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Reference :-

C.O. 88

885/5 PUBLIC RECORD OFFICE, LONDON

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posed scheme; and, on the side of the latter, the peace contribution of 122,5971. per annum, plus the cost of local defence. I think it will be generally admitted that to place the matter in this light is to ignore by far the larger share of the Imperial burden in relation to the defence of our mutual interests. The whole standard of defence of the Australasian Colonies is based on the fact that an enemy could send small squadrons only into these waters; that very few, if any, ironclads would be able to reach Australasian ports; and that considerable expeditions could not be undertaken against them. these limitations to an enemy's action, which have been universally accepted and acted But upon, exist solely in consequence of the great ironclad fleet maintained by the Imperial Governnient in European waters, and based on fortresses and coaling stations created and maintained without charge to the Australasian taxpayer. It is the function of this fleet to seal an enemy's ports, and to follow and intercept any considerable expeditions directed against a distant colony. No estimate could, of course, be formed of the cost of the indirect protection thus accorded to the Australasian Colonies or of the consequent saving in local defence which those colonies enjoy; but it is evident that the item is a very heavy one.

The members of the Conference have not, perhaps, sufficiently realized that if the Admiralty scheme is carried out the colonies will be enabled to make reductions in the cost of the contemplated increase to their local defences. Thus, one of the Victorian Representatives alluded to the intention of his Government to expend a further sum of 500,000. on the defences of Port Philip, and it was argued that no modification of this expenditure would be possible, and that the taxpayers of Victoria might well hesitate to accept the burden imposed by the naval contribution, looking to the heavy charges, present and prospective, of their local defences. In the view of Her Majesty's Government, however, the conditions of local defence would be very materially changed by the permanent addition of seven ships of war to the Austra- lasian station. If that increase becomes an accomplished fact, the scale of future expenditure on local defence may undoubtedly be modified in the case of the colonies which have done so much already; and, from the taxpayers' point of view, the naval contribution is highly economical in proportion to the defensive advantages it will

confer.

In drawing your attention to the above points, it has merely been my object to lay before you the considerations which have weighed with Her Majesty's Government in arriving at a decision on the general question. As I have already stated, we are anxious to arrive at a settlement. We do not regard this question in the light of a mere bargain between the mother country and the colonies, but as the starting point of a new policy-the first step towards a federation for defence which will not only add strength to the Empire, but tend to bind its members in closer union.

Colonial Office,

April 23, 1887.

No. 64.

H. T. HOLLAND.

AGREEMENT AS TO ADDITIONAL FORCE TO BE EMPLOYED FOR THE PROTECTION OF THE FLOATING TRADE IN AUSTRALASIAN WATERS.

(FIRST DRAFT.)

THE Commissioners for executing the office of Lord High Admiral of the United Kingdom of Great Britain and Ireland, &c., and the Governments of Her Majesty's Colonies of New South Wales, Tasmania, South Australia, New Zealand, Victoria, Queensland, and Western Australia having recognised the necessity of increasing the Naval Force in Australasian waters at their joint charge, have resolved to conclude for this purpose an Agreement as follows:-

ARTICLE I,

That there shall be created a force of sea-going ships of war, herein-after referred to as "these vessels," to be provided, equipped, manned, and maintained at the joint cost of Imperial and Colonial funds.

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ARTICLE II.

That these vessels shall be placed in every respect on the same status as Her Majesty's Status. ships of war, whether in commission or not.

ARTICLE III.

That the officers and men of such of these vessels as are in commission shall be Change of changed triennially, and of those in reserve as may be considered advisable.

ARTICLE IV.

crews.

That these vessels shall be under the sole control and orders of the Naval Com- Control. mander-in-Chief for the time being appointed to command Her Majesty's ships and vessels on the Australian Station.

That these vessels shall be retained within the limits of the Australian Station, as Limit of etu- defined in the Standing Orders of the Naval Commander-in-Chief, and in times of peace ployment. or war shall be employed within such limits in the same way as are Her Majesty's ships

of war.

ARTICLE V.

That in consequence of the creation of this joint naval force, no reduction is to take No reduc- place in the normal strength of Her Majesty's naval force employed on the Australian tion of

Imperial Station, exclusive of surveying vessels.

squadron.

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ARTICLE VI.

That the addition to the squadron shall consist of five fast cruizers and two Number of torpedo-gunboats, as represented by the "Archer" (or improved vessels of similar type) vessels. and "Rattlesnake classes in Her Majesty's navy. Of the above, three cruizers and one gunboat to be kept always in commission, the remainder being held in reserve, in Australasian ports, ready for commission whenever occasion arises.

ARTICLE VII.

1. That the first cost of these vessels shall be paid out of Imperial funds, and the Cost. vessels fully equipped, manned, and sent to Australia.

2. That the Colonies shall pay the Imperial Government interest at 5 per cent. on Interest on the first and prime cost of these vessels.

first cost.

maintenance.

3. That the Colonies shall, in addition, bear the actual charges for maintaining from Annual year to year three fast cruizers and one torpedo-gunboat which are to be kept in charge for commission in time of peace, and also of the three other vessels which are to remain in reserve, including the liability on account of retired pay to officers, pensions to men, and the charge for relief of crews, provided always that the claim made by the Imperial Government under this head does not exceed the annual payment of 91,000Z.

4. That in time of emergency or actual war the cost of commissioning and maintain. Cost of ing the three vessels kept in reserve during peace shall be borne by the Imperial maintenance Government.

ARTICLE VIII.

in war.

That in the event of any of these vessels being lost they shall be replaced at the cost Replacement. of the Imperial Government.

ARTICLE IX.

of vessels if lost.

1. That this Agreement shall be considered to become actually binding between the Terms of Imperial and the several Colonial Governments named in the first clause so soon as the agreement. latter shall have passed Acts of Parliament securing a permanent Vote, to which Acts this Agreement shall be attached as a first schedule.

2. That the Agreement shall be for a period of ten years, and only to terminate if and Period. provided notice has been given three years previously, viz., at the end of the seventh year, or at the end of any subsequent year, and then three years after such date.

3. That, on the termination of the Agreement, these vessels remain the property of Vessels to b the Imperial Government.

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property of

Admiralty.