33

A.—6

Enclosure. Admiral Tkyon to His Excellency the Goveenoe of Victoeia, 28th May, 1886, in reference to Memoranda by the Hon. D. Gillies, Premier of Victoria, bearing dates 20th and 25th May, 1886. Sib,— H.M.S. " Nelson," at Sydney, 28th May, 1886. When acknowledging the receipt of your Excellency's letter of the 26th instant, with enclosures, I cannot refrain from making a few observations. 2. It will not have escaped your Excellency's notice that Mr. Gillies, in his memorandum of the 25th May, 1886, in paragraph 4, encourages the desire for " united action " on the part of the several colonies, but in the concluding words it is expressed " that any increase to the present insufficient naval squadron should be solely at the cost of the colonies, appears to Mr. Gillies to be quite unreasonable, and it is certainly one that has never before been put forward." This is not, apparently, quite a clear exposition of the case as is shown in the correspondence that was placed before the meeting on board H.M.S. " Nelson," and which I already have had the honour of transmitting to your Excellency. 3. In the memorandum of the 27th March, 1885, as well as in other papers, it was expressly laid down that the cost of such an addition to the sea-going squadron as is contemplated on this station, made at the instance of the colonies, should be borne by them. So far as my recollection serves, the principle of sharing the cost of such localized vessels between the Imperial and Colonial Governments was first made by New Zealand, and the proposal then made would have imposed a heavier charge on the Government of that colony than the scheme I had the honour, by direction, to submit, and which is now under consideration, while it would, if carried out, have been far less effective. 4. When the memorandum of the 27th March, 1885, was read by the then Government of Victoria not a word was said as to the unfairness of the proposal. On the contrary, I was present, and the impression made on my mind was that, while it was not formally considered or replied to, and while no decision could then be given on it, it met with a general acquiescence in principle. 5. In justice to myself as a responsible professional officer charged with the guarding of these seas, I must assert that, from my point of view, there is nothing that is not fair in my memoranda. What is therein put forward I advocate in what is sometimes called Australasian, as well as in Imperial interests —personally I fail to see the difference : there is but one interest—the maintenance of the Empire and the nation. 6. I quite recognize, I trust, that while many may concur that a great object such as the one at present under consideration should and ought to be effected, there will be many opinions as to how the subject should be approached, and still more as to the most proper way of obtaining a practical conclusion. 7. In this instance the difference of opinion appears to be as to which section of the nation should bear the cost. 8. In paragraph 4 of Mr. Gillies's memorandum is expressed the desire to " secure united action," he also refers to the present (in his opinion) insufficient naval squadron. On the latter point I endeavoured to prove this not to be so in my memorandum of the 24th April, 1886; and still further to show that, in the very interests of Australasia, with which it has not only been my pleasure bat my obvious duty to identify myself, that it would be unwise to increase to any considerable extent this squadron at the cost of the^tleet of the nation, whose mission it is to maintain wide world interests, and maintained as it is solely at the cost of the taxpayer at Home. 9. In paragraph 5 allusion is made to the Sydney Conference of 1881, and a communication made by the Secretary of State on a resolution that was affirmed at that conference is quoted. I note that the subject does not appear to have been discussed at that conference from any general, national, or naval point of view, but is very briefly dealt with in a space that would occupy one page of the Blue Book, and terminates with a resolution, though it does not appear that any evidence was taken or estimate framed, nor is it clear that it was discussed so fully as to elucidate the points involved. 10. I endeavoured to show, in my memorandum of the 24th April, 1886, that the squadron on this station has already been increased. The actual cost of the provision and maintenance of ships is but a part after all of the entire cost. The works undertaken on Spectacle Island, on Garden Island, and at Woolloomooloo, now in actual progress, largely increase not only the present and permanent expenditure on naval account, but also the resources of the station to meet a time of emergency. The increased expenditure on the defences of depots on the lines of trade are of great national importance. These are but some of the points on which the Imperial Government has shown practically its determination to defend the Empire in all parts of the world, and notably in Australasia, happen what may ; and there is not one word that has been written or uttered to show that the Imperial Government does not recognize its responsibility, and—nay more, it has, as I have stated, practically shown its determination to bear the responsibility it has borne through all times. 11. The origin of the subject at present under consideration is within these great colonies, and it is a proud thing to feel it is so. The Admiralty have intrusted me with the direction of negotiations to endeavour to secure united action, and to express their earnest appreciation of the proffered co-operation. The final figures giving the financial state of the case, as proposed by Victoria in the memorandum of the 20th May, 1886, practically puts forward a counter proposal to anything yet heard of—viz., that the Colonial Governments should, when the ships are on a peace footing—viz., under all ordinary and normal conditions, contribute £90,000 a year, and that the taxpayer at Home should contribute £31,300. Nothing is said of the necessary charges involved and above referred to, and it is assumed that the deterioration of the vessels would be 5 per cent, per annum. It is not so necessary to refer to a time of war, for it is recognized that there would at such times be 5—A.-6.