My dear Prime Minister,

BRITISH TRADE

In my last letter I sent you some information about British trade
and made the remark that unemployment figures had shewn a
considerable improvement. Unfortunately this week's figures have
been of an alarming nature, indicating a 28,000 increase in
unemployment and shewing that there are 109,000 more unemployed
persons in Great Britain during the last week than there were in
the same week in 1926. It is possible that the increase in
unemployment is partly due to the aftermath of the Easter holidays
but I do not think that that can account for anything like 28,000
people.

THE AUSTRALIAN TARIFF AND BRITISH TRADE

I am enclosing a leading article from today's 'Times' to which I
would particularly like to draw your attention. [1] The Annual
meeting of the Association of British Chambers of Commerce is
taking place today and I learnt that several branches were
submitting resolutions drawing attention to the heavy incidence of
Dominion tariffs on various branches of British trade. I,
therefore, saw a friend at the 'Times' and provided information
upon which this leading article was based.

I feel sure that you will agree that the publication of this
information in the 'Times' just before a public discussion of the
resolutions is likely to draw a good deal of the sting out of the
discussion and is, therefore, from our point of view very valuable
propaganda.

'LONDON WEEKLY'

I am enclosing a copy of the 'London Weekly' for April 23rd and
would particularly draw your attention to one section of the
financial survey which was written by the Rt. Hon. W. Graham [2],
M.P. Apparently Graham has suddenly come across your speech at the
Economic Session of the Imperial Conference.

It is rather interesting to find that a man in Graham's position
should write in this way on your speech so long after its
occurrence.

In this issue I contributed an article on Australian trade and I
would also draw your attention to an amusing paragraph among the
notes for which I must also plead guilty.

'CANADA'

I am enclosing a leading article from 'Canada', a weekly paper
published in London, which is apparently intended to indicate to
Canada that she should follow Australia's example and cooperate
more effectively with British agencies, such as the Empire
Marketing Board. I presume the Editor came across a copy of my
pamphlet and I was very surprised to see the personal reference.

AUSTRALIAN WINES

I am enclosing a copy of the Budget Debate in which the Wine
Duties were passed. In connection with this subject I had a call
yesterday from a Mr. Walker [3], of Adelaide, who claims to be the
largest individual exporter of Australian sweet wines. He said
that last year his own firm exported 500,000 gallons. He showed me
a cable which he had received from his Agents in Australia, who
stated that there was great uncertainty as to whether the
Government were going to further reduce the export bounty and also
as to whether the Government were going to introduce restrictions
on export. He told me that today there is a great opportunity for
selling Australian sweet wine at a satisfactory price for forward
delivery but that the Tarragona people are anxiously trying to
convince the British Wine Merchants that they will continue to
cater for the trade. Their proposals are to export one-third of
dry wine under 25, one-third of very sweet wine under 25 and
one-third of very heavily fortified wine of about 41 and to
arrange for these three consignments to be blended and pasteurized
in this country.

The British Wine Merchant is a little doubtful as to whether the
resultant liquor would be satisfactory and is, therefore, prepared
at the present moment to make large contracts with Australia. The
apparent uncertainty of the position in regard to the Commonwealth
Government's intentions is, according to Mr. Walker, making it
impossible to quote firm prices and may, in his opinion, result in
Australia losing a great opportunity. In my own opinion Mr. Walker
seemed to exaggerate the position but I feel that it would be very
advantageous if the Commonwealth Government could see its way to
declare that the revised bounty will remain in force at the
figures already announced at least for two years.

COMMONWEALTH COUNCIL FOR SCIENTIFIC & INDUSTRIAL RESEARCH

I am glad to be able to inform you that I have received very
pleasant personal and official letters from Mr. Julius [4] and Dr.

Rivett. [5] I have also seen something of Professor Watt. [6] The
letters from Australia indicated that the Executive Council [7]
were finding the information that I am sending to them on research
work in this country and on the work of the Research Grants
Committee of the Empire Marketing Board both interesting and
valuable.

Professor Watt has left for Rome but on his return is going to
spend a day or two going through the information that we have
collected here with special reference to agricultural problems. He
seems to consider that the idea of the Commonwealth Council for
Scientific & Industrial Research being represented in London by
the official representative of Australia on the Empire Marketing
Board is an eminently suitable method.

I am collecting information from the best available sources for
the Council on the subject of the Tropical Agricultural Research
Station. I think that it would be quite feasible to give special
emphasis to Tropical Animal Husbandry in such a way as closely to
link the Agricultural Research Station with the whole question of
Tropical Hygiene and the work of the Tropical School of Medicine,
Cairns. In fact I believe that some such arrangement might be very
suitable for Australia's part in the Empire's link, quite apart
from the outstanding importance of this type of work from the
problems of Tropical Australia.

D. & M. COMMISSION

Up to the present time I have merely received two or three brief
notes from Gepp [8] explaining that he is extraordinarily busy and
that he will make arrangements for proper liaison between the D. &

M. Commission and this office as soon as he can. I quite
understand the position but at the same time would just like to
remind you that from one source or another-whether it be the
Ministry of Markets or the D. & M. Commission-it is most essential
that I should receive continuous information as to happenings of
economic importance in Australia. Without this information the
utility of my work must be at least to some extent handicapped.

PREFERENCE BALANCE SHEET

I have recently got out some figures shewing what Great Britain
gives and what Great Britain receives in the way of preference
from the various countries of the Empire. This statement will be
of considerable interest to you and I enclose a copy herewith. You
will notice that so far as both India and the Crown Colonies are
concerned, Great Britain already gives more in preference than she
receives. Of course with each of the Dominions the position is
reversed. In the case of South Africa, it is probable that the
figures for 1926, when available, will shew a very substantial
reduction in the value of the preferential rebate allowed by that
Dominion to Great Britain.

MR. A. F. BELL [9], C.M.G.

I have had a number of long talks with Bell about dried fruits,
trade publicity work and Geneva. I took him to see Ormsby-Gore
[10] and he lunched with me to meet Tallents [11], the Secretary
of the Empire Marketing Board.

I think you know that I have only casually met Mr. Bell once
before his arrival in this country and I am delighted to find that
we seem to see problems in just the same angle; it is also
pleasant to meet a man who has so high a regard for you and such
admiration for the work which you are doing for Australia.

Mr. Bell was anxious to have my advice on questions connected with
the International Economic Conference. I suggested to him that an
attitude of watchful reticence was much the best line to take at
Geneva itself but that the Australian Delegates should take an
early opportunity of making clear to the British Delegation that
they were not prepared to agree to any proposals which might in
any way limit the economic freedom of the British Dominions; to
make what economic arrangements they thought most suitable for
their own development.

The British Delegation is almost wholly consisted of free traders
and Sir Arthur Balfour [12] and Mr. W. T. Layton [13] have deeply
committed themselves to the policy of the reduction of tariff
barriers. They are both confirmed and intense believers in the
importance of the European market to Great Britain and I feel
certain that our people ought to make them vividly aware of the
Australian point of view.

PARLIAMENTARY QUESTIONS AND ANSWERS

I am enclosing one or two Parliamentary questions and answers
which will be of interest to you.

ANZAC

On the 26th April the 'Times' in their third leading article
published a very well written appreciation of Anzac and I am
enclosing this article which I am sure you would like to read.

Yours sincerely,
F. L. MCDOUGALL