an interesting problem now arising with regard to the quality of the Transvaal coal. The Vereeniging coal is believed to possess very satisfactory steaming qualities, and we hope at an early date to satisfy ourselves whether it is coal which we can use if it be brought down to the coast.

The last subject is a very small one, but it is of some importance, that is the question of nickel. At present we are bound by existing contracts to use the Caledonian nickel which is becoming a very important element in

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the manufacture of armour, but we are quite aware of the value and importance of the Canadian nickel deposits, and I can say that at the Admiralty we are doing all we can to ascertain how we can best obtain the valuable supplies of the Canadian nickel, and I hope to send some expert person to inquire into the sources of supply and the conditions under which it can be obtained.

I think that really exhausts the matters which are of real importance. There is, at the Admiralty, as has been stated by Mr. Brodrick, as there always has been at the War Office, à desire to to do all we can to make use of supplies from the Colonies. We are doing so on a very large scale, and we are doing it on conditions which we believe to be favourable and accept- able to the Colonial exporters.

Mr. SEDDON: When you say Australia, do you not mean Australasia or only Australia?

Mr. ARNOLD FORSTER: When I said Australasian, what-

Mr. SEDDON: You said the number from Australia who supplied canned meats that were on the list.

Mr. ARNOLD FORSTER: Yes; I should have said Australasia, eight.

The SECRETARY OF STATE: While assuming that we are fairly agreed as to the principle, we could not accept the resolution exactly as it stands. I think it goes farther than the Prime Minister really meant it to go. For instance, it speaks of all contracts. That, therefore, will apply to contracts which are made within the country, and which are filled within the country. For instance, supposing we wanted butter for the Curragh Camp in Ireland. According to the diteral interpretation of this resolution, we could not get buttor from Ireland without having in the first instance sent to all the Colonies to know what the price of butter was in their respective countries. That, of course, is not intended.

Sir EDMUND BARTON: Certainly not. I meant supplios drawn from outside the United Kingdom.

The SECRETARY OF STATE: Thereforo, in order to make some other points clear and also to widen the operation of the resolution, I would suggest some rather different words. I would say that in view of what Sir Edmund Barton has said, what is quite clear, that the Prime Minister in his case could not pledge the several States, that the form that the resolution should take is only that of an expression of opinion; it does not of course, bind anyone absolutely to carry out the opinion expressed. The words I suggest

are:--

That in all Government contracts, whether in the case of the "Colonial or the Imperial Governments, it is desirable that, as far as practicable, the products of the Empire should be preferred to tho products of foreign countries.

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"With a view to promoting this result it is suggested that where such contracts cannot be filled in the country in which the supplies

are required, the fullest practicable notice of the requirements and of the conditions of tender should be given both in the Colonies and "the United Kingdom and that this notice should be communicated

through official channels as well as through the P'ress."

Mr. SEDDON: There are one or two points I should like to have cleared up by Mr. Brodrick. Mr. Brodrick said that the price of the meat from Australia was 64d. That was the frozen meat offered to be landed in South Africa, was it not? And 7d., 1 understood, was the price that the meat under the contract was delivered at. Well, the New Zealand firms were in a difficulty about tendering, because delivery in South Africa was in the hands of a combine, and they could not very well deliver. Then, as regards the

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