A.—6a

76

Sscond Condition. Secondly, the scheme to be assisted must be a scheme the development of which is being anticipated. It is not possible, 1 think you will agree, to contemplate the giving of subsidies for work which in any case is going to be put in hand. That woulel tenel on the one hand to raise prices and on the other to make people sit back on their haunches and say, " If we are to have grants for something which in any case we are going to do, then we shall not progress till we get them." But there is a clear distinction between work which is going forward in any case and what 1 call anticipated development work put in hand before its time, and this only applies to work put in hand before its normal time. Third Condition. Then, tho third condition (naturally the immediate interest to us is that we shoulel get orders in this time of our very dire distress) is that those schemes should be reflected in. orelers placeel here. Fourth Condition. The fourth condition is what I will call joint responsibility—-that is to say, if a scheme is put up by a Dominion Government or by a Government of a State within a Dominion we; should both accept some share of responsibility for it. If the undertaking is a State undertaking, of course, you do accept direct financial responsibility for it, because it is carried out with money raised by you. It is a State loan, and the financial liability of that loan is there. If, on the other hand, it were put forward by a public-utility company which we were asked to support, I think then in. that case, the project being for our mutual aelvantage;, we; should both take; some share in supporting that company. That conelition would, of course, automatically apply wherever it was a State undertaking. The condition of dual responsibility would only have to bo made effective in the way I have suggested where it is to be undertaken by a company or local authority. Measure of Assistance would vary with Different Schemes. Now, if those general lines arc acceptable and are useful, I think it would be perfectly easy to devise machinery in the Dominions, in India, and on this side to test the schemes and to settle the terms for each. The measure of assistance would naturally have to vary with different schemes. Some are of a more remunerative character than others. If you get a scheme which is likely to show considerable profit in a reasonable time, that requires less assistance ; and it would be reasonable that if it showed surplus profits after a perioel of years, then the advance made by this country might be paid back out of surplus profits. You« get other schemes which are very necessary, but which are not going to be, revenueproducing on any considerable scale for a considerable time. In these cases the measure of financial assistance would probably have to be larger in order to justify tho Dominion in undertaking it immediately ; and the prospects of ultimate repayment would be much more remote, and possibly it would not be in any case susceptible of repayment at all. But what we could say on this side would be : We want to go in for this policy ; it is good for us ; we hope it will be good for you if you are prepared to take it up, and we will devote a certain sum of money each year to make these grants on agreed schemes which are put in hand in tho immediate future. A Business Proposition. Now, I am putting this forward not as a philanthropic proposition, and not as an unsound one economically. lam putting it forward as a-business proposition. It is good business for us if wo can get orders and get development more quickly ; the bettor the prospect of settlement the more immediate the. development of trade. It is good business for you —at least I think so —because you get the development quicker and the increase of population and increase of wealth with, this financial assistance earlier than you otherwise would. We have all been saying here : We; have got this great undeveloped estate, and the whole job of this Conference, is to push on with its development. lam putting this forward as another practical suggestion and contribution, which, I believe, will be for the benefit of both sides ; and I would just add this, and this alone : This is not an uneconomic specific. I believe it to bo an absolutely sound policy economically, because what it comes to is this : that together we are using our credit, not tei do something which is uneconomical, but to speed up the normal revenue-producing development earlier, and at the time when we need it most. That, gentlemen, is the broad proposition I want to put before you. DISCUSSION ON CHAIRMAN'S STATEMENT. Sir Lomer Gouin : As you were told yesterday by my colleague Mr. Graham, Canada is an industrial as well as a farming country, and for that reason your proposition, which is very interesting, does not appeal as forcibly to Canada as it might to some of the other Dominions. I understand that your idea is to solve the problem of unemployment in this country, the depression of British trade, and. to assist in the development of the Dominions and colonies. The main proposition that I find in your scheme is, firstly, an offer by the British Government of an advance of capital or a guarantee of interest on capital The Chairman : It was the other way on : either a guarantee of capital or an advance of some part of the interest. Proposals not of Direct Interest to Canada at present. Sir Lomer Gouin: To create new public-utility undertakings; and this conditionally, provided the Dominions or the States interested should contribute for a same amount or a same proportion of