55

A.—4

592. Is not the price of these great staple exports fixed by the rates ruling in England, and those rates rule in these local markets ?—That is so. 593. Is not the English market practically inexhaustible so far as our exports go ?—So far as we can produce, I believe it is. 594. Are we likely to suffer so seriously as you seem to anticipate, even if the Australian market were closed against us ?—Australia is nearer to the Home market than we are, for one thing, and the tendency would be to trade with the Commonwealth in preference to outsiders for home consumption. 595. Although they produce very much the same class of goods that we produce, and export them to England and other places ?—But I believe New Zealand can produce better goods than any of those countries in the class referred to. 596. In regard to manufactures, do you not think that the sea barrier would prevent our manufactures being profitably sent into Australia ? —Yes, to a very large extent; but I think that, on account of the increased output bringing about cheaper production, the tendency will be to send these goods into the other States of the Commonwealth, instead of to New Zealand only. If federated we would all have the same chances to carry on the trade. 597. Do I understand you to say that it would be beneficial to our manufacturers as well as producers to federate ?—Yes. 598. Do you think it possible to supply Australia with manufactured goods?— Yes, with the surplus we manufacture. 599. Have you considered the re-export trade of Australia at all ?—I have seen the figures. 600. The re-export trade between the colonies is £18,600,000, while the New Zealand reexports only amounted to £138,595, of which £134,000 went to the South Sea Islands ; so that practically we have no re-export trade excepting the South Sea Islands : is that not because the contiguity of the Australian Colonies enables them to exchange between themselves ?—The agents are liable to concentrate themselves in the large centres of population, and that may account for it. 601. Would not that continue, apart from federation?—To some extent it would, as the tendency would be to draw towards the Federal centre. 601 a. Then, the Australian merchants reshipped a large amount of these re-exports—£l,3oo,ooo —to New Zealand: would they not be likely to reship larger amounts under the Federation ?— I expect that the whole of the trade of the South Pacific will expand through the establishment of the Commonwealth, and the impetus would extend here. 602. But I mean the trade between Australia and New Zealand : do you think the merchants of Australia will dominate our trade to a large extent ? —I do not think it will be to their interests to do it more than now. 602 a. Are they not deterred by the tariff to some extent ? —Of course, if you remove the tariff we will have the same advantages here as there. 603. But still they export largely here in spite of the tariff ?—Probably because they have representatives here. 603 a. Have not they advantages in freight?—l do not know that they have, because intercolonial freights have always been pretty high ; and they might be doing a larger trade—l believe they are—with the people there than we can do because having lower freights from Home. 604. Have they not advantages in their branches ? —Yes. 605. Would that not give their merchants the advantage over us ?—They have that advantage now, and have always had it; it would not be altered by the Commonwealth. 606. And making the ports free would not make any difference, do you think ?—They get drawbacks there now on the Customs duties. 607. Do you think Melbourne would not supply such places as the West Coast?—No, there would still be the same State rivalry, and they are not likely to take the trade away from New Zealand; and the tendency would be to develop trade more largely if we were a part of the Commonwealth than if we were not. 608. Hon. Major Steward.} Eegarding your views on defence, do you mean that you think the Commonwealth could establish a navy sufficiently strong not only to protect its own immense seaboard, but also to spare vessels to assist in the defence of New Zealand?— That is putting the question in a very different way. My idea was that they could provide a small colonial navy able to concentrate itself at any given point to repel any attack of vessels sent by a foreign Power. In that way there would be more protection than could be afforded by any land defence. 609. The assumption is that New Zealand becomes a part of the Commonwealth ; if so, and a quarrel arises with another European Power which results in that Power attacking the Commonwealth, does it not follow that the latter would have to look out for the protection of its own shores as well as New Zealand ?—Undoubtedly. 610. Then, is it not probable that the Commonwealth would look first to the protection of such ports as Sydney and Melbourne rather than to the protection of Dunedin and Lyttelton ?— But I think all the States would have some permanent protection. 611. If it were going to defend, it would only defend the points nearest itself, and only those which there was the most necessity to defend ? —Yes. 612. Then, it would be only the surplus naval strength it had available that it would be able to send to New Zealand ? —That is so. 613. Then, do you think it probable, if we entered the Federation, that the Commonwealth would be able to establish a navy sufficiently strong to protect the ports on the mainland and spare anything for the protection of our ports ?—No; there is such an extensive seaboard to protect that it would be practically impossible; but I thought four or five cruisers could be maintained in addition to whatever gunboats were necessary for port defence, to be concentrated wherever it was deemed necessary.