Sessional_Paper_1890 — Page 376

15. The estimated cost of the navy to the Imperial Exchequer is, as you will see from the Statesman's Year Book (page 247), over 13,000,000. for the year 1898-9, and as the population of the United Kingdom (page 255) is more than 37,000,000, these figures show that the mother country contributes 7s. per head of its population to the naval defence of the Empire, and it might reasonably expect its dependencies to make provision for their own defence to an equal amount. Questions of jurisdiction beyond the three-mile limit, of the flag, and of discipline, stand in the way of Colonial war ships, so that the navy will always be that of the mother country, and in dealing with the great question of the defence of the Empire it is difficult to lay down any other broad principle for dividing the cost of Colonial defence, except that of the mother country undertaking the sea defence of the Colonies by means of her navy, and of the Colonies, so far as their means allow, respectively providing for their own land defence. But even this principle admits of extension, as, for instance, when a Colony agrees to contribute, as most of the Australian Colonies now do, to the cost of additional ships to be employed in local waters for the (protection of the floating trade within those

waters.

16. In some cases, as I need scarcely inform you, the poverty of the Colony renders any realisation of the general principle laid down in the preceding paragraph practically unattainable; in others, the contribution, though sub- stantial, falls short of the full cost owing to the inability of the Colony to provide more; and in both cases the difference is borne by the heavily taxed mother country. The Army Estimates (page 245 of the Year Book) are considerably over 16,000,000, or more than 8s. 9d. per head of the population. And this, added to the naval charges, makes a payment by the mother country of 15s. 9d. per head per annum for the defence of the Empire in 1888-9. But I am informed by the Lords Commissioners of the Treasury that the corresponding payment for the current year may be estimated at 16s. 5d. per head. These are the net amounts, after allowing for contributions received from India and the Colonies, but are exclusive of a very large expenditure chargeable to special defence loans.

17. If these payments are contrasted with the contribution asked from the Colony under your Government, you will see that 40,000/. a year is not only a very much smaller charge per head of the population, but, as I shall proceed to show, its payment is well within the ability of the flourishing Colony of Hong- Kong. There are other objects on which the money might usefully be spent, but self-protection is the first duty of a community, to which other matters should be postponed, and it is hardly necessary to point out that, unless that is secured, very much of the other outlay may prove to have been undertaken in vain.

18. The revenue for 1888 amounted to $1,557,300, and 40,000%. (the con- tribution proposed for the next three years) taken only at 3s. a dollar amounts to about 17 per cent. of the revenue, and to about $1.24 (say 3s. 9d.) per head of the population of the Colony, the whole of which is vitally interested in the security of the port. It cannot be said that such a payment is excessive, either as a charge upon the people who throng to Hong Kong to seek the protection to life and property afforded by the British flag, or in its proportion to the total public revenue of the Colony, or by comparison with the expenditure on similar purposes in the United Kingdom.

19. I will only further point out in reference to the annual payments, what doubtless you will not have failed to notice, that the 40,000l. which the Colony will pay in each of the next three years is only one seventh of the cost of the garrison, while the remaining six sevenths, 240,000., will still be borne by the mother country.

New Barracks.

20. A separate correspondence is proceeding with respect to the details of the additional barracks which will be required for the increased garrison, and I do not